Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for so long as any Advance remains outstanding: (a) it will retain, as originator, on an ongoing basis, a material net economic interest in the form specified in paragraph (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “Retention”); (b) neither it nor any of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention Requirements; (c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements; (d) it will confirm to each of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report; (e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and (f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.
Appears in 4 contracts
Samples: Revolving Credit and Security Agreement (Blackstone Secured Lending Fund), Revolving Credit and Security Agreement (Blackstone / GSO Secured Lending Fund), Revolving Credit and Security Agreement (Blackstone / GSO Secured Lending Fund)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding:
, the Equityholder represents and undertakes to the Facility Agent and the Lenders that: (aA) it holds and will retainretain unencumbered 100% of the Preference Shares of the Borrower (representing no less than 6.0% of the aggregate nominal value of all the Collateral Obligations measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower)); (B) the Borrower shall have no other issued equity interests other than to Walkers Fiduciary Limited, as originator, on an ongoing basis, a material net economic interest and the aggregate Preference Shares held by the Equityholder with respect to its equity interests in the form specified in paragraph (d) of Article 6(3) Borrower shall represent at least 5.0% of the Securitisation Regulationaggregate nominal value of all the Collateral Obligations measured at the time of origination as described in (A) above; (C) the Equityholder shall not sell or enter into any credit risk mitigation, being retention of the first loss tranche and, if necessary, short positions or any other tranches having the same xxxxxx or a more severe otherwise seek to mitigate its credit risk profile than those transferred or sold with respect to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to its equity interests in the Borrower under (except as permitted by the LLC Agreement, in an amount equal to Capital Requirements Regulation) and (D) not less than 5% of the Retention Basis Amount aggregate outstanding principal balance of the Collateral Obligations has been originated and underwritten by the Equityholder (such net economic interest being as Servicer for the “Retention”)Borrower) or the Borrower as the named lender in the Underlying Instruments at origination thereof;
(b) neither it nor any The Equityholder represents that for purposes of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause Requirements that it established the securitisation transaction contemplated by the Facility Agreement by incorporating the Borrower, determining the Borrower’s policies and eligibility criteria for the acquisition and origination of Collateral Obligations, determining the transaction structure and negotiating the Transaction Documents to cease to be compliant with the EU Retention Requirements;various transaction parties; and
(c) it will take such further action, provide such information as is in its possession (provided Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each all of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants conditions set out at paragraphs forth in clause (a) above are true and (b) above in have been true up to and on each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either date of the covenants set out in paragraphs related Collection Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the Retention Requirements: (aA) or (b) above in prompt written notice of any way; and
(f) it will notify each breach of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms obligations set forth in this paragraph and each Lender hereby represents Section 10.24(a); (B) confirmation that is not relying on any all of the Borrower, conditions set forth in Section 10.24(a) above continue to be complied with (x) in the Servicer event of material change in the performance of the Collateral Obligations and risk characteristics of the Advances and (y) upon the occurrence of any Event of Default or the Equityholder or becoming aware of any breach of their respective Affiliates, for its obligations contained in any financial, tax, legal, accounting, or regulatory advise Transaction Document and (C) all information that any such entity requests in connection with its obligations under the matters set forth in this Section 13.22 and/or Section 13.23 belowRetention Requirements.
Appears in 2 contracts
Samples: Loan Financing and Servicing Agreement (Oaktree Specialty Lending Corp), Loan Financing and Servicing Agreement (Oaktree Strategic Income Corp)
Risk Retention. The Equityholder hereby represents and covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer Investment Advisor that, for so long as any Advance remains outstanding:
(a) it will retain, as originatororiginator (for the purpose of the Securitisation Regulation), on an ongoing basis, a material net economic interest in the form specified in paragraph (d3(d) of Article 6(3) 6 of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “RetentionRetained Interest”);
(b) neither it nor any of its Affiliates will sell, hedge hedge, enter into a short position or otherwise mitigate its credit risk under or associated with the Retention Retained Interest where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Risk Retention Requirements;
(c) it will (A) take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Risk Retention Requirements and (B) provide to the Administrative Agent and/or any Lender that is subject to the EU Due Diligence Requirements, the information, documents, reports and notifications that the Administrative Agent and/or such Lender reasonably requests as necessary to enable compliance with any of their obligations under the EU Due Diligence Requirements, provided that, notwithstanding the provisions of (A) and (B) above, it shall be obligated to do so only if such information, documents, reports and notifications are (1) not subject to a duty of confidentiality; and (2)(a) in its possession, or (b) not in its possession but it can obtain such information, documents, reports or notifications using commercially reasonable efforts and without material expense (provided further that, if obtaining such information, documents, reports or notifications would involve material expense but the requesting Xxxxxx agrees to reimburse it, then it shall obtain the same);
(d) it will confirm to each of the Borrower, the Administrative Agent, the ServicerInvestment Advisor, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the ServicerInvestment Advisor, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and;
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours endeavors to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto; and
(g) (A) in relation to each Collateral Asset acquired by the Borrower which is a Retention Holder Originated Collateral Asset pursuant to part (a) of the definition thereof, it applied sound and well-defined credit granting criteria to the origination of the Collateral Asset; (B) in relation to each Collateral Asset acquired by the Borrower which is a Retention Holder Originated Collateral Asset pursuant to part (b) of the definition thereof, it has verified, in light of the information available to it and subject to its usual standard of care, and reasonably believes that the entity which was, directly or indirectly, involved in the original agreement which created the Collateral Asset applied sound and well-defined credit granting criteria to the origination of the Collateral Asset, and that it maintained clearly established processes for approving, amending, modifying, renewing and financing the Collateral Asset and had effective systems in place to apply those criteria and processes to ensure that the Collateral Asset was granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness; and (C) it and the Borrower has, and reasonably expect to maintain, clearly established criteria and processes for originating, amending, modifying, renewing and financing the Collateral Assets (the “Collateral Asset Originations and Revisions”) and have effective systems in place to apply those criteria and processes to ensure that Collateral Asset Originations and Revisions are granted and approved based on a thorough assessment of each Obligor’s creditworthiness. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer Investment Advisor or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise advice in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.
Appears in 2 contracts
Samples: Revolving Credit and Security Agreement (Goldman Sachs Private Credit Corp.), Revolving Credit and Security Agreement (Goldman Sachs Private Credit Corp.)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs Huntsman International shall (di) and (e) below only, the Servicer that, for so long as any Advance remains outstanding:
(a) it will retain, as originator, on an ongoing basisbasis retain, in its capacity as an originator (under the CRR), a material net economic interest in the form specified in paragraph (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, Pool Receivables in an amount at least equal to not less than 5% of the Retention Basis aggregate Principal Amount of the Pool Receivables at such time in accordance with Article 405, paragraph (1)(d) of CRR Part 5, (ii) not change the manner in which it retains such net economic interest being since the “Retention”);
Closing Date, except to the extent permitted under CRR Part 5, (biii) neither it nor not enter into any of its Affiliates will sell, hedge or otherwise mitigate its credit risk mitigation, short position or any other hedge with respect to such net economic interest, except to the extent permitted under CRR Part 5, and (iv) provide all information to the Lenders or associated with the Retention where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention Requirements;
(c) it will take such further action, provide such information Funding Agents as is in its possession (provided that the provision of such information would not contravene required for any applicable contract, law Lender or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, Funding Agent to comply with CRR Part 5 including as may reasonably be required requested by the Borrower, a any Lender or the Administrative Funding Agent from time to satisfy the EU Retention Requirements;time.”
(d) it will confirm The second proviso to each Section 28(a) of the BorrowerReceivables Loan Agreement shall be and hereby is amended in its entirety to read as follows: “provided that, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs clause (a) and (bii) above in each Monthly Report;shall not apply if the daily average of the aggregate Principal Amounts of Receivables of an Originator that is removed, withdrawn or terminated pursuant to the provisions of this Section 28 occurring during the immediately preceding twelve (12) calendar months is less than ten per cent (10%) of the Aggregate Receivables Amount as of the date immediately prior to the proposed removal, withdrawal or termination of the relevant Approved Originator:”
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails The second proviso to comply with either Section 28(b) of the covenants set out Receivables Loan Agreement shall be and hereby is amended in paragraphs its entirety to read as follows: “provided that, subclause (a) or (ba)(ii) above shall not apply if the average of the aggregate Principal Amount of Receivables removed from the pool of Receivables pursuant to the provisions of this Section 28 in any way; andthe immediately preceding twelve (12) calendar months (including the daily aggregate Principal Amount of Receivables of such proposed Excluded Designated Line of Business) is less than ten per cent (10%) of the Aggregate Receivables Amount as of the date immediately prior to the proposed removal, withdrawal or termination of the relevant Approved Originator or proposed cessation of the Excluded Designated Line of Business;”
(f) it will notify each of its Affiliates Schedule 3 of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), Receivables Loan Agreement shall be deemed and hereby is amended by amending the definition of “Applicable Margin” in its entirety to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.read as follows:
Appears in 2 contracts
Samples: European Receivables Loan Agreement, Master Amendment to the European Receivables Loan Agreement (Huntsman International LLC)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for i. For so long as any Advance remains Obligations are outstanding:
: (ai) the Seller represents and undertakes to the Lender for the purposes of the Retention Requirements that: (A) as an originator for the purposes of the Retention Requirements, it holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the form specified in paragraph (d) of Article 6(3) of securitisation transaction contemplated by the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Credit Agreement, in an amount equal to which shall not be less than 5% of the Retention Basis Amount aggregate nominal value of all the Collateral Obligations (such net economic interest the “Retained Economic Interest”) measured at the time of origination (being the “Retention”occasion of each origination or acquisition of a Collateral Obligation by the Purchaser);
; (bB) neither the Retained Economic Interest takes the form of a first loss tranche in accordance with paragraph 1(d) of Article 405 of the EU Capital Requirements Regulation (Regulation (EU) No 575/2013), as represented by the Seller’s limited company interest in the Purchaser; (C) it nor holds and will retain up to 100% of the limited liability company interests of the Purchaser and the Purchaser shall have no other issued equity interests; (D) the aggregate capital contributions made by the Seller with respect to the limited liability company interests in the Purchaser shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (A) above; and (E) the Seller shall not sell or enter into any of its Affiliates will sellcredit risk mitigation, hedge short positions or any other xxxxxx or otherwise seek to mitigate its credit risk under or associated with respect to its limited liability company interests in the Retention where to do so would cause the transaction contemplated Purchaser (except as permitted by the Facility Documents EU Capital Requirements Regulation referenced in (B) above).
ii. Each Collateral Report shall contain or be accompanied by a certification from the Seller containing a representation that all of the conditions set forth in clause (i) above are true and have been true up to cease and on each date since the prior Reporting Date (or, with respect to be compliant with the EU Retention Requirements;
(c) it will take such further actionfirst Reporting Date, since the Closing Date). The Seller shall provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or to the Administrative Agent and/or any Lender that is subject to satisfy the EU Retention Requirements;
: (dA) it will confirm to each prompt written notice of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each breach of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms obligations set forth in this paragraph Section 5.1(l)(i); and each Lender hereby represents (B) all information that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise such entity requests in connection with its obligations under the matters set forth in this Section 13.22 and/or Section 13.23 belowRetention Requirements.
Appears in 2 contracts
Samples: Sale and Contribution Agreement (FS Global Credit Opportunities Fund-A), Sale and Contribution Agreement (FS Investment Corp II)
Risk Retention. The Equityholder hereby covenants, for the benefit of Risk Retention Sponsor represents and undertakes to the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer each Lender that, for so long as (i) any Advance remains outstandingLender is subject, whether directly or indirectly, to the EU Securitization Rules; and (ii) the Aggregate Loan Principal Balance is greater than zero:
(a) it will retainthe Risk Retention Sponsor holds, as originator, and shall retain on an ongoing basis, a material net economic interest in the transaction contemplated by this Agreement which shall not be less than 5%, as set forth in sub-paragraphs (b) and (c) below (the “Retained Interest”);
(b) the Retained Interest is, and shall be, in the form specified of the first loss tranche as defined in paragraph (d) of Article 6(3) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having Risk Retention Sponsor ensuring that:
(i) at all times:
(A) the same or a more severe risk profile than those transferred or sold to investors Risk Retention Sponsor holds and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to will retain not less than 580% of the Retention Basis Amount Equity Interests in Pkg 10 Parent, either directly or, if indirectly, then only through one or more Holding Subsidiaries; and
(such net economic interest being B) Pkg 10 Parent holds and will retain directly 100% of the Equity Interests in Pkg 10 Pledgor, LLC (“RetentionPkg 10 Equity Owner”);
(bii) neither it nor any with effect from the time (if any) at which Pkg 8 Pledgor, LLC is added as an Equity Owner hereunder:
(A) the Risk Retention Sponsor holds and will retain not less than 59.6% of its Affiliates the Equity Interests in Pkg 8 Parent, either directly or, if indirectly, then only through one or more Holding Subsidiaries; and
(B) Pkg 8 Parent holds and will sellretain directly 100% of the Equity Interests in Pkg 8 Pledgor, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention RequirementsLLC (“Pkg 8 Equity Owner”);
(ciii) it will take such further actionat all times, provide such information as is 100% of the Equity Interests in its possession each Borrower are held and retained by Pkg 8 Equity Owner or Pkg 10 Equity Owner, either directly or, if indirectly, then only through one or more Special Purpose Entities; and
(provided iv) the amount of Equity Interests held and retained by the Risk Retention Sponsor in each of the Borrowers in accordance with sub-paragraphs (b)(i) to (iii) above equals, in total, at least 5% of the sum, for all Financed Properties and Financed Single Plat Developments, of the amount that is, for each Financed Property and each Financed Single Plat Development, the provision higher of (x) the Purchase Price of the relevant Financed Property or Financed Single Plat Development, and (y) the BPO Value of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreementsFinanced Property Financed Single Plat Development, in each case, as may reasonably be required at the time of origination (being the most recent Borrowing Date to occur under this Agreement for a Financed Property or a Financed Single Plat Development);
(c) the Risk Retention Sponsor will not, and will not permit any affiliate (including any entity referred to in sub-paragraph (b) above, each an “Intermediate Entity”) to: (i) hedge or otherwise mitigate the credit risk arising from or associated with the Retained Interest (including any interest in any Intermediate Entity); or (ii) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from or associated with the Retained Interest (including any interest in any Intermediate Entity), except (in the case of both part (i) and part (ii) of this sub-paragraph (c)) to the extent permitted by the BorrowerEU Securitization Rules, it being understood that the Interest Rate Cap Agreement shall not constitute a Lender credit risk mitigation or the Administrative Agent to satisfy a hedge prohibited by the EU Retention RequirementsSecuritization Rules;
(d) it the Risk Retention Sponsor will confirm to each of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, Agent that it continues to comply with its continued compliance with the covenants set out at obligations under sub-paragraphs (a) to (c) above:
(i) each month, at the time the statements referred to in Section 5.02(b)(iii) are required to be provided, a statement confirming that it continues to comply with its obligations under sub-paragraphs (a) through (c) above, in the form attached as Exhibit I;
(ii) in the event of a material change in the performance of the Loans or the risk characteristics of the Loans and the Financed Properties and Financed Single Plat Developments as a result of a material change in the structure of the transactions contemplated by this Agreement or otherwise; and
(biii) above upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in each Monthly Reportany Transaction Documents;
(e) it the Risk Retention Sponsor will promptly notify the Borrower, provide prompt written notice to the Administrative Agent, the Servicer, each Lender Agent and the Collateral Agent in writing if for Lenders of any reason it fails to comply with either breach of the covenants set out in its obligations under sub-paragraphs (a) through (c) above;
(f) the Risk Retention Sponsor will not change the manner in which it holds the Retained Interest, or the methodology used to calculate the amount of the Retained Interest, except (bin each case) above to the extent that such change is permitted under the EU Securitization Rules;
(g) the Risk Retention Sponsor will provide all such information, documents, reports and notifications that the Administrative Agent or any Lender may reasonably require in any wayrelation to the Retained Interest, the Financed Properties, the Financed Single Plat Developments and/or the Leases in order that a Lender may comply with its obligations under the EU Securitization Rules;
(h) the Risk Retention Sponsor (i) was not established for, and does not operate for, the sole purpose of securitizing exposures; (ii) holds, and shall continue to invest in and hold, assets, securities and other investments, excluding the Equity Interests in the Borrowers and its interests in the Financed Properties and Financed Single Plat Developments; (iii) has, and shall continue to have, the capacity to meet its general payment and other obligations and absorb credit losses through resources other than its Equity Interests in the Borrowers and its interests in the Financed Properties and Financed Single Plat Developments; and (iv) has established, and shall maintain, arrangements by which it has the benefit of the services of sufficient decision makers with the required experience to enable the Risk Retention Sponsor to pursue its established business strategy, as well as an adequate corporate governance structure; and
(fi) it the Risk Retention Sponsor has taken or procured (or, as applicable, will notify take or procure) all necessary steps to ensure that: (i) the Leases were (or, as applicable, will be) granted on the basis of sound and well-defined underwriting criteria; (ii) clearly established processes are maintained for approving, amending and renewing the Leases; and (iii) effective systems are in place to apply those criteria and processes to ensure that Leases are granted based on a thorough assessment of each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowTenant’s creditworthiness.
Appears in 2 contracts
Samples: Loan Agreement (Bluerock Homes Trust, Inc.), Loan Agreement (Bluerock Residential Growth REIT, Inc.)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent Lenders and, in respect of paragraphs (div) and (ev) below only, the Servicer Collateral Manager that, for so long as any Advance Loan remains outstanding:
(ai) it will retain, as originator, on an ongoing basis, a material net economic interest in the form specified in paragraph (d3(d) of Article 6(3) 6 of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “"Retention”");
(bii) neither it nor any of its Affiliates will sell, hedge hedge, enter into a short position or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Transaction Documents to cease to be compliant with the EU Risk Retention Requirements;
(ciii) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Risk Retention Requirements;
(div) it will confirm to each of the Borrower, the Administrative Agent, the Servicer, Collateral Manager and each Lender and the Collateral AgentLender, its continued compliance with the covenants set out at paragraphs (ai) and (bii) above in each Monthly Reporton a monthly basis;
(ev) it will promptly notify the Borrower, the Administrative Agent, the Servicer, Collateral Manager and each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (ai) or (bii) above in any way; and
(fvi) it will notify each of its Affiliates of the contents of paragraph (bii) above and shall use reasonable endeavours endeavors to procure that each of its Affiliates complies with the terms of paragraph (bii) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to the Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 9(e) and/or Section 13.23 9(f) below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer Collateral Manager or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 9(e) and/or Section 13.23 9(f) below.
