Document:

EX-4.1

 Exhibit 4.1 

EXECUTION COPY 
  

 
  

HLSS SERVICER ADVANCE RECEIVABLES TRUST 

as Issuer 
 and 

DEUTSCHE BANK NATIONAL TRUST COMPANY 

as Indenture Trustee, Calculation Agent, Paying Agent and Securities Intermediary 

and 
 HLSS HOLDINGS, LLC, 

as Administrator and as Servicer (on and after the MSR Transfer Date) 

and 
 OCWEN LOAN SERVICING, LLC,

 as a Subservicer and as Servicer (prior to the MSR Transfer Date) 

and 
 NEW RESIDENTIAL INVESTMENT
CORP., 
 and 
 CREDIT SUISSE
AG, NEW YORK BRANCH, 
 as Administrative Agent 
  

 
 SERIES 2012-VF3

 THIRD AMENDED AND RESTATED INDENTURE SUPPLEMENT 

Dated as of August 28, 2015 

to 
 SIXTH AMENDED AND RESTATED
INDENTURE 
 Dated as of January 17, 2014 
  

 
 HLSS SERVICER
ADVANCE RECEIVABLES TRUST 
 ADVANCE RECEIVABLES BACKED NOTES, 

SERIES 2012-VF3 
  

 
  

 TABLE OF CONTENTS 

 

							
	 	 	 	  	PAGE	 
			
	SECTION 1.	 	CREATION OF SERIES 2012-VF3 NOTES	  	 	2	  
			
	SECTION 2.	 	DEFINED TERMS	  	 	3	  
			
	SECTION 3.	 	FORMS OF SERIES 2012-VF3 NOTES; TRANSFER RESTRICTIONS	  	 	26	  
			
	SECTION 4.	 	COLLATERAL VALUE EXCLUSIONS	  	 	27	  
			
	SECTION 5.	 	GENERAL RESERVE ACCOUNTS	  	 	29	  
			
	SECTION 6.	 	PAYMENTS; NOTE BALANCE INCREASES; EARLY MATURITY	  	 	29	  
			
	SECTION 7.	 	DETERMINATION OF NOTE INTEREST RATE AND LIBOR	  	 	31	  
			
	SECTION 8.	 	INCREASED COSTS	  	 	33	  
			
	SECTION 9.	 	SERIES REPORTS	  	 	35	  
			
	SECTION 10.	 	CONDITIONS PRECEDENT SATISFIED	  	 	37	  
			
	SECTION 11.	 	REPRESENTATION AND WARRANTIES	  	 	37	  
			
	SECTION 12.	 	AMENDMENTS	  	 	38	  
			
	SECTION 13.	 	COUNTERPARTS	  	 	38	  
			
	SECTION 14.	 	ENTIRE AGREEMENT	  	 	39	  
			
	SECTION 15.	 	LIMITED RECOURSE	  	 	39	  
			
	SECTION 16.	 	NOTICE	  	 	40	  
			
	SECTION 17.	 	OWNER TRUSTEE LIMITATION OF LIABILITY	  	 	40	  
			
	SECTION 18.	 	SYNDICATION	  	 	40	  
			
	SECTION 19.	 	BLUEMOUNTAIN LETTERS	  	 	41	  
			
	SECTION 20.	 	PERMITTED REFINANCINGS	  	 	41	  
			
	SECTION 21.	 	JOINT AND SEVERAL LIABILITY	  	 	41	  
			
	SECTION 22.	 	CAP PAYMENT AMOUNT	  	 	41	  
			
	 Schedule 1
	 	 No-RAC Servicing Agreements
	  			

  
 - i - 

 THIS SERIES 2012-VF3 THIRD AMENDED AND RESTATED INDENTURE SUPPLEMENT (this “Indenture
Supplement”), dated as of August 28, 2015, is made by and among HLSS SERVICER ADVANCE RECEIVABLES TRUST, a statutory trust organized under the laws of the State of Delaware (the “Issuer”), DEUTSCHE BANK NATIONAL TRUST
COMPANY, a national banking association, as trustee (the “Indenture Trustee”), as calculation agent (the “Calculation Agent”), as paying agent (the “Paying Agent”) and as securities intermediary
(the “Securities Intermediary”), HLSS HOLDINGS, LLC, a Delaware limited liability company (“HLSS”), as Administrator on behalf of the Issuer, as owner of the economics associated with the servicing under the
Designated Servicing Agreements, and as Servicer under the Designated Servicing Agreements from and after the related MSR Transfer Dates (as defined below), OCWEN LOAN SERVICING, LLC (“OLS”), as a Subservicer, and as Servicer under
the Designated Servicing Agreements prior to the related MSR Transfer Date, NEW RESIDENTIAL INVESTMENT CORP., and CREDIT SUISSE AG, NEW YORK BRANCH (“Credit Suisse”), as Administrative Agent. This Indenture Supplement relates to and
is executed pursuant to that certain Sixth Amended and Restated Indenture (as amended by Amendment No. 1, dated as of May 5, 2015, and as may be further amended, supplemented, restated or otherwise modified from time to time, the
“Base Indenture”), dated as of January 17, 2014, among the Issuer, the Servicer, the Administrator, the Indenture Trustee, the Calculation Agent, the Paying Agent, the Securities Intermediary, Credit Suisse, Barclays Bank PLC
(“Barclays”) and Wells Fargo Securities, LLC (“Wells Fargo”), all the provisions of which are incorporated herein as modified hereby and shall be a part of this Indenture Supplement as if set forth herein in full
(the Base Indenture as so supplemented by this Indenture Supplement being referred to as the “Indenture”). 
 Capitalized
terms used and not otherwise defined herein shall have the respective meanings given them in the Base Indenture. 
 PRELIMINARY STATEMENT

 The Issuer has duly authorized the issuance of the Series 2012-VF3 Notes (the “Series 2012-VF3 Notes”) and the
parties entered into the Series 2012-VF3 Indenture Supplement dated as of December 26, 2012 to document the terms of the issuance of the Series 2012-VF3 Notes (the “Original Indenture Supplement”). The Original Indenture
Supplement was subsequently amended pursuant to Amendment No. 1, dated as of February 15, 2013, Amendment No. 2, dated as of March 13, 2013, Amendment No. 3, dated as of April 12, 2013, Amendment No. 4, dated as of
May 21, 2013 and Amendment No. 5, dated as of July 1, 2013, and amended and restated pursuant to the Amended and Restated Series 2012-VF3 Indenture Supplement (the Original Indenture Supplement as so amended, the “Amended and
Restated Indenture Supplement”). 
 The Amended and Restated Indenture Supplement was subsequently amended and restated pursuant to
the Second Amended and Restated Series 2012-VF3 Indenture Supplement (the Amended and Restated Indenture Supplement as so amended, the “Second Amended and Restated Indenture Supplement”). 

The Second Amended and Restated Indenture Supplement was subsequently amended pursuant to Amendment No. 1, dated as of September 18,
2013, Amendment No. 2, dated as of 

 
October 24, 2013, Amendment No. 3, dated as of April 23, 2014, Amendment No. 4, dated as of July 16, 2014, Amendment No. 5, dated as of December 5, 2014,
Amendment No. 6, dated as of January 15, 2015, Amendment No. 7, dated as of April 6, 2015, Amendment No. 8, dated as of May 5, 2015 and Amendment No. 9, dated as of June 11, 2015 (the Second Amended and
Restated Indenture Supplement as so amended, the “Existing Indenture Supplement”). 
 The Series 2012-VF3 Notes were issued
in four (4) Classes of Variable Funding Notes (Class A-VF3, Class B-VF3, Class C-VF3, and Class D-VF3), with the Initial Note Balances, Maximum VFN Principal Balance, Stated Maturity Date, Revolving Period, Note Interest Rates, Expected
Repayment Date and other terms as specified in the Existing Indenture Supplement, known as the Advance Receivables Backed Notes, Series 2012-VF3, and secured by the Trust Estate Granted to the Indenture Trustee pursuant to the Base Indenture. The
Indenture Trustee holds the Trust Estate as collateral security for the benefit of the Holders of the Series 2012-VF3 Notes and all other Series of Notes issued under the Indenture as described therein. 

This Indenture Supplement shall become effective upon the latest to occur of the following (the “Effective Date”): 

(i) the execution and delivery of this Indenture Supplement by all parties hereto; 

(ii) the delivery of an Issuer Tax Opinion; 

(iii) the delivery of an Opinion of Counsel stating that the execution of this Indenture Supplement is authorized or permitted by the Existing
Indenture Supplement and that all conditions precedent thereto have been satisfied; 
 (iv) the delivery of an Officer’s Certificate to
the effect that the Issuer reasonably believes this Indenture Supplement will not have a Material Adverse Effect on any Outstanding Notes and is not reasonably expected to have an Adverse Effect at any time in the future; and 

(v) the delivery of notice of amendment of the Existing Indenture Supplement to each Note Rating Agency currently rating the Outstanding
Notes. 
 In the event that any term or provision contained herein shall conflict with or be inconsistent with any term or provision
contained in the Base Indenture, the terms and provisions of this Indenture Supplement shall govern to the extent of such conflict. 
 The
Existing Indenture Supplement is hereby amended and restated in its entirety as follows: 
  

	 	Section 1.	Creation of Series 2012-VF3 Notes. 

 There are hereby created, effective as of the
Issuance Date, the Series 2012-VF3 Notes, to be issued pursuant to the Base Indenture and this Indenture Supplement, to be known as “HLSS Servicer Advance Receivables Trust 2012-VF3 Advance Receivables Backed Notes, Series 2012-VF3 Variable
Funding Notes.” The Series 2012-VF3 Notes shall not be subordinated to any other Notes. The Series 2012-VF3 Notes are issued in four (4) Classes of Variable Funding Notes. 

  
 2 

	 	Section 2.	Defined Terms. 

 With respect to the Series 2012-VF3 Notes and in addition to or in
replacement for the definitions set forth in Section 1.1 of the Base Indenture, the following definitions shall be assigned to the defined terms set forth below: 

“Administrative Agent” means, for so long as the Series 2012-VF3 Notes have not been paid in full: (i) with respect to
the provisions of this Indenture Supplement, Credit Suisse, or an Affiliate or successor thereto; and (ii) with respect to the provisions of the Base Indenture and any other Transaction Document (other than the related Indenture Supplement),
and notwithstanding the terms and provisions of any other Indenture Supplement, together, Barclays, Wells Fargo, Credit Suisse and such other parties as set forth in any other Indenture Supplement, or a respective Affiliate or any respective
successor thereto. For the avoidance of doubt, reference to “it” or “its” with respect to the Administrative Agent in the Base Indenture shall mean “them” and “their,” and reference to the singular therein in
relation to the Administrative Agent shall be construed as if plural. 
 “Advance Rates” means, for any date of
determination with respect to each Receivable and any Class of Series 2012-VF3 Notes, the percentage amount based on the Advance Type of such Receivable, as set forth below; 

provided, that in the event of an OLS Ratings Downgrade Event, the Advance Rates applicable to the Receivables related to such Class of Notes shall be
equal to the Advance Rates prior to such OLS Ratings Downgrade Event minus 5.00% (such reduction, a “Downgrade Advance Rate Reduction”); provided, however, that, following such a Downgrade Advance Rate
Reduction, if (1) (a) a Collateral Test Rectification Event has occurred and (b) the Monthly Reimbursement Rate is greater than 9.00%, or (2) an upgrade by S&P and any other Note Rating Agency rating the Series 2012-VF3 Notes
of the Servicer’s (prior to any MSR Transfer Date) and the related Subservicer’s (on and after any MSR Transfer Date) sub-prime servicer rating to “Average” or higher occurs, then the Advance Rates applicable to the Receivables
related to such Class of Notes shall be equal to the Advance Rates after giving effect to such Downgrade Advance Rate Reduction plus 5.00%; 

provided, further, that, as determined by the Administrative Agent, to the extent Tangible Net Worth is less than $925,000,000 but greater than
or equal to $540,000,000, then the Advance Rates shall be reduced by an additional 2.00%; 
 provided, further, that, as determined by the
Administrative Agent: (i) to the extent the liquidity of Ocwen Financial Corp. ($100,000,000 of which must be in cash and the remaining in uncollateralized unused borrowing capacity) is below $150,000,000 but greater than or equal to
$100,000,000 and the Monthly Reimbursement Rate is below: (A) 12%, then the Advance Rates shall be reduced by 0.25%; (B) 11%, then the Advance Rate shall be reduced by 1.00%; (C) 10%, then the Advance Rates shall be reduced by 1.75%;
(D) 9%, then the Advance Rates shall be reduced by 2.50%; or (E) 8%, then the Advance Rates shall be reduced by 3.50%; and (ii) to the extent the liquidity of Ocwen Financial Corp. ($50,000,000 of which must be in cash and the
remaining in uncollateralized unused borrowing capacity) is below $100,000,000 (and the Liquidity Requirement is otherwise satisfied) and the Monthly Reimbursement Rate is below: 

  
 3 

 
(A) 12%, then the Advance Rates shall be reduced by 0.50%; (B) 11%, then the Advance Rates shall be reduced by 2.00%; (C) 10%, then the Advance Rates shall be reduced by 3.50%;
(D) 9%, then the Advance Rates shall be reduced by 5.00%; or (E) 8%, then the Advance Rates shall be reduced by 7.00%; 
 provided,
further, that the Advance Rate for any Receivable related to any Class of Notes shall be zero if such Receivable is not a Facility Eligible Receivable; and 

provided, further, that, for the Class D-VF3 Variable Funding Notes, the weighted average Advance Rate shall not exceed 93.75%; 

 

																	
	Advance Type / Class of Notes	  	Class A-
VF3
Variable
Funding
Notes	 	 	Class B-
VF3
Variable
Funding
Notes	 	 	Class C-
VF3
Variable
Funding
Notes	 	 	Class D-
VF3
Variable
Funding
Notes	 
					
	 P&I Advances (other than Servicing Fee Advances) in Non-Judicial States
	  	 	88.00	% 	 	 	89.75	% 	 	 	91.50	% 	 	 	95.50	% 
	 P&I Advances (other than Servicing Fee Advances) in Judicial States
	  	 	82.00	% 	 	 	84.00	% 	 	 	86.25	% 	 	 	95.25	% 
	 Servicing Fee Advances in Non-Judicial States
	  	 	88.00	% 	 	 	89.50	% 	 	 	91.00	% 	 	 	95.00	% 
	 Servicing Fee Advances in Judicial States
	  	 	83.25	% 	 	 	85.00	% 	 	 	87.00	% 	 	 	92.50	% 
	 Escrow Advances in Non-Judicial States
	  	 	88.00	% 	 	 	89.50	% 	 	 	91.00	% 	 	 	95.00	% 
	 Escrow Advances in Judicial States
	  	 	88.00	% 	 	 	89.50	% 	 	 	91.00	% 	 	 	95.00	% 
	 Corporate Advances in Non-Judicial States
	  	 	88.00	% 	 	 	89.50	% 	 	 	91.00	% 	 	 	95.00	% 
	 Corporate Advances in Judicial States
	  	 	83.25	% 	 	 	85.00	% 	 	 	87.00	% 	 	 	92.50	% 
	 Loan-Level P&I Advances (other than Servicing Fee Advances) in Non-Judicial States
	  	 	78.00	% 	 	 	81.75	% 	 	 	85.50	% 	 	 	91.50	% 
	 Loan-Level P&I Advances (other than Servicing Fee Advances) in Judicial States
	  	 	72.00	% 	 	 	76.00	% 	 	 	80.25	% 	 	 	91.25	% 
	 Loan-Level Escrow Advances in Non-Judicial States
	  	 	78.00	% 	 	 	81.50	% 	 	 	85.00	% 	 	 	91.00	% 
	 Loan-Level Escrow Advances in Judicial States
	  	 	78.00	% 	 	 	81.50	% 	 	 	85.00	% 	 	 	91.00	% 
	 Loan Level Corporate Advances in Non-Judicial States
	  	 	78.00	% 	 	 	81.50	% 	 	 	85.00	% 	 	 	91.00	% 
	 Loan-Level Corporate Advances in Judicial States
	  	 	73.25	% 	 	 	77.00	% 	 	 	81.00	% 	 	 	88.50	% 

 “Advance Ratio” means, as of any date of determination with respect to any Designated
Servicing Agreement, the ratio (expressed as a percentage), calculated as of the last day of the calendar month immediately preceding the calendar month in which such date occurs, of (i) the related PSA Stressed Non-Recoverable Advance Amount
(other than any Mortgage Loans that generate Receivables that are Loan-Level Receivables or any Mortgage Loans that are attributable to Small Threshold Servicing Agreements) on such date over (ii) the aggregate monthly scheduled principal and
interest payments for the calendar month immediately preceding the calendar month in which such date occurs with respect to all non-delinquent Mortgage Loans serviced under such Designated Servicing Agreement. 

“Aggregate Margin” means, with respect to each Class of Series 2012-VF3 and any date of determination, a per annum rate equal
to the sum of the applicable Margin and the applicable ERD Margin. 

  
 4 

 “Applicable Rating” means the rating assigned to each Class of the Series
2012-VF3 Notes by S&P, as the Note Rating Agency, upon the issuance of such Class as set forth below: 
 (i)
Class A-VF3 Variable Funding Notes: AAA(sf); 
 (ii) Class B-VF3 Variable Funding Notes: AA(sf); 

(iii) Class C-VF3 Variable Funding Notes: A(sf); and 

(iv) Class D-VF3 Variable Funding Notes: BBB (sf). 

“Base Indenture” has the meaning assigned to such term in the Preliminary Statement. 

“Base Rate” means, on any date, a fluctuating rate of interest per annum equal to the higher of (i) the Prime
Rate on such date and (ii) the Federal Funds Rate on such date plus 0.50% per annum. 
 “BlueMountain
Letters” shall mean letters from BlueMountain Capital Management, LLC (through its counsel, Patterson Belknap Webb & Tyler LLP) to the Indenture Trustee, dated January 23, 2015, February 20, 2015 and June 22,
2015, in which allegations were made of violations of servicing agreements and laws by Ocwen Loan Servicing, LLC. 
 “Cap Payment
Amounts” means, in respect of any Class of Notes for any Interest Accrual Period, such amounts constituting the difference between (a) the Interest Payment Amounts that would be payable based on the Note Interest Rate for such Class of
Notes determined without regard to the applicable Maximum Rate and (b) the Interest Payment Amounts. 
 “Cap Payment
Holder” means, 
 (i) in respect of the portion of the Cap Payment Amount attributable to the Class A-VF3
Notes, Credit Suisse International; 
 (ii) in respect of the portion of the Cap Payment Amount attributable to the Class
B-VF3 Notes, Credit Suisse International; 
 (iii) in respect of the portion of the Cap Payment Amount attributable to the
Class C-VF3 Notes, Credit Suisse International; and 
 (iv) in respect of the portion of the Cap Payment Amount attributable
to the Class D-VF3 Notes, Credit Suisse International, 
 or, in any case, any permitted assignee or transferee thereof so long as such
permitted assignee satisfies all of the transfer restrictions with respect to the Notes set forth in the Base Indenture and the Note Purchase Agreement, mutadis mutandis. 

“Cash Equivalents” shall mean (a) securities with maturities of one year or less from the date of acquisition issued or
fully guaranteed or insured by the United States Government or any agency thereof, (b) certificates of deposit and eurodollar time deposits with maturities of 90 days 

  
 5 

 
or less from the date of acquisition and overnight bank deposits of any commercial bank having capital and surplus in excess of $500,000,000, (c) repurchase obligations of any commercial
bank satisfying the requirements of clause (b) of this definition, having a term of not more than seven days with respect to securities issued or fully guaranteed or insured by the United States Government, (d) commercial paper of a
domestic issuer rated at least “A-1” or the equivalent thereof by S&P or “P-1” or the equivalent thereof by Moody’s Investors Service, Inc. (“Moody’s”) and in either case maturing within 90 days after the
day of acquisition, (e) securities with maturities of 90 days or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at least “A” by
S&P or “A” by Moody’s, (f) securities with maturities of 90 days or less from the date of acquisition backed by standby letters of credit issued by any commercial bank satisfying the requirements of clause (b) of this
definition, or (g) shares of money market mutual or similar funds which invest exclusively in assets satisfying the requirements of clauses (a) through (f) of this definition. 

“Class A-VF3 Variable Funding Notes” means, the Variable Funding Notes, Class A-VF3 Variable Funding Notes, issued
hereunder by the Issuer having an aggregate VFN Principal Balance of no greater than the applicable Maximum VFN Principal Balance. 

“Class B-VF3 Variable Funding Notes” means, the Variable Funding Notes, Class B-VF3 Variable Funding Notes, issued hereunder
by the Issuer, having an aggregate VFN Principal Balance of no greater than the applicable Maximum VFN Principal Balance. 
 “Class
C-VF3 Variable Funding Notes” means, the Variable Funding Notes, Class C-VF3 Variable Funding Notes, issued hereunder by the Issuer having an aggregate VFN Principal Balance of no greater than the applicable Maximum VFN Principal Balance.

 “Class D-VF3 Variable Funding Notes” means, the Variable Funding Notes, Class D-VF3 Variable Funding Notes, issued
hereunder by the Issuer having an aggregate VFN Principal Balance of no greater than the applicable Maximum VFN Principal Balance. 

“Coefficient” means, for each Class of Series 2012-VF3 Notes, 0.08%. 

“Collateral Test Rectification Event” means, if an OLS Ratings Downgrade Event has occurred, and if a Collateral Test would
not be satisfied for all Series as a whole as of the close of business on the last day of the Monthly Advance Collection Period preceding the upcoming Payment Date or the Advance Collection Period preceding the upcoming Interim Payment Date, that an
amount has been paid to the Variable Funding Notes or otherwise posted to the Trust Accounts (other than the General Reserve Account) on such date (after giving effect to any required payments on such date, if any) equal to the positive difference,
if any, between, for all Outstanding Series of Notes, (i) the sum of the Series Invested Amount for such Series on such date (after giving effect to any required payments on such date, if any) and (ii) the product of (A) the Series
Allocation Percentage for such Series and (B) (1) the aggregate Receivable Balances of all Receivables under all Designated Servicing Agreements plus (2) all Collections on deposit in the Trust Accounts (other than the General Reserve
Account) on such date (after giving effect 

  
 6 

 
to any required payments on such date, if any); provided, however, that for the purposes of such calculation it shall be assumed that no Downgrade Advance Rate Reduction has occurred with respect
to each Series of Variable Funding Notes. 
 “Commercial Paper Notes” means with respect to each Conduit Purchaser, the
short-term promissory notes issued by such Conduit Purchaser.
 “Commercial Paper Rate” means with respect to each Interest
Accrual Period and each Conduit Purchaser, the per annum rate equivalent to the weighted average cost related to the issuance of related Commercial Paper Notes for such Interest Accrual Period (such costs as reasonably determined by the related
sponsor or administrative agent for such Conduit Purchaser, and which shall include (without duplication) the fees and commissions of placement agents and dealers, incremental carrying costs incurred with respect to Commercial Paper Notes, other
borrowings by such Conduit Purchaser and any other costs associated with the issuance of such Commercial Paper Notes); provided, that if any component of such per annum rate is a discount rate, in calculating the “Commercial Paper Rate”,
the related Conduit Administrative Agent shall for such component use the rate resulting from converting such discount rate to an interest bearing equivalent rate per annum. The Conduit Administrative Agent shall deliver to the Administrator and the
Indenture Trustee the Commercial Paper Rate with respect to the Series 2012-VF3 Notes held by the Conduit Purchasers, if applicable, by no later than the Business Day prior to the Determination Date and the determination of the applicable
Commercial Paper Rate by the Conduit Administrative Agent shall be binding absent manifest error. 
 “Committed Purchaser”
means Credit Suisse AG, Cayman Islands Branch, and its successors and assigns. 
 “Conduit Administrative Agent” has the
meaning set forth in the Note Purchase Agreement. 
 “Conduit Purchaser” means (i) any Purchaser which is designated
as a “Conduit Purchaser” on the signature pages to the VF3 Note Purchase Agreement and (ii) any Purchaser which is designated as a “Conduit Purchaser” on the signature pages of any assignment agreement pursuant to which it
becomes a party to the VF3 Note Purchase Agreement. 
 “Constant” means, for each Class of Series 2012-VF3 Notes, 1.00%.

