NEWTEK CONVENTIONAL LENDING, LLC LIMITED LIABILITY COMPANY AGREEMENT This Limited Liability Company Agreement, dated as of November 27, 2018, of Newtek Conventional Lending, LLC (the “Company”) is entered into by and between Conventional Lending TCP...
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Exhibit 10.1 NEWTEK CONVENTIONAL LENDING, LLC LIMITED LIABILITY COMPANY AGREEMENT THE SECURITIES REPRESENTED BY THIS AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATES OR OTHER JURISDICTIONS. THEY ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND THE REGISTRATION AND QUALIFICATION REQUIREMENTS OF SUCH LAWS. THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND SUCH LAWS PURSUANT TO REGISTRATION, QUALIFICATION, OR EXEMPTION THEREFROM AND IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR BY ANY STATE OR OTHER SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THE OFFERING MATERIALS, AND ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
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NEWTEK CONVENTIONAL LENDING, LLC LIMITED LIABILITY COMPANY AGREEMENT This Limited Liability Company Agreement, dated as of November 27, 2018, of Newtek Conventional Lending, LLC (the “Company”) is entered into by and between Conventional Lending TCP Holdings LLC and Newtek Commercial Lending, Inc. (each, a “Member” and collectively, the “Members”). WHEREAS, the Members desire to form a co-managed limited liability company under the Act (as defined below) for the purposes and pursuant to the terms set forth herein; NOW THEREFORE, in consideration of the mutual agreements set forth below, and intending to be legally bound, the Members hereby agree as follows: ARTICLE I DEFINITIONS Section 1.01 Definitions. For purposes of this Agreement, the following terms shall have the following meanings: “1940 Act” means the Investment Company Act of 1940, as amended. “Acceptance Period” has the meaning set forth in Section 8.01(g)(ii). “Act” means the Limited Liability Company Act of the State of Delaware, as from time to time in effect. “Adjusted Asset Value” with respect to any asset shall be the asset’s adjusted basis for federal income tax purposes, except as follows: (i) The initial Adjusted Asset Value of any asset contributed by a Member to the Company shall be the gross fair market value of such asset at the time of contribution, as determined by the contributing Member and the Company. (ii) In the discretion of the Administrative Agent, the Adjusted Asset Values of all Company assets may be adjusted to equal their respective gross fair market values, as determined by the Board (provided that, the Board shall use the Value of any asset determined in accordance with Section 10.05), and the resulting unrecognized profit or loss allocated to the Capital Accounts of the Members pursuant to Article 4, as of the following times: (A) the grant of an additional interest in the Company to any new or existing Member; (B) the distribution by the Company to a Member of more than a de minimis amount of Company assets; (C) the termination of the Company either by expiration of the Company’s term or the occurrence of an event of early termination; and
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(D) the liquidation of the Company within the meaning of Treasury Regulation §1.704- 1(b)(2)(ii)(g). (iii) The Adjusted Asset Values of the Company assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m). “Adjusted Capital Account”, with respect to any Member, shall mean the Member’s Capital Account as adjusted by the items described in Sections 1.704-2(g)(1), 1.704-2(i)(5) and 1.704-1(b)(2)(ii)(d)(4), (5) and (6) of the Treasury Regulations. “Administrative Agent” means Newtek Business Services Corp. or an Affiliate thereof retained by the Company with Board Approval to perform administrative services for the Company. “Administrative Services Agreement” means the Administrative Services Agreement between the Company and the Administrative Agent, as amended from time to time with Board Approval. “Advancing Member” has the meaning set forth in Section 4.02. “Affiliate” means, with respect to a Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the other Person. “Agreement” means this Limited Liability Company Agreement, as it may from time to time be amended. “Board” means the Board of Directors of the Company. “Board Approval” means, as to any matter requiring Board Approval under this Agreement, the majority approval or subsequent ratification of the Directors present at a meeting duly held at which a quorum is present, provided that at least one Director elected, designated, or appointed by each Member approves any such act or decision. Matters requiring Board Approval are set forth in further detail in Schedule A of this Agreement. Board Approval may be received without a meeting, without notice, and without a vote if all Directors entitled to vote with respect to the subject matter of that action consent to the action in writing (including by e-mail), and the writing or writings are filed with the minutes of proceedings of the Board. “Capital Account” means, as to each Member, the capital account maintained on the books of the Company for the Member in accordance with Section 5.01. 2
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“Capital Commitment” means, as to each Member, the total amount set forth on the Member List, which is contributed and agreed to be contributed to the Company by the Member as a Capital Contribution. “Capital Contribution” means, as to each Member, the aggregate amount of cash actually contributed to the equity capital of the Company by the Member as set forth in Section 4.01. The Capital Contribution of a Member that is an assignee of all or a portion of an equity interest in the Company shall include the Capital Contribution of the assignor (or a pro rata portion of the assignor’s Capital Contribution in the case of an assignment of less than the Entire Interest of the assignor). “Certificate of Formation” means the certificate of formation for the Company filed under the Act, as amended from time to time. “Change of Control” means, with respect to any Person, a transaction which causes the owners of that Person as of the date of this Agreement and their Affiliates to own less than fifty percent (50%) of that Person immediately after that transaction. “Code” means the Internal Revenue Code of 1986, as amended from time to time. “Company” has the meaning set forth in the recitals. “Control” means the power, directly or indirectly, to direct the management or policies of a Person, whether by ownership of securities, by contract, or otherwise. “Daily Interest Amount” means, with respect to an Investment, the amount obtained by multiplying the outstanding principal amount of an Investment by the Daily Interest Rate applicable to that Investment. “Daily Interest Rate” means (i) for an Investment in the form of a loan or debt, the rate determined by dividing the per annum interest rate applicable to such Investment by 365, and (ii) for an Investment in the form of preferred, structured or other equity that has an associated contractual accruing dividend rate, the rate determined by dividing the per annum contractual accruing dividend rate applicable to such Investment by 365. “Default Date” has the meaning set forth in Section 4.03(a). “Defaulting Member” has the meaning set forth in Section 4.03(a). “Delayed Contribution” has the meaning set forth in Section 4.02. “Delayed Member” has the meaning set forth in Section 4.02. “Depreciation” means, for any period, an amount equal to the depreciation or other cost recovery deduction allowable with respect to an asset for such period, except that (A) with respect to any asset the Adjusted Asset Value of which differs from its adjusted tax basis for 3