Appears in 2 contracts
Samples: Credit Agreement (Steele Creek Capital Corp), Credit Agreement (Steele Creek Capital Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding:
: the Equityholder represents and undertakes that: (aA) it as an originator for purposes of the EU Securitization Rules, the Equityholder holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the securitization transaction contemplated by this Agreement, which shall not be less than 5% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to Equityholder’s direct equity interest in the Borrower under and indirect equity interest in the LLC Agreement, in an amount equal to not less than 5Securitization Subsidiaries (“Equity Interests”); (C) the Equityholder directly holds and will directly retain 100% of the Retention Basis Amount Equity Interests in the Borrower and in turn the Borrower holds and will retain 100% of the equity interests in the Securitization Subsidiaries; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to the Equity Interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; and (E) the Equityholder shall not, and it nor any of will procure that its Affiliates will sell(including without limitation, the Borrower and the Securitization Subsidiaries) do not, hedge or otherwise mitigate its credit risk or sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising under or associated with the Retention where Retained Economic Interest, except to do so would cause the extent permitted under the EU Securitization Rules.
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditions set forth in clause (a) above are true and have been true up to and on each date of the related Accrual Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the EU Securitization Rules: (A) prompt written notice of any breach of the obligations set forth in clause (a) above; (B) confirmation in writing that all of the conditions set forth in clause (a) above continue to be complied with (x) in the event of a material change in the transaction structure that materially impacts the performance of the Collateral Obligations or the risk characteristics of the Collateral Obligations and Advances made with respect thereto and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information, documents, reports and notifications that any such entity reasonably requests in connection with its obligations under the EU Securitization Rules, but only to the extent the same (x) is in the possession (or reasonable procurement) of the Equityholder, and (y) is not subject to contractually binding confidentiality requirements or laws governing the protection of confidentiality of information and the processing of personal data (“Restricted Information”), or if it is Restricted Information and cannot be anonymized or aggregated, the Facility Agent and/or any such Lender enters into a confidentiality agreement reasonably acceptable to the Equityholder.
(c) The Equityholder represents and undertakes that: (A) its Equity Interests in the Borrower were duly approved in accordance with its governing documents and investment policies; and (B) acting through its investment manager, GC Advisors LLC (the “Investment Manager”), the Equityholder established the transaction contemplated by the Facility Transaction Documents by: (x) causing the incorporation of each Loan Party from time to cease to be compliant time party hereto as a wholly-owned subsidiary; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations; and (z) determining the transaction structure and negotiating the Transaction Documents with the EU Retention Requirements;various transaction parties.
(d) The Equityholder represents that: (A) it was not established for, and does not operate for, the sole purpose of securitizing exposures; (B) it has, and reasonably expects to continue to have, the capacity to meet its general payment and other obligations consistent with a broader business enterprise; and (C) it maintains a corporate governance structure and through its Investment Manager it has, and shall continue to retain, experienced decision makers to enable the Equityholder to pursue its established business strategy.
(e) The Equityholder is, and will remain, ultimately responsible for and retain discretion over the actions of the Investment Manager; and any actions taken by the Investment Manager in relation to the matters outlined in clause (c) it will take such further actionabove are taken for, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contractand on behalf of, law or regulation or duties of confidentiality binding on the Equityholder.
(f) The Equityholder represents and enter into undertakes that: (A) the Collateral Obligations originated by the Equityholder and the Borrower have been, and will continue to be, originated pursuant to a sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing the Underlying Instruments related to such Collateral Obligations and each of the Equityholder and the Borrower have, and shall maintain, effective systems in place to apply those criteria and processes to ensure that such Underlying Instruments are granted and approved based on a thorough assessment of each Obligor’s creditworthiness; and (B) in relation to each other agreements, in each case, as may reasonably be required Collateral Obligation acquired by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each Equityholder reasonably believes in light of the Borrowerinformation available to it and subject to a reasonable standard of care, that the Administrative Agententity which was, directly or indirectly, involved in the ServicerUnderlying Instruments which created such Collateral Obligation granted such Underlying Instruments pursuant to a sound and well-defined criteria and clearly established processes for approving, each Lender amending, modifying, renewing and financing the Collateral Agent, its continued compliance with Underlying Instruments and it had effective systems in place to apply those criteria and processes to ensure that the covenants set out at paragraphs (a) Underlying Instruments were granted and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either approved based on a thorough assessment of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowrelevant Obligor’s creditworthiness.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Golub Capital BDC 3, Inc.)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding:
: the Equityholder represents and undertakes that: (aA) it as an originator for purposes of the EU Securitization Rules, the Equityholder holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the securitization transaction contemplated by this Agreement, which shall not be less than 5% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to Equityholder’s direct equity interest in the Borrower under and indirect equity interest in the LLC Agreement, in an amount equal to not less than 5Securitization Subsidiaries (“Equity Interests”); (C) the Equityholder directly holds and will directly retain 100% of the Retention Basis Amount Equity Interests in the Borrower and in turn the Borrower holds and will retain 100% of the equity interests in the Securitization Subsidiaries; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to the Equity Interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; and (E) the Equityholder shall not, and it nor any of will procure that its Affiliates will sell(including without limitation, the Borrower and the Securitization Subsidiaries) do not, hedge or otherwise mitigate its credit risk or sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising under or associated with the Retention where Retained Economic Interest, except to do so would cause the extent permitted under the EU Securitization Rules.
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditions set forth in clause (a) above are true and have been true up to and on each date of the related Collection Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the EU Securitization Rules: (A) prompt written notice of any breach of the obligations set forth in clause (a) above; (B) confirmation that all of the conditions set forth in clause (a) above continue to be complied with (x) in the event of a material change in the transaction structure that materially impacts the performance of the Collateral Obligations or the risk characteristics of the Collateral Obligations and Advances made with respect thereto and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information, documents, reports and notifications that any such entity reasonably requests in connection with its obligations under the EU Securitization Rules, but only to the extent the same (x) is in the possession (or reasonable procurement) of the Equityholder, and (y) is not subject to contractually binding confidentiality requirements or laws governing the protection of confidentiality of information and the processing of personal data (“Restricted Information”), or if it is Restricted Information and cannot be anonymized or aggregated, the Facility Agent and/or any such Lender enters into a confidentiality agreement reasonably acceptable to the Equityholder.
(c) The Equityholder represents and undertakes that: (A) its Equity Interests in the Borrower were duly approved in accordance with its governing documents and investment policies; and (B) acting through its investment manager, GC Advisors LLC (the “Investment Manager”), the Equityholder established the transaction contemplated by the Facility Transaction Documents by: (x) causing the incorporation of each Loan Party from time to cease to be compliant time party hereto as a wholly-owned subsidiary; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations; and (z) determining the transaction structure and negotiating the Transaction Documents with the EU Retention Requirements;various transaction parties.
(d) The Equityholder represents that: (A) it was not established for, and does not operate for, the sole purpose of securitizing exposures; (B) it has, and reasonably expects to continue to have, the capacity to meet its general payment and other obligations consistent with a broader business enterprise; and (C) it maintains a corporate governance structure and through its Investment Manager it has, and shall continue to retain, experienced decision makers to enable the Equityholder to pursue its established business strategy.
(e) The Equityholder is, and will remain, ultimately responsible for and retain discretion over the actions of the Investment Manager; and any actions taken by the Investment Manager in relation to the matters outlined in clause (c) it will take such further actionabove are taken for, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contractand on behalf of, law or regulation or duties of confidentiality binding on the Equityholder.
(f) The Equityholder represents and enter into undertakes that: (A) the Collateral Obligations originated by the Equityholder and the Borrower have been, and will continue to be, originated pursuant to a sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing the Underlying Instruments related to such Collateral Obligations and each of the Equityholder and the Borrower have, and shall maintain, effective systems in place to apply those criteria and processes to ensure that such Underlying Instruments are granted and approved based on a thorough assessment of each Obligor’s creditworthiness; and (B) in relation to each other agreements, in each case, as may reasonably be required Collateral Obligation acquired by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each Equityholder reasonably believes in light of the Borrowerinformation available to it and subject to a reasonable standard of care, that the Administrative Agententity which was, directly or indirectly, involved in the ServicerUnderlying Instruments which created such Collateral Obligation granted such Underlying Instruments pursuant to a sound and well-defined criteria and clearly established processes for approving, each Lender amending, modifying, renewing and financing the Collateral Agent, its continued compliance with Underlying Instruments and it had effective systems in place to apply those criteria and processes to ensure that the covenants set out at paragraphs (a) Underlying Instruments were granted and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either approved based on a thorough assessment of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowrelevant Obligor’s creditworthiness.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Golub Capital BDC 3, Inc.)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for For so long as any Advance remains outstandingObligations are outstanding and any Lender is subject to the EU Securitization Rules:
(a) The Equityholder represents and undertakes to the Facility Agent and the Lenders that: (A) that as an originator for the purposes of the EU Securitization Rules, it holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the form specified in transaction contemplated by this Agreement, which shall be comprised of 100% of the Preference Shares of the Borrower (representing no less than 5% of the aggregate nominal value of all Collateral Obligations measured at the time of their origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower), or such lesser amount that may be permitted under the EU SecurizationSecuritization Regulation) (the “Retained Economic Interest”), for the purposes of complying with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as it applies at the date of this Agreement; (B) the Equityholder shall not (and will procure that any of its Affiliates do not) short, being retention hedge, otherwise mitigate its credit risk or sell, transfer or otherwise surrender all or part of the first loss tranche andrights, benefits or obligations arising from or associated with the Retained Economic Interest (except as permitted by the EU Securitization Rules); and (C) over 50% of the aggregate outstanding principal balance of the Collateral Obligations shall constitute Retention Holder Collateral Obligations, with such proportion of Retention Holder Collateral Obligations being measured on the basis of the aggregate outstanding principal balance of the Collateral Obligations following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower, or, if necessaryat any time less than 50.01% of all of the Collateral Obligations are Retention Holder Collateral Obligations, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to it shall procure that the Borrower under the LLC Agreement, in an amount equal to shall only acquire or originate Eligible Collateral Obligations that qualify as Retention Holder Collateral Obligations until not less than 550.01% of the all Collateral Obligations are Retention Basis Amount (such net economic interest being the “Retention”)Holder Collateral Obligations;
(b) neither Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditions set forth in clauses (a)(A) and (a)(B) above are true and have been true up to and on each date of the related Collection Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the EU Securitization Rules: (A) prompt written notice of any breach of the obligations set forth in clauses (a)(A) and (B) above; (B) confirmation that all of the conditions set forth in clause (a) above continue to be complied with (x) in the event of a material -114 USActive 49316845.1149316845.12 change in the performance of the Collateral Obligations or the risk characteristics of the Advances and (y) upon the occurrence of any Event of Default or becoming aware of any -115 USActive 49316845.1149316845.12 breach of the obligations contained in any Transaction Documents; and (C) all information and documents that the Facility Agent and/or any Lender may reasonably request in connection with its obligations under Article 5 of the EU Securitization Regulation and any related EU Securitization Rules, but only to the extent the same is not subject to laws governing the protection of confidentiality of information and the processing of personal data (“Restricted Information”), or if it nor is Restricted Information and cannot be anonymized or aggregated to the extent not prohibited by law or the terms of such Restricted Information, if the Facility Agent and/or relevant Lender enters into a confidentiality agreement reasonably acceptable to the Equityholder; and provided that the Equityholder shall not be required to provide any information relating to any limited partner of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated the Equityholder and provided further that the Equityholder shall only be required to comply with Article 7 of the Retention where EU Securitization Regulation to do so would cause the transaction contemplated extent mutually agreed upon by the Equityholder and the Facility Documents Agent and/or any Lender that is subject to cease to be compliant with the EU Retention RequirementsSecuritization Rules;
(c) The Equityholder represents that it will take such further action, provide such information has been involved in the establishment of the transaction contemplated by this Agreement by: (A) causing the formation of the Borrower as is in its possession a 100% owned subsidiary; (provided that B) approving the provision eligibility criteria for the origination and acquisition of such information would not contravene any applicable contract, law or regulation or duties Collateral Obligations by the Borrower; and (C) negotiating and approving the execution of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required Transaction Documents by the Borrower, a Lender or the Administrative Agent to satisfy Equityholder and the EU Retention RequirementsServicer;
(d) it The Equityholder hereby further represents and undertakes to the Facility Agent and the Lenders party hereto as follows:
(i) It was not established for, and does not operate for, the sole purpose of securitizing exposures.
(A) The Retention Holder Originated Collateral Obligations have been, or will confirm be originated pursuant to each a sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing those credits and the Equityholder has effective systems in place to apply those criteria and processes to ensure that such credits are granted and approved based on a thorough assessment of the Borrowerrelevant Obligor’s creditworthiness; and (B) the Equityholder will use reasonable skill and care to ensure that the Retention Holder Acquired Collateral Obligations and each other Eligible Collateral Obligation acquired by the Borrower in respect of which the initial originator was not a European credit institution or investment firm (as each such term is defined in Capital Requirementsthe EU Securitization Regulation (Regulation (EU) No 575/2013)) have been, or will be originated pursuant to a sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing those credits and that the Administrative Agentinitial originator had effective systems in place to apply those criteria and processes to ensure that such credits are granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness.
(iii) The Equityholder is duly organized, validly existing and in good -116 USActive 49316845.1149316845.12 standing under the Servicerlaws of the jurisdiction of its organization and has full power and authority to execute, each Lender deliver and perform its obligations under this Agreement. -117 USActive 49316845.1149316845.12 Substituted Collateral Obligations pursuant to Section 7.11 or (iv) amounts paid to the Borrower pursuant to Section 8.3. In connection with the release of a Lien on any Collateral permitted pursuant to this Section 12.3 and conducted in the ordinary course of business consistent with industry standards and practices (including the use of escrows), the Collateral Agent, its continued compliance with on behalf of the covenants set out Secured Parties, will, at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, sole expense of the Servicer, each Lender execute and deliver to the Servicer any assignments, bills of sale, termination statements and any other releases and instruments as the Servicer may reasonably request in order to effect the release and transfer of such Collateral; provided, that the Collateral Agent in writing if for any reason it fails to comply with either Agent, on behalf of the covenants set out in paragraphs (a) Secured Parties, will make no representation or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained hereinwarranty, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction express or any of the parties hereto implied, with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise such Collateral in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowsuch sale or transfer and assignment.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Oaktree Strategic Income Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for so long as any Advance remains outstanding:
(a) it will retain, as originator, on an ongoing basis, a material net economic interest in the form specified in paragraph (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “Retention”);
(b) neither it nor any of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention Requirements;
(c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Payment Date Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (Blackstone Private Credit Fund)
Risk Retention. The Equityholder hereby represents and covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer Investment Advisor that, for so long as any Advance remains outstanding:
(a) it will retain, as originatororiginator (for the purpose of the Securitisation Regulation), on an ongoing basis, a material net economic interest in the form specified in paragraph (d3(d) of Article 6(3) 6 of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “RetentionRetained Interest”);
(b) neither it nor any of its Affiliates will sell, hedge hedge, enter into a short position or otherwise mitigate its credit risk under or associated with the Retention Retained Interest where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Risk Retention Requirements;
(c) it will (A) take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Risk Retention Requirements and (B) provide to the Administrative Agent and/or any Lender that is subject to the EU Due Diligence Requirements, the information, documents, reports and notifications that the Administrative Agent and/or such Lender reasonably requests as necessary to enable compliance with any of their obligations under the EU Due Diligence Requirements, provided that, notwithstanding the provisions of (A) and (B) above, it shall be obligated to do so only if such information, documents, reports and notifications are (1) not subject to a duty of confidentiality; and (2)(a) in its possession, or (b) not in its possession but it can obtain such information, documents, reports or notifications using commercially reasonable efforts and without material expense (provided further that, if obtaining such information, documents, reports or notifications would involve material expense but the requesting Xxxxxx agrees to reimburse it, then it shall obtain the same);
(d) it will confirm to each of the Borrower, the Administrative Agent, the ServicerInvestment Advisor, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the ServicerInvestment Advisor, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and;
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours endeavors to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto; and
(A) in relation to each Collateral Asset acquired by the Borrower which is a Retention Holder Originated Collateral Asset pursuant to part (a) of the definition thereof, it applied sound and well-defined credit granting criteria to the origination of the Collateral Asset; (B) in relation to each Collateral Asset acquired by the Borrower which is a Retention Holder Originated Collateral Asset pursuant to part (b) of the definition thereof, it has verified, in light of the information available to it and subject to its usual standard of care, and reasonably believes that the entity which was, directly or indirectly, involved in the original agreement which created the Collateral Asset applied sound and well-defined credit granting criteria to the origination of the Collateral Asset, and that it maintained clearly established processes for approving, amending, modifying, renewing and financing the Collateral Asset and had effective systems in place to apply those criteria and processes to ensure that the Collateral Asset was granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness; and (C) it and the Borrower has, and reasonably expect to maintain, clearly established criteria and processes for originating, amending, modifying, renewing and financing the Collateral Assets (the “Collateral Asset Originations and Revisions”) and have effective systems in place to apply those criteria and processes to ensure that Collateral Asset Originations and Revisions are granted and approved based on a thorough assessment of each Obligor’s creditworthiness. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer Investment Advisor or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise advice in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (Goldman Sachs Private Credit Corp.)