 “Corporate Trust Office” means, with respect to the Series 2012-VF3 Notes, the office of the Indenture Trustee at which
at any particular time its corporate trust business will be administered, which office at the date hereof is located at 1761 East St. Andrew Place, Santa Ana, California 92705, Attention: Trust Administration – OC12S9. 

“Cost of Funds Rate”: means, for any day of any Interest Accrual Period, (a) to the extent a Conduit Purchaser has
funded its interest in any Series 2012-VF3 Note through the issuance of Commercial Paper Notes, the Commercial Paper Rate applicable to such Conduit Purchaser and (b) in all other cases, the sum of One-Month LIBOR plus, solely with respect to
the Series 2012-VF3 Original Amounts, 1.00%.

  
 7 

 “Cumulative Default Fee Amount” means, for any Payment Date and any Class of
Series 2012-VF3 Notes and notwithstanding anything to the contrary set forth in the definition of “Cumulative Default Fee Amount” set forth in the Base Indenture, any portion of the Default Fee for that Class for a previous Payment Date
that has not been paid, plus accrued and unpaid interest thereon at the applicable Note Interest Rate plus 3.00% from the Payment Date on which the shortfall first occurred through the current Payment Date. 

“Cumulative ERD Fee Amount” means, for any Payment Date and any Class of Series 2012-VF3 Notes and notwithstanding anything
to the contrary set forth in the definition of “Cumulative ERD Fee Amount” set forth in the Base Indenture, any portion of the ERD Fee for that Class for a previous Payment Date that has not been paid, plus accrued and unpaid interest
thereon at the applicable Note Interest Rate plus the ERD Fee Rate for that Class from the Payment Date on which the shortfall first occurred through the current Payment Date. 

“Default Fee” means, with respect to each Class of Series 2012-VF3 Notes and notwithstanding anything to the contrary set
forth in the definition of “Default Fee” set forth in the Base Indenture, for any Payment Date following the occurrence of an Event of Default including the Final Payment Date for such class of Notes, a fee equal to the product of
(i) 3.00%, (ii) the related Note Balance as of the close of business on the preceding Payment Date and (iii) a fraction, the numerator of which is the number of days elapsed from and including the preceding Payment Date (or, if later,
the occurrence of such Event of Default) to but excluding such current Payment Date and the denominator of which equals 360. 

“Default Rate” means, for any Class of Notes, the sum (expressed as a percentage) of the Note Interest Rate for such Class
and 3.00%. 
 “Derivative Agreement” means, with respect to the Series 2012-VF3 Notes, the interest rate “cap”
hedging arrangement to be entered into on or before June 11, 2015 and any replacement therefor in accordance with such agreements and the terms thereof, which shall be a “Derivative Agreement” for purposes of the Base Indenture solely
in respect of the Series 2012-VF3 Notes. The “Cap Rate” thereunder shall equal the Maximum Rate. The related Derivative Counterparty shall be the “Floating Rate Payer” thereunder. The Issuer shall be the “Fixed Rate
Payer” thereunder. The “Notional Amount” thereunder shall be determined by the Derivative Counterparty and the Issuer. 

“Derivative Agreement Account” means, the segregated non-interest bearing trust account or accounts, each of which shall be
an Eligible Account, established and maintained for the benefit of the Cap Payment Holders pursuant to Section 22 and entitled “Deutsche Bank National Trust Company, as Indenture Trustee for the HLSS Servicer Advance Receivables Backed
Notes, Derivative Agreement Account – Series 2012-VF3. 
 “Derivative Imbalance” has the meaning set forth in
Section 22 hereof. 
 “Derivative Imbalance Required Reserve” means, on any date, an amount equal to the product of
(i) the Derivative Imbalance, if any, on such date and (ii) 5.00%. 

  
 8 

 “Derivative Reserve Account” means, the segregated non-interest bearing trust
account or accounts, each of which shall be an Eligible Account, established and maintained for the benefit of the Cap Payment Holders pursuant to Section 22 and entitled “Deutsche Bank National Trust Company, as Indenture Trustee for the
HLSS Servicer Advance Receivables Backed Notes, Derivative Reserve Account – Series 2012-VF3. 
 “ERD Fee” means, with
respect to each Class of Series 2012-VF3 Notes and notwithstanding anything to the contrary set forth in the definition of “ERD Fee” set forth in the Base Indenture, on each Payment Date, the sum of (A) the product of (i) the
applicable ERD Fee Rate for that Class, (ii) the average daily related VFN Principal Balance during the related Interest Accrual Period and (iii) a fraction, the numerator of which is the number of days elapsed from and including the
preceding Payment Date to but excluding such current Payment Date and the denominator of which equals 360 plus (B) the sum for each day while a Eurodollar Disruption Event under clause (ii) of the definition thereof is continuing during
the related Interest Accrual Period, in an amount equal to the product of (i) the excess, if any, of the Base Rate over One-Month LIBOR for each day on which such Eurodollar Disruption Event was in effect during such period, (ii) the
related VFN Principal Balance on such date and (iii) a fraction, the numerator of which equals one (1) and the denominator of which equals 360 plus (C) the sum for each day while the applicable Cost of Funds Rate is greater than the
Index during the related Interest Accrual Period, the sum of the product of (i) the excess, if any, of the applicable Cost of Fund Rate over the Index, (ii) the related VFN Principal Balance on such date and (iii) a fraction, the
numerator of which equals one (1) and the denominator of which equals 360. 
 “ERD Fee Rate” means, with respect to
each Class of Series 2012-VF3 Notes, a per annum rate equal to the applicable ERD Margin. 
 “ERD Margin” means, for each
Class of Series 2012-VF3 Notes, a per annum rate set forth below: 
 (a) Class A-VF3 Variable Funding Notes: 0.25%; 

(b) Class B-VF3 Variable Funding Notes: 0.65%; 

(c) Class C-VF3 Variable Funding Notes: 0.65%; and 

(d) Class D-VF3 Variable Funding Notes: 0.65%. 

“Eurodollar Disruption Event” means, with respect to the Series 2012-VF3 Notes held by the Committed Purchasers and, in the
event the Cost of Funds Rate shall be determined pursuant to clause (b) of the definition thereof, the Conduit Purchasers, as applicable, any of the following: (i) a good faith determination by any Holder of the Series 2012-VF3 Notes that
it would be contrary to law or to the directive of any central bank or other governmental authority (whether or not having the force of law) for such Holder to obtain United States dollars in the London interbank market to fund or maintain any
portion of the Note Balances of such Notes during any Interest Accrual Period, (ii) a good faith determination by any Holder of the Series 2012-VF3 Notes that the interest rates offered on deposits of United States dollars to such Holder in the
London interbank market does not accurately reflect the cost to such Holder of purchasing, 

  
 9 

 
funding or maintaining any portion of the Note Balances of such Notes during any Interest Accrual Period, or (iii) the inability of any Holder of the Series 2012-VF3 Notes to obtain United
States dollars in the London interbank market to fund or maintain any portion of the Note Balances of such Notes for such Interest Accrual Period. 

“Exempted MBS Trust” means each of the RAAC 2006-SP3 MBS Trust, RAAC 2006-SP MBS Trust, RAAC 2007-SP3 MBS Trust, RAMP
2005-RP3 MBS Trust and STALT 2006-1F MBS Trust. 
 “Expected Repayment Date” for the Series 2012-VF3 Notes means
April 4, 2016; provided, that the Expected Repayment Date may not in any event be longer than the Expected Repayment Date of the commitments extended by any new Administrative Agent under the Indenture or any incremental lending arrangements
provided by any Administrative Agent under the Indenture, including for the avoidance of doubt, any other Outstanding Series of Variable Funding Notes under the Indenture. 

“Expense Rate” means, as of any date of determination, with respect to the Series 2012-VF3 Notes, the percentage equivalent
of a fraction, (i) the numerator of which equals the sum of (1) the product of the related Series Allocation Percentage for the Interim Payment Date or Payment Date immediately preceding such date multiplied by the aggregate amount
of Fees due and payable by the Issuer on the next succeeding Payment Date plus (2) the product of the related Series Allocation Percentage for the Interim Payment Date or Payment Date immediately preceding such date multiplied by any
expenses payable or reimbursable by the Issuer on the next succeeding Payment Date, up to the applicable Expense Limit, if any, prior to payments to the Holders of the Series 2012-VF3 Notes, pursuant to the terms and provisions of this Indenture
Supplement, the Base Indenture or any other Transaction Document that have been invoiced to the Indenture Trustee and the Administrator, plus (3) the aggregate amount of related Series Fees payable by the Issuer on the next succeeding
Payment Date and (ii) the denominator of which equals the sum of the outstanding Note Balances of all Series 2012-VF3 Notes at the close of business on such date; provided, that, with respect to the first calculation of “Expense
Rate” following the Issuance Date, such calculation shall include a “Series Allocation Percentage” as determined by the Administrator and the Administrative Agent. 

“Facility Eligible Receivable” means, with respect to the Series 2012-VF3 Notes, a Receivable: 

(i) which constitutes a “general intangible,” “account” or “payment intangible” within the
meaning of Section 9-102(a)(42), Section 9-102(a)(2) and Section 9-102(a)(61), respectively (or the corresponding
provision in effect in a particular jurisdiction) of the UCC as in effect in all applicable jurisdictions; 
 (ii) which is
denominated and payable in United States dollars; 
 (iii) which arises under and pursuant to the terms of a Designated
Servicing Agreement and, at the time the related Advance was made, (A) was determined by the Servicer or Subservicer, as applicable, in good faith to (1) be ultimately recoverable from the proceeds of the related Mortgage Loan, related
liquidation proceeds or otherwise from the proceeds of or collections on the related Mortgage Loan and (2) comply with all requirements for reimbursement thereunder, and (B) was authorized pursuant to the terms of the related Designated
Servicing Agreement; 

  
 10 

 (iv) which arises under a Facility Eligible Servicing Agreement; 

(v) which is not subject to any Adverse Claim and in which all right, title and interest in and to such Receivable (including
good and marketable title) have been validly sold and/or contributed by the Receivables Seller to the Depositor, and validly sold and/or contributed by the Depositor to the Issuer and, prior to the MSR Transfer Date, sold by the Servicer to the
Receivables Seller; 
 (vi) with respect to which no representation or warranty made by the Receivables Seller or the
Servicer in the Receivables Sale Agreement has been breached, which breach has continued uncured past the time at which the Servicer or the Receivables Seller was required to pay the Indemnity Payment with respect thereto pursuant to the Receivables
Sale Agreement; 
 (vii) with respect to which, as of the date such Receivable was acquired by the Issuer, none of the
Receivables Seller, the Servicer, the Subservicer or the Depositor had (A) taken any action that would impair the right, title and interest of the Indenture Trustee therein, or (B) failed to take any action that was necessary to avoid
impairing the Indenture Trustee’s right, title or interest therein; 
 (viii) the Advance (other than a Servicing Fee
Advance) related to which either (A) has been fully funded by the Servicer using its own funds and/or Amounts Held for Future Distribution (to the extent permitted under the related Designated Servicing Agreement) and/or Collections (as
appropriate) in excess of the related Required Expense Reserve, and/or amounts drawn on Variable Funding Notes or out of funds in the Collection and Funding Account or Available Funds as provided herein, or (B) in the case of P&I Advances,
will be funded on the related Funding Date and all amounts necessary to fund the related Advance are on deposit in an account under the exclusive control and direction of the Indenture Trustee pending remittance to the appropriate MBS trustees; 

(ix) which relates to a Mortgage Loan that is secured by a first lien on the underlying mortgaged property; 

(x) which does not relate to a Mortgage Loan the terms of which have been modified after the creation of such Receivable (for
purposes of this clause, a Mortgage Loan has been modified only after the modification continues effective following any trial period); 

(xi) if a Servicing Fee Advance Receivable, the provisions of the related Servicing Fee Advance Designated Servicing Agreement
identified on the Servicing Fee Advance Designated Servicing Agreement Schedule require that any unpaid and accrued servicing fees owed to the Servicer be repaid on or prior to the date of any redemption in full under the applicable Servicing Fee
Advance Designated Servicing Agreement; and 
 (xii) if a Servicing Fee Advance Receivable, which relates to a Servicing Fee
Advance Designated Servicing Agreement identified on the Servicing Fee Advance Designated Servicing Agreement Schedule. 

  
 11 

 “Facility Eligible Servicing Agreement” means, with respect to the Series
2012-VF3 Notes, any Designated Servicing Agreement which, as of any date of determination, meets the following criteria: 

(i) either OLS or an OFC-Owned Servicer (in either case, prior to the MSR Transfer Date) and HLSS (from and after the MSR
Transfer Date) is the servicer under such Designated Servicing Agreement and a Responsible Officer of the Servicer has received neither (A) any notice, or otherwise obtained actual knowledge, of the occurrence of any Unmatured Default or
Servicer Termination Event by or with respect to the Servicer under such Designated Servicing Agreement except (i) to the extent that, in the case of an Unmatured Default, such Unmatured Default has been cured prior to its becoming a Servicer
Termination Event, and (ii) any Unmatured Default or Servicer Termination Event caused solely by the failure of a Collateral Performance Test or a Servicer Ratings Downgrade for which the Servicer shall not have received a written notice of
pending termination, nor (B) notice of a claim for monetary loss against the Servicer by a party to such Designated Servicing Agreement or by a related securityholder, whose claim is for an aggregate amount greater than 5% of the aggregate
Receivable Balance of the Receivables created pursuant to such Designated Servicing Agreement; 
 (ii) pursuant to the terms
of such Designated Servicing Agreement: 
 (A) under such agreement, the Servicer is permitted to reimburse itself for the
related Advance out of late collections of the amounts advanced, including from insurance proceeds and liquidation proceeds from the Mortgage Loan with respect to which such Advance was made, prior to any holders of any notes, certificates or other
securities backed by the related mortgage loan pool, which securities, in the case of Designated Servicing Agreements, must have included a “AAA” or equivalent rated class at the time of execution of the Designated Servicing Agreement, and
prior to payment of any party subrogated to the rights of the holders of such securities (such as a reimbursement right of a credit enhancer) or any hedge or derivative termination fees, or to any related MBS Trust or any related trustee, custodian,
hedge counterparty or credit enhancer; 
 (B) under such agreement, other than with respect to any Servicing Fee Advance
Receivable or Loan-Level Receivable, if the Servicer determines that the related Advance will not be recoverable out of late collections of the amounts advanced or out of insurance proceeds or liquidation proceeds from the Mortgage Loan with respect
to which such Advance was made, the Servicer has the right to reimburse itself for such Advance out of any funds (other than prepayment charges) in the Dedicated Collection Account or out of general collections received by the Servicer with respect
to any Mortgage Loans serviced under the same Designated Servicing Agreement, prior to any payment to any holders of any notes, certificates or other securities backed by the related mortgage loan 

  
 12 

 
pool, which securities included a “AAA” or equivalent rated class at the time of execution of the Designated Servicing Agreement, and prior to payment of any party subrogated to the
rights of the holders of such securities (such as a reimbursement right of a credit enhancer) or any hedge or derivative termination fees, or to the related MBS Trust or any related trustee, custodian or credit enhancer (a “General
Collections Backstop”); 
 (iii) such Designated Servicing Agreement provides that all Advances (not including
Servicing Fee Advances) as to a Mortgage Loan are reimbursed on a “first-in, first out” or “FIFO” basis, such that the Advances of a particular type that were disbursed first in time will be reimbursed prior to Advances of the
same type with respect to that Mortgage Loan that were disbursed later in time; 
 (iv) all Receivables arising under such
Designated Servicing Agreement are free and clear of any Adverse Claim in favor of any Person and the related MBS Trustee or other owner and any related monoline insurer or other credit enhancement provider shall have been delivered a notice in the
form of Exhibit C attached to the Base Indenture signed by the Servicer; 
 (v) such Designated Servicing Agreement is
in full force and effect; 
 (vi) an Eligible Subservicing Agreement is in full force and effect for all mortgage loans
serviced by the Servicer under such Designated Servicing Agreement, and the related Subservicer (or OLS or any OFC-Owned Servicer as Servicer prior to the MSR Transfer Date) is an Eligible Subservicer and is in compliance with such Subservicing
Agreement and, from and after the MSR Transfer Date, OLS, any other OFC-Owned Servicer or another servicer acceptable to the Administrative Agent, shall be serving as “hot back-up servicer” for HLSS under an agreement approved by the
Administrative Agent; 
 (vii) such Designated Servicing Agreement includes an express provision for the assignment by the
Servicer of its rights to be reimbursed for Advances (except in the case of Servicing Fee Advances); and, with respect to any Servicing Fee Advance Receivable, the related Servicing Fee Advance Designated Servicing Agreement does not prohibit the
sale and/or contribution to the Issuer of, specifically, the rights to reimbursement for the Servicing Fee Advances under the related MBS Trust (as determined, regardless of the terms contained in such Servicing Fee Advance Designated Servicing
Agreement, in the sole and absolute discretion of the Administrative Agent). 
 (viii) such Designated Servicing Agreement
arises under and is governed by the laws of the United States or a state within the United States; 
 (ix) the Servicer has
not voluntarily elected to change the reimbursement mechanics of Advances under such Designated Servicing Agreement from a pool-level reimbursement mechanic to a loan-level reimbursement mechanic or from a loan-level reimbursement mechanic to a
pool-level reimbursement mechanic without consent of each Administrative Agent; and 
 (x) if such Designated Servicing
Agreement is a subservicing agreement, the subservicing agreement and the related servicing or master servicing agreement provide that: (1) Servicer, as subservicer, under such agreement, is required to make all Advances on Mortgage Loans
subserviced by a Servicer; (2) Servicer, as subservicer under such agreement, is entitled to reimbursement from all permitted sources under such Designated Servicing Agreement; (3) the related primary or master servicer agrees to remit to
the Servicer, as subservicer, within two (2) Business Days of receipt thereof, any collections and reimbursements of P&I Advances, Corporate Advances and Escrow Advances it receives, without set-off; and (4) the related primary or
master servicer agrees to reasonably cooperate with the Servicer, as subservicer, to obtain reimbursement of P&I Advances, Corporate Advances and Escrow Advances including, if either of such primary or master servicer or the Servicer, as
subservicer, is terminated, by seeking immediate reimbursement therefor from the successor servicer or, failing that, on a first-in-first-out basis. 

  
 13 

 “Federal Funds Rate” means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the federal funds rates as quoted by the Administrative Agent and confirmed in Federal Reserve Board Statistical Release H. 15 (519) or any successor or substitute
publication selected by the Administrative Agent (or, if such day is not a Business Day, for the next preceding Business Day), or if, for any reason, such rate is not available on any day, the rate determined, in the sole opinion of the
Administrative Agent, to be the rate at which federal funds are being offered for sale in the national federal funds market at 9:00 a.m. (New York City time). 

“Funding Conditions” means, with respect to any proposed Funding Date and the Series 2012-VF3 Notes, in addition to the
Funding Conditions set forth in the Base Indenture, the following condition: 
 (i) payment, as of the immediately preceding
Payment Date, of the Series 2012-VF3 Additional Fee in full and in the manner specified in the Series 2012-VF3 Additional Letter. For the avoidance of doubt, the Series 2012-VF3 Additional Letter is not the VF3 Fee Letter or a Fee Letter referenced
and defined in the Base Indenture; 
 (ii) the ratings assigned to any Class of Series 2012-VF3 Notes is not reduced below
the Applicable Rating assigned to such Class of Series 23012-VF3 Notes; and 
 (iii) with respect to funding the Series
2013-VF3 Incremental Amounts, (A) such amounts shall be subject to the Applicable Rating and (B) upon any Funding Date with respect thereto, either the sum of plus the related Commitment with respect thereto plus the available Commitment
of other Series of Variable Funding Notes plus the respective commitments in third party credit facilities of the Administrator plus available cash and Cash Equivalents on hand at the Administrator and NRZ is sufficient to redeem in full all
Outstanding Series of Term Notes or all Series of Term Notes will be redeemed in full. 
 “Governmental Authority” means
the United States of America, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and having jurisdiction over the
applicable Person. 

  
 14 

 “Increased Costs Limit” means, for each Holder of Series 2012-VF3 Note, such
Holder’s pro rata percentage (based on the Note Balance of such Holder’s Series 2012-VF3 Notes) of 0.10% of the average aggregate Note Balance for all Classes of Series 2012-VF3 Notes Outstanding for any twelve-month period. 

“Indebtedness” shall mean: (a) obligations created, issued or incurred by NRZ for borrowed money (whether by loan, the
issuance and sale of debt securities or the sale of property to another person subject to an understanding or agreement, contingent or otherwise, to repurchase such property from such person); (b) obligations of NRZ to pay the deferred purchase
or acquisition price of property or services, other than trade accounts payable (other than for borrowed money) arising, and accrued expenses incurred, in the ordinary course of business so long as such trade accounts payable are payable within 90
days of the date the respective goods are delivered or the respective services are rendered; (c) indebtedness of others secured by a lien on the property of NRZ, whether or not the respective indebtedness so secured has been assumed by NRZ;
(d) obligations (contingent or otherwise) of NRZ in respect of letters of credit or similar instruments issued or accepted by banks and other financial institutions for account of NRZ; (e) obligations of NRZ to pay rent or other amounts
under a lease of (or other agreement conveying the right to use) property to the extent such obligations are required to be classified and accounted for as a capital lease on a balance sheet of NRZ under GAAP, and, for purposes of this definition,
the amount of such obligations shall be the capitalized amount thereof, determined in accordance with GAAP, and “lease” shall have the meaning under GAAP as of January 1, 2013; (f) obligations of NRZ under repurchase agreements
or loan and security agreements or similar warehouse facilities; (g) indebtedness of others guaranteed by NRZ; (h) indebtedness of general partnerships of which NRZ is a general partner; and (i) any other indebtedness of NRZ by a
note, bond, debenture or similar instrument; provided, however that, in each case, “Indebtedness” shall not include NRZ’s Non-Recourse Indebtedness. 

“Index” means, for any Class of the Series 2012-VF3 Notes, One Month LIBOR. 

“Initial Note Balance” has the meaning set forth in the Original Indenture Supplement. 

“Interest Accrual Period” means, for the Series 2012-VF3 Notes and any Payment Date, the period beginning on the immediately
preceding Payment Date (or, in the case of the first Payment Date with respect to any Class, the related Issuance Date) and ending on the day immediately preceding the current Payment Date. The Interest Payment Amount for the Series 2012-VF3 Notes
on any Payment Date shall be determined based on the actual number of days in the Interest Accrual Period. 
 “Interest Day Count
Convention” means the actual number of days in the related Interest Accrual Period divided by 360. 
 “Interest Rate
Adjustment Date”: Each Business Day. 

  
 15 

 “Investment Manager” means, (i) Fortress Investment Group LLC or any wholly
owned subsidiary thereof, (ii) FIG LLC, (iii) any entity whose business and operations are managed or supervised by Wesley R. Edens, or (iv) any successors and permitted assigns of the foregoing so long as such entity pursuant to this
clause (iv) is reasonably acceptable to the Administrative Agent. 
 “Issuance Date” means April 6, 2015. 

