MORGAN STANLEY BANK
XXXXXX
XXXXXXX BANK
October
[__],31,
2006
Resource
Capital Funding II, LLC
c/o
Resource Capital Corp.
0000
Xxxxxx Xxxxxx, 00xx Floor
Philadelphia,
PA 19103
Re: Fee
Letter
Ladies
and Gentlemen:
Reference
is made to the Receivables Loan and Security Agreement dated as of the date
hereof (as such may be amended, restated and/or otherwise modified from time
to
time, the “RLSA”)
among
Resource Capital Funding II, LLC, as Borrower (the “Borrower”),
LEAF
Financial Corporation (“LEAF
Financial”),
as
Servicer, Xxxxxx Xxxxxxx Bank (“Xxxxxx
Xxxxxxx”)
and
the other Lenders party thereto from time to time, U.S. Bank National
Association, as Custodian and the Lender’s Bank, and Lyon Financial Services,
Inc. (d/b/a U.S. Bank Portfolio Services). Terms defined in the RLSA are used
in
this fee letter as therein defined.
This
fee
letter is the fee letter referred to in Section 2.08(a) of the RLSA and sets
forth the understanding of the parties hereto with respect to certain fees
that
are payable by the Borrower in connection with the financing provided by the
Lenders pursuant to the RLSA.
The
parties hereto agree as follows:
l. Resource
Capital Corp. xxxxxx agrees to pay to Xxxxxx Xxxxxxx, a one-time, up-front,
fully-earned and non-refundable due diligence fee (the “Due
Diligence Fee”),
in
the amount of $25,000. The parties hereto acknowledge that the Due Diligence
Fee
shall be paid prior to the initial Borrowing and the Borrower shall receive
a
credit against the Arrangement Fee equal to any portion of the Due Diligence
Fee
not applied to the out-of-pocket expenses of Xxxxxx Xxxxxxx.
2. The
Borrower hereby agrees to pay to Xxxxxx Xxxxxxx a fee (the “Arrangement
Fee”)
in the
amount of $500,000, which such fee shall have been earned, in its entirety,
as
of the date hereof. The Arrangement Fee is payable in four (4) equal
installments according to the following schedule: 1st
payment
of $125,000 (minus
the
amount of the Due Diligence Fee not applied to the out-of-pocket expenses of
Xxxxxx Xxxxxxx) on
1
October 15, 2006; 2nd
payment
of $125,000 on January 15, 2007; 3rd
payment
of $125,000 on April 15, 2006; and 4th
payment
of $125,000 on July 15, 2007.
3. The
Borrower hereby agrees that, in the event that the Lender increases the
Borrowing Limit pursuant to Section 2.16 of the RLSA, the Borrower shall pay
to
the Agent, for its own account, immediately prior to the effectiveness of such
increase, a fee (the “Increase
Fee”)
in an
amount equal to 0.20% of the principal amount of such increase, which such
fee
shall have been earned, in its entirety, on the date of such
increase.
4. (a) During
the period commencing on the date hereof and ending on the Collection Date,
the
Borrower shall pay Xxxxxx Xxxxxxx, a fee (the “Unused
Fee”)
in
respect of each Fee Period (other than the Fee Period commencing on the date
hereof and the five following Fee Periods) which shall be equal to (A) 0.10%,
if
the Facility Amount is equal to or less than $100,000,000, and 0.25%, if the
Facility Amount is greater than $100,000,000, multiplied
by (B)
an amount equal to (i) the Borrowing Limit (or, if more than one Borrowing
Limit
was in effect during such Fee Period, the daily average Borrowing Limit) in
effect during such Fee Period minus
(ii) the
daily average Facility Amount during such Fee Period, as determined by the
Lender, multiplied
by (C) a
fraction, the numerator of which shall be the actual number of days in such
Fee
Period and the denominator of which shall be 360 days.
(b) The
Unused Fee shall be payable by the Borrower in arrears on each Remittance Date
commencing on the seventh (7th)
Remittance Date after the Closing Date with respect to the Fee Period
immediately preceding such Remittance Date, and on the Collection Date. The
Unused Fee shall not be payable with respect to any Fee Period during interest
in respect of the Loans Outstanding is computed by reference to the Default
Funding Rate.
5. If
the
Borrower exercises its right to prepay, in whole or in part, the outstanding
principal amount of the Loans in accordance with Section 2.15 of the RLSA,
the
Borrower shall pay Xxxxxx Xxxxxxx a fee (the “Prepayment
Premium”)
in an
amount equal to 0.50% multiplied
by the
Facility Amount. Notwithstanding the foregoing, such Prepayment Premium shall
be
credited against any fees paid to Xxxxxx Xxxxxxx in connection with a
securitization transaction.
6. Whenever
any payment hereunder shall be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day and such extension
of
time shall be included in the computation of such payment; provided,
that no
day shall be included in more than one Fee Period.
7. For
all
purposes under the RLSA, “Adjusted
Eurodollar Rate Margin”
shall
mean (a) prior to the date the Facility Amount first exceeds $100,00,000,100,000,000,
0.60%
per annum and (b) on or after the date the Facility Amount first exceeds
$100,000,000, 0.75% per annum.
8. Unless
otherwise required by applicable law, each party hereto agrees to maintain
the
confidentiality of this fee letter in communications with third parties and
otherwise; provided,
that,
this fee letter may be disclosed by each party to its respective legal counsel
and auditors, any rating agency and any provider of liquidity support or credit
enhancement, if they
2
agree
to hold it confidential. The terms and
provisions of this fee letter shall be binding upon, and shall inure to the
benefit of, the successors and assigns of the parties hereof. THIS FEE LETTER
SHALL, IN ACCORDANCE WITH SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE
STATE OF NEW YORK, BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO ANY CONFLICTS OF LAW PRINCIPLES THEREOF THAT WOULD CALL FOR THE
APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION.
[Remainder
of page intentionally left blank.]
3
This
fee
letter may be executed in two or more counterparts, each of which shall be
an
original, but all of which together shall constitute one and the same
instrument. Delivery of an executed counterpart of a signature page to this
fee
letter by facsimile shall be effective as delivery of a manually executed
counterpart of this fee letter.
Very
truly yours,
XXXXXX
XXXXXXX BANK, as Lender
By: ________________________________
Name:
Title:
Xxxxxx
and accepted as of
the
date
first above written:
RESOURCE
CAPITAL FUNDING II, LLC,
as
Borrower
By: ___________________________
Name:
Title:
S-1