Risk Retention. The Equityholder Sponsor hereby covenantsrepresents, warrants and agrees for the benefit of the Administrative Agent, Agent and the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for so long as any Advance remains the Obligations are outstanding, that:
(a) it the Sponsor, in its capacity as originator for the purposes of the Securitisation Regulation Rules, will retain, as originator, acquire on the Closing Date and will hold on an ongoing basis, basis a material net economic interest in the transactions contemplated hereunder and under the other Facility Documents (the “Transaction”) in an amount of not less than 5% of the nominal value of the securitised exposures, in the form specified of an first loss tranche as referred to in paragraph option (d) of Article 6(3) of the EU Securitisation RegulationRegulation (the “Retained Interest”), being retention of by the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to Sponsor’s indirectly owning equity interest in the Borrower under sufficient for the LLC Agreement, in an amount equal to not less than 5% purposes of the Retention Basis Amount (such net economic interest being the “Retention”)this paragraph;
(b) neither it nor the Sponsor will not (and will not permit any of its Affiliates will sell, affiliates to) hedge or otherwise mitigate its credit risk under or associated with the Retention where Retained Interest, sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from the Retained Interest, except to do so would cause the transaction contemplated extent permitted by the Facility Documents to cease to be compliant with the EU Retention RequirementsSecuritisation Regulation Rules;
(c) it the Sponsor will take such further actionnot change the retention option or method of calculation of the Retained Interest, provide such information as is in its possession (provided that except to the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required extent permitted by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention RequirementsSecuritisation Regulation Rules;
(d) it the Sponsor will confirm provide (or cause the Servicer to each provide) ongoing confirmation of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its Sponsor’s continued compliance with the covenants set out at paragraphs obligations described above (ai) and (b) above in or concurrently with the delivery of each Monthly Report, (ii) promptly following the occurrence of any Default or Event of Default, and (iii) from time to time promptly upon written request by the Administrative Agent (on behalf of any Lenders) in connection with any material change in the performance of the Collateral Loans or the Transaction or any material breach of the Facility Documents;
(e) it the Sponsor will promptly notify the BorrowerAdministrative Agent and the Lenders in accordance with this Agreement of any violation of the Sponsor’s commitment to retain the Retained Interest or any change to the manner in which the Retained Interest is held;
(f) the Sponsor will provide (or cause the Servicer, the Equityholder or the Borrower to provide), promptly upon written request by the Administrative AgentAgent on behalf of any Lender or Lenders from time to time, such further information as the Administrative Agent or any Lender may reasonably request in order to enable compliance by any Lender with the Securitisation Regulation to the extent that such information is in the possession or control of the Sponsor, the Servicer, the Equityholder or the Borrower and that the Sponsor (or the Servicer, the Equityholder or the Borrower, as applicable) can provide such information without breaching applicable confidentiality laws or contractual obligations binding on them;
(g) for the purposes of the Securitisation Regulation Rules, the Sponsor reasonably believes that (A) with respect to each Lender and of the Collateral Agent Loans made from time to time by the Borrower, or made by the Sponsor and then transferred by the Sponsor to the Borrower, the Sponsor, itself or through related entities, directly or indirectly, has been or will be involved in writing if for any reason it fails the original agreement giving rise to comply with either the obligations of the covenants set out relevant Obligor, (B) with respect to each of the Collateral Loans purchased from time to time by the Borrower from third parties, the Sponsor, by such purchase, has acquired the economic risk and benefits of those Collateral Loans for its own account, (C) both initially and on an ongoing basis, at any time the aggregate outstanding amount of Collateral Loans referred to in paragraphs (a) or (bA) above in any waywill be more than fifty percent (50%) of the aggregate amount of all Collateral Loans at that time, and (D) the Sponsor has established and is managing the securitisation constituted by the Transaction; and
(fh) it will notify each the Sponsor (i) was not established and does not operate for the sole purpose of its Affiliates of securitizing exposures, (ii) has a business strategy and the contents of paragraph (b) above capacity to meet payment obligations consistent with a broader business enterprise and shall use reasonable endeavours involving material support from capital, assets, fees or other income available to procure that each of its Affiliates complies the Sponsor, relying neither on the Collateral Loans and any other exposures being securitised by the Sponsor, nor on the Retained Interest and any other interests retained or proposed to be retained in accordance with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting , as well as any corresponding income from such exposures and interests, and (iii) has responsible decision-makers who have the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions)required experience to enable the Sponsor to pursue its established business strategy, shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowas well as an adequate corporate governance arrangement.
Appears in 1 contract
Samples: First Omnibus Amendment (Pennantpark Investment Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding, the and any Lender is subject to the EU Securitization Rules:
(a) The Equityholder represents and undertakes to the Facility Agent and the Lenders that: (A) that as an originator for the purposes of the EU Securitization Rules, it holds and will retain, as originator, on retain unencumberedon an ongoing on-going basis, a material net economic interest in the form specified transaction contemplated by this Agreement, which shall be comprised of 100% of the Preference Shares of the Borrower (representing no less than 6.05% of the aggregate nominal value of all the Collateral Obligations measured at the time of their origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower)); (B) the Borrower shall have no other issued equity interests other than to Walkers Fiduciary Limited, and the aggregate Preference Shares held by the Equityholder with respect to its equity interests in the Borrower shall represent at least 5.0% of the aggregate nominal value of all the Collateral Obligations measured at the time of origination as described in (A) above; (C) the Equityholder shall not sell or enter into any credit risk mitigation, short positions or any other xxxxxx or otherwise seek to, or such lesser amount that may be permitted under the EU Securization Regulation) (the “Retained Economic Interest”), for the purposes of complying with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as it applies at the date of this Agreement; (B) the Equityholder shall not (and will procure that any of its Affiliates do not) short, being retention hedge, otherwise mitigate its credit risk or sell, transfer or otherwise surrender all or part of the first loss tranche andrights, if necessary, other tranches having benefits or obligations arising from or associated with respect to its equity interests in the same or a more severe risk profile than those transferred or sold to investors Borrowerthe Retained Economic Interest (except as permitted by the Capital Requirements Regulation) and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to (D) not less than 55EU Securitization Rules); and (C) over 50% of the aggregate outstanding principal balance of the Collateral Obligations has been originated and underwritten by the Equityholder (as Servicer for the Borrower) or the Borrower as the named lender in the Underlying Instruments at origination thereof; shall constitute Retention Basis Amount (Holder Collateral Obligations, with such net economic interest proportion of Retention Holder Collateral Obligations being measured on the “Retention”)basis of the aggregate outstanding principal balance of the Collateral Obligations following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower, or, if at any time less than 50.01% of all of the Collateral Obligations are Retention Holder Collateral Obligations, it shall procure that the Borrower shall only acquire or originate Eligible Collateral Obligations that qualify as Retention Holder Collateral Obligations until not less than 50.01% of all Collateral Obligations are Retention Holder Collateral Obligations;
(b) neither The Equityholder represents that for purposes of the Retention Requirements that it nor any established the securitisation transaction contemplated by the Agreement by incorporating the Borrower, determining the Borrower’s policies and eligibility criteria for the acquisition and origination of its Affiliates will sellCollateral Obligations, hedge or otherwise mitigate its credit risk under or associated determining the transaction structure and negotiating the Transaction Documents with the various transaction parties; and
(c) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditions set forth in clauseclauses (a)(A) and (a)(B) above are true and have been true up to and on each date of the related Collection Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the Retention where RequirementsEU Securitization Rules: (A) prompt written notice of any breach of itsthe obligations set forth in Section 10.24clauses (a)(A) and (B) above; (B) confirmation that all of the conditions set forth in Section 10.24clause (a) above continue to do so would cause be complied with (x) in the event of a material change in the performance of the Collateral Obligations andor the risk characteristics of the Advances and (y)upon the occurrence of any Event of Default or becoming aware of any breach of itsthe obligations contained in any Transaction DocumentDocuments; and (C) all information and documents that any such entity requeststhe Facility Agent and/or any Lender may reasonably request in connection with its obligations under the Retention RequirementsArticle 5 of the
(c) The Equityholder represents that it has been involved in the establishment of the transaction contemplated by this Agreement by: (A) causing the Facility formation of the Borrower as a 100% owned subsidiary; (B) approving the eligibility criteria for the origination and acquisition of Collateral Obligations by the Borrower; and (C) negotiating and approving the execution of the Transaction Documents to cease to be compliant with the EU Retention Requirements;
(c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy Equityholder and the EU Retention RequirementsServicer;
(d) it The Equityholder hereby further represents and undertakes to the Facility Agent and the Lenders party hereto as follows:
(i) It was not established for, and does not operate for, the sole purpose of securitizing exposures.
(ii) (A) The Retention Holder Originated Collateral Obligations have been, or will confirm be originated pursuant to each a sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing those credits and the Equityholder has effective systems in place to apply those criteria and processes to ensure that such credits are granted and approved based on a thorough assessment of the Borrowerrelevant Obligor’s creditworthiness; and (B) the Equityholder will use reasonable skill and care to ensure that the Retention Holder Acquired Collateral Obligations and each other Eligible Collateral Obligation acquired by the Borrower in respect of which the initial originator was not a European credit institution or investment firm (as each such term is defined in Capital Requirements Regulation (Regulation (EU) No 575/2013)) have been, or will be originated pursuant to a sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing those credits and that the Administrative Agentinitial originator had effective systems in place to apply those criteria and processes to ensure that such credits are granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness.
(iii) The Equityholder is duly organized, validly existing and in good standing under the Servicerlaws of the jurisdiction of its organization and has full power and authority to execute, each Lender deliver and perform its obligations under this Agreement.
(iv) The Equityholder has taken all necessary action to authorize the entering into this Agreement on the terms and conditions hereof and the Collateral Agentexecution, its continued compliance with delivery and performance of this Agreement and the covenants set out at paragraphs (a) and (b) above in each Monthly Report;performance of all obligations imposed upon it hereunder.
(ev) it will promptly notify All consents, licenses, authorizations, and approvals of, and registrations and declarations with, any governmental authority or regulatory body necessary for the Borrowerdue execution, the Administrative Agentdelivery, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits performance of this Section 13.22 and/or Section 13.23 below (including Agreement have been obtained and remain in full force and effect and all conditions thereof have been duly complied with, and no other action by, and no notice to or filing with, any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, governmental authority or regulatory advise body is required in connection with the matters set forth execution, delivery or performance of this Agreement except where the lack or failure thereof would not reasonably be expected to have a Material Adverse Effect.
(vi) This Agreement constitutes the legal, valid, and binding obligation of the Equityholder and is enforceable against the Equityholder in this Section 13.22 and/or Section 13.23 belowaccordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium, conservatorship, receivership, and other laws of general applicability relating to or affecting, creditors’ rights and, subject as to enforceability, to equitable principles of general application.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Oaktree Specialty Lending Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of Risk Retention Sponsor represents and undertakes to the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer each Lender that, for so long as (i) any Advance remains outstanding:Lender is subject, whether directly or indirectly, to the EU Securitization Rules; and (ii) the Aggregate Loan Principal Balance is greater than zero:
(a) it will retainthe Risk Retention Sponsor holds, as originator, and shall retain on an ongoing basis, a material net economic interest in the transaction contemplated by this Agreement which shall not be less than 5%, as set forth in sub-paragraphs (b) and (c) below (the “Retained Interest”);
(b) the Retained Interest is, and shall be, in the form specified of the first loss tranche as defined in paragraph (d) of Article 6(3) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having Risk Retention Sponsor ensuring that:
(i) at all times:
(A) the same or a more severe risk profile than those transferred or sold to investors Risk Retention Sponsor holds and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to will retain not less than 80% of the Equity Interests in Pkg 10 Parent, either directly or, if indirectly, then only through one or more Holding Subsidiaries; and
(B) Pkg 10 Parent holds and will retain directly 100% of the Equity Interests in Pkg 10 Pledgor, LLC (“Pkg 10 Equity Owner”);
(ii) with effect from the time (if any) at which Pkg 8 Pledgor, LLC is added as an Equity Owner hereunder:
(A) the Risk Retention Sponsor holds and will retain not less than 59.6% of the Equity Interests in Pkg 8 Parent, either directly or, if indirectly, then only through one or more Holding Subsidiaries; and
(B) Pkg 8 Parent holds and will retain directly 100% of the Equity Interests in Pkg 8 Pledgor, LLC (“Pkg 8 Equity Owner”);
(iii) at all times, 100% of the Equity Interests in each Borrower are held and retained by Pkg 8 Equity Owner or Pkg 10 Equity Owner, either directly or, if indirectly, then only through one or more Special Purpose Entities; and
(iv) the amount of Equity Interests held and retained by the Risk Retention Sponsor in each of the Borrowers in accordance with sub-paragraphs (b)(i) to (iii) above equals, in total, at least 5% of the Retention Basis Amount sum, for all Financed Properties and Financed Single Plat Developments, of the amount that is, for each Financed Property and each Financed Single Plat Development, the higher of (such net economic interest being x) the “Retention”);
Purchase Price of the relevant Financed Property or Financed Single Plat Development, and (by) neither it nor any of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention Requirements;
(c) it will take such further action, provide such information as is in its possession (provided that the provision BPO Value of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreementsFinanced Property Financed Single Plat Development, in each case, as may reasonably be required by at the Borrower, time of origination (being the most recent Borrowing Date to occur under this Agreement for a Lender Financed Property or the Administrative Agent to satisfy the EU Retention Requirements;a Financed Single Plat Development);
(dc) it the Risk Retention Sponsor will confirm not, and will not permit any affiliate (including any entity referred to each of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of sub-paragraph (b) above and shall use reasonable endeavours to procure that above, each of its Affiliates complies an “Intermediate Entity”) to: (i) hedge or otherwise mitigate the credit risk arising from or associated with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below Retained Interest (including any related definitions interest in any Intermediate Entity); or provisions(ii) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from or associated with the Retained Interest (including any interest in any Intermediate Entity), shall be deemed to have agreed except (in the case of both part (i) and part (ii) of this sub-paragraph (c)) to the terms set forth in this paragraph and each Lender hereby represents extent permitted by the EU Securitization Rules, it being understood that is the Interest Rate Cap Agreement shall not relying on any of constitute a credit risk mitigation or a hedge prohibited by the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.EU Securitization Rules;
Appears in 1 contract
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains outstanding:
Obligations are outstanding and any Lender is subject to the EU Securitization Rules, the Equityholder represents and undertakes that: (aA) it the Equityholder holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the transaction contemplated by this Agreement, which shall not be less than 5.0% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to Equityholder’s direct limited liability company interest in the Borrower under (the LLC Agreement“Equity Interests”); (C) the Equityholder directly holds, in an amount equal to not less than 5and will retain 100% of the Retention Basis Amount Equity Interests; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to the Equity Interests shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; (E) the Equityholder shall not, and it nor any of will procure that its Affiliates will sell(including without limitation, hedge the Borrower) do not (x) short, hedge, or otherwise mitigate its credit risk under arising from or associated with the Retention where Retained Economic Interest; or (y) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from or associated with the Retained Economic Interest, except (in each case) as permitted by the EU Securitization Rules; and (F) greater than 50% of all of the Collateral Obligations will be Equityholder Originated Collateral Obligations, with such proportion of the Equityholder Originated Collateral Obligations being measured on the basis of the aggregate outstanding principal balance of the Collateral Obligations following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower.
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the obligations set forth in clause (a) above are being complied with in all material respects and have been complied with in all material respects up to do so would cause and on each date of the related Accrual Period. The Equityholder shall, at the Equityholder’s own cost and expense, provide to the Facility Agent and/or any SR Lender: (A) prompt written notice of any breach of the obligations set forth in clause (a) above; (B) at the request of any SR Lender, confirmation in writing that all of the obligations set forth in clause (a) above continue to be complied with (x) in the event of a material change in the structure of the transaction contemplated by the Facility Transaction Documents to cease to be compliant that could have a material adverse impact on the performance of the Advances, or the risk characteristics of the Collateral Obligations and the Advances with respect thereto; and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information, documents and reports that the SR Lender(s) may require in connection with its obligations under the EU Retention Securitization Rules, including without limitation, any information, documentation or reports that the SR Lender requires for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements;; provided that the Equityholder shall only be required to provide notification of any significant event of the type specified by Article 7(1)(g) of the EU Securitization Regulation to the extent that a notification or report in respect of the relevant event has not otherwise been provided by any person pursuant to any other provision of any Transaction Document; provided further, that the Equityholder shall not be required to provide any information, documents or reports: (x) relating to any shareholder of the Equityholder; (y) that is/are the subject of contractual confidentiality requirements; or (z) that is/are subject to laws governing the protection of confidentiality of information and the processing of personal data (all such information being collectively referred to as “Restricted Information”), unless, if it is Restricted Information that cannot be anonymized or aggregated, and there is no existing confidentiality agreement permitting the disclosure of Restricted Information to the SR Lender(s), the Facility Agent and/or the SR Lender(s) enters into a confidentiality agreement reasonably acceptable to the Equityholder, with respect to such Restricted Information, so that it can be furnished to the Facility Agent and the SR Lender(s).
(c) The Equityholder further represents and undertakes that acting directly or indirectly through the Management Company, the Equityholder established the transaction contemplated by the Transaction Documents by: (A) causing the formation of the Borrower as a wholly-owned direct subsidiary that is consolidated with the Equityholder for accounting purposes; (B) approving the eligibility criteria for the Borrower’s origination and acquisition of the Collateral Obligations; (C) assuming the role of the Servicer under the terms and conditions of this Agreement; and (D) determining the transaction structure and negotiating and approving the Transaction Documents.
(d) The Equityholder believes that: (A) it will take such further actionwas not established for, provide such information as is in and does not operate for, the sole purpose of securitizing exposures; (B) it has, and reasonably expects to continue to have, a strategy and the capacity to meet its possession payment obligations consistent with a broader business model that involves material support from capital, assets, fees and sources of income, by virtue of which it does not rely on (provided that x) the provision Collateral Obligations or other assets securitized by it; or (y) the Retained Economic Interest or any other interest retained or proposed to be retained by it for purposes of such information would not contravene any applicable contractthe EU Risk Retention Requirement, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, any related corresponding income as may reasonably be required its sole or predominant source of income; and (C) it has, and shall continue to retain, responsible decision makers with the necessary experience to enable the Equityholder to pursue its established business strategy, as well as an adequate corporate governance structure.