“LIBOR” has the meaning assigned such term in Section 7 of this Indenture Supplement. 

“LIBOR Determination Date” means, for each Interest Accrual Period, the second London Banking Day prior to the commencement
of such Interest Accrual Period. 
 “Liquidity Requirement” means the requirement that an entity have funds available to
fund servicer advances, as of the close of business on the last Business Day of each calendar month, beginning August 2013, in an amount at least equal to the lesser of (1) $100,000,000 and (2) the greater of (a) the sum of
(i) 0.001% of the aggregate unpaid principal balance of all mortgage loans sub-serviced by such entity (i.e., without an obligation to fund servicer advances) plus (ii) 0.01% of the aggregate unpaid principal balance of all mortgage
loans serviced by such entity (i.e., with the obligation to fund servicer advances) or as to which such entity holds rights to the servicing plus the obligation to fund servicer advances, plus (iii) 3.25% of the aggregate amount
of all servicer advances made by such entity that remain unreimbursed, and (b) $25,000,000; provided, that at least the greater of (1) $15,000,000 and (2) 50% of such funds available, must consist of unrestricted cash on
deposit in accounts held in the sole name of, and solely controlled by, such entity, free and clear of all Adverse Claims (including liens), and the remainder as undrawn and available borrowing capacity under committed servicer advance facilities
and committed unsecured revolving loans made to such entity as borrower, as determined on such date of measurement, which undrawn and available borrowing capacity need not be presently collateralized. 

“Loan-Level Advance Receivable” means a Receivable (other than a Servicing Fee Advance Receivable) relating to a Designated
Servicing Agreement identified on the Designated Servicing Agreement Schedule the provisions of which do not contain a General Collections Backstop with respect to the related Advances. 

“Loan-Level Receivable” means a Loan-Level Advance Receivable or Loan-Level Servicing Fee Advance Receivable. 

“Loan-Level Servicing Fee Advance Receivable”: A Servicing Fee Advance Receivable relating to a Servicing Fee Advance
Designated Servicing Agreement identified on the Servicing Fee Advance Designated Servicing Agreement Schedule the provisions of which do not contain a General Collections Backstop. 

“London Banking Day” means any day on which commercial banks and foreign exchange markets settle payment in both London and
New York City. 

  
 16 

 “Low Threshold Servicing Agreement” has the meaning assigned such term in
Section 4 of this Indenture Supplement. 
 “Margin” means with respect to each Class of Series 2012-VF3 Notes,
a per annum rate set forth below: 
  

	 	(a)	Class A-VF3 Variable Funding Notes: 0.85%; 

  

	 	(b)	Class B-VF3 Variable Funding Notes: 1.20%; 

  

	 	(c)	Class C-VF3 Variable Funding Notes: 1.45%; and 

  

	 	(d)	Class D-VF3 Variable Funding Notes: 2.75%; 

 provided, that, with respect to each Class
of Series 2012-VF3 Notes, the issuance of Variable Funding Notes following the related Issuance Date and each Interest Accrual Period thereafter, the “Margin” for such Class shall be the applicable percentage agreed to by the Receivables
Seller, the Issuer and the Administrative Agent upon the related issuance date of such Variable Funding Notes. 
 “Market Value
Ratio” means, as of any date of determination with respect to a Designated Servicing Agreement, the ratio (expressed as a percentage) of (i) the lesser of (A) the Funded Advance Receivable Balance for such Designated Servicing
Agreement on such date and (B) the aggregate of all Facility Eligible Receivables under such Designated Servicing Agreement on such date over (ii) the aggregate Net Property Value of the Mortgaged Properties and REO Properties for Mortgage
Loans that are serviced under such Designated Servicing Agreement on such date. 
 “Maximum Rate” means 0.75% per
annum. 
 “Maximum VFN Principal Balance” means: (i) on any date of determination prior to September 1, 2015,
(A) for the Class A-VF3 Variable Funding Notes, $1,283,200,000, (B) for the Class B-VF3 Variable Funding Notes, $25,213,330, (C) for the Class C-VF3 Variable Funding Notes, $26,600,000, and (D) for the Class D-VF3 Variable
Funding Notes, $64,986,670; (ii) on any date of determination on and after September 1, 2015 but prior to December 1, 2015, (A) for the Class A-VF3 Variable Funding Notes, $549,942,855, (B) for the Class B-VF3 Variable
Funding Notes, $10,805,715, (C) for the Class C-VF3 Variable Funding Notes, $11,400,000, and (D) for the Class D-VF3 Variable Funding Notes, $27,851,430; (iii) on any date of determination on and after December 1, 2015,
(A) for the Class A-VF3 Variable Funding Notes, $0, (B) for the Class B-VF3 Variable Funding Notes, $0, (C) for the Class C-VF3 Variable Funding Notes, $0, and (D) for the Class D-VF3 Variable Funding Notes, $0; or
(iv) in the case of each such Class on any date, such lesser amount calculated pursuant to a written agreement between the Servicer, the Administrator and the Administrative Agent. 

“Middle Threshold Servicing Agreement” has the meaning assigned such term in Section 4 of this Indenture
Supplement. 

  
 17 

 “Monthly Reimbursement Rate” means, as of any date of determination, the
arithmetic average of the fractions (expressed as percentages), determined for each of the three (3) most recently concluded calendar months, obtained by dividing (i) the aggregate Advance Reimbursement Amounts collected by the Servicer
and deposited into the Trust Accounts during such month by (ii) the aggregate Receivable Balances funded by the Servicer using its own funds or facility funds as of the close of business on the last day of the Monthly Advance Collection Period.

 “Mortgage Loan” means a mortgage loan transferred and assigned to an Underlying Trustee and serviced for such Underlying
Trustee pursuant to a Servicing Agreement. 
 “Mortgage Loan-Level Market Value Ratio” means, as of any date of
determination with respect to a Mortgage Loan or REO Property that is secured by a first lien on the related Mortgaged Property, the ratio (expressed as a percentage) of (x) the aggregate Receivable Balance of all Receivables outstanding with
respect to such Mortgage Loan or REO Property on such date over (y) the Net Property Value of such Mortgaged Property or REO Property on such date. 

“MSRs” means mortgage servicing rights and rights to mortgage servicing rights, as applicable. 

“Net Proceeds Coverage Percentage” means, for any Payment Date, the percentage equivalent of a fraction, (i) the
numerator of which equals the amount of Collections on Receivables deposited into the Collection and Funding Account during the related Monthly Advance Collection Period, and (ii) the denominator of which equals the aggregate average
outstanding Note Balances of all Outstanding Notes during such Monthly Advance Collection Period. 
 “Net Property Value”
means, with respect to any Mortgaged Property, (A) with respect to a Current Mortgage Loan, the market value of such Mortgaged Property as established by OLS’s independent property valuation methodology (as established by the lesser of any
appraisal, broker’s price opinion or OLS’s automated valuation model with respect to such Mortgaged Property) or (B) with respect to a Delinquent Mortgage Loan, the product of (a) the market value of such Mortgaged Property as
established by OLS’s independent property valuation methodology (as established by the lesser of any appraisal, broker’s price opinion or OLS’s automated valuation model with respect to such Mortgaged Property), multiplied by
(b) OLS’s established market and property discount value rate, minus (c) OLS’s brokerage fee and closing costs with respect to such Mortgaged Property, plus (d) any projected mortgage insurance claim proceeds. 

“Net Worth” shall mean, the excess of total assets of NRZ, over total liabilities of NRZ, determined in accordance with GAAP
on a quarterly basis. 
 “No-Payment at Termination Servicing Fee Advance Receivable”: A Servicing Fee Advance Receivable
relating to a Servicing Fee Advance Designated Servicing Agreement identified on the Servicing Fee Advance Designated Servicing Agreement Schedule the provisions of which do not require that all unpaid and accrued servicing fees owed to the
Servicer be repaid on or prior to the date of any involuntary transfer of servicing or any servicer termination. 

  
 18 

 “No-RAC Servicing Agreements” shall have the meaning set forth in
Section 11(b). 
 “Non-Recourse” shall mean, with respect to any specified Person, Indebtedness that is specifically
advanced to finance the acquisition of property or assets and secured only by the property or assets to which such Indebtedness relates without recourse to such Person (other than subject to such customary carve-out matters for which such Person
acts as a guarantor in connection with such Indebtedness, such as bad boy acts, fraud, misappropriation, breach of representation and warranty, misapplication, and environmental matters); provided; that, notwithstanding the foregoing, if any
Indebtedness that would be Non-Recourse Indebtedness but for the fact that such Indebtedness is made with recourse to other assets, then only the portion of such Indebtedness that is recourse to such other assets shall be deemed not to be
Non-Recourse Indebtedness, and all other Indebtedness shall be deemed to be Non-Recourse Indebtedness. 
 “Note Interest
Rate” means, with respect to any Interest Accrual Period for each Class of Notes, the rates described below: 
 (i)
Class A-VF3 Variable Funding Notes: the sum of (A) the lesser of (I) the Index for such Interest Accrual Period and (II) the Maximum Rate plus (B) the applicable Margin; 

(ii) Class B-VF3 Variable Funding Notes: the sum of (A) the lesser of (I) the Index for such Interest Accrual Period
and (II) the Maximum Rate plus (B) the applicable Margin; 
 (iii) Class C-VF3 Variable Funding Notes: the sum of
(A) the lesser of (I) the Index for such Interest Accrual Period and (II) the Maximum Rate plus (B) the applicable Margin; and 

(iv) Class D-VF3 Variable Funding Notes: the sum of (A) the lesser of (I) the Index for such Interest Accrual Period
and (II) the Maximum Rate plus (B) the applicable Margin; 
 provided; that if, for any Interest Accrual Period,
(a) the Index is not determinable, or (b) a Eurodollar Disruption Event (under clause (i) or clause (iii) of the definition thereof) shall have occurred, the Note Interest Rate shall be the sum of (A) the lesser of
(I) the Base Rate and (II) the Maximum Rate plus (B) the applicable Margin. For the avoidance of doubt, the “Note Interest Rate” for the Series 2012-VF3 Notes is subject to the definition of “Note Interest Rate” in the
Base Indenture. 
 “Note Rating Agency” means, for the Series 2012-VF3 Notes, S&P. 

  
 19 

 “NRZ Change of Control” occurs if any of the following occur: (i) the
Investment Manager is no longer the manager of NRZ or (ii) NRZ shall cease to directly or indirectly own 100% of the equity interests of HLSS. 

“OLS Ratings Downgrade Event” means a downgrade by S&P or any other Note Rating Agency rating the Series 2012-VF3 Notes
of the Servicer’s (prior to any MSR Transfer Date) or the related Subservicer’s (on and after any MSR Transfer Date) sub-prime servicer rating below “Average” (regardless of whether such Servicer or Subservicer has been placed on
negative watch by any such Note Rating Agency). 
 “One-Month LIBOR” has the meaning assigned such term in
Section 7 of this Indenture Supplement. 
 “Prime Rate” means the rate announced by the Administrative Agent
from time to time as its prime rate in the United States, such rate to change as and when such designated rate changes. The Prime Rate is not intended to be the lowest rate of interest charged by the Administrative Agent in connection with
extensions of credit to debtors. 
 “PSA Migration Conditions” means, with respect to the allocation of any or all of the
maximum principal balance of the Notes issued pursuant to the Base Indenture to decrease the Maximum VFN Principal Balance hereunder, the following conditions: (1) any such shift shall be in conjunction with a transfer of Designated Servicing
Agreements (as defined in the Base Indenture) out of the Base Indenture and into the Designated Servicing Agreements under a bilateral credit facility (as set forth in Section 20 hereof), (2) all conditions to a Permitted Refinancing under
the Base Indenture are met in connection with such transfer, (3) after the transfer of any Designated Servicing Agreement and related collateral from the Base Indenture to indenture related to such bilateral credit facility, such collateral
shall be subject to the eligibility criteria and Advance Rates set forth therein, (4) the Designated Servicing Agreements (as defined in the Indenture) selected for transfer shall not have been adversely selected, and (5) all of the
Administrative Agents (as defined in the Base Indenture) are comfortable in their discretion with allowing the removal of collateral from the Base Indenture and consent to such removal. 

“PSA Stressed Non-Recoverable Advance Amount” means as of any date of determination, the sum of: 

(i) for all Mortgage Loans that are current as of such date, the greater of (A) zero and (B) the excess of
(1) Total Advances related to such Mortgage Loans on such date over (2) (x) in the case of Mortgage Loans secured by a first lien, the product of 50% and the sum of all of the Net Property Values for the related Mortgaged Property or
(y) in the case of Mortgage Loans secured by a second or more junior lien, zero; and 
 (ii) for all Mortgage Loans that
are delinquent as of such date, but not related to property in foreclosure or REO Property, the greater of (A) zero and (B) the excess of (i) Total Advances related to such Mortgage Loans on such date over (ii) (x) in the
case of Mortgage Loans secured by a first lien, the product of 50% and the sum of all of the Net Property Values for the related Mortgaged Property or (y) in the case of Mortgage Loans secured by a second or more junior lien, zero; and 

  
 20 

 (iii) for all Mortgage Loans that are related to properties in foreclosure, the
greater of (A) zero and (B) the excess of (1) Total Advances related to such Mortgage Loans on such date over (2) (x) in the case of Mortgage Loans secured by a first lien, the product of 50% and the sum of all of the Net
Property Values for the related Mortgaged Property or (y) in the case of Mortgage Loans secured by a second or more junior lien, zero; and 

(iv) for all Mortgage Loans that are related to REO Property, the greater of (A) zero and (B) the excess of
(1) Total Advances related to such Mortgage Loans on such date over (2) (x) in the case of Mortgage Loans secured by a first lien, the product of 50% and the sum of all of the Net Property Values for the related REO Property or
(y) in the case of Mortgage Loans secured by a second or more junior lien, zero. 
 “Purchaser”: Collectively, the
Committed Purchasers, the Conduit Purchasers, their respective successors and permitted assigns and any other variable funding note holder. 

“Redemption Percentage” means, for the Series 2012-VF3 Notes, 10%. 

“Regulatory Change” means (a) the adoption of any law, rule or regulation after the date hereof, (b) any change in
any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the date hereof or (c) compliance by any Holder (or, for purposes of Section 8(a)(3), by any lending office of such
Holder or by such Holder’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date hereof. 

“Reference Banks” has the meaning assigned to such term in Section 7 of this Indenture Supplement. 

“Reserve Interest Rate” has the meaning assigned to such term in Section 7 of this Indenture Supplement. 

“Restricted Servicing Fee Advance Receivable”: Any Loan-Level Servicing Fee Advance Receivable or No-Payment at
Termination Servicing Fee Advance Receivable. 
 “Senior Secured Term Loan Facility Agreement” means the Senior Secured
Term Loan Facility Agreement, dated as of September 1, 2011, among OFC, as borrower, certain subsidiaries of OFC, as subsidiary guarantors, the lenders party thereto from time to time and Barclays Bank PLC, as administrative agent and as
collateral agent, as amended, supplemented, restated, or otherwise modified from time to time. 
 “Series 2012-VF3 Additional
Fee” means that certain monthly fee payable in accordance with the terms and provisions of the Series 2012-VF3 Additional Letter. 

“Series 2012-VF3 Additional Letter” means that certain Series 2012-VF3 Additional Letter, dated as of April 6, 2015,
among the Administrative Agent and NRZ. 

  
 21 

 “Series 2012-VF3 Incremental Amount” means, with respect to each Class of Series
2012-VF3 Notes, the amount set forth below: 
 (a) prior to September 1, 2015; 

(i) Class A-VF3 Variable Funding Notes: $549,942,860; 

(ii) Class B-VF3 Variable Funding Notes: $10,805,710; 

(iii) Class C-VF3 Variable Funding Notes: $11,400,000; and 

(iv) Class D-VF3 Variable Funding Notes: $27,851,430; and 

(b) on and after to September 1, 2015; 

(i) Class A-VF3 Variable Funding Notes: $0; 

(ii) Class B-VF3 Variable Funding Notes: $0; 

(iii) Class C-VF3 Variable Funding Notes: $0; and 

(iv) Class D-VF3 Variable Funding Notes: $0. 

“Series 2012-VF3 Note Balance” means the aggregate Note Balance of the Series 2012-VF3 Notes. 

“Series 2012-VF3 Original Amount” means, with respect to each Class of Series 2012-VF3 Notes, the amount set forth below:

 (a) prior to September 1, 2015; 

(i) Class A-VF3 Variable Funding Notes: $733,257,140; 

(ii) Class B-VF3 Variable Funding Notes: $14,407,620; 

(iii) Class C-VF3 Variable Funding Notes: $15,200,000; and 

(iv) Class D-VF3 Variable Funding Notes: $37,135,240; and 

(b) on and after September 1, 2015 but prior to December 1, 2015; 

(i) Class A-VF3 Variable Funding Notes: $549,942,855; 

(ii) Class B-VF3 Variable Funding Notes: $10,805,715; 

(iii) Class C-VF3 Variable Funding Notes: $11,400,000; and 

(iv) Class D-VF3 Variable Funding Notes: $27,851,430; and 

  
 22 

 (c) on and after December 1, 2015; 

(i) Class A-VF3 Variable Funding Notes: $0; 

(ii) Class B-VF3 Variable Funding Notes: $0; 

(iii) Class C-VF3 Variable Funding Notes: $0; and 

(iv) Class D-VF3 Variable Funding Notes: $0. 

“Series Fee Limit” means, with respect to the Series Fees related to the Series 2012-VF3 Notes: 

(i) for any rolling twelve-month period, an aggregate amount equal to the product of 0.10% and the average daily Maximum VFN
Principal Balance during such prior rolling twelve-month period (or, for any day after the end of the Revolving Period for the Series 2012-VF3 Notes, the aggregate VFN Principal Balance of the Series 2012-VF3 Notes on any such day); and 

(ii) for any single Payment Date, an amount equal to the product of 0.01% and the average daily aggregate Maximum VFN Principal
Balance during the immediately preceding Interest Accrual Period (or, for any day after the end of the Revolving Period for the Series 2012-VF3 Notes, the aggregate VFN Principal Balance of the Series 2012-VF3 Notes on any such day). 

“Series Fees” means, for the Series 2012-VF3 Notes and any Payment Date, the sum of (i) the VF3 Facility Fee (including,
but not limited to, any related gross up or VF3 Facility Fee Remainder as calculated in accordance with the Fee Letter) and (ii) the aggregate unreimbursed fees, indemnification amounts owed to and expenses of the Administrative Agent due under
the Indenture. 
 “Series Reserve Required Amount” means with respect to any Payment Date or Interim Payment Date, as the
case may be, for the General Reserve Account applicable to the Series 2012-VF3 Notes, an amount equal to six (6) months’ interest calculated on the Note Balance of each Class of Series 2012-VF3 Notes as of such Payment Date or Interim
Payment Date, as the case may be. For the avoidance of doubt, reference to “Series Reserve Account” shall mean the General Reserve Account with respect to the Series 2012-VF3 Notes and “Series Reserve Required Amount” shall mean
the General Reserve Required Amount with respect to the Series 2012-VF3 Notes. 
 “Side Letter” means that certain Side
Letter, dated as of May 5, 2015, among Barclays, as Administrative Agent, Purchaser and sole Holder of the Series 2012-VF1 Variable Funding Notes, Wells Fargo, as Administrative Agent, Wells Fargo Bank, N.A., as Committed Purchaser and sole
Holder of the Series 2012-VF2 Variable Funding Notes, Credit Suisse, as Administrative Agent, Credit Suisse AG, Cayman Islands Branch, as Committed Purchaser and Holder of the Series 2012-VF3 Variable Funding Notes, and Alpine Securitization Corp.,
as Conduit Purchaser and Holder of the Series 2012-VF3 Variable Funding Notes. 

  
 23 

 “Small Threshold Servicing Agreement” has the meaning assigned such term in
Section 4 of this Indenture Supplement. 
 “Stated Maturity Date” means, for each Class of the Series 2012-VF3
Notes, thirty (30) years following the end of the related Revolving Period. 
 “Stressed Interest Rate” “ means,
for any Class of Series 2012-VF3 Notes as of any date, the sum of (x) the per annum index on the basis of which such Class’s interest rate is determined for the current Interest Accrual Period (calculated based upon, for any day on which a
Eurodollar Disruption Event described in clause (ii) of the definition thereof is continuing, the Base Rate), and (y) such Class’s Constant and (z) the product of (I) such Class’s Coefficient and (II) Stressed Time,
plus (ii) the weighted average per annum Aggregate Margin of all outstanding Classes of such Series. 
 “Stressed
Time” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is one (1), and the denominator of which equals the Stressed Time Percentage times the Monthly Reimbursement Rate on such date.

 “Stressed Time Percentage” means, for the Series 2012-VF3 Notes, Class A-VF3 Variable Funding Notes: 37.65%, Class
B-VF3 Variable Funding Notes: 40.97%, Class C-VF3 Variable Funding Notes: 45.48%, and Class D-VF3 Variable Funding Notes: 65.80%. 

“Support Advances” shall mean any loans or advances, or any participation or other interest, funded or held by a Support
Party pursuant to a Support Facility (but excluding any such loans or advances made to fund the applicable Conduit Purchaser’s obligations to pay interest, fees or other similar amounts relating to the funding of its making or maintaining its
interest in a Purchased Note). 
 “Tangible Net Worth” shall mean the consolidated Net Worth of NRZ and its Subsidiaries,
less the consolidated net book value of all assets of NRZ and its Subsidiaries (to the extent reflected as an asset in the balance sheet of NRZ or any Subsidiary at such date) which will be treated as intangibles under GAAP, including, without
limitation, such items as deferred financing expenses, deferred taxes, net leasehold improvements, good will, trademarks, trade names, service marks, copyrights, patents, licenses and unamortized debt discount and expense. 

“Target Amortization Amounts” means, for each Class of Series 2012-VF3 Notes, 100% of the Note Balance of such Class at the
close of business on the last day of its Revolving Period, payable on the First Payment Date after the beginning of the Target Amortization Period. 

“Target Amortization Event” for the Series 2012-VF3 Notes, means the occurrence of any of the following conditions or events,
which is not waived by 100% of the Holders of the Series 2012-VF3 Notes: 
 (i) on any Payment Date, the arithmetic average
of the Net Proceeds Coverage Percentage determined for such Payment Date and the two (2) preceding Payment Dates is less than five (5) times the percentage equivalent of a fraction (A) the numerator of which equals the sum of the
accrued Interest Payment Amounts for each 

  
 24 

 
Class of all Outstanding Notes on such date and (B) the denominator of which equals the aggregate average Note Balances of each Class of Outstanding Notes during the related Monthly Advance
Collection Period; 
 (ii) the occurrence of one or more Servicer Termination Events under Designated Servicing Agreements
representing 15% or more (by Mortgage Loan balance as of the date of termination) of all the Designated Servicing Agreements then included in the Facility, but not including any Servicer Termination Events that are solely due to the breach of one or
more Collateral Performance Tests or a Servicer Ratings Downgrade or the transfer of subservicing of any such Designated Servicing Agreement without the prior written consent of the Administrative Agent; 

(iii) the Monthly Reimbursement Rate is less than 5.00%; 

(iv) as of the close of business on the last Business Day of any calendar month, beginning in April 2015, OLS shall have failed
to satisfy the Liquidity Requirement; 
 (v) the rating assigned to any Class of Series 2012-VF3 Notes is reduced below the
Applicable Rating assigned to such Class of Series 2012-VF3 Notes and such reduction has not been cured for a period of two (2) Business Days following the date on which written (which may be electronic) notice of such reduction shall have been
given to any of the parties hereto; 
 (vi) (A) the sum of the NRZ’s (i) unrestricted cash, plus
(ii) unrestricted Cash Equivalents, plus (iii) the aggregate amount of unused capacity available to NRZ (taking into account applicable haircuts) under committed mortgage loan warehouse and repurchase facilities and mortgage servicing
right facilities for which NRZ has unencumbered eligible collateral to pledge thereunder, plus (iv) net equity value of whole pool agency securities is less than (A) prior to August 15, 2015, $60,000,000, and (B) on or after
August 15, 2015, $50,000,000, as of the end of any fiscal quarter of NRZ; 
 (vii) NRZ shall permit its Tangible Net
Worth to be less than $540,000,000 as of end of any fiscal quarter of NRZ; 
 (viii) (A) NRZ shall permit the ratio of its
Indebtedness to Tangible Net Worth to be greater than 4:1 (adjusted for any future acquisitions) as of end of any fiscal quarter of NRZ or (B) the occurrence of a NRZ Change of Control; and 

(ix) a “Target Amortization Period” shall have occurred with respect to any Class of Variable Funding Notes or Draw
Notes of any other Series. 
 “Target Amortization Period” means, for any Class of Series 2012-VF3 Notes, as applicable,
the period that begins upon the occurrence of an applicable Target Amortization Event and ends upon the earlier of (i) a Facility Early Amortization Event and (ii) the date on which the Notes of such Class are paid in full. 

  
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 “Transaction Documents” means, in addition to the documents set forth in the
definition thereof in the Base Indenture, this Indenture Supplement, the VF3 Note Purchase Agreement, the Series 2012-VF3 Additional Letter, the VF3 Fee Letter and the Side Letter, each as amended, supplemented, restated, or otherwise modified from
time to time. 
 “Trigger Advance Rate” means, for any Class within the Series 2012-VF3 Notes, as of any date, the rate
equal to (1) 100% minus (2) the product of (a) one twelfth (1/12) of the Stressed Interest Rate for such Class, as of such date plus the related Expense Rate as of such date, multiplied by (b) the related
Stressed Time for such Class as of such date. 
 “Underlying Trust” means a trust or trust estate in which the Mortgage
Loans being serviced by the Servicer pursuant to a Designated Servicing Agreement, are held in a securitization transaction by the related Underlying Trustee or held in whole loan form by an owner thereof. 

“Underlying Trustee” means a trustee or indenture trustee for an Underlying Trust. 

“Undrawn Fee Rate” means, with respect to each Class of Series 2012-VF3 Notes held by the Committed Purchaser and for each
Interest Accrual Period, 0.50% per annum. For the avoidance of doubt, only the Committed Purchasers shall be paid Undrawn Fee Amounts as set forth in the Base Indenture. 

“VF3 Facility Fee” shall have the meaning set forth in the VF3 Fee Letter. 

“VF3 Fee Letter” means that certain Amended and Restated Fee Letter Agreement, dated as of April 6, 2015, among the
Administrative Agent, the Administrator, the Servicer and the Issuer. 
 “VF3 Note Purchase Agreement” means that certain
Second Amended and Restated Note Purchase Agreement, dated as of August 28, 2015, by and among the Issuer, Credit Suisse, as the Administrative Agent and Conduit Administrative Agent, Credit Suisse AG, Cayman Islands Branch, as the Committed
Purchaser and Alpine Securitization Corp., as the Conduit Purchaser. 
  

	 	Section 3.	Forms of Series 2012-VF3 Notes; Transfer Restrictions. 

 (a) The form of the Rule 144A
Definitive Note and of the Regulation S Definitive Notes that may be used to evidence the Series 2012-VF3 Variable Funding Notes in the circumstances described in Section 5.4(c) of the Base Indenture are in the form attached to the Base
Indenture as Exhibits A-2 and A-4, respectively. 
 (b) In addition to any provisions set forth in Section 6.5 of
the Base Indenture, with respect to the Series 2012-VF3 Notes, the Holder of any Class of such Notes shall only transfer its beneficial interest therein to another potential investor following receipt of the written consent of the related
Administrative Agent. For the avoidance of doubt, this Section 3(b) applies to transfers of participation interests in the Series 2012-VF3 Notes and transfers of all or a portion of any Series 2012-VF3 Note that does not include the
Commitment of the Purchaser under the VF3 Note Purchase Agreement. The Indenture Trustee (in all of its capacities) shall not be responsible to monitor, and shall not have any liability, for any such transfers of beneficial interests of
participation interests. 

  
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	 	Section 4.	Collateral Value Exclusions. 

 For purposes of calculating “Collateral Value”
in respect of the Series 2012-VF3 Notes, the Collateral Value shall be zero for any Receivable that: 
 (i) is
attributable to any Designated Servicing Agreement to the extent that such Receivable Balance, when added to the aggregate Receivable Balance already outstanding with respect to such Designated Servicing Agreement, would cause the related Advance
Ratio to be equal to or greater than 100%; 
 (ii) is attributable to any Designated Servicing Agreement to the extent that
such Receivable Balance, when added to the aggregate Receivable Balance already outstanding with respect to such Designated Servicing Agreement, would cause the related Market Value Ratio to exceed 25%; 

(iii) is attributable to a Designated Servicing Agreement (i) for which the underlying Mortgage Loans have an unpaid
principal balance of less than $1,000,000 or (ii) that contains at least one (1) but fewer than fifteen (15) Mortgage Loans, as of the end of the most recently concluded calendar month (“Small Threshold Servicing
Agreements”), to the extent that such Receivables Balance, when added to the aggregate Receivables Balance of all Receivables outstanding with respect to Small Threshold Servicing Agreements, cause the total Receivables Balance attributable
to Small Threshold Servicing agreements to exceed 2.50% of the total Receivables Balances of all Receivables included in the Facility; 

(iv) is attributable to a Designated Servicing Agreement (i) for which the underlying Mortgage Loans have an unpaid
principal balance an unpaid principal balance greater than or equal to $1,000,000 but less than $10,000,000, or (ii) that contains at least 15 but fewer than 50 Mortgage Loans, as of the end of the most recently concluded calendar month
(“Low Threshold Servicing Agreement”), to the extent that such Receivable Balances, when added to the aggregate Receivable Balances of all Receivables outstanding with respect to Low Threshold Servicing Agreements, cause the total
Receivable Balances attributable to Small Threshold Servicing Agreements and Low Threshold Servicing Agreements, collectively, to exceed 7.50% of the total Receivable Balances of all Receivables included in the Facility; 

(v) is attributable to a Designated Servicing Agreement (i) for which the underlying Mortgage Loans have an unpaid
principal balance greater than or equal to $10,000,000 but less than $25,000,000, or (ii) that contains at least 50 but fewer than 125 Mortgage Loans, as of the end of the most recently concluded calendar month (“Middle Threshold
Servicing Agreement”), to the extent the Receivable Balance of such Receivable, when added to the aggregate Receivable Balances of all Receivables outstanding with respect to Middle Threshold Servicing Agreements, cause the total Receivable
Balances attributable to Small Threshold Servicing Agreements, Low 

  
 27 

 
Threshold Servicing Agreements and Middle Threshold Servicing Agreements, collectively, to exceed 15.00% of the aggregate of the Receivable Balances of all Receivables included in the Facility;

 (vi) is attributable to a Designated Servicing Agreement, to the extent that the Receivable Balance of such Receivable,
when added to the aggregate Receivable Balances outstanding with respect to that same Designated Servicing Agreement, would cause the total Receivable Balances attributable to such Designated Servicing Agreement to exceed 15% of the aggregate of the
Receivable Balances of all Receivables included in the Trust Estate; 
 (vii) unless the related Designated Servicing
Agreement shall satisfy clause (iii) and clause (viii) of the definition of “Facility Eligible Servicing Agreement” in the Base Indenture, is a Receivable attributable to an Exempted MBS Trust; provided, that, for the avoidance
of doubt, the parties hereto are not, pursuant to this Section 4(vii) and with respect to the Designated Servicing Agreements related to the Exempted MBS Trusts, waiving any failure to satisfy any other provision of the definition of
“Facility Eligible Servicing Agreement”; and 
 (viii) is a Loan-Level Receivable whose Receivable Balance, when
added to the aggregate Receivable Balances of all Receivables outstanding with respect to Loan-Level Advance Receivables, cause the total Receivable Balances attributable to Loan-Level Advance Receivables to exceed 15% of the total Receivable
Balances of all Receivables included in the Facility; 
 (ix) is a Servicing Fee Advance Receivable that the Administrative
Agent has not provided its written consent (in its sole and absolute discretion) for, notwithstanding the satisfaction of clause (xi) and (xii) of the definition of “Facility Eligible Receivable” and clause (viii) of the
definition of “Facility Eligible Servicing Agreement.” For the avoidance of doubt, for so long as the Administrative Agent determines that the Servicing Fee Advance Receivables related to any Servicing Fee Advance Designated Servicing
Agreement cannot be afforded a positive Collateral Value, the related Servicing Fee Advance Designated Servicing Agreement shall not be considered a Servicing Fee Advance Designated Servicing Agreement in respect of the Series 2012-VF3 Notes; 

(x) is a Loan-Level Servicing Fee Advance Receivable attributable to a Mortgaged Property, to the extent that the
Receivable Balance of such Receivable, when added to the aggregate Receivable Balance outstanding for all other Loan-Level Servicing Fee Advance Receivables with respect to such Mortgaged Property, causes the total
Receivable Balance for all Loan-Level Servicing Fee Advance Receivables to exceed 10% of the Net Property Value of such Mortgaged Property; 

(xi) (A) is a Loan-Level Receivable whose Receivable Balance, when added to the aggregate Receivable Balances of all
Receivables with respect to the related Mortgage Loan or REO Property, would cause the related Mortgage Loan-Level Market Value Ratio to exceed 50.0% or (B) is a Receivable related to a Mortgage Loan or REO Property that is attributable to a
Small Threshold Servicing Agreement whose Receivable 

  
 28 

 
Balance, when added to the aggregate Receivable Balances of all Receivables related to the Mortgage Loan or REO Property that is attributable to a Small Threshold Servicing Agreement, would cause
the related Mortgage Loan-Level Market Value Ratio to exceed 50.0%; 
 (xii) is a Restricted Servicing Fee Advance Receivable
attributable to a Servicing Fee Advance Designated Servicing Agreement, to the extent that the Receivable Balance of such Receivable, when added to the aggregate Receivable Balance outstanding for all other Restricted Servicing Fee
Advance Receivables with respect to all Servicing Fee Advance Designated Servicing Agreements, causes the total Receivable Balance for all Restricted Servicing Fee Advance Receivables to exceed 3.25% of the total Receivable Balance of all
Facility Eligible Receivables included in the Trust Estate; 
 (xiii) is a Servicing Fee Advance Receivable which has not
been reimbursed in full under the related Facility Eligible Servicing Agreement as of the remittance date following the liquidation of the related Mortgage Loan and final reporting with respect thereto; and 

(xiv) is a Receivable related to a Mortgage Loans that is delinquent as of such date (for more than 90 days), with respect to
which the estimated valuation with respect to the related Net Property Value is older than 180 days. 
  

	 	Section 5.	General Reserve Accounts 

 In accordance with the terms and provisions of this
Section 5 and Section 4.6 of the Base Indenture, the Indenture Trustee shall establish and maintain a General Reserve Account with respect to the Class A-VF3 Variable Funding Notes, the Class B-VF3 Variable Funding
Notes, the Class C-VF3 Variable Funding Notes and the Class D-VF3 Variable Funding Notes, which shall be an Eligible Account, for the benefit of the Class A-VF3 Variable Funding Noteholders, the Class B-VF3 Variable Funding Noteholders, the
Class C-VF3 Variable Funding Noteholders and the Class D-VF3 Variable Funding Noteholders. 
  

	 	Section 6.	Payments; Note Balance Increases; Early Maturity. 

 (a) The Paying Agent shall make
payments of the Interest Payment Amounts, ERD Fees, Cumulative ERD Fee Amounts, Default Fees, and Cumulative Default Fee Amounts payable to the holders of the Series 2012-VF3 Notes on a Payment Date in accordance with Section 4.5(a) of
the Base Indenture as follows: first, to the Class A-VF3 Variable Funding Notes, the amount of such Interest Payment Amount, ERD Fee, Cumulative ERD Fee Amount, Default Fees or Cumulative Default Fee Amount, as applicable, due for such Class on
the related Payment Date, thereafter, to the Class B-VF3 Variable Funding Notes, the amount of such Interest Payment Amount, ERD Fee, Cumulative ERD Fee Amount, Default Fees or Cumulative Default Fee Amount, as applicable, due for such Class on the
related Payment Date, thereafter, to the Class C-VF3 Variable Funding Notes, the amount of such Interest Payment Amount, ERD Fee, Cumulative ERD Fee Amount, Default Fees or Cumulative Default Fee Amount, as applicable, due for such Class on the
related Payment Date, and thereafter, to Class D-VF3 

  
 29 

 
Variable Funding Notes, the amount of such Interest Payment Amount, ERD Fee, Cumulative ERD Fee Amount, Default Fees or Cumulative Default Fee Amount, as applicable, due for such Class on the
related Payment Date. The Paying Agent shall make payments of principal on the Series 2012-VF3 Notes on each Interim Payment Date and each Payment Date in accordance with Sections 4.4 and 4.5, respectively, of the Base Indenture (at
the option of the Issuer in the case of requests during the Revolving Period for the Series 2012-VF3 Notes). The Note Balance of each Class of the Series 2012-VF3 Notes may be increased from time to time on certain Funding Dates in accordance with
the terms and provisions of Section 4.3 of the Base Indenture, but not in excess of the related Maximum VFN Principal Balance. In addition, the parties hereto agree that the failure to pay any portion of any related Undrawn Fee Amount on
any Payment Date shall constitute an Event of Default under Section 8.1(a)(i) of the Base Indenture. 
 (b) In accordance with
the terms and provisions of Section 4.5(a)(1)(ii) and Section 4.5(a)(2)(iii)(A) of the Base Indenture, the Paying Agent shall allocate amounts related to all Series Fees for the Series 2012-VF3 Notes in the following order of priority:
(i) first, to pay the applicable portion of the VF3 Facility Fee to Credit Suisse, as Administrative Agent; and (ii) second, pro rata, to pay all other fees and expenses related to the Series 2012-VF3 Notes. In addition, the
parties hereto agree that the failure to pay any portion of any related Undrawn Fee Amount on any Payment Date shall constitute an Event of Default under Section 8.1(a)(i) of the Base Indenture. 

Notwithstanding anything to the contrary in the Base Indenture, and for the avoidance of doubt, references to Senior Margin, Senior Rate,
Senior Interest Amounts, Senior Cumulative Interest Shortfall Amounts, Subordinated Interest Amounts or Subordinated Cumulative Interest Shortfall Amounts shall no longer apply to the Series 2012-VF3 Notes and payments made on the Series 2012-VF3
Notes pursuant to Section 4.5(a)(1)(viii) shall be made in accordance with sub-clause (B) thereof, and payments made on the Series 2012-VF3 Notes pursuant to Section 4.5(a)(2)(iii)(C) shall be made in accordance with sub-clause
(2) thereof. In addition, notwithstanding anything to the contrary in Section 8.1(a) of the Base Indenture, an Event of Default under Section 8.1(a) shall exist on the Series 2012-VF3 Notes only if there is a default (which default
continues for a period of two (2) Business Days following written or electronic notice from the Indenture Trustee or the Administrative Agents), in the payment (i) of any principal, interest or any Fees (other than any Default Fees,
Cumulative Default Fee Amounts, ERD Fees or Cumulative ERD Fee Amounts) due and owing on any Payment Date (including without limitation the full aggregate amount of any Target Amortization Amounts due on such Payment Date) or (ii) in full of
all accrued and unpaid interest and the Outstanding Note Balance of the Series 2012-VF3 Notes on or before the related Stated Maturity Date (which, for the avoidance of doubt, shall not include any Default Fees, Cumulative Default Fee Amounts, ERD
Fees or Cumulative ERD Fee Amounts). 
 In addition, under Section 4.5(a)(2)(iii)(A) of the Base Indenture, the Paying Agent shall pay
Series Fees for the Series 2012-VF3 Notes subject to the related Series Fee Limit; any Series Fees due pursuant hereto in excess of the applicable Series Fee Limit shall be paid, after payments under Section 4.5(a)(2)(iii)(E) of the Base
Indenture and before payments under Section 4.5(a)(2)(iii)(F) of the Base Indenture. A failure to pay the amount equal to the Series Fee in excess of the Series Fee Limit on any Payment Date shall not be an Event of Default under
Section 8.1 of the Indenture. 

  
 30 

 (c) Notwithstanding anything to the contrary contained herein or in the Base Indenture, the
Issuer may, upon at least five (5) Business Days’ prior written notice to the Administrative Agent, redeem in whole or in part, and/or terminate and cause the retirement of any of the Series 2012-VF3 Notes at any time using proceeds of
issuance of new Notes. 
 The Series 2012-VF3 Notes are also subject to optional redemption in accordance with the terms of
Section 13.1 of the Base Indenture. 
 Upon the issuance of Term Notes following the related Issuance Date and any redemption of
the Series 2012-VF3 Notes and/or Series 2012-VF2 Notes, the proceeds of such issuance of Term Notes shall be allocated among the Series 2012-VF2 Notes and the Series 2012-VF3 Notes in amounts in accordance with the terms and provisions of the Base
Indenture or as otherwise agreed to between Wells Fargo Securities, LLC and Credit Suisse AG, New York Branch, each in their capacity as Administrative Agent, as certified to the Trustee by Wells Fargo Securities, LLC, and Credit Suisse AG, New York
Branch; it being agreed and acknowledged that the Indenture Trustee and Paying Agent shall have no responsibility for any such allocation. 

(d) Any payments of principal allocated to the Series 2012-VF3 Notes during a Full Amortization Period shall be applied in the
following order of priority, first, to the Class A-VF3 Variable Funding Notes, until their Note Balance has been reduced to zero, second, to the Class B-VF3 Variable Funding Notes until their Note Balance has been reduced to zero,
third, to the Class C-VF3 Variable Funding Notes, until their Note Balance has been reduced to zero, and fourth, to the Class D-VF3 Variable Funding Notes, until their Note Balance has been reduced to zero. 

(e) The Administrative Agent and the Holders of 100% of the Outstanding Notes further confirm that that the Series 2012-VF3 Notes issued on
the Issuance Date pursuant to this Indenture Supplement shall be issued in the names of “Credit Suisse AG, New York Branch, solely in its capacity as Administrative Agent on behalf of [COMMITTED PURCHASER/CONDUIT PURCHASER],” as
applicable, and the Administrative Agent and the Holder of 100% of the Outstanding Notes hereby direct the Indenture Trustee to issue the Series 2012-VF3 Notes in the name of “Credit Suisse AG, New York Branch, solely in its capacity as
Administrative Agent on behalf of [COMMITTED PURCHASER/CONDUIT PURCHASER],” as applicable. For the avoidance of doubt, the parties hereto hereby agree that, in accordance with the terms and provisions of Section 2.1(a)(ii) of the VF3 Note
Purchase Agreement, the Administrative Agent shall act as agent of each Holder of a Series 2012-VF3 Note and shall determine the allocation of “Additional Note Balances” (as such term is defined in the VF3 Note Purchase Agreement) to be
purchased by each such Holder. 
  

	 	Section 7.	Determination of Note Interest Rate and LIBOR. 

 (a) At least one (1) Business Day
prior to each Determination Date, the Administrator shall calculate the Note Interest Rate for the related Interest Accrual Period (using the 

  
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Commercial Paper Rated defined by the Conduit Administrative Agent and One Month LIBOR as determined by the Administrative Agent in accordance with Section 7(b) below, as applicable)
and the Interest Payment Amount for the Series 2012-VF3 Notes for the upcoming Payment Date, and include a report of such amount in the related Payment Date Report. 

(b) On each LIBOR Determination Date, the Administrative Agent will determine the arithmetic mean of the London Interbank Offered Rate
(“LIBOR”) quotations for one-month Eurodollar deposits (“One-Month LIBOR”) for the succeeding Interest Accrual Period for the Series 2012-VF3 Notes on the basis of the Reference Banks’ offered LIBOR quotations
provided to the Calculation Agent as of 11:00 a.m. (London time) on such LIBOR Determination Date. As used herein with respect to a LIBOR Determination Date, “Reference Banks” means leading banks engaged in transactions in
Eurodollar deposits in the international Eurocurrency market (i) with an established place of business in London, (ii) whose quotations appear on the Bloomberg Screen US0001M Index Page for the LIBOR Determination Date in question and
(iii) which have been designated as such by the Calculation Agent (after consultation with the Administrative Agent) and are able and willing to provide such quotations to the Calculation Agent for each LIBOR Determination Date.
“Bloomberg Screen US0001M Index Page” means the display designated as page US0001M Index Page on the Bloomberg Financial Markets Commodities News (or such other pages as may replace such page on that service for the purpose of
displaying LIBOR quotations of major banks). If any Reference Bank should be removed from the Bloomberg Screen US0001M Index Page or in any other way fails to meet the qualifications of a Reference Bank, the Administrative Agent may, in its sole
discretion, designate an alternative Reference Bank. 
 If, for any LIBOR Determination Date, two (2) or more of the Reference Banks
provide offered One-Month LIBOR quotations on the Bloomberg Screen US0001M Index Page, One-Month LIBOR for the next succeeding Interest Accrual Period for the Series 2012-VF3 Notes will be the arithmetic mean of such offered quotations (rounding
such arithmetic mean if necessary to the nearest five decimal places). 
 If, for any LIBOR Determination Date, only one (1) or none of
the Reference Banks provides such offered One-Month LIBOR quotations for the next applicable Interest Accrual Period, One-Month LIBOR for the next Interest Accrual Period for the Series 2012-VF3 Notes will be the higher of (x) One-Month LIBOR
as determined for the previous LIBOR Determination Date and (y) the Reserve Interest Rate. The “Reserve Interest Rate” on any date of determination will be the rate per annum that the Administrative Agent determines to
be either (A) the arithmetic mean (rounding such arithmetic mean if necessary to the nearest five decimal places) of the one-month Eurodollar lending rate that New York City banks selected by the Administrative Agent are quoting, on the
relevant LIBOR Determination Date, to the principal London offices of at least two (2) leading banks in the London Interbank market or (B) in the event that the Administrative Agent is unable to determine such arithmetic mean, the lowest
one-month Eurodollar lending rate that the New York City banks so selected by the Administrative Agent are quoting on such LIBOR Determination Date to leading European banks. 

If, on any LIBOR Determination Date, the Administrative Agent is required but is unable to determine the Reserve Interest Rate in the manner
provided in the preceding paragraph, One-Month LIBOR for the next applicable Interest Accrual Period will be One-Month LIBOR as determined for the previous LIBOR Determination Date. 

  
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 Notwithstanding the foregoing, One-Month LIBOR for an Interest Accrual Period shall not be based
on One-Month LIBOR for the previous Interest Accrual Period on the Series 2012-VF3 Notes for two (2) consecutive LIBOR Determination Dates. If, under the priorities described above, One-Month LIBOR for an Interest Accrual Period on the Series
2012-VF3 Notes would be based on One-Month LIBOR for the previous LIBOR Determination Date for the second consecutive LIBOR Determination Date, the Administrative Agent shall select an alternative index (over which the Administrative Agent has no
control) used for determining one-month Eurodollar lending rates that is calculated and published (or otherwise made available) by an independent third party, and this alternative index shall constitute One-Month LIBOR for all purposes under this
Indenture Supplement in that event. 
 (c) The establishment of the Commercial Paper Rate by the Conduit Administrative Agent and One-Month
LIBOR by the Administrative Agent and the Administrator’s subsequent calculation of the Note Interest Rate on the Series 2012-VF3 Notes for the relevant Interest Accrual Period, in the absence of manifest error, will be final and binding. 