(e) The Equityholder represents and undertakes that (A) each Equityholder Originated Collateral Obligation originated or acquired by the Borrower on or prior to the Closing Date has been, and each Equityholder Originated Collateral Obligation originated or acquired by the Borrower after the Closing Date will be, originated pursuant to a sound and well-defined credit granting criteria and clearly established processes for approving, amending, renewing and financing those credits and that effective systems are in place to apply those criteria and processes to ensure that such credits are granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness; and (B) in relation to any other Collateral Obligation acquired by the Borrower, the Equityholder has verified that the entity that was, directly or indirectly, involved in the original agreement which created such Collateral Obligation applied a Lender or sound and well-defined credit granting criteria to the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each origination of the BorrowerCollateral Obligation, the Administrative Agentand that it maintained clearly established processes for approving, the Serviceramending, each Lender modifying, renewing and financing the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) Obligation and (b) above had effective systems in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender place to apply those criteria and processes to ensure that the Collateral Agent in writing if for any reason it fails to comply with either Obligation was granted and approved based on a thorough assessment of the covenants set out in paragraphs (a) or (b) above in any way; andObligor’s creditworthiness.
(f) it For the avoidance of doubt, the Equityholder is, and will notify each remain, ultimately responsible for its representations and the satisfaction of its Affiliates covenants pursuant to this Section 10.22, regardless whether any actions are taken by the Management Company for or on behalf of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything Equityholder in relation to the contrary contained hereinmatters outlined in clause (c) above.
(g) Notwithstanding the foregoing, neither the Equityholder nor the Borrower makes any representation as to compliance whether or not the Equityholder qualifies an “original lender”, an “originator” or a “sponsor” for the purposes of the transaction EU Securitization Regulation, and neither the Equityholder nor the Borrower makes any representation as to the effect or any sufficiency of this Section 10.22 for purposes of an SR Lender’s compliance with the parties hereto with respect to Securitisation RegulationEU Securitization Rules. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), 10.22 shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowparagraph.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Vista Credit Strategic Lending Corp.)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains outstanding:
Obligations are outstanding and any Lender is subject to the EU Securitization Rules, the Equityholder represents and undertakes that: (ai) it will retainthe Equityholder, as an originator, holds and will retain on an ongoing on-going basis, a material net economic interest in the transaction contemplated by this Agreement, which shall not be less than 5.0% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (ii) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to Equityholder’s direct limited liability company interest in the Borrower under (the LLC Agreement“Equity Interests”); (iii) the Equityholder directly holds, in an amount equal to not less than 5and will retain 100% of the Retention Basis Amount Equity Interests; (such net economic interest being iv) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to the Equity Interests shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bi) neither above; and (v) the Equityholder shall not, and it nor any of will procure that its Affiliates will sell(including without limitation, hedge the Borrower) do not (x) short, hedge, or otherwise mitigate its credit risk under arising from or associated with the Retention where Retained Economic Interest; or (y) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from or associated with the Retained Economic Interest, except (in each case) as permitted by the EU Securitization Rules.
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the obligations set forth in clause (a) above are being complied with and have been complied with up to do so would cause and on each date of the related Accrual Period. The Equityholder shall, at the Equityholder’s own cost and expense, provide to the Facility Agent and/or any SR Lender that is subject to the EU Securitization Rules: (i) prompt written notice of any breach of the obligations set forth in clause (a) above; (ii) at the request of any SR Lender, confirmation in writing that all of the obligations set forth in clause (a) above continue to be complied with (x) in the event of a material change in the structure of the transaction contemplated by the Facility Transaction Documents to cease to be compliant that could have a material adverse impact on the performance of the Advances, or the risk characteristics of the Collateral Obligations and the Advances with respect thereto; and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (iii) all information, documents and reports that the SR Lenders may require in connection with their obligations under the EU Retention Securitization Rules, including without limitation, any information, documentation or reports that the SR Lenders require for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements;; provided that the Equityholder shall only be required to provide notification of any significant event of the type specified by Article 7(1)(g) of the EU Securitization Regulation to the extent that a notification or report in respect of the relevant event has not otherwise been provided by any person pursuant to any other provision of any Transaction Document; provided further, that the Equityholder shall not be required to provide any information, documents or reports: (x) without prejudice to Section 10.4(a) of this Agreement, relating to any member of the Equityholder; (y) that is/are the subject of contractual confidentiality requirements; or (z) that is/are subject to laws governing the protection of confidentiality of information and the processing of personal data (all such information being collectively referred to as “Restricted Information”), unless, if it is Restricted Information that cannot be anonymized or aggregated, and there is no existing confidentiality agreement permitting the disclosure of Restricted Information to the SR Lenders, the Facility Agent and/or the SR Lenders enter into a confidentiality agreement reasonably acceptable to the Equityholder, with respect to such Restricted Information, so that it can be furnished to the Facility Agent and the SR Lenders.
(c) The Equityholder further represents and undertakes that it established the transaction contemplated by the Transaction Documents by: (i) causing the incorporation of the Borrower as a wholly-owned direct subsidiary that is consolidated with the Equityholder for accounting purposes; (ii) approving the eligibility criteria for the Borrower’s origination and acquisition of the Collateral Obligations; (iii) assuming the role of Servicer under the terms and conditions of this Agreement; and (iv) determining the transaction structure and negotiating and approving the Transaction Documents.
(d) The Equityholder represents that: (i) it was not established for, and does not operate for, the sole purpose of securitizing exposures; (ii) it has, and will take such further actioncontinue to have, provide such information as is in a strategy and the capacity to meet its possession payment obligations consistent with a broader business model that involves material support from capital, assets, fees and sources of income, by virtue of which it does not rely on (provided that x) the provision Collateral Obligations or other assets securitized by it; or (y) the Retained Economic Interest or any other interest retained or proposed to be retained by it for purposes of such information would not contravene any applicable contractthe EU Risk Retention Requirement, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, any related corresponding income as may reasonably be required by the Borrower, a Lender its sole or the Administrative Agent to satisfy the EU Retention Requirements;
predominant source of income; and (diii) it will confirm has, and shall continue to each of the Borrowerretain, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance responsible decision makers with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;necessary experience to enable the Equityholder to pursue its established business strategy, as well as an adequate corporate governance structure.
(e) it will promptly notify The Equityholder represents that: (i) each Collateral Obligation is an Equityholder Collateral Obligation; (ii) the BorrowerEquityholder Originated Collateral Obligations have been originated pursuant to sound and well-defined credit-granting criteria and clearly established processes for approving, amending, modifying, renewing and financing those credits and that effective systems were in place to apply those criteria and processes to ensure that credit-granting was based on a thorough assessment of the relevant Obligor’s creditworthiness; and (iii) in relation to each Equityholder Acquired Collateral Obligation, the Administrative AgentEquityholder has verified that the Affiliate which was involved in the Underlying Instrument which created such Collateral Obligation applied sound and well-defined credit-granting criteria to the origination of such Collateral Obligation, the Servicerand that it maintained clearly established processes for approving, each Lender amending, modifying, renewing and the Collateral Agent financing those credits and that effective systems were in writing if for any reason it fails place to comply with either apply those criteria and processes to ensure that credit-granting was based on a thorough assessment of the covenants set out in paragraphs (a) or (b) above in any way; andrelevant Obligor’s creditworthiness.
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Each Lender hereby represents that is not relying on any of the Borrower, the Servicer or Servicer, the Equityholder or any of their respective Affiliates, Affiliates for the provision of any financial, tax, legal, accounting, or regulatory advise advice in connection with any such Lender's analysis relating to the EU Securitization Regulation on the matters set forth in this Section 13.22 and/or Section 13.23 below10.22.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (SCP Private Credit Income BDC LLC)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding:
: the Equityholder represents and undertakes that: (aA) it as an originator for purposes of the EU Securitization Rules, the Equityholder holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the securitization transaction contemplated by this Agreement, which shall not be less than 5% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to Equityholder’s direct equity interest in the Borrower under and indirect equity interest in the LLC Agreement, in an amount equal to not less than 5Securitization Subsidiaries (“Equity Interests”); (C) the Equityholder directly holds and will directly retain 100% of the Retention Basis Amount Equity Interests in the Borrower and in turn the Borrower holds and will retain 100% of the equity interests in the Securitization Subsidiaries; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to the Equity Interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; and (E) the Equityholder shall not, and it nor any of will procure that its Affiliates will sell(including without limitation, the Borrower and the Securitization Subsidiaries) do not, hedge or otherwise mitigate its credit risk or sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising under or associated with the Retention where Retained Economic Interest, except to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with extent permitted under the EU Retention Requirements;Securitization Rules.
(cb) it will take such further action, provide such information as is in its possession (provided Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each all of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants conditions set out at paragraphs forth in clause (a) above are true and (b) above in have been true up to and on each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either date of the covenants related Collection Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the EU Securitization Rules: (A) prompt written notice of any breach of the obligations set out forth in paragraphs clause (a) or above; (bB) above confirmation in any way; and
(f) it will notify each of its Affiliates writing that all of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms conditions set forth in this paragraph and each Lender hereby represents clause (a) above continue to be complied with (x) in the event of a material change in the transaction structure that is not relying on any materially impacts the performance of the Borrower, the Servicer Collateral Obligations or the Equityholder risk characteristics of the Collateral Obligations and Advances made with respect thereto and (y) upon the occurrence of any Event of Default or becoming aware of any breach of their respective Affiliatesthe obligations contained in any Transaction Documents; and (C) all information, for documents, reports and notifications that any financial, tax, legal, accounting, or regulatory advise such entity reasonably requests in connection with its obligations under the matters set forth EU Securitization Rules, but only to the extent the same (x) is in this Section 13.22 the possession (or reasonable procurement) of the Equityholder, and (y) is not subject to contractually binding confidentiality requirements or laws governing the protection of confidentiality of information and the processing of personal data (“Restricted Information”), or if it is Restricted Information and cannot be anonymized or aggregated, the Facility Agent and/or Section 13.23 belowany such Lender enters into a confidentiality agreement reasonably acceptable to the Equityholder.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Golub Capital BDC 3, Inc.)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding:
: the Equityholder represents and undertakes that: (aA) it the Equityholder holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the form specified in paragraph (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC securitization transaction contemplated by this Agreement, in an amount equal to which shall not be less than 5% of the Retention Basis Amount aggregate nominal value of all the Collateral Obligations (such net economic interest the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form of a first loss tranche in accordance with paragraph 1(d) of Article 405 of the Capital Requirements Regulation, as represented by the Equityholder’s direct equity interest in the Borrower and indirect equity interest in the Securitization Subsidiaries (“RetentionEquity Interests”);; (C) the Equityholder directly holds and will directly retain 100% of the Equity Interests in the Borrower and in turn the Borrower holds and will retain 100% of the equity interests in the Securitization Subsidiaries; (D) the aggregate capital contributions made by the Equityholder with respect to the Equity Interests shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (A) above; (E) the Equityholder shall not, and it will procure that its Affiliates (including without limitation, the Borrower and the Securitization Subsidiaries) do not, sell or enter into any credit risk mitigation, short positions or any other hxxxxx or otherwise seek to mitigate its credit risk with respect to its Equity Interests in such Loan Party or the Collateral Obligations (except as permitted by the Capital Requirements Regulation); and (F) not less than 51% of all of the Collateral Obligations will be Collateral Obligations with respect to which the Equityholder, either itself or through related entities (including without limitation, a Loan Party), directly or indirectly, was involved in the original agreement that created such Collateral Obligations, with such proportion of Collateral Obligations being measured on the basis of the aggregate outstanding principal balance of the Collateral Obligations following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower.
(b) neither it nor Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditions set forth in clause (a) above are true and have been true up to and on each date of the related Collection Period. The Equityholder shall provide to the Facility Agent and/or any of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with Lender that is subject to the Retention where Requirements: (A) prompt written notice of any breach of the obligations set forth in clause (a) above; (B) confirmation that all of the conditions set forth in clause (a) above continue to do so would cause be complied with (x) in the event of a material change in the transaction structure that materially impacts the performance of the Collateral Obligations or the risk characteristics of the Advances and the Collateral Obligations and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information that any such entity requests in connection with its obligations under the Retention Requirements.
(c) The Equityholder represents and undertakes that: (A) its Equity Interests in the Borrower were duly approved in accordance with its governing documents and investment policies; and (B) acting through its investment manager, GC Advisors LLC (the “Investment Manager”), the Equityholder established the transaction contemplated by the Facility Transaction Documents by: (x) causing the incorporation of each Loan Party from time to cease to be compliant time party hereto as a wholly-owned subsidiary; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations; and (z) determining the transaction structure and negotiating the Transaction Documents with the EU Retention Requirements;
(c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;various transaction parties.
(d) The Equityholder represents that: (A) it will confirm to each of the Borrowerwas not established for, and does not operate for, the Administrative Agent, the Servicer, each Lender and sole purpose of securitizing exposures; (B) it has a broader business purpose other than securitizing the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) Obligations; and (bC) above it has the capacity to meet its general payment and other obligations and absorb credit losses through resources other than its interests in each Monthly Report;the Collateral Obligations.
(e) it The Equityholder is, and will promptly notify remain, ultimately responsible for and retain discretion over the Borroweractions of the Investment Manager; and any actions taken by the Investment Manager in relation to the matters outlined in clause (c) above are taken for, and on behalf of, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowEquityholder.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (GOLUB CAPITAL INVESTMENT Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains outstanding:
Obligations are outstanding and any Lender is subject to the EU Securitization Rules, the Equityholder represents and undertakes that: (aA) the Equityholder reasonably believes it is an originator for the purposes of the EU Securitization Rules, and will retain, as originator, hold and will retain on an ongoing on-going basis, a material net economic interest in the transaction contemplated by this Agreement, which shall not be less than 55.0% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as in force on the Twelfth Amendment Effective Date, being retention of as represented by the first loss tranche and, if necessary, other tranches having Equityholder’s direct limited liability company interest in the same or a more severe risk profile than those transferred or sold to investors Borrower; (C) the Equityholder holds and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5will directly retain 100% of the Retention Basis Amount equity interests in the Borrower; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to its equity interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; (E) the Equityholder shall not, and it nor any of its Affiliates will sellprocure that the Borrower shall not: (x) short, hedge or otherwise mitigate its the credit risk under arising from the Retained Interest; or associated (y) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from the Retained Economic Interest, except (in each case) if and as permitted by the EU Securitization Rules; and (F) immediately following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower, not less than 51% of all of the Collateral Obligations will be Retention HolderEquityholder Collateral Obligations, with such proportion of Retention HolderEquityholder Collateral Obligations being measured on the basis of the aggregate outstanding principal balance of the Collateral Obligations at such time and if at any time less than 51% of all of the Collateral Obligations are Retention HolderEquityholder Collateral Obligations, the Equityholder shall, and shall procure that the Borrower will, only acquire or originate Collateral Obligations that qualify as Retention HolderEquityholder Collateral Obligations until not less than 51% of all Collateral Obligations are Retention HolderEquityholder Collateral Obligations; provided that a breach of this paragraph (a)(F) shall not be an Event of Default pursuant to Section 13.1 herein for a period of sixty (60) days from the date of a breach of this paragraph (a)(F).
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that it is, and has at all oftimes been, in compliance with the Retention where conditionsobligations set forth in clause (a) above are true and have been true up to do so would cause and on each date of the related Collection Period. The Equityholder shall provide, at its own cost and expense, to the Facility Agent and/or any SR Lender that is subject to the EU Securitization Rules: (A) prompt written notice of any breach of the obligations set forth in clause (a) above; (B) at the request of any SR Lender, confirmation that all of the conditionsobligations set forth in clause (a) above continue to be complied with (x) in the event of a material change in the structure of the transaction contemplated by the Transaction Documents that could have a material impact on the performance of the Collateral ObligationsAdvances or the risk characteristics of the Collateral Obligations and the Advances made with respect thereto; and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information, documents, reports and notifications that any such entity requeststhe SR Lender(s) may require in connection with its obligations under the EU Securitization Rules, but only to the extent the same is notincluding without limitation, any information, documentation, reports or notifications that the SR Lender(s) requires for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements; provided, that the Equityholder shall only be required to provide notification of any significant event of the type specified by Article 7(1)(g) of the EU Securitization Regulation to the extent that a notification or report in respect of the relevant event has not otherwise been provided by any person pursuant to any other provision of any Transaction Document; provided further, that the Equityholder shall not be required to provide any information, documents, reports or notifications: (x) relating to any limited partners; (y) that is/are the subject to contractually bindingof contractual confidentiality requirements; or (z) that is/are subject to laws governing the protection of confidentiality of information and the processing of personal data (all such information, documents, reports and notifications being collectively referred to as “Restricted Information”), orunless, if it is Restricted Information andthat cannot be anonymized or aggregated, and there is no existing confidentiality agreement permitting the disclosure of Restricted Information to the SR Lender(s), the Facility Documents Agent and/or any suchthe SR Lender(s) enters into a confidentiality agreement reasonably acceptable to cease the Equityholder; provided that nothing in this Agreement shall require the Servicer, the Borrower and/or the Equityholder to be compliant comply, with the Article 7 Transparency and Reporting Requirements unless mutually agreed upon by the Equityholder,respect to such Restricted Information, so that it can be furnished to the Facility Agent and/or any the SR Lender that is subject to the EU Retention Requirements;Securitization Rules (which agreement shall not be unreasonably withheld, delayed or conditioned by the Equityholder(s).
(c) The Equityholder represents and undertakes that: (A) its direct holding of the equity interests of the Borrower was duly approved in accordance with its governing documents and investment policies; and (B) acting through its investment advisor, Silver Point Specialty Credit Fund Management, LLC (the “Investment Manager”), the Equityholder established the transaction contemplated by the Transaction Documents by: (x) causing the formation of the Borrower as a wholly-owned subsidiary that is consolidated for accounting purposes; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations; (z) determining the transaction structure and negotiating the Transaction Documents with the various transaction parties.