 

	 	Section 8.	Increased Costs. 

 (a) If any Regulatory Change or other requirement of any law, rule,
regulation or order applicable to a Holder of a Series 2012-VF3 Note (a “Requirement of Law”) or any change in the interpretation or application thereof or compliance by such Holder with any request or directive (whether or not having the
force of law) from any central bank or other governmental authority made subsequent to the date hereof: 
 (1) shall subject
such Holder to any tax of any kind whatsoever with respect to its Series 2012-VF3 Note (excluding income taxes, branch profits taxes, franchise taxes or similar taxes imposed on such Holder as a result of any present or former connection between
such Holder and the United States, other than any such connection arising solely from such Holder having executed, delivered or performed its obligations or received a payment under, or enforced, this Indenture Supplement or any U.S. federal
withholding taxes imposed under Code sections 1471 through 1474 as of the date of this Indenture (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any regulations or official
interpretations thereunder and any agreements entered into under 1471(b) of the Code or any U.S. federal withholding taxes imposed as a result of a failure by such Noteholder to timely furnish the Indenture Trustee on behalf of the Issuer any
applicable IRS Form W-9, W-8BEN, W-8ECI or W-8IMY (with any applicable attachments)) or change the basis of taxation of payments to such Holder in respect thereof; shall impose, modify or hold applicable any reserve, special deposit, compulsory loan
or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, or other extensions of credit by, or any other acquisition of funds by, any office of such Holder which is not otherwise included in the
determination of the Note Interest Rate hereunder; or 

  
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 (2) shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan, insurance charge or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, or credit extended or participated by, or any other acquisition of funds by, any office of such Holder
which is not otherwise included in the determination of the Note Interest Rate hereunder; or 
 (3) shall have the effect of
reducing the rate of return on such Holder’s capital or on the capital of such Holder’s holding company, if any, as a consequence of this Indenture Supplement, the VF3 Note Purchase Agreement or the Series 2012-VF3 Notes to a level below
that which such Holder or such Holder’s holding company could have achieved but for such Requirements of Law (other than any Regulatory Change, Requirement of Law, interpretation or application thereof, request or directive with respect to
taxes) (taking into consideration such Holder’s policies and the policies of such Holder’s holding company with respect to capital adequacy); or 

(4) shall impose on such Holder or the London interbank market any other condition, cost or expense (other than with respect
to taxes) affecting this Indenture Supplement, the VF3 Note Purchase Agreement or the Series 2012-VF3 Notes or any participation therein; or 

(5) shall impose on such Holder any other condition; 

and the result of any of the foregoing is to increase the cost to such Holder, by an amount which such Holder deems to be material, of continuing to hold its
Series 2012-VF3, of maintaining its obligations with respect thereto, or to reduce any amount due or owing hereunder in respect thereof, or to reduce the amount of any sum received or receivable by such Holder (whether of principal, interest or any
other amount) or (in the case of any change in a Requirement of Law regarding capital adequacy or liquidity requirements or in the interpretation or application thereof or compliance by such Holder or any Person controlling such Holder with any
request or directive regarding capital adequacy or liquidity requirements (whether or not having the force of law) from any governmental or quasi-governmental authority made subsequent to the date hereof) shall have the effect of reducing the rate
of return on such Holder’s or such controlling Person’s capital as a consequence of its obligations as a Holder of a Variable Funding Note to a level below that which such Holder or such controlling Person could have achieved but for such
adoption, change or compliance (taking into consideration such Holder’s or such controlling Person’s policies with respect to capital adequacy) by an amount deemed by such Holder to be material, then, in any such case, such Holder shall
invoice the Administrator for such additional amount or amounts as calculated by such Holder in good faith as will compensate such Holder for such increased cost or reduced amount, and such invoiced amount shall be payable to such Holder on the
Payment Date following the next Determination Date following such invoice, in accordance with Section 4.5(a)(1)(ii) or Section 4.5(a)(2)(ii) of the Base Indenture, as applicable; provided, however, that any
amount of Increased Costs in excess of the Increased Cost Limit shall be payable to such Holder in accordance with Section 4.5(a)(1)(viii) or Section 4.5(a)(2)(vi) of the Base Indenture, as applicable. 

  
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 (b) Each Support Party (as such term is defined in the VF3 Note Purchase Agreement) shall be
entitled to receive additional payments and indemnification pursuant to this Section 8 as though it were a Committed Purchaser and such Section applied to its interest in or commitment to acquire an interest in the Series 2012-VF3 Notes;
provided, that such Support Party shall not be entitled to additional payments pursuant to this Section 8 by reason of Requirements of Law which occurred prior to the date it became a Support Party; provided, further, that such Support
Party shall be entitled to receive additional amounts pursuant to this Section 8 only to the extent that its related Conduit Purchaser would have been entitled to receive such amounts in the absence of Support Advances (as such term is
defined in the VF3 Note Purchase Agreement) from such Support Party. The provisions of this Section 8 shall apply to the Conduit Administrative Agent and to such of its Affiliates as may from time to time administer, make referrals to or
otherwise provide services or support to the Conduit Purchasers (in each case as though such Conduit Administrative Agent or Affiliate were a Purchaser and such Section applied to its administration of or other provisions of services or support to
such Conduit Purchaser in connection with the transactions contemplated by this Agreement), whether as an administrator, administrative agent, referral agent, managing agent or otherwise. 

(c) Increased Costs payable under this Section 8 shall be payable on a Payment Date only to the extent invoiced to the Indenture
Trustee prior to the related Determination Date. 
  

	 	Section 9.	Series Reports. 

 (a) Series Calculation Agent Report. The Calculation Agent shall
deliver a report of the following items together with each Calculation Agent Report pursuant to Section 3.1 of the Base Indenture to the extent received from the Servicer, with respect to the Series 2012-VF3 Notes: 

(i) the unpaid principal balance of the Mortgage Loans subject to any Small Threshold Servicing Agreement, Low Threshold
Servicing Agreement and Middle Threshold Servicing Agreement; 
 (ii) the Advance Ratio for each Designated Servicing
Agreement, and whether the Advance Ratio for such Designated Servicing Agreement exceeds 100%; 
 (iii) the Market Value
Ratio for each Designated Servicing Agreement, and whether the Market Value Ratio for such Designated Servicing Agreement exceeds 25%; 

(iv) the aggregate Receivables Balance of all Loan-Level Receivables included in the Trust Estate and whether the percentage of
Loan-Level Receivables included in the Trust Estate exceeds 10% or causes the Mortgage Loan-Level Market Value Ratio for Loan-Level Receivables to exceed 50%; 

(v) the aggregate Receivables Balance of all Restricted Servicing Fee Receivables included in the Trust Estate and whether the
percentage of Restricted Servicing Fee Receivables included in the Trust Estate exceeds 3.25%; 

  
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 (vi) for each Middle Threshold Servicing Agreement, as of the end of the most
recently concluded calendar month, the aggregate of the Funded Advance Receivable Balances of all Receivables attributable to such Designated Servicing Agreement as a percentage of the aggregate of the Funded Advance Receivable Balances of all
Receivables included in the Trust Estate; 
 (vii) for each Low Threshold Servicing Agreement, as of the end of the most
recently concluded calendar month, the aggregate of the Funded Advance Receivable Balances of all Receivables attributable to such Designated Servicing Agreement as a percentage of the aggregate of the Funded Advance Receivable Balances of all
Receivables included in the Trust Estate; 
 (viii) for each Small Threshold Servicing Agreement, as of the end of the most
recently concluded calendar month, the aggregate of the Funded Advance Receivable Balances of all Receivables attributable to such Designated Servicing Agreement as a percentage of the aggregate of the Funded Advance Receivable Balances of all
Receivables included in the Trust Estate; 
 (ix) (A) a list of each Target Amortization Event for the Series 2012-VF3 Notes
and presenting a “yes” or “no” answer beside each indicating whether each such Target Amortization Event has occurred as of the end of the Monthly Advance Collection Period preceding the upcoming Payment Date or the Advance
Collection Period preceding the upcoming Interim Payment Date; and (B) whether any Target Amortization Amount that has become due and payable has been paid. 

(x) whether any Receivable, or any portion of the Receivables, attributable to a Designated Servicing Agreement, has zero
Collateral Value by virtue of the definition of “Collateral Value” or Section 4 of this Indenture Supplement, and indicating the related provision affecting such Receivable; 

(xi) a calculation of the Net Proceeds Coverage Percentage in respect of each of the three (3) preceding Monthly Advance
Collection Periods (or each that has occurred since the date of this Indenture Supplement, if less than three (3)), and the arithmetic average of the three; 

(xii) the Monthly Reimbursement Rate for the upcoming Payment Date or Interim Payment Date; 

(xiii) the PSA Stressed Non-Recoverable Advance Amount for the upcoming Payment Date or Interim Payment Date; 

(xiv) the Trigger Advance Rate for each Class of Series 2012-VF3 Notes; 

(xv) the aggregate amount paid pursuant to the Derivative Agreement in the Derivative Agreement Account and the Cap Payment
Amounts with respect to each Class of the Series 2012-VF3 Notes and the amount of Derivative Imbalance Required Reserve to be paid into and on deposit in the Derivative Reserve Account. 

  
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 (b) Series Payment Date Report. In conjunction with each Payment Date Report, the
Indenture Trustee shall also report the Stressed Time Percentage. 
 (c) Limitation on Indenture Trustee Duties. The Indenture
Trustee shall have no independent duty to verify: (1) the Adjusted Tangible Equity, (2) the occurrence of any of the events described in clauses (ii), (v), (vi) and (vii) of the definition of “Target Amortization
Event,” (3) compliance with clause (vi) of the definition of “Facility Eligible Servicing Agreement,” and (4) that all Series 2012-VF3 Notes meet the criteria set forth in the last proviso of the definition of
“Note Interest Rate.” 
  

	 	Section 10.	Conditions Precedent Satisfied. 

 The Issuer hereby represents and warrants to the
Holders of the Series 2012-VF3 Notes and the Indenture Trustee that, as of the related Issuance Date, each of the conditions precedent set forth in the Base Indenture, including but not limited to those conditions precedent set forth in
Section 6.10(a) thereof, have been satisfied. 
  

	 	Section 11.	Representation and Warranties. 

 (a) The Issuer, the Administrator, the Servicer and the
Indenture Trustee hereby restate as of the related Issuance Date, or as of such other date as is specifically referenced in the body of such representation and warranty, all of the representations and warranties set forth in Sections 9.1,
10.1 and 11.14, respectively, of the Base Indenture. 
 (b) On any MSR Transfer Date, HLSS shall deliver to the Indenture
Trustee an MSR Transfer Notice signed by OLS and HLSS; provided, however, that the Issuer, Administrative Agent, Servicer and Administrator each acknowledge and agree that with respect to each Designated Servicing Agreement related to the No-RAC MBS
Trusts (the “No-RAC Servicing Agreements”), the Servicer currently acts as primary servicer of each such No-RAC Servicing Agreement, notwithstanding that the Servicer may not have received all of the rating agency confirmation
letters specified that are required under such No-RAC Servicing Agreements to effect a definitive transfer to the Servicer of the related servicing rights and role of primary servicer. Notwithstanding anything to the contrary herein or in the
other Transaction Documents (i) it is intended that Receivables related to the No-RAC Servicing Agreements be eligible for financing under this Indenture Supplement and the other Transaction Documents notwithstanding the failure of the related
transfer conditions set forth above to be satisfied, (ii) the No-RAC Servicing Agreements shall not fail to be Facility Eligible Servicing Agreements solely as a result of the failure of such transfer conditions to be satisfied,
(iii) Receivables related to the No-RAC Servicing Agreements shall not fail to be Facility Eligible Receivables solely as a result of the failure of such transfer conditions to be satisfied and (iv) the failure of such transfer conditions
to be satisfied shall not be deemed to constitute, cause or otherwise give rise to a breach, default, Event of Default, Facility Early Amortization Event, Target Amortization Event, Servicer Termination Event or similar event under this Indenture
Supplement, the Base Indenture or the other Transaction Documents, in each case so long as the Servicer has not received a notice of termination with respect to any such No-RAC Servicing Agreement from any Person entitled to deliver such
notice under such No-RAC Servicing Agreement. 
 (c) Notwithstanding any provision to the contrary in this Indenture Supplement or the Base
Indenture, the Administrative Agent and Noteholder each hereby (i) acknowledges and agrees that the representations and warranties and (ii) the agreements, in each case, made by it set forth in Section 3 of Amendment No. 7 to the
Second Amended and Restated Indenture Supplement, dated as of April 6, 2015, are still in full force and effect notwithstanding the amendment and restatement of the Second Amended and Restated Indenture Supplement. 

  
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	 	Section 12.	Amendments. 

 (a) Notwithstanding any provisions to the contrary in Article XII of
the Base Indenture, and in addition to and otherwise subject to the provisions set forth in Sections 12.1 and 12.3 of the Base Indenture, without the consent of the Holders of any Notes or any other Person but with the consent of the
Issuer (evidenced by its execution of such amendment), the Indenture Trustee, the Administrator, the Servicer, the Subservicer (whose consent shall be required only to the extent that such amendment would materially affect the Subservicer), and the
Administrative Agent, and with prior notice to the applicable Note Rating Agency, at any time and from time to time, upon delivery of an Issuer Tax Opinion and upon delivery by the Issuer to the Indenture Trustee of an Officer’s Certificate to
the effect that the Issuer reasonably believes that such amendment will not have an Adverse Effect, may amend this Indenture Supplement for any of the following purposes: (i) to correct any mistake or typographical error or cure any ambiguity,
or to cure, correct or supplement any defective or inconsistent provision herein or any other Transaction Document; (ii) to take any action necessary to maintain the rating currently assigned by the applicable Note Rating Agency to and/or to
avoid such Class of Notes being placed on negative watch by such Note Rating Agency; or (iii) to amend any other provision of this Indenture Supplement. 

(b) Notwithstanding any provisions to the contrary in Section 6.10 or Article XII of the Base Indenture, no supplement,
amendment or indenture supplement entered into with respect to the issuance of a new Series of Notes or pursuant to the terms and provisions of Section 12.2 of the Base Indenture may, without the consent of 66 2/3% of the Series 2012-VF3
Notes (including 100% of the Class A-VF3 Variable Funding Notes), supplement, amend or revise any term or provision of this Indenture Supplement. 

(c) Notwithstanding any provisions to the contrary in Article XII of the Base Indenture, and in addition to and otherwise subject to
the provisions set forth in Sections 12.1 and 12.3 of the Base Indenture, Section 6(c) of this Indenture Supplement shall not be amended without the consent of Wells Fargo Securities, LLC, as administrative agent of the Series
2012-VF2 Notes. 
  

	 	Section 13.	Counterparts. 

 This Indenture Supplement may be executed in any number of counterparts,
by manual or facsimile signature, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument. 

  
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	 	Section 14.	Entire Agreement. 

 This Indenture Supplement, together with the Base Indenture
incorporated herein by reference, constitutes the entire agreement among the parties hereto with respect to the subject matter hereof, and fully supersedes any prior or contemporaneous agreements relating to such subject matter. 

 

	 	Section 15.	Limited Recourse. 

 (a) Reimbursement of Advances upon Transfer of Servicing. In
connection with any sale or other voluntary transfer of servicing under any Designated Servicing Agreement (not including any transfer resulting from the succession of another Person to the business of the Servicer) or removal of the Seller as
Servicer with respect to any of the No-RAC Servicing Agreements (set forth on Schedule 1) by the related Underlying Trustee on account of a failure to satisfy any condition to transfer of servicing requiring rating agency confirmation with respect
thereto, the Servicer shall cause the Subservicer to collect reimbursement of all outstanding Advances under such Designated Servicing Agreement prior to transferring the servicing under such Designated Servicing Agreement. 

(b) Other than as expressly provided in this Indenture Supplement, the Series 2012-VF3 Notes, any other Transaction Documents or otherwise,
the obligations of the Issuer under the Series 2012-VF3 Notes, this Indenture Supplement and each other Transaction Document to which it is a party are limited recourse obligations of the Issuer, payable solely from the Trust Estate, and following
realization of the Trust Estate and application of the proceeds thereof in accordance with the terms of this Indenture Supplement, none of the Holders of Series 2012-VF3 Notes, the Indenture Trustee or any of the other parties to the Transaction
Documents shall be entitled to take any further steps to recover any sums due but still unpaid hereunder or thereunder, all claims in respect of which shall be extinguished and shall not thereafter revive. No recourse shall be had for the payment of
any amount owing in respect of the Series 2012-VF3 Notes or this Indenture Supplement or for any action or inaction of the Issuer against any officer, director, employee, shareholder, stockholder or incorporator of the Issuer or any of their
successors or assigns for any amounts payable under the Series 2012-VF3 Notes or this Indenture Supplement. 
 (c) It is understood
that the foregoing provisions of this Section 15 shall not (a) prevent recourse to the Trust Estate for the sums due or to become due under any security, instrument or agreement which is part of the Trust Estate or (b) save as
specifically provided therein, constitute a waiver, release or discharge of any indebtedness or obligation evidenced by the Series 2012-VF3 Notes or secured by this Indenture Supplement. It is further understood that the foregoing provisions of this
Section 15 shall not limit the right of any Person to name the Issuer as a party defendant in any proceeding or in the exercise of any other remedy under the Series 2012-VF3 Notes or this
Indenture Supplement, so long as no judgment in the nature of a deficiency judgment or seeking personal liability shall be asked for or (if obtained) enforced against any such Person or entity. 

  
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	 	Section 16.	Notice 

 Any communication provided for or permitted hereunder or otherwise pursuant to
the Base Indenture shall be in writing and, unless otherwise expressly provided herein, shall be deemed to have been duly given if delivered by courier or mailed by first class mail, postage prepaid, or if transmitted by facsimile and confirmed in a
writing delivered or mailed as aforesaid, to: in the case of Credit Suisse AG, New York Branch, Eleven Madison Avenue, New York, New York 10010, Attention: Asset Finance - Structured Products, facsimile number: (212) 743-2105; in the case of
Credit Suisse AG, Cayman Islands Branch, c/o Credit Suisse AG, New York Branch, Eleven Madison Avenue, New York, New York 10010, Attention: Asset Finance - Structured Products, facsimile number: (212) 743-2105; in the case of Alpine
Securitization Corp., c/o Credit Suisse AG, New York Branch, Eleven Madison Avenue, New York, New York 10010, Attention: Asset Finance - Structured Products, facsimile number: (212) 743-2105 or, as to such Person, such other address or
facsimile number as may hereafter be furnished by such Person to the parties hereto in writing. The parties hereto agree that, with respect to any communication delivered under any Transaction Document to the Receivables Seller, the Administrator,
the Depositor, the Issuer, any Administrative Agent (as defined under clause (ii) of the definition hereof) or any Holder of a Series 2012-VF3 Note, a copy of such communication shall be delivered to the Administrative Agent as well. 

 

	 	Section 17.	Owner Trustee Limitation of Liability. 

 It is expressly understood and agreed by the
parties hereto that (a) this Indenture Supplement is executed and delivered by Wilmington Trust Company, not individually or personally, but solely as Owner Trustee of the Issuer under the Trust Agreement, in the exercise of the powers and
authority conferred and vested in it, (b) each of the representations, undertakings and agreements herein made on the part of the Issuer is made and intended not as a personal representation, undertaking and agreement by Wilmington Trust
Company but is made and intended for the purpose of binding only the Issuer, (c) nothing herein contained shall be construed as creating any liability on Wilmington Trust Company, individually or personally, to perform any covenant either
expressed or implied contained herein, all such liability, if any, being expressly waived by the parties hereto and by any Person claiming by, through or under the parties hereto and (d) under no circumstances shall Wilmington Trust Company be
personally liable for the payment of any indebtedness or expenses of the Issuer or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Issuer under this Indenture Supplement or the
other Transaction Documents. 
  

	 	Section 18.	Syndication. 

 The parties hereto hereby acknowledge and agree that a Noteholder (an
“Original Noteholder”) may (i) reallocate or syndicate all or any portion of the principal balance evidenced by a Note held by such Original Noteholder and interest attributable to such Note and/or (ii) amend and restate, replace
or split any Note held by such Original Noteholder into one or more additional or replacement notes and/or (iii) use commercially reasonable efforts to sell Term Notes, and in each case reduce the Commitment of such Original Noteholder, with
the consent of the Administrator (such consent not to be unreasonably withheld, delayed or qualified); provided, that, notwithstanding the foregoing, to the extent such Original Noteholder reallocates

  
 40 

 
or syndicates, amends, restates, replaces or splits the Notes or sells related Term Notes pursuant to this Section 18 without the consent of the Administrator, reference in the Base
Indenture or any other Transaction Document to funding obligations, voting power, consent rights or other rights of any such Class of Notes resulting from this Section 18 shall mean such designated percentage of voting power solely of the
Original Noteholder. The parties hereto shall cooperate with the Original Noteholder to consummate any reallocation, syndication, amendment and restatement, replacement or split or sale of Term Notes, including, without limitation, executing such
amendments, modifications and supplements to this Indenture Supplement and the related Note as reasonably required by the Original Noteholder. The Original Noteholder shall reimburse the other parties hereto for all reasonable out-of-pocket costs
and expenses incurred by such parties in connection with the such reallocation or syndication under this Section 18. 
  

	 	Section 19.	BlueMountain Letters. 

 On each day, during the Revolving Period, the Administrator
represents and warrants that none of the allegations in the Blue Mountain Letters are true in any respect that would have a reasonable possibility of having a material adverse effect on the collectability, value or timing of collection of any of the
Receivables. 
  

	 	Section 20.	Permitted Refinancings. 

 At the request of the Administrator, so long as PSA Migration
Conditions are satisfied at such time, the Administrative Agent will permit the Permitted Refinancing of assets into a bilateral credit facility provided by the Administrative Agent. Such bilateral credit facility will be on the same terms to as the
Series 2012-VF3 Notes (including, but not limited to, maintenance of an Applicable Rating), and any commitment under such bilateral credit facility will automatically result in a corresponding reduction in the Maximum VFN Principal Balance of the
Series 2012-VF3 Notes. 
  

	 	Section 21.	Joint and Several Liability. 

 Each of NRZ and the Administrator hereby acknowledges and
agrees that it is jointly and severally liable to the Administrative Agent and the Noteholders for all representations, warranties, covenants, indemnities and other obligations of the Administrator set forth in the Transaction Documents. 

 

	 	Section 22.	Cap Payment Amount. 

 In accordance with the terms and provisions of this Section 22
and Section 4.6 of the Base Indenture, the Indenture Trustee shall establish and maintain a Derivative Agreement Account and Derivative Reserve Account for the benefit of the Cap Payment Holders. If either of the Derivative Agreement Account or
Derivative Reserve Account loses its status as an Eligible Account, the funds in such account shall be moved to an account that qualifies as an Eligible Account within fourteen (14) days. The Indenture Trustee shall deposit and withdraw
available amounts from the Derivative Agreement Account and Derivative Reserve Account pursuant to, and to the extent required by, this Section 22. 