(d) The Equityholder: (A) was not established for, and does not operate for, the sole purpose of securitizing exposures; (B) has the capacity to meet its payment obligations consistent with a broader business enterprise, by virtue of which it will take such further action, provide such information as is in does not rely solely or predominantly on (x) the Collateral Obligations or other assets securitized by it; or (y) the Retained Economic Interest or any other interest retained or proposed to be retained by it for purposes of the EU Risk Retention Requirement to be able to meet its possession payment obligations; and (provided that C) has experienced decision makers to enable the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each caseEquityholder to pursue its established business strategy, as may reasonably be required well as an adequate corporate governance structure.
(e) The Equityholder represents and undertakes that: (A) the Retention HolderEquityholder Originated Collateral Obligations have been, and will continue to be, originated pursuant to a sound and well-defined criteria and clearly established processes for approving, amending, modifying, renewing and financing the Underlying Instruments related to such Collateral Obligations and the Equityholder has, and it shall maintain effective systems in place to apply those criteria and processes to ensure that such Underlying Instruments are granted and approved based on a thorough assessment of each Obligor’s creditworthiness; and (B) in relation to each Retention HolderEquityholder Acquired Collateral Obligation and each other Collateral Obligation acquired by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each Equityholder reasonably believes in light of the Borrowerinformation available to it and subject to a reasonable standard of care, that the Administrative Agententity which was, directly or indirectly, involved in the Servicer, each Lender and Underlying Instruments which created the Collateral AgentObligations granted such Underlying Instruments pursuant to a sound and well-defined criteria and clearly established processes for approving, its continued compliance with amending, modifying, renewing and financing the covenants set out at paragraphs (a) Underlying Instruments and (b) above it had effective systems in each Monthly Report;
(e) it will promptly notify place to apply those criteria and processes to ensure that the Borrower, the Administrative Agent, the Servicer, each Lender Underlying Instruments were granted and the Collateral Agent in writing if for any reason it fails to comply with either approved based on a thorough assessment of the covenants set out in paragraphs (a) or (b) above in any way; andrelevant Obligor’s creditworthiness.
(f) it The Equityholder is, and will notify each of its Affiliates remain, ultimately responsible for, and retain discretion over, the actions of the contents of paragraph Investment Manager and any actions taken by the Investment Manager in relation to the matters outlined in clause (bc) above are taken for, and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrowerbehalf of, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowEquityholder.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Silver Point Specialty Lending Fund)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding:
, the Equityholder represents and undertakes to each SR Lender for the purposes of the EU Securitization Rules that: (aA) as an originator for the purposes of the EU Securitization Rules, it holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the securitization transaction contemplated by this Agreement, which shall not be less than 5.0% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in paragraph (d) of accordance with Article 6(36(3)(d) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having Equityholder’s direct limited liability company interest in the same or a more severe risk profile than those transferred or sold Borrower; (C) it holds and will directly retain up to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5100% of the Retention Basis Amount limited liability company interests of the Borrower and the Borrower shall have no other issued equity interests; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to the limited liability company interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; (E) the Equityholder shall not, and it nor any of will procure that its Affiliates will sell(including without limitation, the Borrower) do not (x) short, hedge or otherwise mitigate its credit risk under arising from or associated with the Retention where to do so would cause Retained Economic Interest, or (y) sell, transfer or otherwise surrender all or part of the transaction contemplated by the Facility Documents to cease to be compliant rights, benefits or obligations arising from or associated with the EU Retention Requirements;
Retained Economic Interest or the Collateral Obligations (c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreementsexcept, in each case, as permitted by the EU Securitization Rules); and (F) all of the Collateral Obligations will be Equityholder Collateral Obligations.
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that it is, and has at all times been, in compliance with its obligations set forth in clause (a) above up to and on each date of the related Collection Period. The Equityholder shall provide, at the Equityholder’s own cost and expense, to the Facility Agent and/or any SR Lender: (A) prompt written notice of any breach of its obligations set forth in clause (a) above; (B) at the request of any SR Lender, confirmation in writing that all of the obligations set forth in clause (a) above continue to be complied with (x) in the event of a material change in the structure of the transaction contemplated by the Transaction Documents that could have a material impact on the performance of the Advances, or the risk characteristics of the Collateral Obligations and the Advances made with respect thereto; and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information, documents and reports that the SR Lender(s) may reasonably require in connection with its obligations under the EU Securitization Rules, including without limitation, any information, documentation or reports that the SR Lender requires for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements; (it being understood that such information shall not be required to be provided more frequently than the Reporting Date in the calendar month immediately succeeding any Distribution Date, commencing with the Reporting Date after the Distribution Date occurring not less than three months after the Twelfth Amendment Effective Date); provided that the Equityholder shall only be required to provide notification of any significant event of the type specified by Article 7(1)(g) of the EU Securitization Regulation to the extent that a notification or report in respect of the relevant event has not otherwise been provided by any person pursuant to any other provision of any Transaction Document; provided further, that the Equityholder shall not be required to provide any information, documents or reports: (x) that is/are the subject of contractual confidentiality requirements; (y) that is/are subject to laws governing the protection of confidentiality of information and the processing of personal data (all such information, documents and reports being collectively referred to as “Restricted Information”), unless, if it is Restricted Information that cannot be anonymized or aggregated, and there is no existing confidentiality agreement permitting the disclosure of Restricted Information to the SR Lender(s), the Facility Agent and/or the SR Lender(s) enters into a confidentiality agreement reasonably acceptable to the Equityholder, with respect to such Restricted Information, so that it can be furnished to the Facility Agent and the SR Lender(s); or (z) that are not in the possession of the Equityholder and that cannot be obtained by the Equityholder using commercially reasonable efforts without material expense.
(c) The Equityholder represents that it has been involved in the establishment of the securitization transaction contemplated at the Twelfth Amendment Effective Date by: (A) effecting the Xxxxxx Funding Merger; (B) approving the eligibility criteria for the origination and acquisition of Collateral Obligations by the Borrower; and (C) negotiating and approving the amendments to the Transaction Documents.
(d) The Equityholder represents that: (A) it was not established for, and does not operate for, the sole purpose of securitizing exposures; (B) it has, and reasonably expects to continue to have, a strategy and the capacity to meet its payment obligations consistent with a broader business model that involves material support from capital, assets, fees or other sources of income, by virtue of which it does not rely on (x) the Collateral Obligations or other assets securitized by it; (y) its equity interest in the Borrower; or (z) the Retained Economic Interest or any other interest retained or proposed to be retained by it for purposes of the EU Risk Retention Requirement, and in each case, any related corresponding income as its sole or predominant source of revenue; and (C) it has, and shall continue to retain, responsible decision makers with the necessary experience to enable the Equityholder to pursue its established business strategy, as well as an adequate corporate governance structure.
(e) Without limiting the obligations of any SR Lender under Article 5 of the EU Securitization Regulation, the Equityholder represents and undertakes that: (A) the Equityholder Originated Collateral Obligations originated or acquired by the Borrower have been, and will be, in its view originated pursuant to a sound and well-defined credit granting criteria; (B) in relation to each Equityholder Acquired Collateral Obligation and other Collateral Obligation acquired by the Borrower, the Equityholder has verified, and will continue to verify, that the entity which was, directly or indirectly, involved in the original agreement which created such Collateral Obligation applied a Lender or sound and well-defined credit granting criteria to the Administrative Agent origination of the Collateral Obligation, and that in the Equityholder’s view it maintained clearly established processes for approving, amending, modifying, renewing and financing the Collateral Obligation and had effective systems in place to satisfy apply those criteria and processes to ensure that the EU Retention Requirements;
Collateral Obligation was granted and approved based on a thorough assessment of the Obligor’s creditworthiness; and (dC) it will confirm has, and shall maintain, what it considers to each of the Borrowerbe clearly established criteria and processes for approving, the Administrative Agentamending, the Servicermodifying, each Lender renewing and financing the Collateral Agent, its continued compliance with Obligations (the covenants set out at paragraphs (a“Loan Originations and Revisions”) and (b) above in its view has effective systems in place to apply those criteria and processes to ensure that any such Loan Originations and Revisions are granted and approved based on a thorough assessment of each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowObligor’s creditworthiness.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (FS KKR Capital Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for so long as any Advance remains outstanding:
(a) it will retain, as originator, on an ongoing basis, a material net economic interest in the form specified in paragraph (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “Retention”);
(b) neither it nor any of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention Requirements;
(c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall USActive 53861575.5 -144- be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (Blackstone / GSO Secured Lending Fund)
Risk Retention. The OFS and the Equityholder hereby covenantscovenant, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent (for the benefit of the Secured Parties) and, in respect of paragraphs (d) and (e) below only, the Servicer that, for so long as any Advance remains outstanding:
(a) it will retainOFS, as originatororiginator (for the purpose of the Securitisation Regulation), will retain on an ongoing basis, a material net economic interest in the form specified in paragraph (d3(d) of Article 6(3) 6 of the Securitisation RegulationRegulation as in effect on the Closing Date, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through OFS owning and continuing to own 100% of the membership interest in the Equityholder (the “Ownership Interest”) and the Equityholder maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “RetentionRetained Interest”);
(b) neither it OFS nor any of its Affiliates the Equityholder will sell, hedge hedge, enter into a short position or otherwise mitigate its credit risk under or associated with the Retention where Ownership Interest or the Retained Interest, except to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant extent permitted in accordance with the EU Risk Retention RequirementsRequirement;
(c) it each of OFS and the Equityholder will (A) take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality or the processing of personal data binding on the Equityholderit (“Restricted Information”); provided further, that it shall use commercially reasonable efforts to obtain any necessary consents required to disclose such restricted information) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Due Diligence Requirements and (B) provide to the Administrative Agent and/or any Lender that is subject to the EU Due Diligence Requirements, all information, documents, reports and notifications that the Administrative Agent and/or such Lender requests in connection with its obligations under the EU Due Diligence Requirements, but only to the extent the same is not Restricted Information, or if it is Restricted Information, if the Administrative Agent and/or any such Lender enters into a confidentiality agreement reasonably acceptable to OFS; provided that nothing in this Agreement shall be construed as requiring OFS or the Equityholder to provide any disclosure prescribed by Article 7 of the Securitisation Regulation, other than to the extent mutually agreed by OFS, the Equityholder, the Administrative Agent and/or any Lender (which agreement shall not be unreasonably withheld, delayed or conditioned by OFS and/or the Equityholder) and except to the extent necessary for any Lender or the Administrative Agent to satisfy the requirements under Article 5 of the Securitisation Regulation (but not the direct or indirect requirements of Article 7 thereof);
(d) it each of OFS and the Equityholder will confirm to each of the Borrower, the Administrative Agent, the Servicer, each Lender Lender, the Collateral Administrator and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it OFS or the Equityholder, as applicable, will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender Lender, the Collateral Administrator and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and;
(f) it OFS will notify each of its Affiliates subsidiaries of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates subsidiaries complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything ;
(g) [reserved]; and
(A) in relation to each Collateral Loan acquired by the Borrower which is a Retention Holder Originated Collateral Loan pursuant to part (a) of the definition thereof, OFS applied sound and well-defined credit granting criteria to the contrary contained herein, neither origination of the Equityholder nor Collateral Loan; (B) in relation to each Collateral Loan acquired by the Borrower makes any representation as which is a Retention Holder Originated Collateral Loan pursuant to compliance part (b) of the transaction or any definition thereof, OFS has verified, in light of the parties hereto with respect information available to Securitisation Regulation. Any Person accepting it and subject to its usual standard of care, and reasonably believes that the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions entity which was, directly or provisions)indirectly, shall be deemed to have agreed involved in the original agreement which created the Collateral Loan applied sound and well-defined credit granting criteria to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any origination of the BorrowerCollateral Loan, and that it maintained clearly established processes for approving, amending, modifying, renewing and financing the Servicer or Collateral Loan and had effective systems in place to apply those criteria and processes to ensure that the Equityholder or any Collateral Loan was granted and approved based on a thorough assessment of their respective Affiliatesthe relevant Obligor’s creditworthiness; and (C) OFS and the Borrower have, and reasonably expect to maintain, clearly established criteria and processes for any financialoriginating, taxamending, legalmodifying, accounting, or regulatory advise renewing and financing the Collateral Loans (the “Collateral Loan Originations and Revisions”) and have effective systems in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowplace to apply those criteria and processes to ensure that Collateral Loan Originations and Revisions are granted and approved based on a thorough assessment of each Obligor’s creditworthiness.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (OFS Capital Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains outstanding:
Obligations are outstanding and any Lender is subject to the EU Securitization Rules, the Equityholder as an originator for purposes of the EU Securitization Rules, represents and undertakes that: (aA) it the Equityholder holds and will retain, as originator, on an ongoing on-going basis, a material net economic interest in the transaction contemplated by this Agreement, which shall not be less than 5% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as in force on the Effective Date, being retention of as represented by the first loss tranche and, if necessary, other tranches having Equityholder’s limited liability company interest in the same or a more severe risk profile than those transferred or sold to investors Borrower; (C) the Equityholder holds and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5will directly retain 100% of the Retention Basis Amount equity interests in the Borrower; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to its equity interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; and (E) the Equityholder shall not, and it nor any of its Affiliates will sellprocure that the Borrower shall not: (x) short, hedge or otherwise mitigate its the credit risk arising from the Retained Economic Interest; or (y) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from the Retained Economic Interest, except (in each case) as permitted by the EU Securitization Rules.
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditionsundertakings set forth in clause (a) above are truebeing complied with, and have been truecomplied with up to and on each date of the related CollectionAccrual Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the EU Securitization Rules: (an “Affected Lender”): (A) prompt written notice of any breach of the obligations set forth in clause Section 10.22(a) above;); and (B) at the request of an Affected Lender, confirmation in writing that all of the conditionsundertakings set forth in clause Section 10.22(a) above continue to be complied with (x) in the event of a material change in the structure of the transaction contemplated by this Agreement structure that could have a material impact onmaterially impacts the performance of the Advances Collateral Obligations or the risk characteristics of the Collateral Obligations Advances and the AdvancesCollateral Obligations; and (y) upon the occurrence of any Event of Default or becoming aware of any breachUnmatured Event of Default. The Equityholder will promptly upon request by the obligations contained in Facility Agent and/or any Transaction Documents; and (C)Affected Lender, at the Equityholder’s own cost and expense, provide all information, documents, and reports and notificationswhich an Affected Lender may require in order that any such entity requests in connectionthe Affected Lender may comply with its obligations under the EU Securitization Rules, but onlyincluding without limitation, any information, documentation or associated reports that the Affected Lender requires for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements, provided that the EU Retention Holder will not be required to the extent the sameprovide any information, documents or reports that is not/are subject to contractually binding confidentiality requirements or laws governing the protection of confidentiality of information and the processing of personal data (“(all such information being referred to as “Restricted Information”), orunless if it is Restricted Information andthat cannot be anonymized or aggregated, the Facility Agent and/or any suchthe Affected Lxxxxx enters into a confidentiality agreement reasonably acceptable to the Equityholder.
(c) The Equityholder represents and undertakes with respect to each Collateral Obligation that (i) the Equityholder itself or through related entities (including without limitation the Borrower), directly or indirectly, was involved in the Underlying Instrument which created such Collateral Obligation (“Equityholder Originated Collateral Obligation”); or (ii) the Equityholder purchased such Collateral Obligation for its own account either directly or indirectly through the Borrower prior to the Collateral Obligation being pledged to the Collateral Agent for the benefit of the Secured Parties as provided in this Agreement, in each case as contemplated by Article 2(3) of the EU Securitization Regulation.
(d) The Equityholder represents and undertakes that: (A) its direct holding of the equity interests of the Borrower was duly approved in accordance with its governing documents and investment policies; (B) the Borrower is consolidated with the Retention where to do so would cause Equityholder for accounting purposes; and (C) acting through its investment advisor, MSD Partners, L.P. (the “Investment Manager”), the Equityholder established the transaction contemplated by the Facility Transaction Documents to cease to be compliant by: (x) causing the formation of the Borrower as a wholly-owned consolidated subsidiary; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations; and (z) determining the transaction structure and negotiating the Transaction Documents with the EU Retention Requirements;various transaction parties.
(ce) The Equityholder (A) was not established for, and does not operate for, the sole purpose of securitizing exposures; (B) has, and reasonably expects to continue to have, a strategy and the capacity to meet its payment obligations consistent with a broader business enterprisemodel that involves material support from capital, assets, fees or other sources of income, by virtue of which it will take such further action, provide such information as is in its possession (provided that the provision of such information would does not contravene any applicable contract, law or regulation or duties of confidentiality binding rely on the EquityholderCollateral Obligations or the Retained Economic Interest and any related corresponding income as its sole or predominate source of revenue; and (C) has, and enter into reasonably expects to continue to retain, experienced decision makers to enable the Equityholder to pursue its established business strategy and it maintains an adequate corporate governance structure.
(f) The Equityholder represents and undertakes that: (A) the Equityholder Originated Collateral Obligations have been, and will continue to be, originated pursuant to a sound and well-defined criteria and clearly established processes for approving, amending, modifying, renewing and financing the Underlying Instruments related to such Collateral Obligations and the Equityholder has, and it shall maintain effective systems in place to apply those criteria and processes to ensure that such Underlying Instruments are granted and approved based on a thorough assessment of each Obligor’s creditworthiness; and (B) in relation to each other agreements, in each case, as may reasonably be required Collateral Obligation acquired by the Borrower, the entity that was, directly or indirectly, involved in the Underlying Instruments which created such Collateral Obligations granted such Underlying Instruments pursuant to a Lender or sound and well-defined criteria and clearly established processes for approving, amending, modifying, renewing and financing the Administrative Agent Underlying Instruments and it had effective systems in place to satisfy apply those criteria and processes to ensure that the EU Retention Requirements;Underlying Instruments were granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness.