  
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 On each Payment Date, the Indenture Trustee shall remit any amounts paid by the Derivative
Counterparty in respect of the Derivative Agreement (and, in accordance with the immediately succeeding paragraph of this Section 22, any applicable amounts from the Derivative Reserve Account) to the Cap Payment Holders, 2012-VF3 Noteholders
and the Depositor, as applicable, in the following order of priority: (i) first, to the Cap Payment Holder in respect of the Class A-VF3 Variable Funding Notes, an amount equal to the Cap Payment Amount for the Class A-VF3
Variable Funding Notes for the prior Interest Accrual Period; (ii) second, to the Cap Payment Holder in respect of the Class B-VF3 Variable Funding Notes, an amount equal to the Cap Payment Amount for the Class B-VF3 Variable Funding
Notes for the prior Interest Accrual Period; (iii) third, to the Cap Payment Holder in respect of the Class C-VF3 Variable Funding Notes, an amount equal to the Cap Payment Amount for the Class C-VF3 Variable Funding Notes for the prior
Interest Accrual Period; (iv) fourth, to the Cap Payment Holder in respect of the Class D-VF3 Variable Funding Notes, an amount equal to the Cap Payment Amount for the Class D-VF3 Variable Funding Notes for the prior Interest Accrual
Period; (v) fifth, to increase the balance on reserve in Derivative Reserve Account to the extent necessary to remedy any Derivative Imbalance; and (vi) sixth, with respect to any amounts remaining, to the Depositor as holder
of the Owner Trust Certificate. 
 If the Series 2012-VF3 Note Balance is greater than the related Notional Amount on any Funding Date (such
amount, the “Derivative Imbalance”), the Indenture Trustee shall withhold from any funding on such Funding Date an amount from such funding (and remit such withheld amounts from such funding to the Derivative Reserve Account) in amount
necessary to cause the amounts on deposit in the Derivative Reserve Account to equal the Derivative Imbalance Required Reserve. The amounts on deposit in the Derivative Reserve Account will be used on each Payment Date to pay any shortfall in the
Cap Payment Amount in accordance with this Section 22. If a Derivative Imbalance is unremedied for a period of fifteen (15) calendar days after a Responsible Officer of the Administrator obtains actual knowledge thereof or receives written
notice (which may be electronic) thereof from the Indenture Trustee, Cap Payment Holder or the Administrative Agent, upon the written approval of the Administrator and the Administrative Agents, the Indenture Trustee shall release such Derivative
Imbalance Required Reserve to purchase an additional Derivative Agreement (which shall have the same “Cap Rate” as the original Derivative Agreement) with the Derivative Counterparty to cure such Derivative Imbalance. If, on any Funding
Date, (x) the amounts on deposit in the Derivative Reserve Account exceed the Derivative Imbalance Required Reserve and (y) there are no outstanding unpaid Cap Payment Amounts (after giving effect to the use of any other amounts on deposit
in the Derivative Reserve Account to pay such amounts as contemplated hereby), then, the Indenture Trustee shall remit such excess to the Depositor as holder of the Owner Trust Certificate on the such Funding Date. 

Notwithstanding any of the foregoing, the Issuer shall not be responsible for the payment of any amounts in respect of the Derivative
Agreement and the Derivative Counterparty shall not be entitled to any rights, benefits or privileges under the Base Indenture or any other Transaction Document other than as set forth in the Derivative Agreement. 

  
 42 

 IN WITNESS WHEREOF, HLSS Servicer Advance Receivables Trust, as Issuer, HLSS Holdings, LLC
(as Administrator on behalf of the Issuer and as Servicer (on and after the MSR Transfer Date)), Ocwen Loan Servicing, LLC (as Servicer (prior to the MSR Transfer Date)), Deutsche Bank National Trust Company, as Indenture Trustee, Calculation Agent,
Paying Agent and Securities Intermediary, and Credit Suisse AG, New York Branch, as Administrative Agent, have caused this Indenture Supplement relating to the Series 2012-VF3 Notes, to be duly executed by their respective officers thereunto duly
authorized and their respective signatures duly attested all as of the day and year first above written. 
  

													
	HLSS SERVICER ADVANCE RECEIVABLES TRUST, as Issuer				 DEUTSCHE BANK NATIONAL TRUST COMPANY, as Indenture Trustee, Calculation Agent, Paying Agent and
Securities Intermediary and not in its individual capacity

	  
 By: Wilmington Trust Company, not in its individual
capacity but solely as Owner Trustee
			
					
	By:		 /s/ Adam B. Scozzafava
				By:		 /s/ Amy McNulty

							
			Name:		 Adam B. Scozzafava
						Name:		 Amy McNulty

							
			Title:		 Vice President
						Title:		 Associate

						
									By:		 /s/ Hang Luu

							
											Name:		 Hang Luu

							
											Title:		 Assistant Vice President

			
	HLSS HOLDINGS, LLC, as Administrator and as Servicer (on or after the MSR Transfer Date)				OCWEN LOAN SERVICING, LLC, as a Subservicer and as Servicer (prior to the MSR Transfer Date)
					
	By:		 /s/ Cameron MacDougall
				By:		 /s/ Michael R. Bourque, Jr.

							
			Name:		 Cameron MacDougall
						Name:		 Michael R. Bourque, Jr.

							
			Title:		 Secretary
						Title:		 Chief Financial Officer

  
 Third A&R Indenture
Supplement (HSART Series 2012-VF3) 

			
	NEW RESIDENTIAL INVESTMENT CORP.
		
	By:		 /s/ Cameron MacDougall

			Name: Cameron MacDougall
			Title:   Secretary

  
 Third A&R Indenture
Supplement (HSART Series 2012-VF3) 

					
	 CREDIT SUISSE AG, NEW YORK

BRANCH, as Administrative Agent

		
	By:	 	 /s/ Jason Muncy

			
		 	Name:	 	 Jason Muncy

			
		 	Title:	 	 Vice President

		
	By:	 	 /s/ Erin McCutcheon

			
		 	Name:	 	 Erin McCutcheon

			
		 	Title:	 	 Vice President

  
 Third A&R Indenture
Supplement (HSART Series 2012-VF3) 

 Agreed and Consented to by: 

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, 
 as Committed
Purchaser and as Holder of the HLSS Servicer Advance Receivables Trust, Advance Receivables Backed Notes, Series 2012-VF3 Class A-VF3 Variable Funding Notes, the Class B-VF3 Variable Funding Notes,
the Class C-VF3 Variable Funding Notes and the Class D-VF3 Variable Funding Notes 
  

					
	By:		 /s/ Jason D. Muncy

			
			Name:		 Jason D. Muncy

			
			Title:		 Authorized Signatory

		
	By:		 /s/ Erin McCutcheon

			
			Name:		 Erin McCutcheon

			
			Title:		 Authorized Signatory

 ALPINE SECURITIZATION CORP., 

as Conduit Purchaser and as Holder of the HLSS Servicer Advance Receivables Trust, Advance Receivables Backed Notes,
Series 2012-VF3 Class A-VF3 Variable Funding Notes, the Class B-VF3 Variable Funding Notes, the Class C-VF3 Variable Funding Notes and the Class D-VF3 Variable Funding Notes 

 

					
	By:		CREDIT SUISSE AG, NEW YORK BRANCH, as its attorney-in-fact
		
	By:		 /s/ Jason Muncy

			
			Name:		 Jason Muncy

			
			Title:		 Vice President

		
	By:		 /s/ Erin McCutcheon

			
			Name:		 Erin McCutcheon

			
			Title:		 Vice President

  
 Third A&R Indenture
Supplement (HSART Series 2012-VF3) 

 Schedule 1 

No-RAC Servicing Agreements 
  

			
	 Investor No.
	  	 Investor Name

	3436	  	C-BASS 2006-CB7
	3038	  	CMLTI 2007-AMC3
	3099	  	Fremont 2006-2
	3162	  	GSAMP 2007-H1
	3164	  	GSAMP 2007-HE2dynatronicsexh41.htm

Exhibit 4.1

DYNATRONICS CORPORATION

2015 EQUITY INCENTIVE AWARD PLAN

 

  

  

  

 

TABLE OF CONTENTS

	
 

	  	Page
	 	 	 
	
ARTICLE 1 PURPOSE

	1
	 	 
	
ARTICLE 2 DEFINITIONS AND CONSTRUCTION

	1
	 	 
	
ARTICLE 3 SHARES SUBJECT TO THE PLAN

	5 
	 	 
	
3.1.

	
Number of Shares

	
5

	 	 	 
	
3.2.

	
Stock Distributed

	
6

	 	 	 
	
3.3.

	
Limitation on Number of Shares Subject to Awards

	
6

	 	 	 
	ARTICLE 4 ELIGIBILITY AND PARTICIPATION 	6
	 	 
	
4.1.

	
Eligibility

	
6

	 	 	 
	
4.2.

	
Participation

	
6

	 	 	 
	
4.3.

	
Foreign Participants

	
6

	 	 	 
	
ARTICLE 5 STOCK OPTIONS

	6
	 	 
	
5.1.

	
General

	
6

	 	 	 
	
5.2.

	
Incentive Stock Options

	
7

	 	 	 
	
5.3.

	
Substitution of Stock Appreciation Rights

	
8

	 	 	 
	
5.4.

	
Paperless Exercise

	
8

	 	 	 
	
5.5.

	
Granting of Options to Independent Directors

	
8

	 	 	 
	
ARTICLE 6 RESTRICTED STOCK AWARDS

	8
	 	 
	
6.1.

	
Grant of Restricted Stock

	
8

	 	 	 
	
6.2.

	
Issuance and Restrictions

	
8

	 	 	 
	
6.3.

	
Forfeiture

	
9

	 	 	 
	
6.4.

	
Certificates for Restricted Stock

	
9

 

 

 

 

 

	ARTICLE 7 STOCK APPRECIATION RIGHTS 	9
	 	 
	
7.1.

	
Grant of Stock Appreciation Rights

	
9

	 	 	 
	
7.2.

	
Coupled Stock Appreciation Rights

	
9

	 	 	 
	 	 	 
	
7.3.

	
Independent Stock Appreciation Rights

	
10

	 	 	 
	
7.4.

	
Payment and Limitations on Exercise

	
10

	 	 	 
	
ARTICLE 8 OTHER TYPES OF AWARDS

	11
	 	 
	
8.1.

	
Performance Share Awards

	
11

	 	 	 
	
8.2.

	
Performance Units

	
11

	 	 	 
	 	 	 
	
8.3.

	
Dividend Equivalents

	
11

	 	 	 
	
8.4.

	
Stock Payments

	
11

	 	 	 
	
8.5.

	
Deferred Stock

	
11

	 	 	 
	
8.6.

	
Restricted Stock Units

	
12

	 	 	 
	
8.7.

	
Other Stock-Based Awards

	
12

	 	 	 
	
8.8.

	
Term

	
12

	 	 	 
	
8.9.

	
Exercise or Purchase Price

	
12

	 	 	 
	
8.10.

	
Exercise Upon Termination of Employment or Service

	
12

	 	 	 
	
8.11.

	
Form of Payment

	
13

	 	 	 
	
8.12.

	
Award Agreement

	
13

	 	 	 
	
ARTICLE 9 PERFORMANCE-BASED AWARDS

	13
	 	 
	
9.1.

	
Purpose

	
13

	 	 	 
	
9.2.

	
Applicability

	
13

	 	 	 
	
9.3.

	
Procedures with Respect to Performance-Based Awards

	
13

	 	 	 
	
9.4.

	
Payment of Performance-Based Awards

	
14

	 	 	 
	
9.5.

	
Additional Limitations

	
14

 

 

 

 

 

	
ARTICLE 10 PROVISIONS APPLICABLE TO AWARDS

	14
	 	 
	
10.1.

	
Stand-Alone and Tandem Awards

	
14

	 	 	 
	
10.2.

	
Award Agreement

	
14

	 	 	 
	
10.3.

	
Limits on Transfer

	
14

	 	 	 
	
10.4.

	
Death of Optionee

	
15

	 	 	 
	
10.5.

	
Retirement or Disability

	
15

	 	 	 
	
10.6.

	
Termination for Other Reasons

	
15

	 	 	 
	
10.7.

	
Leaves of Absence and Performance Targets

	
15

	 	 	 
	
10.8.

	
Newly Eligible Employees

	
15

	 	 	 
	
10.9.

	
Stock Certificates; Book Entry Procedures

	
15

	 	 	 
	
ARTICLE 11 CHANGES IN CAPITAL STRUCTURE

	16
	 	 
	
11.1.

	
Adjustments

	
16

	 	 	 
	
11.2.

	
Outstanding Awards—Other Changes

	
17

	 	 	 
	
11.3.

	
No Other Rights

	
17

	 	 	 
	
ARTICLE 12 ADMINISTRATION

	17
	 	 
	
12.1.

	
Committee

	
17

	 	 	 
	
12.2.

	
Committee Appointee Duration

	
17

	 	 	 
	
12.3.

	
Action by the Board

	
18

	 	 	 
	
12.4.

	
Action by the Committee

	
18

	 	 	 
	
12.5.

	
Authority of Committee

	
18

	 	 	 
	
12.6.

	
Decisions Binding

	
19

	 	 	 
	
12.7.

	
Delegation of Authority

	
19

	 	 	 
	
12.8.

	
Committee Administration

	
19

	 	 	 
	
12.9.

	
Liability

	
19

 

 

 

 

 

	
ARTICLE 13 EFFECTIVE AND EXPIRATION DATE

	20
	 	 
	
13.1.

	
Effective Date

	
20

	 	 	 
	
13.2.

	
Expiration Date

	
20

	 	 	 
	
ARTICLE 14 AMENDMENT, MODIFICATION, AND TERMINATION

	20
	 	 
	
14.1.

	
Amendment, Modification, and Termination

	
20

	 	 	 
	
14.2.

	
Awards Previously Granted

	
20

	 	 	 
	ARTICLE 15 COMPLIANCE WITH SECTION 409A OF THE CODE 0	20
	 	 
	
15.1.

	
Awards Subject to §409A of the Code

	
20

	 	 	 
	
15.2.

	
Distributions under a Section 409A Award

	
21

	 	 	 
	
15.3.

	
Prohibition on Acceleration of Benefits

	
21

	 	 	 
	
15.4.

	
Elections under Section 409A Awards

	
22

	 	 	 
	
15.5.

	
Compliance in Form and Operation

	
22

	 	 	 
	
ARTICLE 16 GENERAL PROVISIONS

	23
	 	 
	
16.1.

	
No Rights to Awards

	
23

	 	 	 
	
16.2.

	
No Shareholder Rights

	
23

	 	 	 
	
16.3.

	
Withholding

	
23

	 	 	 
	
16.4.

	
No Right to Employment or Services

	
23

	 	 	 
	
16.5.

	
Unfunded Status of Awards

	
23

	 	 	 
	
16.6.

	
Indemnification

	
23

	 	 	 
	
16.7.

	
Relationship to other Benefits

	
24

	 	 	 
	
16.8.

	
Expenses

	
24

	 	 	 
	
16.9.

	
Titles and Headings

	
24

	 	 	 
	
16.10.

	
Fractional Shares

	
24

	 	 	 
	
16.11.

	
Limitations Applicable to Section 16 Persons

	
24

	 	 	 
	
16.12.

	
Government and Other Regulations

	
24

	 	 	 
	
16.13.

	
Governing Law

	
25

 

  

  

  

 

DYNATRONICS CORPORATION

 

2015 EQUITY INCENTIVE AWARD PLAN

ARTICLE 1

 

PURPOSE

 

The purposes of the Dynatronics Corporation 2015 Equity Incentive Award Plan (the “Plan”) are to:

 

(1)           Closely associate the interests of management, Employees, directors and Consultants of Dynatronics Corporation, a Utah corporation (the “Company”), with the shareholders of the Company by reinforcing the relationship between participants’ rewards and shareholder gains;

 

(2)           Provide management and employees with an equity ownership in the Company commensurate with Company performance, as reflected in increased shareholder value;

 

(3)           Maintain competitive compensation levels; and

 

(4)           Provide an incentive to management and employees to remain in continuing employment with the Company and to put forth maximum efforts for the success of its business.

 

The Plan is further intended to provide flexibility to the Company in its ability to motivate, attract, and retain the services of members of the Board, Employees and Consultants upon whose judgment, interest, and special effort the successful conduct of the Company’s operation is largely dependent.

 

ARTICLE 2

 

DEFINITIONS AND CONSTRUCTION

 

Wherever the following terms are used in the Plan they shall have the meanings specified below, unless the context clearly indicates otherwise. The singular pronoun shall include the plural where the context so indicates.

 

2.1. “Award” means an Option, a Restricted Stock award, a Stock Appreciation Right award, a Performance Share award, a Performance Unit award, a Dividend Equivalents award, a Stock Payment award, a Deferred Stock award, a Restricted Stock Unit award, an Other Stock-Based Award, or a Performance-Based Award granted to a Participant pursuant to the Plan.

 

2.2. “Award Agreement” means any written agreement, contract, or other instrument or document evidencing an Award.

 

2.3. “Board” means the Board of Directors of the Company.

 

  

1

  

 

2.4. “Change in Control” means the occurrence of any of the following in one or a series of related transactions: (i) consummation of a merger or consolidation of the Company or any Subsidiary or a sale of more than one-half of the assets of the Company in one or a series of related transactions, unless following such transaction or series of transactions, the holders of the Company’s securities prior to the first such transaction continue to hold at least one-half of the voting rights and equity interests of the surviving entity or acquirer of such assets; (ii) a recapitalization, reorganization or other transaction involving the Company or any Subsidiary that constitutes or results in a transfer of more than one-half of the voting rights or equity interests in the Company to persons who were not holders of the Company’s securities prior to such transaction; or (iii) consummation of a “Rule 13e-3 transaction” as defined in Rule 13e-3 under the Exchange Act with respect to the Company, unless following such transaction, the holders of the Company’s securities prior to such transaction continue to hold at least one-half of the voting rights and equity interests of the Company.

 

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

 

2.6. “Committee” means the committee of the Board described in Article 12.

 

2.7. “Consultant” means any consultant or adviser if:

 

(a) The consultant or adviser renders bona fide services to the Company;

 

(b) The services rendered by the consultant or adviser are not in connection with the offer or sale of securities in a capital-raising transaction and do not directly or indirectly promote or maintain a market for the Company’s securities; and

 

(c) The consultant or adviser is a natural person who has contracted directly with the Company to render such services.

 

2.8. “Covered Employee” means an Employee who is, or may be, as determined by the Committee, a “covered employee” within the meaning of §162(m) of the Code.

 

2.9. “Deferred Stock Award” means a right to receive a specified number of shares of Stock during specified time periods pursuant to Article 8.

 

2.10. “Disability” means that the Participant qualifies to receive long-term disability payments under the Company’s long-term disability insurance program, if any, as it may be amended from time to time.

 

2.11. “Dividend Equivalents” means a right granted to a Participant pursuant to Article 8 to receive the equivalent value (in cash or Stock) of dividends paid on Stock.

 

2.12. “Effective Date” shall have the meaning set forth in Section 13.1.

 

2.13. “Eligible Individual” means any person who is an Employee, a Consultant or a member of the Board, as determined by the Committee.

 

  

2

  

 

2.14. “Employee” means any officer or other employee (as defined in accordance with §3401(c) of the Code) of the Company or any Subsidiary.

 

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

 

2.16. “Fair Market Value” means, as of any given date, the fair market value of a share of Stock on the date determined by such methods or procedures as may be established from time to time by the Committee. Unless otherwise determined by the Committee, the Fair Market Value of a share of Stock as of any date shall be (i) the closing selling price of a share of Common Stock on the principal exchange on which shares of Common Stock are then trading, if any, on such date, or if shares were not traded on such date, then on the closest preceding date on which a trade occurred; or (ii) if Common Stock is not traded on an exchange, the closing selling price of a share of Common Stock on such date as reported by the Nasdaq Capital Market, or if not then in existence, by their successor quotation system; or (iii) if Common Stock is not publicly traded, the Fair Market Value of a share of Common Stock as established by the Committee acting in good faith.

 

2.17. “Grant Date” means the date on which the Committee adopts a resolution, or takes other appropriate action, expressly granting an Award to a Participant that specifies the key terms and conditions of the Award or, if a later date is set forth in such resolution, then such date as is set forth in such resolution.

 

2.18. “Incentive Stock Option” means an Option that is intended to meet the requirements of §422 of the Code or any successor provision thereto.

 

2.19. “Independent Director” means a member of the Board who is not an Employee of the Company.

 

2.20. “Non-Employee Director” means a member of the Board who qualifies as a “Non-Employee Director” as defined in Rule 16b-3(b)(3) of the Exchange Act, or any successor definition adopted by the Board.

 

2.21. “Non-Qualified Stock Option” means an Option that is not intended to be an Incentive Stock Option.

 

2.22. “Option” means a right granted to a Participant pursuant to Article 5 of the Plan to purchase a specified number of shares of Stock at a specified price during specified time periods. An Option may be either an Incentive Stock Option or a Non-Qualified Stock Option.

 

2.23. “Other Stock-Based Award” means an Award granted or denominated in Stock or units of Stock pursuant to Section 8.7 of the Plan.

 

2.24. “Participant” means any Eligible Individual who, as a member of the Board or Employee or Consultant, has been granted an Award pursuant to the Plan.

 

2.25. “Performance-Based Award” means an Award granted to selected Covered Employees pursuant to Articles 6 and 8, but which is subject to the terms and conditions set forth in Article 9. All Performance-Based Awards are intended to qualify as Qualified Performance-Based Compensation.

 

  

3

  

 

2.26. “Performance Criteria” means the criteria that the Committee selects for purposes of establishing the Performance Goal or Performance Goals for a Participant for a Performance Period. The Performance Criteria that will be used to establish Performance Goals are limited to the following: net earnings (either before or after interest, taxes, depreciation and amortization), economic value-added (as determined by the Committee), sales or revenue, net income (either before or after taxes), operating earnings, cash flow (including, but not limited to, operating cash flow and free cash flow), cash flow return on capital, return on net assets, return on shareholders’ equity, return on assets, return on capital, shareholder returns, return on sales, gross or net profit margin, productivity, expense, margins, operating efficiency, customer satisfaction, working capital, earnings per share, price per share of Stock, and market share, any of which may be measured either in absolute terms or as compared to any incremental increase or as compared to results of a peer group. The Committee shall, within the time prescribed by §162(m) of the Code, define in an objective fashion the manner of calculating the Performance Criteria it selects to use for such Performance Period for such Participant.

 

2.27. “Performance Goals” means, for a Performance Period, the goals established in writing by the Committee for the Performance Period based upon the Performance Criteria. Depending on the Performance Criteria used to establish such Performance Goals, the Performance Goals may be expressed in terms of overall Company performance or the performance of a division, business unit, or an individual. The Committee, in its discretion, may adjust or modify the calculation of Performance Goals for such Performance Period in order to prevent the dilution or enlargement of the rights of Participants (a) in the event of, or in anticipation of, any unusual or extraordinary corporate item, transaction, event, or development, or (b) in recognition of, or in anticipation of, any other unusual or nonrecurring events affecting the Company, or the financial statements of the Company, or in response to, or in anticipation of, changes in applicable laws, regulations, accounting principles, or business conditions.

 

2.28. “Performance Period” means the one or more periods of time, which may be of varying and overlapping durations, as the Committee may select, over which the attainment of one or more Performance Goals will be measured for the purpose of determining a Participant’s right to, and the payment of, a Performance-Based Award.

 

2.29. “Performance Share” means a right granted to a Participant pursuant to Article 8, to receive Stock, the payment of which is contingent upon achieving certain Performance Goals or other performance-based targets established by the Committee.

 

2.30. “Performance Unit” means a right granted to a Participant pursuant to Article 8, to receive units of value, including dollar value of shares of Stock, the payment of which is contingent upon achieving certain Performance Goals or other performance-based targets established by the Committee.

 

2.31. “Plan” means this Dynatronics Corporation 2015 Equity Incentive Award Plan, as it may be amended from time to time.

 

  

4

  

 

2.32. “Qualified Performance-Based Compensation” means any compensation that is intended to qualify as “qualified performance-based compensation” as described in §162(m)(4)(C) of the Code.