(g) The Equityholder is, and will remain, ultimately responsible for and retain discretion over the actions of the Investment Manager and any actions taken by the Investment Manager in relation to the matters outlined in clause (d) it will confirm to each of the Borrowerabove are taken for, and on behalf of, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowEquityholder.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (MSD Investment Corp.)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for so long as any Advance remains outstanding:
(a) it will retain, as originator, on an ongoing basis, a material net economic interest in the form specified in paragraph (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “Retention”);
(b) neither it nor any of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention Requirements;
(c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties -135- hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (Blackstone Secured Lending Fund)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding:
, the Equityholder represents and undertakes to each SR Lender for the purposes of the EU Securitization Rules that: (aA) as an originator for the purposes of the EU Securitization Rules, it holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the securitization transaction contemplated by this Agreement, which shall not be less than 5.0% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in paragraph (d) of accordance with Article 6(36(3)(d) of the Securitisation EU Securitization Regulation, being retention of as represented by the first loss tranche and, if necessary, other tranches having Equityholder’s direct limited liability company interest in the same or a more severe risk profile than those transferred or sold Borrower; (C) it holds and will directly retain up to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5100% of the Retention Basis Amount limited liability company interests of the Borrower and the Borrower shall have no other issued equity interests; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to the limited liability company interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; (E) the Equityholder shall not, and it nor any of will procure that its Affiliates will sell(including without limitation, the Borrower) do not (x) short, hedge or otherwise mitigate its credit risk under arising from or associated with the Retention where to do so would cause Retained Economic Interest, or (y) sell, transfer or otherwise surrender all or part of the transaction contemplated by the Facility Documents to cease to be compliant rights, benefits or obligations arising from or associated with the EU Retention Requirements;
Retained Economic Interest or the Collateral Obligations (c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreementsexcept, in each case, as permitted by the EU Securitization Rules); and (F) all of the Collateral Obligations will be Equityholder Collateral Obligations.
(a) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that it is, and has at all times been, in compliance with its obligations set forth in clause (a) above up to and on each date of the related Collection Period. The Equityholder shall provide, at the Equityholder’s own cost and USActive 31637433.35 -104- expense, to the Facility Agent and/or any SR Lender: (A) prompt written notice of any breach of its obligations set forth in clause (a) above; (B) at the request of any SR Lender, confirmation in writing that all of the obligations set forth in clause (a) above continue to be complied with (x) in the event of a material change in the structure of the transaction contemplated by the Transaction Documents that could have a material impact on the performance of the Advances, or the risk characteristics of the Collateral Obligations and the Advances made with respect thereto; and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information, documents and reports that the SR Lender(s) may reasonably require in connection with its obligations under the EU Securitization Rules, including without limitation, any information, documentation or reports that the SR Lender requires for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements; (it being understood that such information shall not be required to be provided more frequently than the Reporting Date in the calendar month immediately succeeding any Distribution Date, commencing with the Reporting Date after the Distribution Date occurring not less than three months after the Twelfth Amendment Effective Date); provided that the Equityholder shall only be required to provide notification of any significant event of the type specified by Article 7(1)(g) of the EU Securitization Regulation to the extent that a notification or report in respect of the relevant event has not otherwise been provided by any person pursuant to any other provision of any Transaction Document; provided further, that the Equityholder shall not be required to provide any information, documents or reports: (x) that is/are the subject of contractual confidentiality requirements; (y) that is/are subject to laws governing the protection of confidentiality of information and the processing of personal data (all such information, documents and reports being collectively referred to as “Restricted Information”), unless, if it is Restricted Information that cannot be anonymized or aggregated, and there is no existing confidentiality agreement permitting the disclosure of Restricted Information to the SR Lender(s), the Facility Agent and/or the SR Lender(s) enters into a confidentiality agreement reasonably acceptable to the Equityholder, with respect to such Restricted Information, so that it can be furnished to the Facility Agent and the SR Lender(s); or (z) that are not in the possession of the Equityholder and that cannot be obtained by the Equityholder using commercially reasonable efforts without material expense.
(b) The Equityholder represents that it has been involved in the establishment of the securitization transaction contemplated at the Twelfth Amendment Effective Date by: (A) effecting the Xxxxxx Funding Merger; (B) approving the eligibility criteria for the origination and acquisition of Collateral Obligations by the Borrower; and (C) negotiating and approving the amendments to the Transaction Documents.
(c) The Equityholder represents that: (A) it was not established for, and does not operate for, the sole purpose of securitizing exposures; (B) it has, and reasonably expects to continue to have, a strategy and the capacity to meet its payment obligations consistent with a broader business model that involves material support from capital, assets, fees or other sources of income, by virtue of which it does not rely on (x) the Collateral Obligations or other assets securitized by it; (y) its equity interest in the Borrower; or (z) the Retained USActive 31637433.35 -105- Economic Interest or any other interest retained or proposed to be retained by it for purposes of the EU Risk Retention Requirement, and in each case, any related corresponding income as its sole or predominant source of revenue; and (C) it has, and shall continue to retain, responsible decision makers with the necessary experience to enable the Equityholder to pursue its established business strategy, as well as an adequate corporate governance structure.
(d) Without limiting the obligations of any SR Lender under Article 5 of the EU Securitization Regulation, the Equityholder represents and undertakes that: (A) the Equityholder Originated Collateral Obligations originated or acquired by the Borrower have been, and will be, in its view originated pursuant to a sound and well-defined credit granting criteria; (B) in relation to each Equityholder Acquired Collateral Obligation and other Collateral Obligation acquired by the Borrower, the Equityholder has verified, and will continue to verify, that the entity which was, directly or indirectly, involved in the original agreement which created such Collateral Obligation applied a Lender or sound and well-defined credit granting criteria to the Administrative Agent origination of the Collateral Obligation, and that in the Equityholder’s view it maintained clearly established processes for approving, amending, modifying, renewing and financing the Collateral Obligation and had effective systems in place to satisfy apply those criteria and processes to ensure that the EU Retention Requirements;
Collateral Obligation was granted and approved based on a thorough assessment of the Obligor’s creditworthiness; and (dC) it will confirm has, and shall maintain, what it considers to each of the Borrowerbe clearly established criteria and processes for approving, the Administrative Agentamending, the Servicermodifying, each Lender renewing and financing the Collateral Agent, its continued compliance with Obligations (the covenants set out at paragraphs (a“Loan Originations and Revisions”) and (b) above in its view has effective systems in place to apply those criteria and processes to ensure that any such Loan Originations and Revisions are granted and approved based on a thorough assessment of each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowObligor’s creditworthiness.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (FS KKR Capital Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding:
, the Equityholder, as an originator for the purposes of the EU Securitization Regulation, represents and undertakes that: (ai) it holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the securitization transaction contemplated by this Agreement, which shall not be less than 5.0% of the aggregate nominal value of all the Collateral Obligations owned by the Borrower (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (ii) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation (as in effect as at the Effective Date), being retention of as represented by the first loss tranche and, if necessary, other tranches having Equityholder’s direct limited liability company interest in the same or a more severe risk profile than those transferred or sold to investors Borrower; (iii) the Equityholder directly holds and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5will directly retain 100% of the Retention Basis Amount equity interests in the Borrower; (such net economic interest being iv) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to the equity interests in the Borrower shall represent at least 5.0% of the aggregate nominal value of all the Collateral Obligations owned by the Borrower measured at the time of origination as described in (bi) neither it nor any of its Affiliates will above; (v) the Equityholder shall not, and the Equityholder shall procure that the Borrower shall not (x) short, hedge, or otherwise credit risk mitigate the Retained Economic Interest; or (y) sell, hedge transfer or otherwise mitigate its credit risk under surrender all or associated with part of the Retention where to do so would cause rights, benefits or obligations arising from the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention Requirements;
Retained Economic Interest (c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreementsexcept, in each case, as may reasonably permitted by the EU Securitization Rules and, for the avoidance of doubt, the sale of any Collateral Obligations, as permitted by the Transaction Documents, shall not be required restricted); and (vi) greater than 50% of all of the Collateral Obligations will be Equityholder Originated Collateral Obligations, with such proportion of the Equityholder Originated Collateral Obligations being measured on the basis of the aggregate outstanding principal balance of the Collateral Obligations following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower, and if at any time less than 50% of all of the Collateral Obligations are Equityholder Originated Collateral Obligations, the Equityholder shall procure that the Borrower shall only acquire or originate Eligible Collateral Obligations that qualify as Equityholder Originated Collateral Obligations until not less than 50% of all Collateral Obligations are Equityholder Originated Collateral Obligations.
(b) The Equityholder represents and undertakes that each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that it is, and has at all times been, in compliance with its undertakings set forth, as applicable, in clause (a) above up to and on each date of the related Accrual Period; and
(c) The Equityholder shall, at its own cost and expense, provide to the Facility Agent and/or any Lender that is subject to the EU Securitization Rules (an “SR Lender”):
(i) prompt written notice of any breach of the applicable undertakings set forth in clause (a) above;
(ii) confirmation in writing that all of the applicable undertakings set forth in clause (a) above continue to be complied with (x) in the event of a material change in the transaction structure that could have a material impact on the performance of the Advances or the Administrative Agent to satisfy risk characteristics of the Collateral Obligations and the Advances made with respect thereto, and (y) upon the occurrence of any Unmatured Event of Default or Event of Default or becoming aware of any breach of the obligations contained in any of the Transaction Documents; and
(iii) all information, documents, reports and notifications that the SR Lenders may require in connection with their obligations under the EU Retention Securitization Rules, including without limitation, any information, documentation, reports or notifications that the SR Lenders require for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements, in respect of which it is agreed as follows:
(A) the Borrower hereby agrees to ensure (or procure) continued compliance with, and is hereby appointed as the designated reporting entity for the purposes of, the Article 7 Transparency and Reporting Requirements;
(B) the Borrower shall make available to the SR Lenders the Transparency Reports at the following times (each a “Submission Date”): (x) on a date that is no later than one month after the Distribution Date in October 2024, and (y) thereafter on a quarterly basis, on a date that is no later than three months after the then most recent Submission Date (and no later than one month after the then most recent Distribution Date);
(C) the data cut-off date in respect of each Transparency Report shall be no earlier than two months prior to such Transparency Report’s Submission Date (except as may otherwise be permitted or required at any time by the Article 7 Transparency and Reporting Requirements);
(D) the Borrower shall only be required to provide notification of any significant event of the type specified by Article 7(1)(g) of the EU Securitization Regulation to the extent that a notification or report in respect of the relevant event has not otherwise been provided by any person pursuant to any other provision of any Transaction Document; and
(E) the Borrower shall not be required to provide any information, documents, reports or notifications that is/are subject to laws governing the protection of confidentiality of information and the processing of personal data (all such information, documents, reports and notifications being collectively referred to as “Restricted Information”), unless, if it is Restricted Information that cannot be anonymized or aggregated, and there is no existing confidentiality agreement permitting the disclosure of Restricted Information to the SR Lenders, the Facility Agent and/or the SR Lenders enter into a confidentiality agreement reasonably acceptable to the Borrower, with respect to such Restricted Information, so that it can be furnished to the Facility Agent and the SR Lenders
(d) The Equityholder represents that: (i) its equity interests in the Borrower were duly approved in accordance with its governing documents and investment policies; (ii) it has appointed Stellus Private BDC Advisor, LLC, as its investment advisor (the “Investment Advisor”), and (iii) the Equityholder established the transaction contemplated by the Transaction Documents by: (x) causing the formation of the Borrower as a wholly-owned subsidiary that is consolidated with the Equityholder for accounting purposes; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations by the Borrower; and (z) determining the transaction structure and negotiating and approving the Transaction Documents.
(e) The Equityholder represents that it is, and will confirm remain, ultimately responsible for and retain discretion over the actions of the Investment Advisor; and any actions taken by the Investment Advisor in relation to the matters outlined in clause (d) above are taken for, and on its behalf.
(f) The Equityholder represents that it (i) was not established for, and does not operate for, the sole purpose of securitizing exposures; (ii) has, and reasonably expects to continue to have, a strategy and the capacity to meet its payment obligations consistent with a broader business model that involves material support from capital, assets, fees or other sources of income, by virtue of which it does not rely on the Collateral Obligations (or any other assets securitized by it), the Retained Economic Interest (or any other interest retained or proposed to be retained by it for the purposes of the EU Securitization Rules) and, in each case, any related corresponding income as its sole or predominant source of revenue; and (iii) has, and reasonably expects to continue to retain, experienced decision makers to enable the Equityholder to pursue its established business strategy and it maintains an adequate corporate governance structure.
(g) The Equityholder represents and undertakes that: (i) each Equityholder Originated Collateral Obligation has been, or will be, originated pursuant to sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing those credits and that effective systems are in place to apply those criteria and processes to ensure that such credits are granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness; and (ii) in relation to each of other Collateral Obligation acquired by the Borrower, the Administrative AgentEquityholder has verified, and will continue to verify, that the Servicerentity which was, each Lender and directly or indirectly, involved in the Underlying Instrument which created the Collateral Agent, its continued compliance with Obligation applied sound and well-defined credit granting criteria to the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and origination of the Collateral Agent Obligation, and that it maintained clearly established processes for approving, amending, modifying, renewing and financing the Collateral Obligation and had effective systems in writing if for any reason it fails place to comply with either apply those criteria and processes to ensure that the Collateral Obligation was granted and approved based on a thorough assessment of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowrelevant Obligor’s creditworthiness.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Stellus Private Credit BDC)
Risk Retention. The Equityholder hereby represents and covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent (for the benefit of the Secured Parties) and, in respect of paragraphs (d) and (e) below only, the Servicer that, for so long as any Advance remains outstanding:
(a) it will retain, as originatororiginator (for the purpose of the Securitisation Regulation), on an ongoing basis, a material net economic interest in the form specified in paragraph (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “RetentionRetained Interest”);
(b) neither it nor any of its Affiliates will sell, hedge hedge, enter into a short position or otherwise mitigate its credit risk under or associated with the Retention Retained Interest where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Risk Retention Requirements;
(c) it will take provide to the Administrative Agent and/or any Lender that is subject to the EU Due Diligence Requirements, the information, documents, reports and notifications that the Administrative Agent and/or such further action, provide Lender reasonably requests as necessary to enable compliance with any of their obligations under the EU Due Diligence Requirements; provided that (i) such information as is not subject to any duty of confidentiality and (x) is in its possession or (y) if it is not in its possession it is obtainable using commercially reasonable efforts and without material expense (provided that further that, if obtaining such information, documents, reports or notifications would involve material expense but the provision requesting Lxxxxx agrees to reimburse it, then it shall obtain the same) and (ii) such disclosure is not contrary to any requirement of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent applicable to satisfy the EU Retention Requirementsit;
(d) it will confirm to each of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Payment Date Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and;
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours endeavors to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto;
(A) in relation to each Collateral Asset acquired by the Borrower which is a Retention Holder Originated Collateral Asset pursuant to part (a) of the definition thereof, it applied sound and well-defined credit granting criteria to the origination of the Collateral Asset; (B) in relation to each Collateral Asset acquired by the Borrower which is a Retention Holder Originated Collateral Asset pursuant to part (b) of the definition thereof, it has verified, in light of the information available to it and subject to its usual standard of care, and reasonably believes that the entity which was, directly or indirectly, involved in the original agreement which created the Collateral Asset applied sound and well-defined credit granting criteria to the origination of the Collateral Asset, and that it maintained clearly established processes for approving, amending, modifying, renewing and financing the Collateral Asset and had effective systems in place to apply those criteria and processes to ensure that the Collateral Asset was granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness; and (C) it has, and reasonably expects to maintain, clearly established criteria and processes for originating, amending, modifying, renewing and financing the Collateral Assets (the “Collateral Asset Originations and Revisions”) and have effective systems in place to apply those criteria and processes to ensure that Collateral Asset Originations and Revisions are granted and approved based on a thorough assessment of each Obligor’s creditworthiness;
(h) none of the Equityholder, its subsidiaries, their respective directors or officers, or, to the best knowledge of the Equityholder, their respective employees or Persons Controlling or Controlled by the Equityholder is a Person that is, or is owned or controlled by Persons that are: (i) a Sanctioned Person or (ii) located, organized or resident in, or whose government is, a Sanctioned Country;
(i) none of the Equityholder, its subsidiaries, their respective directors or officers, or, to the best knowledge of the Equityholder, their respective employees or Persons Controlling or Controlled by the Equityholder has engaged in any activity or conduct which would violate any applicable anti-bribery, anti-corruption, anti-terrorism or anti-money laundering laws, regulations or rules in any applicable jurisdiction and the Equityholder has instituted and maintains policies and procedures designed to prevent violation of such laws, regulations and rules. The Equityholder shall maintain policies and procedures designed to prevent violation of any applicable anti-bribery, anti-corruption, anti-terrorism or anti-money laundering laws, regulations or rules in any applicable jurisdiction. The Equityholder shall not use the proceeds of the loan hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, sister company, joint venture partner or any other Person (i) to fund any activities or business of or with any Person, or in any country or territory, that, at the time of such funding, is, a Sanctioned Person or Sanctioned Country, or (ii) in any other manner that would result in a violation of Sanctions, any applicable anti-bribery, anti-corruption, anti-terrorism or anti-money laundering laws, regulations or rules in any applicable jurisdiction by any Person (including any Person participating in the loan hereunder, whether as underwriter, advisor, investor, lender, hedge provider, facility or security agent or otherwise);
(j) it reasonably believes it has established the securitisation contemplated by the Facility Documents; and
(k) it is not an entity that has been established or operates for the sole purpose of securitising exposures. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to each of the Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), ) shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that it is not relying on any of the Borrower, the Servicer or the Equityholder or any of their the respective Affiliates, for any financial, tax, legal, accounting, accounting or regulatory advise advice in connection with the matters set forth in this Section 13.22. For the avoidance of doubt, this Section 13.22 and/or Section 13.23 belowdoes not constitute regulatory advice.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (Ares Strategic Income Fund)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent Lenders and, in respect of paragraphs (div) and (ev) below only, the Servicer Collateral Manager that, for so long as any Advance Loan remains outstanding:
(ai) it will retain, as originator, on an ongoing basis, a material net economic interest in the form specified in paragraph (d3(d) of Article 6(3) 6 of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “Retention”);
(bii) neither it nor any of its Affiliates will sell, hedge hedge, enter into a short position or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Transaction Documents to cease to be compliant with the EU Risk Retention Requirements;
(ciii) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Risk Retention Requirements;
(div) it will confirm to each of the Borrower, the Administrative Agent, the Servicer, Collateral Manager and each Lender and the Collateral AgentLender, its continued compliance with the covenants set out at paragraphs (ai) and (bii) above in each Monthly Reporton a monthly basis;
(ev) it will promptly notify the Borrower, the Administrative Agent, the Servicer, Collateral Manager and each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (ai) or (bii) above in any way; and
(fvi) it will notify each of its Affiliates of the contents of paragraph (bii) above and shall use reasonable endeavours endeavors to procure that each of its Affiliates complies with the terms of paragraph (bii) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to the Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 9(e) and/or Section 13.23 9(f) below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer Collateral Manager or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 9(e) and/or Section 13.23 9(f) below.