 

2.33. “Restricted Stock” means Stock awarded to a Participant pursuant to Article 6 that is subject to certain restrictions and may be subject to risk of forfeiture.

 

2.34. “Restricted Stock Unit” means an Award granted pursuant to Section 8.6.

 

2.35. “Section 409A Award” shall have the meaning set forth in Section 15.1.

 

2.36. “Securities Act” shall mean the Securities Act of 1933, as amended.

 

2.37. “Stock” or “Common Stock” means the common stock of the Company, no par value per share, and such other securities of the Company that may be substituted for Stock pursuant to Article 11.

 

2.38. “Stock Appreciation Right” or “SAR” means a right granted pursuant to Article 7 to receive a payment equal to the excess of the Fair Market Value of a specified number of shares of Stock on the date the SAR is exercised over the Fair Market Value on the date the SAR was granted as set forth in the applicable Award Agreement.

 

2.39. “Stock Payment” means (a) a payment in the form of shares of Stock, or (b) an option or other right to purchase shares of Stock, as part of any bonus, deferred compensation or other arrangement, made in lieu of all or any portion of the compensation, granted pursuant to Article 8.

 

2.40. “Subsidiary” means any “subsidiary corporation” as defined in §424(f) of the Code and any applicable regulations promulgated thereunder or any other entity of which a majority of the outstanding voting stock or voting power is beneficially owned directly or indirectly by the Company.

 

ARTICLE 3

 

SHARES SUBJECT TO THE PLAN

 

3.1. Number of Shares.

 

(a) Subject to Article 11 and Section 3.1(b), the aggregate number of shares of Stock which may be issued, transferred or reserved for issuance pursuant to Awards under the Plan shall be 500,000 shares.  In order that the applicable regulations under the Code relating to Incentive Stock Options be satisfied, the maximum number of shares of Stock that may be delivered upon exercise of Incentive Stock Options shall be the number specified in this Section 3.1(a). In the absence of an effective registration statement under the Securities Act, all Options granted and shares of Common Stock subject to their exercise will be restricted as to subsequent resale or transfer, pursuant to the provisions of Rule 144 promulgated under the Securities Act.

 

(b) To the extent that an Award terminates, expires, or lapses for any reason, any shares of Stock subject to the Award shall again be available for the grant of an Award pursuant to the Plan. To the extent permitted by applicable law or any exchange rule, shares of Stock issued in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form of combination by the Company or any Subsidiary shall not be counted against shares of Stock available for grant pursuant to this Plan.

 

  

5

  

 

3.2. Stock Distributed.  Any Stock distributed pursuant to an Award will consist of authorized and unissued Stock of the Company.

 

3.3. Limitation on Number of Shares Subject to Awards.  Notwithstanding any provision in the Plan to the contrary, and subject to Article 11, (a) the maximum number of shares of Stock with respect to one or more Awards that may be granted to any one Participant during a one-year period (measured from the date of any grant) shall be 150,000 shares, and (b) the maximum dollar value payable to any one Participant during a one-year period with respect to awards of Performance Units shall be $500,000.

 

ARTICLE 4

 

ELIGIBILITY AND PARTICIPATION

 

4.1. Eligibility.  Each Eligible Individual shall be eligible to be granted one or more Awards pursuant to the Plan.

 

4.2. Participation.  Subject to the provisions of the Plan, the Committee may, from time to time, select from among all Eligible Individuals, those to whom Awards shall be granted and shall determine the nature and amount of each Award. No Eligible Individual shall have any right to be granted an Award pursuant to this Plan.

 

4.3. Foreign Participants.  In order to assure the viability of Awards granted to Participants employed in foreign countries, the Committee may provide for such special terms as it may consider necessary or appropriate to accommodate differences in local law, tax policy, or custom.  Moreover, the Committee may approve such supplements to, or amendments, restatements, or alternative versions of, the Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of the Plan as in effect for any other purpose; provided, however, that no such supplements, amendments, restatements, or alternative versions shall increase the share limitations contained in Sections 3.1 and 3.3 of the Plan.

 

ARTICLE 5 

 

STOCK OPTIONS

 

5.1. General.  The Committee is authorized to grant Options to Participants on the following terms and conditions:

 

(a) Exercise Price.  The exercise price per share of Stock subject to an Option shall be not less than 100% of the Fair Market Value of a share of Stock on the Grant Date.

 

(b) Time and Conditions of Exercise.  Each Option shall be fully exercisable at any time within the period beginning not earlier than six months after the date of the option grant and ending not later than ten (10) years after the date of such grant (the “Option Term”), unless the Committee specifies otherwise.  In no event, however, shall the Option Term extend beyond ten (10) years after the Grant Date. No Option shall be exercisable after the expiration of the Option Term.  The Committee shall also determine the performance or other conditions, if any, that must be satisfied before all or part of an Option may be exercised.

 

  

6

  

 

(c) Payment.  The Committee shall determine the methods by which the exercise price of an Option may be paid, the form of payment, including, without limitation: (i) cash, (ii) promissory note bearing interest at no less than such rate as shall preclude the imputation of interest under the Code, (iii) shares of Stock having a Fair Market Value on the date of delivery equal to the aggregate exercise price of the Option or exercised portion thereof, or (iv) other property acceptable to the Committee (including through the delivery of a notice that the Participant has placed a market sell order with a broker with respect to shares of Stock then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the Option exercise price;  provided  that payment of such proceeds is then made to the Company upon settlement of such sale), and the methods by which shares of Stock shall be delivered or deemed to be delivered to Participants. Notwithstanding any other provision of the Plan to the contrary, no Participant who is a member of the Board or an “executive officer” of the Company within the meaning of Section 13(k) of the Exchange Act shall be permitted to pay the exercise price of an Option by means of a personal loan or other credit extended by the Company or in any other method which would violate Section 13(k) of the Exchange Act.

 

(d) Evidence of Grant.  All Options shall be evidenced by a written Award Agreement between the Company and the Participant.  The Award Agreement shall include the number of shares of Common Stock subject to the Option, the exercise price, the exercise date, the Option Term, and such additional provisions as may be specified by the Committee.

 

5.2. Incentive Stock Options.  The terms of any Incentive Stock Options granted pursuant to the Plan must comply with the conditions and limitations contained Section 13.2 and this Section 5.2.

 

(a) Eligibility.  The Committee may grant one or more Incentive Stock Options to Employees of the Company or any “subsidiary corporation” thereof (within the meaning of §424(f) of the Code and the applicable regulations promulgated thereunder). The date an Incentive Stock Option is granted shall be the Grant Date.

 

(b) Individual Dollar Limitation.  The aggregate Fair Market Value (determined as of the Grant Date) of all shares of Stock with respect to which Incentive Stock Options are first exercisable by a Participant in any calendar year may not exceed $100,000 or such other limitation as imposed by §422(d) of the Code, or any successor provision.  Multiple Incentive Stock Options may be granted to an Optionee in any calendar year.

 

(c) Ten-Percent Owners.  The Committee may determine to grant an Incentive Stock Option to an Employee who is also an individual who owns, as of the Grant Date, directly or indirectly according to the stock ownership attribution rules of §424(d) of the Code, Stock possessing more than ten percent (10%) of the total combined voting power of all classes of Stock of the Company.  However, the exercise price of such Option granted shall not be less than 110% of Fair Market Value on the Grant Date.  Furthermore, the Option may be exercisable for no more than five (5) years from the Grant Date.

 

  

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(d) Notice of Disposition.  The Participant shall give the Company prompt notice of any disposition of shares of Stock acquired by exercise of an Incentive Stock Option within (i) two (2) years from the Grant Date of such Incentive Stock Option or (ii) one (1) year after the transfer of such shares of Stock to the Participant.

 

(e) Right to Exercise.  During a Participant’s lifetime, an Incentive Stock Option shall not be transferable by the Participant and may be exercised only by the Participant.

 

5.3. Substitution of Stock Appreciation Rights.  The Committee may provide in the Award Agreement evidencing the grant of an Option that the Committee, in its sole discretion, shall have the right to substitute a Stock Appreciation Right for such Option at any time prior to or upon exercise of such Option, subject to the provisions of Section 7.2 hereof; provided that such Stock Appreciation Right shall be exercisable with respect to the same number of shares of Stock for which such substituted Option would have been exercisable.

 

5.4. Paperless Exercise.  In the event that the Company establishes, for itself or using the services of a third party, an automated system for the exercise of Options, such as a system using an internet website or interactive voice response, then the paperless exercise of Options by a Participant may be permitted through the use of such an automated system.

 

5.5. Granting of Options to Independent Directors.   The Board may from time to time, in its sole discretion, and subject to the limitations of the Plan:

 

(a) Select from among the Independent Directors (including Independent Directors who have previously been granted Options under the Plan) such of them as in its opinion should be granted Options;

 

(b) Subject to Section 3.3, determine the number of shares of Stock that may be purchased upon exercise of the Options granted to such selected Independent Directors; and

 

(c) Subject to the provisions of this Article 5, determine the terms and conditions of such Options, consistent with the Plan.

 

Options granted to Independent Directors shall be Non-Qualified Stock Options.

 

ARTICLE 6                      

 

RESTRICTED STOCK AWARDS

 

6.1. Grant of Restricted Stock.  The Committee is authorized to make Awards of Restricted Stock to any Participant selected by the Committee in such amounts and subject to such terms and conditions as determined by the Committee. All Awards of Restricted Stock shall be evidenced by a written Restricted Stock Award Agreement.

 

6.2. Issuance and Restrictions.  Restricted Stock shall be subject to such restrictions on transferability and other restrictions as the Committee may impose (including, without limitation, limitations on the right to vote Restricted Stock or the right to receive dividends on the Restricted Stock). These restrictions may lapse separately or in combination at such times, pursuant to such circumstances, in such installments, or otherwise, as the Committee determines at the time of the grant of the Award or thereafter.

 

  

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6.3. Forfeiture.  Except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of employment or service during the applicable restriction period, Restricted Stock that is at that time subject to restrictions shall be forfeited;  provided, however, that the Committee may (a) provide in any Restricted Stock Award Agreement that restrictions or forfeiture conditions relating to Restricted Stock will be waived in whole or in part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part restrictions or forfeiture conditions relating to Restricted Stock.

 

6.4. Certificates for Restricted Stock.  Restricted Stock granted pursuant to the Plan may be evidenced in such manner as the Committee shall determine. If certificates representing shares of Restricted Stock are registered in the name of the Participant, certificates must bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Stock, and the Company may, at its discretion, retain physical possession of the certificate until such time as all applicable restrictions lapse.

 

ARTICLE 7

 

STOCK APPRECIATION RIGHTS

 

7.1. Grant of Stock Appreciation Rights.  A Stock Appreciation Right may be granted to any Participant selected by the Committee. A Stock Appreciation Right may be granted (a) in connection and simultaneously with the grant of an Option, (b) with respect to a previously granted Option, or (c) independent of an Option. A Stock Appreciation Right shall be subject to such terms and conditions not inconsistent with the Plan as the Committee shall impose and shall be evidenced by an Award Agreement.

 

7.2. Coupled Stock Appreciation Rights.

 

(a) A Coupled Stock Appreciation Right (“CSAR”) shall be related to a particular Option and shall be exercisable only when and to the extent the related Option is exercisable, provided, however, that the exercise price for any CSAR shall not be less than 100% of the Fair Market Value on the Grant Date; and provided, further, that, the Committee in its sole and absolute discretion may provide that the CSAR may be exercised subsequent to a termination of employment or service, as applicable, or following a Change in Control of the Company, or because of the Participant’s retirement, death or disability, or otherwise.

 

(b) A CSAR may be granted to a Participant for no more than the number of shares subject to the simultaneously or previously granted Option to which it is coupled.

 

(c) A CSAR shall entitle the Participant (or other person entitled to exercise the Option pursuant to the Plan) to surrender to the Company the unexercised portion of the Option to which the CSAR relates (to the extent then exercisable pursuant to its terms) and to receive from the Company in exchange therefor an amount determined by multiplying the difference obtained by subtracting the Option exercise price from the Fair Market Value of a share of Stock on the date of exercise of the CSAR by the number of shares of Stock with respect to which the CSAR shall have been exercised, subject to any limitations the Committee may impose.

 

  

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7.3. Independent Stock Appreciation Rights.

 

(a) An Independent Stock Appreciation Right (“ISAR”) shall be unrelated to any Option and shall have a term set by the Committee. An ISAR shall be exercisable in such installments as the Committee may determine. An ISAR shall cover such number of shares of Stock as the Committee may determine. The exercise price per share of Stock subject to each ISAR shall be set by the Committee; provided, however, that the exercise price for any ISAR shall not be less than 100% of the Fair Market Value on the Grant Date; and provided, further, that, the Committee in its sole and absolute discretion may provide that the ISAR may be exercised subsequent to a termination of employment or service, as applicable, or following a Change in Control of the Company, or because of the Participant’s retirement, death or disability, or otherwise.

 

(b) An ISAR shall entitle the Participant (or other person entitled to exercise the ISAR pursuant to the Plan) to exercise all or a specified portion of the ISAR (to the extent then exercisable pursuant to its terms) and to receive from the Company an amount determined by multiplying the difference obtained by subtracting the exercise price per share of the ISAR from the Fair Market Value of a share of Stock on the date of exercise of the ISAR by the number of shares of Stock with respect to which the ISAR shall have been exercised, subject to any limitations the Committee may impose.

 

7.4. Payment and Limitations on Exercise.

 

(a) Subject to Section 7.4(b) and (c), payment of the amounts determined under Sections 7.2(c) and 7.3(b) above shall be in cash, in Stock (based on its Fair Market Value as of the date the Stock Appreciation Right is exercised) or a combination of both, as determined by the Committee.

 

(b) To the extent payment for a Stock Appreciation Right is to be made in cash, the Award Agreement shall, to the extent necessary to comply with the requirements of §409A of the Code, specify the date of payment, which may be different than the date of exercise of the Stock Appreciation Right. If the date of payment for a Stock Appreciation Right is later than the date of exercise, the Award Agreement may specify that the Participant be entitled to earnings on such amount until paid.

 

(c) To the extent any payment under Section 7.2(c) or 7.3(b) is effected in Stock it shall be made subject to satisfaction of any applicable provisions of Sections 5.1, 5.4, and 5.5 above pertaining to Options.

 

  

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ARTICLE 8

 

OTHER TYPES OF AWARDS

 

8.1. Performance Share Awards.  Any Participant selected by the Committee may be granted one or more Performance Share awards which shall be denominated in a number of shares of Stock and which may be linked to any one or more of the Performance Criteria or other specific performance criteria determined appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. In making such determinations, the Committee shall consider (among such other factors as it deems relevant in light of the specific type of award) the contributions, responsibilities and other compensation of the particular Participant.

 

8.2. Performance Units.  Any Participant selected by the Committee may be granted one or more Performance Unit awards which shall be denominated in units of value, including dollar value of shares of Stock, and which may be linked to any one or more of the Performance Criteria or other specific performance criteria determined appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. In making such determinations, the Committee shall consider (among such other factors as it deems relevant in light of the specific type of award) the contributions, responsibilities and other compensation of the particular Participant.

 

8.3. Dividend Equivalents.

 

(a) Any Participant selected by the Committee may be granted Dividend Equivalents based on the dividends declared on the shares of Stock that are subject to any Award (other than Restricted Stock Units under Section 8.6, below), to be credited as of dividend payment dates, during the period between the Grant Date of the Award and the date the Award is exercised, vests or expires, as determined by the Committee. Such Dividend Equivalents shall be converted to cash or additional shares of Stock by such formula and at such time and subject to such limitations as may be determined by the Committee. Notwithstanding the foregoing, Dividend Equivalents credited in connection with an Award that vests based on the achievement of Performance Criteria or other specific performance criteria shall be subject to restrictions and risk of forfeiture to the same extent as the Award with respect to which such Dividend Equivalents have been credited.

 

(b) Dividend Equivalents granted with respect to Options or SARs, with respect to pre-exercise periods, regardless of whether such Option or SAR is subsequently exercised.

 

8.4. Stock Payments.  Any Participant selected by the Committee may receive Stock Payments in the manner determined from time to time by the Committee. The number of shares shall be determined by the Committee and may be based upon the Performance Criteria or other specific performance criteria determined appropriate by the Committee, determined on the date such Stock Payment is made or on any date thereafter.

 

8.5. Deferred Stock.  Any Participant selected by the Committee may be granted an award of Deferred Stock in the manner determined from time to time by the Committee. The number of shares of Deferred Stock shall be determined by the Committee and may be linked to the Performance Criteria or other specific performance criteria determined to be appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. Stock underlying a Deferred Stock award will not be issued until the Deferred Stock award has vested, pursuant to a vesting schedule or performance criteria set by the Committee.  Unless otherwise provided by the Committee, a Participant awarded Deferred Stock shall have no rights as a Company shareholder with respect to such Deferred Stock until such time as the Deferred Stock Award has vested and the Stock underlying the Deferred Stock Award has been issued.

 

  

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8.6. Restricted Stock Units.  The Committee is authorized to make Awards of Restricted Stock Units to any Participant selected by the Committee in such amounts and subject to such terms and conditions as determined by the Committee. At the time of grant, the Committee shall specify the date or dates on which the Restricted Stock Units shall become fully vested and nonforfeitable, and may specify such conditions to vesting as it deems appropriate. At the time of grant, the Committee shall specify the maturity date applicable to each grant of Restricted Stock Units which shall be no earlier than the vesting date or dates of the Award and may be determined at the election of the grantee. On the maturity date, the Company shall, subject to Section 10.5(b), transfer to the Participant one unrestricted, fully transferable share of Stock for each Restricted Stock Unit scheduled to be paid out on such date and not previously forfeited. The Committee shall specify the purchase price, if any, to be paid by the grantee to the Company for such shares of Stock.

 

8.7. Other Stock-Based Awards.  Any Participant selected by the Committee may be granted one or more Awards that provide Participants with shares of Stock or the right to purchase shares of Stock or that have a value derived from the value of, or an exercise or conversion privilege at a price related to, or that are otherwise payable in shares of Stock and which may be linked to any one or more of the Performance Criteria or other specific performance criteria determined appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. In making such determinations, the Committee shall consider (among such other factors as it deems relevant in light of the specific type of Award) the contributions, responsibilities and other compensation of the particular Participant.

 

8.8. Term.  Except as otherwise provided herein, the term of any Award of Performance Shares, Performance Units, Dividend Equivalents, Stock Payments, Deferred Stock, Restricted Stock Units or Other Stock-Based Award shall be set by the Committee in its discretion.

 

8.9. Exercise or Purchase Price.  The Committee may establish the exercise or purchase price, if any, of any Award of Performance Shares, Performance Units, Deferred Stock, Stock Payments, Restricted Stock Units or Other Stock-Based Award; provided, however, that such price shall not be less than the par value of a single share of Stock on the Grant Date, unless otherwise permitted by applicable state law.

 

8.10. Exercise Upon Termination of Employment or Service.  An Award of Performance Shares, Performance Units, Dividend Equivalents, Deferred Stock, Stock Payments, Restricted Stock Units and Other Stock-Based Award shall only be exercisable or payable while the Participant is an Employee, a Consultant, or a member of the Board, as applicable;  provided, however, that the Committee in its sole and absolute discretion may provide that an Award of Performance Shares, Performance Units, Dividend Equivalents, Stock Payments, Deferred Stock, Restricted Stock Units or Other Stock-Based Award may be exercised or paid subsequent to a termination of employment or service, as applicable, or following a Change in Control of the Company, or because of the Participant’s retirement, death or disability, or otherwise;  provided, however , that any such provision with respect to Performance Shares or Performance Units shall be subject to the requirements of §162(m) of the Code that apply to Qualified Performance-Based Compensation.

 

  

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8.11. Form of Payment.  Payments with respect to any Awards granted under this Article 8 shall be made in cash, in Stock or a combination of both, as determined by the Committee.

 

8.12. Award Agreement.  All Awards under this Article 8 shall be subject to such additional terms and conditions as determined by the Committee and shall be evidenced by a written Award Agreement.

 

ARTICLE 9

 

PERFORMANCE-BASED AWARDS

 

9.1. Purpose.  The purpose of this Article 9 is to provide the Committee the ability to qualify Awards other than Options and SARs and that are granted pursuant to Articles 6 and 8 as Qualified Performance-Based Compensation. If the Committee, in its discretion, decides to grant a Performance-Based Award to a Covered Employee, the provisions of this Article 9 shall control over any contrary provision contained in Articles 6 or 8; provided, however, that the Committee may in its discretion grant Awards to Covered Employees that are based on Performance Criteria or Performance Goals but that do not satisfy the requirements of this Article 9.

 

9.2. Applicability.  This Article 9 shall apply only to those Covered Employees selected by the Committee to receive Performance-Based Awards. The designation of a Covered Employee as a Participant for a Performance Period shall not in any manner entitle the Participant to receive an Award for the period. Moreover, designation of a Covered Employee as a Participant for a particular Performance Period shall not require designation of such Covered Employee as a Participant in any subsequent Performance Period and designation of one Covered Employee as a Participant shall not require designation of any other Covered Employees as a Participant in such period or in any other period.

 

9.3. Procedures with Respect to Performance-Based Awards.  To the extent necessary to comply with the Qualified Performance-Based Compensation requirements of §162(m)(4)(C) of the Code, with respect to any Award granted under Articles 6 and 8 which may be granted to one or more Covered Employees, no later than ninety (90) days following the commencement of any fiscal year in question or any other designated fiscal period or period of service (or such other time as may be required or permitted by §162(m) of the Code), the Committee shall, in writing, (a) designate one or more Covered Employees, (b) select the Performance Criteria applicable to the Performance Period, (c) establish the Performance Goals, and amounts of such Awards, as applicable, which may be earned for such Performance Period, and (d) specify the relationship between Performance Criteria and the Performance Goals and the amounts of such Awards, as applicable, to be earned by each Covered Employee for such Performance Period. Following the completion of each Performance Period, the Committee shall certify in writing whether the applicable Performance Goals have been achieved for such Performance Period. In determining the amount earned by a Covered Employee, the Committee shall have the right to reduce or eliminate (but not to increase) the amount payable at a given level of performance to take into account additional factors that the Committee may deem relevant to the assessment of individual or corporate performance for the Performance Period.

 

  

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9.4. Payment of Performance-Based Awards.  Unless otherwise provided in the applicable Award Agreement, a Participant must be employed by the Company or a Subsidiary on the day a Performance-Based Award for such Performance Period is paid to the Participant. Furthermore, a Participant shall be eligible to receive payment pursuant to a Performance-Based Award for a Performance Period only if the Performance Goals for such period are achieved.

 

9.5. Additional Limitations.  Notwithstanding any other provision of the Plan, any Award which is granted to a Covered Employee and is intended to constitute Qualified Performance-Based Compensation shall be subject to any additional limitations set forth in §162(m) of the Code (including any amendment to §162(m) of the Code) or any regulations or rulings issued thereunder that are requirements for qualification as qualified performance-based compensation as described in §162(m)(4)(C) of the Code, and the Plan shall be deemed amended to the extent necessary to conform to such requirements.

 

ARTICLE 10

 

PROVISIONS APPLICABLE TO AWARDS

 

10.1. Stand-Alone and Tandem Awards.  Awards granted pursuant to the Plan may, in the discretion of the Committee, be granted either alone, in addition to, or in tandem with, any other Award granted pursuant to the Plan. Awards granted in addition to or in tandem with other Awards may be granted either at the same time as or at a different time from the grant of such other Awards.

 

10.2. Award Agreement.  Awards under the Plan shall be evidenced by written Award Agreements that shall set forth the terms, conditions, limitations and award type for each Award which may include the term of an Award, the provisions applicable in the event the Participant’s employment or service terminates, and the Company’s authority to unilaterally or bilaterally amend, modify, suspend, cancel or rescind an Award.