Appears in 1 contract
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains outstanding:
Obligations are outstanding and any Lender is subject to the EU Securitization Rules, the Equityholder as an originator for purposes of the EU Securitization Rules, represents and undertakes that: (aA) it the Equityholder holds and will retain, as originator, on an ongoing on-going basis, a material net economic interest in the transaction contemplated by this Agreement, which shall not be less than 5% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as in force on the Effective Date, being retention of as represented by the first loss tranche and, if necessary, other tranches having Equityholder’s limited liability company interest in the same or a more severe risk profile than those transferred or sold to investors Borrower; (C) the Equityholder holds and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5will directly retain 100% of the Retention Basis Amount equity interests in the Borrower; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to its equity interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; and (E) the Equityholder shall not, and it nor any of its Affiliates will sellprocure that the Borrower shall not: (x) short, hedge or otherwise mitigate its the credit risk arising from the Retained Economic Interest; or (y) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from the Retained Economic Interest, except (in each case) as permitted by the EU Securitization Rules.
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditions set forth in clause (a) above are true and have been true up to and on each date of the related Collection Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the EU Securitization Rules: (A) prompt written notice of any breach of the obligations set forth in clause (a) above; (B) confirmation in writing that all of the conditions set forth in clause (a) above continue to be complied with (x) in the event of a material change in the structure of the transaction contemplated by this Agreement that could have a material impact on the performance of the Advances or the risk characteristics of the Collateral Obligations and the Advances; and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information, documents, reports and notifications that any such entity requests in connection with its obligations under the EU Securitization Rules, but only to the extent the same is not subject to contractually binding confidentiality requirements or associated laws governing the protection of confidentiality of information and the processing of personal data (“Restricted Information”), or if it is Restricted Information and cannot be anonymized or aggregated, the Facility Agent and/or any such Lender enters into a confidentiality agreement reasonably acceptable to the Equityholder.
(c) The Equityholder represents and undertakes with respect to each Collateral Obligation that (i) the Equityholder itself or through related entities (including without limitation the Borrower), directly or indirectly, was involved in the Underlying Instrument which created such Collateral Obligation (“Equityholder Originated Collateral Obligation”); or (ii) the Equityholder purchased such Collateral Obligation for its own account either directly or indirectly through the Borrower prior to the Collateral Obligation being pledged to the Collateral Agent for the benefit of the Secured Parties as provided in this Agreement, in each case as contemplated by Article 2(3) of the EU Securitization Regulation.
(d) The Equityholder represents and undertakes that: (A) its direct holding of the equity interests of the Borrower was duly approved in accordance with its governing documents and investment policies; (B) the Borrower is consolidated with the Retention where to do so would cause Equityholder for accounting purposes; and (C) acting through its investment advisor, MSD Partners, L.P. (the “Investment Manager”), the Equityholder established the transaction contemplated by the Facility Transaction Documents to cease to be compliant by: (x) causing the formation of the Borrower as a wholly-owned consolidated subsidiary; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations; and (z) determining the transaction structure and negotiating the Transaction Documents with the EU Retention Requirements;various transaction parties.
(ce) The Equityholder (A) was not established for, and does not operate for, the sole purpose of securitizing exposures; (B) has the capacity to meet its payment obligations consistent with a broader business enterprise; and (C) has experienced decision makers to enable the Equityholder to pursue its established business strategy and it maintains an adequate corporate governance structure.
(f) The Equityholder represents and undertakes that: (A) the Equityholder Originated Collateral Obligations have been, and will take continue to be, originated pursuant to a sound and well-defined criteria and clearly established processes for approving, amending, modifying, renewing and financing the Underlying Instruments related to such further actionCollateral Obligations and the Equityholder has, provide and it shall maintain effective systems in place to apply those criteria and processes to ensure that such information as is Underlying Instruments are granted and approved based on a thorough assessment of each Obligor’s creditworthiness; and (B) in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such relation to each other agreements, in each case, as may reasonably be required Collateral Obligation acquired by the Borrower, the entity that was, directly or indirectly, involved in the Underlying Instruments which created such Collateral Obligations granted such Underlying Instruments pursuant to a Lender or sound and well-defined criteria and clearly established processes for approving, amending, modifying, renewing and financing the Administrative Agent Underlying Instruments and it had effective systems in place to satisfy apply those criteria and processes to ensure that the EU Retention Requirements;Underlying Instruments were granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness.
(g) The Equityholder is, and will remain, ultimately responsible for and retain discretion over the actions of the Investment Manager and any actions taken by the Investment Manager in relation to the matters outlined in clause (d) it will confirm to each of the Borrowerabove are taken for, and on behalf of, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowEquityholder.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (MSD Investment Corp.)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains outstandingObligations are outstanding and any Lender is an Affected Lender, the Equityholder as an originator for purposes of the EU Securitization Rules, represents and undertakes that:
(ai) it the Equityholder holds and will retain, as originator, on an ongoing on-going basis, a material net economic interest in the transaction contemplated by this Agreement, which shall not be less than 5.0% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower);
(ii) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as in force on the Effective Date, being retention of as represented by the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to Equityholder’s limited liability company interest in the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “RetentionEquity Interests”);
(biii) neither the Equityholder holds and will directly retain 100% of the Equity Interests;
(iv) the aggregate capital contributions made by the Equityholder with respect to the Equity Interests shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (i) above; and -108- USActive 58353885.2
(v) the Equityholder shall not, and it nor any of its Affiliates will sellprocure that the Borrower shall not: (x) short, hedge or otherwise mitigate its the credit risk arising from the Retained Economic Interest; or (y) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from the Retained Economic Interest, except (in each case) as permitted by the EU Securitization Rules.
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the obligations set forth in Section 10.22(a) above are being complied with, and have been complied with, up to and on each date of the related Accrual Period. The Equityholder shall provide, at its own cost and expense, to the Facility Agent and/or the Affected Lenders:
(i) prompt written notice of any breach of the obligations set forth in Section 10.22(a);
(ii) at the request of an Affected Lender, confirmation that all of the obligations set forth in Section 10.22(a) continue to be complied with (x) in the event of a material change in the transaction structure that materially impacts the performance of the Advances or the risk characteristics of the Collateral Obligations and the Advances made with respect thereto; and (y) upon the occurrence of any Event of Default or becoming aware of any Unmatured Event of Default; and
(iii) all information, documents, reports and notifications that the Affected Lenders may require in connection with their obligations under the EU Securitization Rules, including without limitation, any information, documentation, reports or associated notifications that the Affected Lenders require for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements, in respect of which it is agreed as follows:
(A) the Equityholder agrees to make available to the Affected Lenders the Transparency Reports at the following times (each a “Submission Date”): (x) the first set of Transparency Reports shall be provided on the Distribution Date in July 2024, and (y) thereafter the Transparency Reports shall be provided on a quarterly basis, on a date that is no later than three months after the then most recent Submission Date (and no later than one month after the then most recent Distribution Date);
(B) the data cut-off date in respect of each Transparency Report shall be the Determination Date preceding the relevant Distribution Date;
(C) the Equityholder shall only be required to provide notification of any significant event of the type specified by Article 7(1)(g) of the EU Securitization Regulation to the extent that a notification or report in respect of the relevant event has not otherwise been provided by any Person pursuant to any other provision of any Transaction Document;
(D) the Equityholder shall not be required to provide any information, documents, reports or notifications that is/are subject to laws governing the -109- USActive 58353885.2 protection of confidentiality of information and the processing of personal data (all such information, documents, reports and notifications being referred to as “Restricted Information”), unless, if it is Restricted Information that cannot be anonymized or aggregated, and there is no existing confidentiality agreement permitting the disclosure of Restricted Information to the Affected Lenders, the Facility Agent and/or the Affected Lenders enter into a confidentiality agreement reasonably acceptable to the Equityholder, with respect to such Restricted Information, so that it can be furnished to the Facility Agent and the Affected Lenders; and
(E) the Affected Lenders acknowledge that the Equityholder is permitted to, and the Affected Lenders should expect that the Equityholder will, delegate all or any portion of its reporting obligations in respect of the Transparency Reports to a third party service provider. Notwithstanding any such delegation, the Equityholder shall remain obligated and liable for the performance of its obligations and duties under this Section 10.22(b)(iii) with respect to the preparation and provision of the Transparency Reports in accordance with the Retention where provisions hereof to do so would cause the same extent and under the same terms and conditions as if it alone were preparing the Transparency Reports as required hereby.
(c) The Equityholder represents and undertakes with respect to each Collateral Obligation that (i) the Equityholder itself or through related entities (including without limitation the Borrower), directly or indirectly, was involved in the Underlying Instrument which created such Collateral Obligation (“Equityholder Originated Collateral Obligation”); or (ii) the Equityholder purchased such Collateral Obligation for its own account either directly or indirectly through the Borrower prior to the Collateral Obligation being pledged to the Collateral Agent for the benefit of the Secured Parties as provided in this Agreement, in each case as contemplated by Article 2(3) of the EU Securitization Regulation.
(d) The Equityholder represents and undertakes that: (i) its direct holding of the Equity Interests was duly approved in accordance with its governing documents and investment policies; (ii) the Borrower is consolidated with the Equityholder for accounting purposes; and (iii) acting through its investment advisor, MSD Partners, L.P. (the “Investment Manager”), the Equityholder established the transaction contemplated by the Facility Transaction Documents by: (x) causing the formation of the Borrower as a wholly-owned consolidated subsidiary; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations; and (z) determining the transaction structure and negotiating the Transaction Documents with the various transaction parties.
(e) The Equityholder (i) was not established for, and does not operate for, the sole purpose of securitizing exposures; (ii) has, and reasonably expects to cease continue to have, a strategy and the capacity to meet its payment obligations consistent with a broader business model that involves material support from capital, assets, fees or other sources of income, by virtue of which it does not rely (A) on the Collateral Obligations or any other assets securitized by it or (B) or the Retained Economic Interest or any other interest retained or proposed to be compliant with retained by it for purposes of the EU Risk Retention Requirements;
(c) it will take such further actionRequirement, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, any related corresponding income as may its sole or predominant source of revenue; and (iii) has, and reasonably be required USActive 58353885.2 expects to continue to retain, a management body with members that have the necessary experience to enable the Equityholder to pursue its established business strategy, as well as an adequate corporate governance structure.
(f) The Equityholder represents and undertakes that: (i) the Equityholder Originated Collateral Obligations have been, and will continue to be, originated pursuant to a sound and well-defined criteria and clearly established processes for approving, amending, modifying, renewing and financing the Underlying Instruments related to such Collateral Obligations and the Equityholder has, and it shall maintain effective systems in place to apply those criteria and processes to ensure that such Underlying Instruments are granted and approved based on a thorough assessment of each Obligor’s creditworthiness; and (ii) in relation to each other Collateral Obligation acquired by the Borrower, the entity that was, directly or indirectly, involved in the Underlying Instruments which created such Collateral Obligations granted such Underlying Instruments pursuant to a Lender or sound and well-defined criteria and clearly established processes for approving, amending, modifying, renewing and financing the Administrative Agent Underlying Instruments and it had effective systems in place to satisfy apply those criteria and processes to ensure that the EU Retention Requirements;Underlying Instruments were granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness.
(dg) it The Equityholder is, and will confirm to each remain, ultimately responsible for and retain discretion over the actions of the BorrowerInvestment Manager and any actions taken by the Investment Manager in relation to the matters outlined in Section 10.22(d) above are taken for, and on behalf of, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowEquityholder.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (MSD Investment Corp.)
Risk Retention. The Equityholder hereby covenantsrepresents, warrants and agrees for the benefit of the Administrative Agent, Agent and the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer Lenders that, for so long as any Advance remains outstanding:
(a) it will retainthe Equityholder, in its capacity as originator, will acquire on the Closing Date and will hold on an ongoing basis, basis a material net economic interest in the transactions contemplated hereunder and under the other Facility Documents (the “Transaction”) in an amount of not less than 5% of the nominal value of the securitised exposures, in the form specified of an first loss tranche as referred to in paragraph option (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount Regulation (such net economic interest being the “RetentionRetained Interest”), by the Equityholder’s owning all the equity interest in the Borrower;
(b) neither it nor the Equityholder will not (and will not permit any of its Affiliates will sell, affiliates to) hedge or otherwise mitigate its credit risk under or associated with the Retention where Retained Interest, not sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from the Retained Interest, except to do so would cause the transaction contemplated by extent permitted in accordance with Article 6 of the Facility Documents to cease to be compliant with the EU Retention RequirementsSecuritisation Regulation;
(c) it the Equityholder will take such further action, provide such information not change the retention option or method of calculation of the Retained Interest except under extraordinary circumstances or as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreementsotherwise permitted, in each case, as may reasonably be required by in accordance Article 6 of the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention RequirementsSecuritisation Regulation;
(d) it the Equityholder will confirm provide (or cause the Servicer to each provide) ongoing confirmation of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its Equityholder’s continued compliance with the covenants set out at paragraphs obligations described above (ai) and (b) above in or concurrently with the delivery of each Monthly Report, (ii) promptly following the occurrence of any Default or Event of Default, and (iii) from time to time promptly upon written request by the Administrative Agent (on behalf of any Lenders) in connection with any material change in the performance of the Collateral Loans or the Transaction or any material breach of the Facility Documents;
(e) it the Equityholder will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender Agent and the Collateral Agent Lenders in writing if for accordance with the Revolving Credit and Security Agreement of any reason it fails to comply with either violation of the covenants set out Equityholder’s commitment to retain the Retained Interest or any change to the manner in paragraphs (a) or (b) above in any way; andwhich the Retained Interest is held;
(f) it the Equityholder will notify each provide (or cause the Servicer or the Borrower to provide), promptly upon written request by the Administrative Agent on behalf of its Affiliates any Lender or Lenders from time to time, such further information as the Administrative Agent or any Lender may reasonably request in order to enable compliance by any Lender with Articles 5 and 7 of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything Securitisation Regulation to the contrary contained herein, neither extent that such information is in the Equityholder nor the Borrower makes any representation as to compliance possession or control of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the BorrowerEquityholder, the Servicer or the Borrower and that the Equityholder (or any the Servicer or the Borrower, as applicable) can provide such information without breaching applicable confidentiality laws or contractual obligations binding on them;
(g) the Equityholder reasonably believes that (A) with respect to each of their respective Affiliates, for any financial, tax, legal, accountingthe Collateral Loans made from time to time by the Borrower, or regulatory advise made by the Equityholder and then transferred by the Equityholder to the Borrower, the Equityholder, itself or through related entities, directly or indirectly, has been or will be involved in connection the original agreement giving rise to the obligations of the relevant Obligor, (B) with respect to each of the Collateral Loans purchased from time to time by the Borrower from third parties, the Equityholder, by such purchase, has acquired the economic risk and benefits of those Collateral Loans for its own account, (C) both initially and on an ongoing basis, at any time the aggregate outstanding amount of Collateral Loans referred to in (A) above will be more than fifty per cent. of the aggregate amount of all Collateral Loans at that time, and (D) for the purposes of the Securitisation Regulation, the Equityholder has established and is managing the securitisation constituted by the Transaction; and
(h) the Equityholder (i) was not established and does not operate for the sole purpose of securitizing exposures, (ii) has a business strategy and the capacity to meet payment obligations consistent with a broader business enterprise and involving material support from capital, assets, fees or other income available to the Equityholder, relying neither on the Collateral Loans and any other exposures being securitised by the Equityholder, nor on the Retained Interest and any other interests retained or proposed to be retained in accordance with the matters set forth in this Section 13.22 and/or Section 13.23 belowSecuritisation Regulation, as well as any corresponding income from such exposures and interests, and (iii) has responsible decision-makers who have the required experience to enable the Equityholder to pursue its established business strategy, as well as an adequate corporate governance arrangement.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (Pennantpark Investment Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for so long as any Advance remains outstanding:
(a) it will retain, as originator, on an ongoing basis, a material net economic interest in the form specified in paragraph (d) of Article 6(3) of the Securitisation Regulation, being retention of the first loss tranche and, if necessary, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5% of the Retention Basis Amount (such net economic interest being the “Retention”);
(b) neither it nor any of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause the transaction contemplated by the Facility Documents to cease to be compliant with the EU Retention Requirements;
(c) it will take such further action, provide such information as is in its possession (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;; USActive 56468589.1056468589.17
(d) it will confirm to each of the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent, its continued compliance with the covenants set out at paragraphs (a) and (b) above in each Monthly Payment Date Report;
(e) it will promptly notify the Borrower, the Administrative Agent, the Servicer, each Lender and the Collateral Agent in writing if for any reason it fails to comply with either of the covenants set out in paragraphs (a) or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (Blackstone Private Credit Fund)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (d) and (e) below only, the Servicer that, for For so long as any Advance remains outstandingObligations are outstanding and any Lender is subject to the EU Securitization Rules:
(a) The Equityholder represents and undertakes to the Facility Agent and the Lenders that: (A) that as an originator for the purposes of the EU Securitization Rules, it holds and will retain, as originator, retain on an ongoing on-going basis, a material net economic interest in the form specified in transaction contemplated by this Agreement, which shall be comprised of 100% of the Preference Shares of the Borrower (representing no less than 5% of the aggregate nominal value of all Collateral Obligations measured at the time of their origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower), or such lesser amount that may be permitted under the EU SecurizationSecuritization Regulation) (the “Retained Economic Interest”), for the purposes of complying with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as it applies at the date of this Agreement; (B) the Equityholder shall not (and will procure that any of its Affiliates do not) short, being retention hedge, otherwise mitigate its credit risk or sell, transfer or otherwise surrender all or part of the first loss tranche andrights, benefits or obligations arising from or associated with the Retained Economic Interest (except as permitted by the EU Securitization Rules); and (C) over 50% of the aggregate outstanding principal balance of the Collateral Obligations shall constitute Retention Holder Collateral Obligations, with such proportion of Retention Holder Collateral Obligations being measured on the basis of the aggregate outstanding principal balance of the Collateral Obligations following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower, or, if necessaryat any time less than 50.01% of all of the Collateral Obligations are Retention Holder Collateral Obligations, other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, through maintaining funding to it shall procure that the Borrower under the LLC Agreement, in an amount equal to shall only acquire or originate Eligible Collateral Obligations that qualify as Retention Holder Collateral Obligations until not less than 550.01% of the all Collateral Obligations are Retention Basis Amount (such net economic interest being the “Retention”)Holder Collateral Obligations;
(b) neither Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditions set forth in clauses (a)(A) and (a)(B) above are true and have been true up to and on each date of the related Collection Period. The Equityholder shall provide to the Facility Agent and/or any Lender that is subject to the EU Securitization Rules: (A) prompt written notice of any breach of the obligations set forth in clauses (a)(A) and (B) above; (B) confirmation that all of the conditions set forth in clause (a) above continue to be complied with (x) in the event of a material change in the performance of the Collateral Obligations or the risk characteristics of the Advances and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information and documents that the Facility Agent and/or any Lender may reasonably request in connection with its obligations under Article 5 of the EU Securitization Regulation and any related EU Securitization Rules, but only to the extent the same is not subject to laws governing the protection of confidentiality of information and the processing of personal data (“Restricted Information”), or if it nor is Restricted Information and cannot be anonymized or aggregated to the extent not prohibited by law or the terms of such Restricted Information, if the Facility Agent and/or relevant Lender enters into a confidentiality agreement reasonably acceptable to the Equityholder; and provided that the Equityholder shall not be required to provide any information relating to any limited partner of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated the Equityholder and provided further that the Equityholder shall only be required to comply with Article 7 of the Retention where EU Securitization Regulation to do so would cause the transaction contemplated extent mutually agreed upon by the Equityholder and the Facility Documents Agent and/or any Lender that is subject to cease to be compliant with the EU Retention RequirementsSecuritization Rules;
(c) The Equityholder represents that it will take such further action, provide such information has been involved in the establishment of the transaction contemplated by this Agreement by: (A) causing the formation of the Borrower as is in its possession a 100% owned subsidiary; (provided that B) approving the provision eligibility criteria for the origination and acquisition of such information would not contravene any applicable contract, law or regulation or duties Collateral Obligations by the Borrower; and (C) negotiating and approving the execution of confidentiality binding on the Equityholder) and enter into such other agreements, in each case, as may reasonably be required Transaction Documents by the Borrower, a Lender or the Administrative Agent to satisfy Equityholder and the EU Retention RequirementsServicer;
(d) it The Equityholder hereby further represents and undertakes to the Facility Agent and the Lenders party hereto as follows:
(i) It was not established for, and does not operate for, the sole purpose of securitizing exposures.
(ii) (A) The Retention Holder Originated Collateral Obligations have been, or will confirm be originated pursuant to each a sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing those credits and the Equityholder has effective systems in place to apply those criteria and processes to ensure that such credits are granted and approved based on a thorough assessment of the Borrowerrelevant Obligor’s creditworthiness; and (B) the Equityholder will use reasonable skill and care to ensure that the Retention Holder Acquired Collateral Obligations and each other Eligible Collateral Obligation acquired by the Borrower in respect of which the initial originator was not a European credit institution or investment firm (as each such term is defined in Capital Requirementsthe EU Securitization Regulation (Regulation (EU) No 575/2013)) have been, or will be originated pursuant to a sound and well-defined credit granting criteria and clearly established processes for approving, amending, modifying, renewing and financing those credits and that the Administrative Agentinitial originator had effective systems in place to apply those criteria and processes to ensure that such credits are granted and approved based on a thorough assessment of the relevant Obligor’s creditworthiness.
(iii) The Equityholder is duly organized, validly existing and in good standing under the Servicerlaws of the jurisdiction of its organization and has full power and authority to execute, each Lender deliver and perform its obligations under this Agreement. Substituted Collateral Obligations pursuant to Section 7.11 or (iv) amounts paid to the Borrower pursuant to Section 8.3. In connection with the release of a Lien on any Collateral permitted pursuant to this Section 12.3 and conducted in the ordinary course of business consistent with industry standards and practices (including the use of escrows), the Collateral Agent, its continued compliance with on behalf of the covenants set out Secured Parties, will, at paragraphs (a) and (b) above in each Monthly Report;
(e) it will promptly notify the Borrower, the Administrative Agent, sole expense of the Servicer, each Lender execute and deliver to the Servicer any assignments, bills of sale, termination statements and any other releases and instruments as the Servicer may reasonably request in order to effect the release and transfer of such Collateral; provided, that the Collateral Agent in writing if for any reason it fails to comply with either Agent, on behalf of the covenants set out in paragraphs (a) Secured Parties, will make no representation or (b) above in any way; and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained hereinwarranty, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction express or any of the parties hereto implied, with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise such Collateral in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowsuch sale or transfer and assignment.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Oaktree Specialty Lending Corp)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains outstanding:
Obligations are outstanding and any Lender is subject to the EU Securitization Rules, the Equityholder represents and undertakes that: (aA) the Equityholder reasonably believes it is an originator for the purposes of the EU Securitization Rules, and will retain, as originator, hold and will retain on an ongoing on-going basis, a material net economic interest in the transaction contemplated by this Agreement, which shall not be less than 5.0% of the aggregate nominal value of all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower); (B) the Retained Economic Interest takes the form specified of a first loss tranche in accordance with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as in force on the Twelfth Amendment Effective Date, being retention of as represented by the first loss tranche and, if necessary, other tranches having Equityholder’s direct limited liability company interest in the same or a more severe risk profile than those transferred or sold to investors Borrower; (C) the Equityholder holds and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to not less than 5will directly retain 100% of the Retention Basis Amount equity interests in the Borrower; (such net economic interest being D) the “Retention”);
aggregate capital contributions made by the Equityholder with respect to its equity interests in the Borrower shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of origination as described in (bA) neither above; (E) the Equityholder shall not, and it nor any of its Affiliates will sellprocure that the Borrower shall not: (x) short, hedge or otherwise mitigate its the credit risk under arising from the Retained Interest; or associated (y) sell, transfer or otherwise surrender all or part of the rights, benefits or obligations arising from the Retained Economic Interest, except (in each case) if and as permitted by the EU Securitization Rules; and (F) immediately following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower, not less than 51% of all of the Collateral Obligations will be Equityholder Collateral Obligations, with such proportion of Equityholder Collateral Obligations being measured on the basis of the aggregate outstanding principal balance of the Collateral Obligations at such time and if at any time less than 51% of all of the Collateral Obligations are Equityholder Collateral Obligations, the Equityholder shall, and shall procure that the Borrower will, only acquire or originate Collateral Obligations that qualify as Equityholder Collateral Obligations until not less than 51% of all Collateral Obligations are Equityholder Collateral Obligations; provided that a breach of this paragraph (a)(F) shall not be an Event of Default pursuant to Section 13.1 herein for a period of sixty (60) days from the date of a breach of this paragraph (a)(F).
(b) Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that it is, and has at all times been, in compliance with the Retention where obligations set forth in clause (a) above up to do so would cause and on each date of the related Collection Period. The Equityholder shall provide, at its own cost and expense, to the Facility Agent and/or any SR Lender : (A) prompt written notice of any breach of the obligations set forth in clause (a) above; (B) at the request of any SR Lender, confirmation that all of the obligations set forth in clause (a) above continue to be complied with (x) in the event of a material change in the structure of the transaction contemplated by the Facility Transaction Documents to cease to be compliant that could have a material impact on the performance of the Advances or the risk characteristics of the Collateral Obligations and the Advances made with respect thereto; and (y) upon the occurrence of any Event of Default or becoming aware of any breach of the obligations contained in any Transaction Documents; and (C) all information, documents, reports and notifications that the SR Lender(s) may require in connection with its obligations under the EU Retention Securitization Rules, including without limitation, any information, documentation, reports or notifications that the SR Lender(s) requires for the purposes of Article 5(1)(e) of the EU Securitization Regulation, in such form, in such manner and at such times as prescribed by the Article 7 Transparency and Reporting Requirements;; provided, that the Equityholder shall only be required to provide notification of any significant event of the type specified by Article 7(1)(g) of the EU Securitization Regulation to the extent that a notification or report in respect of the relevant event has not otherwise been provided by any person pursuant to any other provision of any Transaction Document; provided further, that the Equityholder shall not be required to provide any information, documents, reports or notifications: (x) relating to any limited partners; (y) that is/are the subject of contractual confidentiality requirements; or (z) that is/are subject to laws governing the protection of confidentiality of information and the processing of personal data (all such information, documents, reports and notifications being collectively referred to as “Restricted Information”), unless, if it is Restricted Information that cannot be anonymized or aggregated, and there is no existing confidentiality agreement permitting the disclosure of Restricted Information to the SR Lender(s), the Facility Agent and/or the SR Lender(s) enters into a confidentiality agreement reasonably acceptable to the Equityholder, with respect to such Restricted Information, so that it can be furnished to the Facility Agent and the SR Lender(s).
(c) The Equityholder represents and undertakes that: (A) its direct holding of the equity interests of the Borrower was duly approved in accordance with its governing documents and investment policies; and (B) acting through its investment advisor, Silver Point Specialty Credit Fund Management, LLC (the “Investment Manager”), the Equityholder established the transaction contemplated by the Transaction Documents by: (x) causing the formation of the Borrower as a wholly-owned subsidiary that is consolidated for accounting purposes; (y) approving the eligibility criteria for the origination and acquisition of Collateral Obligations; (z) determining the transaction structure and negotiating the Transaction Documents with the various transaction parties.
(d) The Equityholder: (A) was not established for, and does not operate for, the sole purpose of securitizing exposures; (B) has the capacity to meet its payment obligations consistent with a broader business enterprise, by virtue of which it will take such further action, provide such information as is in does not rely solely or predominantly on (x) the Collateral Obligations or other assets securitized by it; or (y) the Retained Economic Interest or any other interest retained or proposed to be retained by it for purposes of the EU Risk Retention Requirement to be able to meet its possession payment obligations; and (provided that C) has experienced decision makers to enable the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholder) and enter into such other agreements, in each caseEquityholder to pursue its established business strategy, as may reasonably be required well as an adequate corporate governance structure.
(e) The Equityholder represents and undertakes that: (A) the Equityholder Originated Collateral Obligations have been, and will continue to be, originated pursuant to a sound and well-defined criteria and clearly established processes for approving, amending, modifying, renewing and financing the Underlying Instruments related to such Collateral Obligations and the Equityholder has, and it shall maintain effective systems in place to apply those criteria and processes to ensure that such Underlying Instruments are granted and approved based on a thorough assessment of each Obligor’s creditworthiness; and (B) in relation to each Equityholder Acquired Collateral Obligation and each other Collateral Obligation acquired by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each Equityholder reasonably believes in light of the Borrowerinformation available to it and subject to a reasonable standard of care, that the Administrative Agententity which was, directly or indirectly, involved in the Servicer, each Lender and Underlying Instruments which created the Collateral AgentObligations granted such Underlying Instruments pursuant to a sound and well-defined criteria and clearly established processes for approving, its continued compliance with amending, modifying, renewing and financing the covenants set out at paragraphs (a) Underlying Instruments and (b) above it had effective systems in each Monthly Report;
(e) it will promptly notify place to apply those criteria and processes to ensure that the Borrower, the Administrative Agent, the Servicer, each Lender Underlying Instruments were granted and the Collateral Agent in writing if for any reason it fails to comply with either approved based on a thorough assessment of the covenants set out in paragraphs (a) or (b) above in any way; andrelevant Obligor’s creditworthiness.
(f) it The Equityholder is, and will notify each of its Affiliates remain, ultimately responsible for, and retain discretion over, the actions of the contents of paragraph Investment Manager and any actions taken by the Investment Manager in relation to the matters outlined in clause (bc) above are taken for, and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrowerbehalf of, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 belowEquityholder.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Silver Point Specialty Lending Fund)
Risk Retention. The Equityholder hereby covenants, for the benefit of the Administrative Agent, the Lenders, the Collateral Agent and, in respect of paragraphs (da) and (e) below only, the Servicer that, for For so long as any Advance remains Obligations are outstanding, the and any Lender is subject to the EU Securitization Rules:
(a) The Equityholder represents and undertakes to the Facility Agent and the Lenders that: (A) that as an originator for the purposes of the EU Securitization Rules, it holds and will retain, as originator, on retain unencumberedon an ongoing on-going basis, a material net economic interest in the form specified transaction contemplated by this Agreement, which shall be comprised of 100% of the USActive 49316845.949316845.10 Preference Shares of the Borrower (representing no less than 6.05% of the aggregate nominal value of all the Collateral Obligations measured at the time of their origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Borrower)); (B) the Borrower shall have no other issued equity interests other than to Walkers Fiduciary Limited, and the aggregate Preference Shares held by the Equityholder with respect to its equity interests in the Borrower shall represent at least 5.0% of the aggregate nominal value of all the Collateral Obligations measured at the time of origination as described in (A) above; (C) the Equityholder shall not sell or enter into any credit risk mitigation, short positions or any other xxxxxx or otherwise seek to, or such lesser amount that may be permitted under the EU Securization Regulation) (the “Retained Economic Interest”), for the purposes of complying with paragraph (d) of Article 6(3) of the Securitisation RegulationEU Securitization Regulation as it applies at the date of this Agreement; (B) the Equityholder shall not (and will procure that any of its Affiliates do not) short, being retention hedge, otherwise mitigate its credit risk or sell, transfer or otherwise surrender all or part of the first loss tranche andrights, if necessary, other tranches having benefits or obligations arising from or associated with respect to its equity interests in the same or a more severe risk profile than those transferred or sold to investors Borrowerthe Retained Economic Interest (except as permitted by the Capital Requirements Regulation) and not maturing any earlier than those transferred or sold to investors, through maintaining funding to the Borrower under the LLC Agreement, in an amount equal to (D) not less than 55EU Securitization Rules); and (C) over 50% of the aggregate outstanding principal balance of the Collateral Obligations has been originated and underwritten by the Equityholder (as Servicer for the Borrower) or the Borrower as the named lender in the Underlying Instruments at origination thereof; shall constitute Retention Basis Amount (Holder Collateral Obligations, with such net economic interest proportion of Retention Holder Collateral Obligations being measured on the “Retention”)basis of the aggregate outstanding principal balance of the Collateral Obligations following the settlement of each acquisition or origination of a Collateral Obligation by the Borrower, or, if at any time less than 50.01% of all of the Collateral Obligations are Retention Holder Collateral Obligations, it shall procure that the Borrower shall only acquire or originate Eligible Collateral Obligations that qualify as Retention Holder Collateral Obligations until not less than 50.01% of all Collateral Obligations are Retention Holder Collateral Obligations;
(b) neither it nor any The Equityholder represents that for purposes of its Affiliates will sell, hedge or otherwise mitigate its credit risk under or associated with the Retention where to do so would cause Requirements that it established the securitisation transaction contemplated by the Facility Agreement by incorporating the Borrower, determining the Borrower’s policies and eligibility criteria for the acquisition and origination of Collateral Obligations, determining the transaction structure and negotiating the Transaction Documents to cease to be compliant with the EU Retention Requirements;various transaction parties; and
(c) it will take such further action, provide such information as is Each Monthly Report shall contain or be accompanied by a certification from the Equityholder containing a representation that all of the conditions set forth in its possession clauseclauses (provided that the provision of such information would not contravene any applicable contract, law or regulation or duties of confidentiality binding on the Equityholdera)(A) and enter into such other agreements, in (a)(B) above are true and have been true up to and on each case, as may reasonably be required by the Borrower, a Lender or the Administrative Agent to satisfy the EU Retention Requirements;
(d) it will confirm to each date of the Borrower, related Collection Period. The Equityholder shall provide to the Administrative Agent, Facility Agent and/or any Lender that is subject to the Servicer, each Lender Retention RequirementsEU Securitization Rules: (A) prompt written notice of any breach of itsthe obligations set forth in Section 10.24clauses (a)(A) and (B) above; (B) confirmation that all of the Collateral Agent, its continued compliance with the covenants conditions set out at paragraphs forth in Section 10.24clause (a) and above continue to be complied with (bx) above in each Monthly Report;
(e) it will promptly notify the Borrower, event of a material change in the Administrative Agent, the Servicer, each Lender and performance of the Collateral Agent in writing if for any reason it fails to comply with either Obligations andor the risk characteristics of the covenants set out in paragraphs (a) or (b) above in any way; Advances and
(f) it will notify each of its Affiliates of the contents of paragraph (b) above and shall use reasonable endeavours to procure that each of its Affiliates complies with the terms of paragraph (b) as if it were a party thereto. Notwithstanding anything to the contrary contained herein, neither the Equityholder nor the Borrower makes any representation as to compliance of the transaction or any of the parties hereto with respect to Securitisation Regulation. Any Person accepting the benefits of this Section 13.22 and/or Section 13.23 below (including any related definitions or provisions), shall be deemed to have agreed to the terms set forth in this paragraph and each Lender hereby represents that is not relying on any of the Borrower, the Servicer or the Equityholder or any of their respective Affiliates, for any financial, tax, legal, accounting, or regulatory advise in connection with the matters set forth in this Section 13.22 and/or Section 13.23 below.
Appears in 1 contract
Samples: Loan Financing and Servicing Agreement (Oaktree Strategic Income Corp)