 

10.3. Limits on Transfer.  Except as otherwise provided by the Committee, no right or interest of a Participant in any Award may be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Subsidiary, or shall be subject to any lien, obligation, or liability of such Participant to any other party other than the Company or a Subsidiary.  Except as otherwise provided by the Committee, during the life of the recipient, such award shall be exercisable only by such person or by such person’s guardian or legal representative.

 

  

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10.4. Death of Optionee.  Notwithstanding Section 10.3, if the Optionee dies while employed by the Company or within ninety (90) days after termination of Optionee’s employment, any Option exercisable on the date of death may be exercised by the Optionee’s estate or by a person who acquires the right to exercise such Option by bequest or inheritance or by reason of the death of the Optionee, provided that such exercise occurs within both the remaining Option Term of the Option and one (1) year after the Optionee’s death.  A beneficiary, legal guardian, legal representative, or other person claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicable to the Participant, except to the extent the Plan and Award Agreement otherwise provide, and to any additional restrictions deemed necessary or appropriate by the Committee.  If no beneficiary has been designated or survives the Participant, payment shall be made to the person entitled thereto pursuant to the Participant’s will or the laws of descent and distribution. Subject to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time provided the change or revocation is filed with the Committee.

 

10.5. Retirement or Disability.  Upon termination of the Optionee’s employment by reason of retirement or permanent disability, the Optionee may, within ninety (90) days from the date of termination, exercise any Options to the extent such Options are exercisable during such 90-day period.

 

10.6. Termination for Other Reasons.  Except as provided herein or except as otherwise determined by the Committee, all Options shall terminate on the earlier of the Option Term or ninety (90) days after the termination of the Optionee’s employment with the Company.

 

10.7. Leaves of Absence and Performance Targets.  The Committee shall be entitled to make such rules, regulations and determinations as it deems appropriate under the Plan in respect of any leave of absence taken by the recipient of any award. Without limiting the generality of the foregoing, the Committee shall be entitled to determine (i) whether or not any such leave of absence shall constitute a termination of employment within the meaning of the Plan and (ii) the impact, if any, of such leave of absence on awards under the Plan theretofore made to any recipient who takes such leave of absence. The Committee shall also be entitled to make such determination of performance targets, if any, as it deems appropriate.

 

10.8. Newly Eligible Employees.  The Committee shall be entitled to make such rules, regulations, determinations and awards as it deems appropriate in respect of any employee who becomes eligible to participate in the Plan or any portion thereof, after the commencement of an award or incentive period.

 

10.9. Stock Certificates; Book Entry Procedures.  As soon as practicable after receipt of payment, the Company shall deliver to the Optionee a certificate(s) for such shares of Common Stock. Upon receipt of such certificate(s), the Optionee shall become a shareholder of the Company with respect to Common Stock represented by share certificates so issued and as such shall be fully entitled to receive dividends, to vote and to exercise all other rights of a shareholder. All Stock certificates delivered pursuant to the Plan are subject to any stop-transfer orders and other restrictions as the Committee deems necessary or advisable to comply with federal, state, or foreign jurisdiction, securities or other laws, rules and regulations and the rules of any national securities exchange or automated quotation system on which the Stock is listed, quoted, or traded. The Committee may place legends on any Stock certificate to reference restrictions applicable to the Stock. In addition to the terms and conditions provided herein, the Board may require that a Participant make such reasonable covenants, agreements, and representations as the Board, in its discretion, deems advisable in order to comply with any such laws, regulations, or requirements. The Committee shall have the right to require any Participant to comply with any timing or other restrictions with respect to the settlement or exercise of any Award, including a window-period limitation, as may be imposed in the discretion of the Committee.

 

  

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ARTICLE 11

 

CHANGES IN CAPITAL STRUCTURE

 

11.1. Adjustments.

 

(a) In the event of any stock dividend, stock split, combination or exchange of shares, merger, consolidation, spin-off, recapitalization, distribution of Company assets to shareholders (other than normal cash dividends), or any other corporate event affecting the Stock or the share price of the Stock, the Committee may make such proportionate adjustments, if any, as the Committee in its discretion may deem appropriate to reflect such changes with respect to (i) the aggregate number and type of shares that may be issued under the Plan (including, but not limited to, adjustments of the limitations in Sections 3.1 and 3.3); (ii) the terms and conditions of any outstanding Awards (including, without limitation, any applicable performance targets or criteria with respect thereto); and (iii) the grant or exercise price per share for any outstanding Awards under the Plan. Any adjustment affecting an Award intended as Qualified Performance-Based Compensation shall be made consistent with the requirements of §162(m) of the Code.

 

(b) In the event of any transaction or event described in Section 11.1(a) or any unusual or nonrecurring transactions or events affecting the Company, any affiliate of the Company, or the financial statements of the Company or any affiliate (including without limitation any Change in Control), or of changes in applicable laws, regulations or accounting principles, and whenever the Committee determines that action is appropriate in order to prevent the dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to any Award under the Plan, to facilitate such transactions or events or to give effect to such changes in laws, regulations or principles, the Committee, in its sole discretion and on such terms and conditions as it deems appropriate, either by amendment of the terms of any outstanding Awards or by action taken prior to the occurrence of such transaction or event and either automatically or upon the Participant’s request, is hereby authorized to take any one or more of the following actions:

 

(i) To provide for either (A) termination of any such Award in exchange for an amount of cash and/or other property, if any, equal to the amount that would have been attained upon the exercise of such Award or realization of the Participant’s rights (and, for the avoidance of doubt, if as of the date of the occurrence of the transaction or event described in this Section 11.1(b) the Committee determines in good faith that no amount would have been attained upon the exercise of such Award or realization of the Participant’s rights, then such Award may be terminated by the Company without payment) or (B) the replacement of such Award with other rights or property selected by the Committee in its sole discretion;

 

  

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(ii) To provide that such Award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by similar options, rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices; and

 

(iii) To make adjustments in the number and type of shares of Stock (or other securities or property) subject to outstanding Awards, and in the number and kind of outstanding Restricted Stock or Deferred Stock and/or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding options, rights and awards and options, rights and awards which may be granted in the future;

 

(iv) To provide that such Award shall be exercisable or payable or fully vested with respect to all shares covered thereby, notwithstanding anything to the contrary in the Plan or the applicable Award Agreement; and

 

(v) To provide that the Award cannot vest, be exercised or become payable after such event.

 

11.2. Outstanding Awards—Other Changes.  In the event of any other change in the capitalization of the Company or corporate change other than those specifically referred to in this Article 11, the Committee may, in its absolute discretion, make such adjustments in the number and kind of shares or other securities subject to Awards outstanding on the date on which such change occurs and in the per share grant or exercise price of each Award as the Committee may consider appropriate to prevent dilution or enlargement of rights.

 

11.3. No Other Rights.  Except as expressly provided in the Plan, no Participant shall have any rights by reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend, any increase or decrease in the number of shares of stock of any class or any dissolution, liquidation, merger, or consolidation of the Company or any other corporation. Except as expressly provided in the Plan or pursuant to action of the Committee under the Plan, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of shares of Stock subject to an Award or the grant or exercise price of any Award.

 

ARTICLE 12

 

ADMINISTRATION

 

12.1. Committee.  Pursuant to Utah Revised Business Corporation Act, and consistent with the provisions of Section 12.3 below, the Board may appoint a Committee consisting of three (3) or more Non-Employee Directors or the Compensation Committee of the Board to administer the Plan.

 

12.2. Committee Appointee Duration.  Once appointed, the Committee shall continue to serve until otherwise directed by the Board. From time to time, the Board may increase or change the size of the Committee, and appoint new members thereof, remove members (with or without cause) and appoint new members in substitution, fill vacancies, however caused, or remove all members of the Committee; provided, however, that subject to Section 12.3, below, at no time shall any person administer the Plan who is not otherwise a Non-Employee Director.

 

  

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12.3. Action by the Board.  Unless and until the Board delegates administration of the Plan to a Committee as set forth below, the Plan shall be administered by the full Board, and for such purposes the term “Committee” as used in this Plan shall be deemed to refer to the Board. The Board, at its discretion or as otherwise necessary to comply with the requirements of §162(m) of the Code, Rule 16b-3 promulgated under the Exchange Act or to the extent required by any other applicable rule or regulation, shall delegate administration of the Plan to a Committee.  The Committee shall consist solely of two or more members of the Board each of whom is both an “outside director,” within the meaning of §162(m) of the Code and any other applicable rules and regulations, and a Non-Employee Director. Notwithstanding the foregoing: (a) the full Board, acting by a majority of its members in office, shall conduct the general administration of the Plan with respect to all Awards granted to Independent Directors and, for purposes of such Awards, the term “Committee” as used in this Plan shall be deemed to refer to the Board and (b) the Committee may delegate its authority hereunder to the extent permitted by Section 12.5. Appointment of Committee members shall be effective upon acceptance of appointment.  The Board may abolish the Committee at any time and revest in the Board the administration of the Plan.  Committee members may resign at any time by delivering written notice to the Board.  Vacancies in the Committee may only be filled by the Board.

 

12.4. Action by the Committee.  A majority of the Committee shall constitute a quorum. The acts of a majority of the members present at any meeting at which a quorum is present, and acts approved in writing by a majority of the Committee in lieu of a meeting, shall be deemed the acts of the Committee. Each member of the Committee is entitled to, in good faith, rely or act upon any report or other information furnished to that member by any officer or other employee of the Company or any Subsidiary, the Company’s independent certified public accountants, or any executive compensation consultant or other professional retained by the Company to assist in the administration of the Plan.

 

12.5. Authority of Committee.  Subject to any specific designation in the Plan, the Committee has the exclusive power, authority and discretion to:

 

(a) Designate Participants to receive Awards;

 

(b) Determine the type or types of Awards to be granted to each Participant;

 

(c) Determine the number of Awards to be granted and the number of shares of Stock to which an Award will relate;

 

(d) Determine the terms and conditions of any Award granted pursuant to the Plan, including, but not limited to, the exercise price, grant price, or purchase price, any reload provision, any restrictions or limitations on the Award, any schedule for lapse of forfeiture restrictions or restrictions on the exercisability of an Award, and accelerations or waivers thereof, any provisions related to non-competition and recapture of gain on an Award, based in each case on such considerations as the Committee in its sole discretion determines;

 

  

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(e) Determine whether, to what extent, and pursuant to what circumstances an Award may be settled in, or the exercise price of an Award may be paid in, cash, Stock, other Awards, or other property, or an Award may be canceled, forfeited, or surrendered;

 

(f) Prescribe the form of each Award Agreement, which need not be identical for each Participant;

 

(g) Decide all other matters that must be determined in connection with an Award;

 

(h) Establish, adopt, or revise any rules and regulations as it may deem necessary or advisable to administer the Plan;

 

(i) Interpret the terms of, and any matter arising pursuant to, the Plan or any Award Agreement; and

 

(j) Make all other decisions and determinations that may be required pursuant to the Plan or as the Committee deems necessary or advisable to administer the Plan.

 

The Committee may delegate to one or more of its members or to one or more agents such administrative duties as it may deem advisable.

 

12.6. Decisions Binding.  The Committee’s interpretation of the Plan, any Awards granted pursuant to the Plan, any Award Agreement and all decisions and determinations by the Committee with respect to the Plan are final, binding, and conclusive on all parties.

 

12.7. Delegation of Authority.  To the extent permitted by applicable law, the Committee may from time to time delegate to a committee of one or more members of the Committee or the Board or one or more officers of the Company the authority to grant or amend Awards to Participants other than (a) senior executives of the Company who are subject to Section 16 of the Exchange Act, (b) Covered Employees, or (c) officers of the Company (or members of the Board) to whom authority to grant or amend Awards has been delegated hereunder. Any delegation hereunder shall be subject to the restrictions and limits that the Committee specifies at the time of such delegation, and the Committee may at any time rescind the authority so delegated or appoint a new delegatee. At all times, the delegatee appointed under this Section 12.7 shall serve in such capacity at the pleasure of the Committee.

 

12.8. Committee Administration.  One member of the Committee shall be elected by the Committee as chairman.  The Committee shall hold its meetings at such times and places as it shall deem advisable.  The Committee may appoint a secretary and make such rules and regulations for the conduct of its business as it shall deem advisable, and shall keep minutes of its meetings.

 

12.9. Liability.   No member of the Board or Committee shall be liable for any action taken or decision or determination made in good faith with respect to any Option, the Plan, or any award thereunder.

 

  

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ARTICLE 13

 

EFFECTIVE AND EXPIRATION DATE

 

13.1. Effective Date.  The Plan is effective as of the date the Plan is approved by a majority of the Board (the “Effective Date”).  The Plan, however, shall be subject to approval by the shareholders.  The Plan will be deemed to be approved by the shareholders if it receives the affirmative vote of the holders of a majority of the shares of stock of the Company present or represented and entitled to vote at a meeting duly held in accordance with the applicable provisions of the Company’s Bylaws, but, in any event, held no later than twelve (12) months after adoption on the Effective Date.

 

13.2. Expiration Date.  The Plan will expire on, and no Incentive Stock Option or other Award may be granted pursuant to the Plan after, the tenth anniversary of the Effective Date. Any Awards that are outstanding on the tenth anniversary of the Effective Date shall remain in force according to the terms of the Plan and the applicable Award Agreement.

 

ARTICLE 14 

 

AMENDMENT, MODIFICATION, AND TERMINATION

 

14.1. Amendment, Modification, and Termination.  The Committee may at any time and from time to time terminate or modify or amend the Plan in any respect, except that (a) to the extent necessary and desirable to comply with any applicable law, regulation, or stock exchange rule, the Company shall obtain shareholder approval of any Plan amendment or any modification of any Options that would be deemed a re-pricing under applicable rules, in such a manner and to such a degree as required, and (b) without shareholder approval the Committee may not (i) increase the maximum number of shares of Common Stock which may be issued under the Plan (other than increases pursuant to Section 11.1), (ii) extend the period during which any Award may be granted or exercised, (iii) amend to the Plan to permit the Committee to grant Options with an exercise price that is below Fair Market Value on the Grant Date, or (iv) extend the term of the Plan. The termination or any modification or amendment of the Plan, except as provided in subsection (a), shall not without the consent of a participant, affect his or her other rights under an award previously granted to him or her.

 

14.2. Awards Previously Granted.   No termination, amendment, or modification of the Plan shall adversely affect in any material way any Award previously granted pursuant to the Plan without the prior written consent of the Participant.

 

ARTICLE 15

 

COMPLIANCE WITH SECTION 409A OF THE CODE

 

15.1. Awards Subject to §409A of the Code.  Any Award that constitutes, or provides for, a deferral of compensation subject to §409A of the Code (a “Section 409A Award”) shall satisfy the requirements of §409A of the Code and this Article 15, to the extent applicable. The Award Agreement with respect to a Section 409A Award shall incorporate the terms and conditions required by §409A of the Code and this Article 15 to the extent possible to cause the Award to not constitute deferred compensation within the meaning of §409A of the Code.

 

  

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15.2. Distributions under a Section 409A Award.

 

(a) Subject to subsection (b), any shares of Stock or other property or amounts to be paid or distributed upon the grant, issuance, vesting, exercise or payment of a Section 409A Award shall be distributed in accordance with the requirements of §409A(a)(2) of the Code, and shall not be distributed earlier than:

 

(i) the Participant’s separation from service, as determined by the Secretary of the Treasury;

 

(ii) the date the Participant becomes disabled;

 

(iii) the Participant’s death;

 

(iv) a specified time (or pursuant to a fixed schedule) specified under the Award Agreement at the date of the deferral compensation;

 

(v) to the extent provided by the Secretary of the Treasury, a change in the ownership or effective control of the Company or a Parent or Subsidiary, or in the ownership of a substantial portion of the assets of the Company or a Parent or Subsidiary; or

 

(vi) the occurrence of an unforeseeable emergency with respect to the Participant.

 

(b) In the case of a Participant who is a “specified employee,” the requirement of subsection (a)(i) shall be met only if the distributions with respect to the Section 409A Award may not be made before the date which is six (6) months after the Participant’s separation from service (or, if earlier, the date of the Participant’s death). For purposes of this subsection (b), a Participant shall be a “specified employee” if such Participant is a key employee (as defined in §416(i) of the Code without regard to paragraph (5) thereof) of a corporation any stock of which is publicly traded on an established securities market or otherwise, as determined under §409A(a)(2)(B)(i) of the Code and the Treasury Regulations thereunder.

 

(c) The requirement of subsection (a)(vi) shall be met only if, as determined under Treasury Regulations under §409A(a)(2)(B)(ii) of the Code, the amounts distributed with respect to the unforeseeable emergency do not exceed the amounts necessary to satisfy such unforeseeable emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such unforeseeable emergency is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship).

 

(d) For purposes of this Section 15.2, the terms specified herein shall have the respective meanings ascribed thereto under §409A of the Code and the Treasury Regulations thereunder.

 

15.3. Prohibition on Acceleration of Benefits.  The time or schedule of any distribution or payment of any shares of Stock or other property or amounts under a Section 409A Award shall not be accelerated, except as otherwise permitted under §409A(a)(3) of the Code and the Treasury Regulations thereunder.

 

  

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15.4. Elections under Section 409A Awards.

 

(a) Any deferral election provided under or with respect to an Award to any Eligible Individual, or to the Participant holding a Section 409A Award, shall satisfy the requirements of §409A(a)(4)(B) of the Code, to the extent applicable, and, except as otherwise permitted under subsection (i) or (ii) below, any such deferral election with respect to compensation for services performed during a taxable year shall be made not later than the close of the preceding taxable year, or at such other time as provided in Treasury Regulations.

 

(i) In the case of the first year in which an Eligible Individual or a Participant holding a Section 409A Award, becomes eligible to participate in the Plan, any such deferral election may be made with respect to services to be performed subsequent to the election with thirty days after the date the Eligible Individual, or the Participant holding a Section 409A Award, becomes eligible to participate in the Plan, as provided under §409A(a)(4)(B)(ii) of the Code.

 

(ii) In the case of any performance-based compensation based on services performed by an Eligible Individual, or the Participant holding a Section 409A Award, over a period of at least twelve (12) months, any such deferral election may be made no later than six (6) months before the end of the period, as provided under §409A(a)(4)(B)(iii) of the Code.

 

(b) In the event that a Section 409A Award permits, under a subsequent election by the Participant holding such Section 409A Award, a delay in a distribution or payment of any shares of Stock or other property or amounts under such Section 409A Award, or a change in the form of distribution or payment, such subsequent election shall satisfy the requirements of §409A(a)(4)(C) of the Code, and:

 

(i) such subsequent election may not take effect until at least twelve (12) months after the date on which the election is made,

 

(ii) in the case such subsequent election relates to a distribution or payment not described in Section 15.2(a)(ii), (iii) or (vi), the first payment with respect to such election may be deferred for a period of not less than five (5) years from the date such distribution or payment otherwise would have been made, and

 

(iii) in the case such subsequent election relates to a distribution or payment described in Section 15.2(a)(iv), such election may not be made less than twelve months prior to the date of the first scheduled distribution or payment under Section 15.2(a)(iv).

 

15.5. Compliance in Form and Operation. A Section 409A Award, and any election under or with respect to such Section 409A Award, shall comply in form and operation with the requirements of §409A of the Code and the Treasury Regulations thereunder.  Notwithstanding the foregoing, neither the Company nor the Committee shall have any obligation to take any action to prevent the assessment of any excise tax or penalty on any Participant under §409A of the Code and neither the Company nor the Committee will have any liability to any Participant for such tax or penalty.

 

  

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ARTICLE 16

 

GENERAL PROVISIONS

 

16.1. No Rights to Awards.  No Eligible Individual or other person shall have any claim to be granted any Award pursuant to the Plan, and neither the Company nor the Committee is obligated to treat Eligible Individuals, Participants or any other persons uniformly.

 

16.2. No Shareholder Rights.  The recipient of any award under the Plan shall have no rights as a shareholder with respect thereto unless and until certificates for shares of Common Stock are issued to him or her.

 

16.3. Withholding.  The Company or any Subsidiary shall have the authority and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy federal, state, local and foreign taxes (including the Participant’s FICA obligation) required by law to be withheld with respect to any taxable event concerning a Participant arising as a result of this Plan. The Committee may in its discretion and in satisfaction of the foregoing requirement allow a Participant to elect to have the Company withhold shares of Stock otherwise issuable under an Award (or allow the return of shares of Stock) having a Fair Market Value equal to the sums required to be withheld. Notwithstanding any other provision of the Plan, the number of shares of Stock which may be withheld with respect to the issuance, vesting, exercise or payment of any Award (or which may be repurchased from the Participant of such Award within six (6) months (or such other period as may be determined by the Committee) after such shares of Stock were acquired by the Participant from the Company) in order to satisfy the Participant’s federal, state, local and foreign income and payroll tax liabilities with respect to the issuance, vesting, exercise or payment of the Award shall be limited to the number of shares which have a Fair Market Value on the date of withholding or repurchase equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such supplemental taxable income.

 

16.4. No Right to Employment or Services.  Nothing in the Plan or any Award Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate any Participant’s employment or services at any time, nor confer upon any Participant any right to continue in the employ or service of the Company or any Subsidiary.

 

16.5. Unfunded Status of Awards.  The Plan is intended to be an “unfunded” plan for incentive compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award Agreement shall give the Participant any rights that are greater than those of a general creditor of the Company or any Subsidiary.

 

16.6. Indemnification.  To the extent allowable pursuant to applicable law, each member of the Committee or of the Board shall be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such member in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action or failure to act pursuant to the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him or her;  provided  he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled pursuant to the Company’s Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.

 

  

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16.7. Relationship to other Benefits.  No payment pursuant to the Plan shall be taken into account in determining any benefits pursuant to any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Subsidiary except to the extent otherwise expressly provided in writing in such other plan or an agreement thereunder.

 

16.8. Expenses.  The expenses of administering the Plan shall be borne by the Company and its Subsidiaries.

 

16.9. Titles and Headings.  The titles and headings of the Sections in the Plan are for convenience of reference only and, in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control.

 

16.10. Fractional Shares.  No fractional shares of Stock shall be issued and the Committee shall determine, in its discretion, whether cash shall be given in lieu of fractional shares or whether such fractional shares shall be eliminated by rounding up or down as appropriate.

 

16.11. Limitations Applicable to Section 16 Persons.  Notwithstanding any other provision of the Plan, the Plan, and any Award granted or awarded to any Participant who is then subject to Section 16 of the Exchange Act, shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.

 

16.12. Government and Other Regulations.  The obligation of the Company to make payment of awards in Stock or otherwise shall be subject to all applicable laws, rules, and regulations, and to such approvals by government agencies as may be required. The Company shall be under no obligation to register pursuant to the Securities Act, as amended, any of the shares of Stock paid pursuant to the Plan. If the shares paid pursuant to the Plan may in certain circumstances be exempt from registration pursuant to the Securities Act, as amended, the Company may restrict the transfer of such shares in such manner as it deems advisable to ensure the availability of any such exemption.

 

  

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16.13. Governing Law.  The Plan and all Award Agreements shall be construed in accordance with and governed by the laws of the State of Utah.

 

*   *   *   *   *

 

I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of Dynatronics Corporation on March 23, 2015.

 

Executed on this 31st day of August, 2015.

 

 

	  	
/s/ Bob Cardon

	  	
Corporate Secretary

 

 

*   *   *   *   *

 

I hereby certify that the foregoing Plan was approved by the shareholders of Dynatronics Corporation on June 29, 2015.

 

Executed on this 31st day of August, 2015.

 

 

	  	
/s/ Bob Cardon

	  	
Corporate Secretary

 

 

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