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federal income tax purposes and which difference is being eliminated by use of the “remedial method” defined by Treasury Regulation § 1.704-3(d), Depreciation for such period shall be the amount of book basis recovered for such period under the rules prescribed by Treasury Regulation § 1.704-3(d)(2), and (B) with respect to any other asset the Adjusted Asset Value of which differs from its adjusted tax basis at the beginning of such period, Depreciation shall be an amount which bears the same ratio to such beginning Adjusted Asset Value as the federal income tax depreciation, amortization, or other cost recovery deduction for such period bears to such beginning adjusted tax basis; provided, however, that if the adjusted tax basis of any asset at the beginning of such period is zero, Depreciation with respect to such asset shall be determined with reference to such beginning Adjusted Asset Value using any reasonable method selected by the Board. “Director” means each Person elected, designated, or appointed to serve as a member of the Board. “Electing Member” has the meaning set forth in Section 9.03(e). “Election to Purchase” has the meaning set forth in Section 9.03(e). “Entire Interest” means all of a Member’s interests in the Company, including the Member’s transferable interest and all management and other rights. “ERISA” the Employee Retirement Income Security Act of 1974, as from time to time amended. “ERISA Plan” a Person that is an “employee benefit plan” within the meaning of, and subject to the provisions of, ERISA. “Expenses” means all costs and expenses, of whatever nature, directly or indirectly borne by the Company, including those borne under the Administrative Services Agreement but excluding those borne under the Loan Administrative Services Agreement and the Loan Servicing Agreement. Expenses include, but are not limited to, referral fees up to 1% of funding of an Investment to be paid to NBSC Alliance Partners, referral partner relationship management fees to be paid to NBSC RVPs up to 0.5% of the funding of an Investment, and certain pass through expenses (such as search fees, flood search, commercial appraisal reports, environment reports, credit reports, tax transcripts, etc.) to be paid by the borrower without xxxx up by the Loan Administrative Agent. “GAAP” means United States generally accepted accounting principles. “Investment” has the meaning set forth in Section 2.04(a). “Investment Committee” means a committee consisting of an equal number of TCPC IC Representatives and Newtek IC Representatives. “Investment Period” has the meaning set forth in Section 7.01(g). 4
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“Investor Laws” has the meaning set forth in Section 8.02(b). “Loan Administrative Agent” means Newtek Business Lending, LLC or an Affiliate thereof retained by the Company with Board Approval to perform loan origination services for the Company. “Loan Administrative Services Agreement” means the Loan Administrative Services Agreement between the Company and the Loan Administrative Agent, as amended from time to time with Board Approval. “Loan Servicing Agreement” means the Loan Servicing Agreement between the Company and the Servicing Agent, as amended from time to time with Board Approval. “Loss” has the meaning set forth in Section 7.12(a). “Member” and “Members” have the meaning set forth in the recitals and also includes any Person that becomes a Member of the Company after the date of this Agreement under the terms of this Agreement. “Member List” has the meaning set forth in Section 2.07. “NBSC” means Newtek Business Services Corp. “Newtek” means Newtek Commercial Lending, Inc., or any Person substituted for Newtek Commercial Lending, Inc. as a Member pursuant to the terms of this Agreement. “NBSC Alliance Partners” means a person or entity who, pursuant to a referral promotion agreement with NBSC, submits business referrals to NBSC in exchange for commissions paid on closed referred transactions. “Newtek Change of Control” has the meaning set forth in Section 7.11(b). “Newtek IC Representative” has the meaning set forth in Section 7.02. “NBSC RVPs” means an employee or contractor of NBSC who promotes NBSC’s products and services in exchange for earning fees or commissions on transactions. “Notice of Intent” has the meaning set forth in Section 8.01(g)(i). “Organization Costs” means all out-of-pocket costs and expenses reasonably incurred directly by the Company or for the Company by a Member or its Affiliates in connection with the formation and capitalization of the Company, the initial offering of Company interests to TCPC and Newtek, and the preparation by the Company to commence its business operations, including reasonable and documented (i) fees and disbursements of legal counsel to the Company or its Affiliates, (ii) accountant fees and other fees for professional services, and (iii) travel costs and other out-of-pocket expenses. 5
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“Outstanding” means all Shares (or Shares of a class, as applicable) that are issued by the Company and reflected as Outstanding on the Company’s books and records as of the date of determination. “Partnership Representative” has the meaning provided in 0. “Person” means an individual or a corporation, partnership, association, joint venture, company, limited liability company, trust, governmental authority, or other entity. “Portfolio Company” means, with respect to any Investment, any Person that is the issuer of any equity securities, equity-related securities or obligations, debt instruments or debt-related securities, or obligations (including senior debt instruments, including investments in senior loans, senior debt securities, and any notes or other evidences of indebtedness, preferred equity, warrants, options, subordinated debt, mezzanine securities, or similar securities or instruments) that are the subject of the Investment. Portfolio Companies do not include Subsidiaries. “Prior Investment Committee Approval” means, as to any matter requiring Prior Investment Committee Approval under this Agreement, the prior approval of at least one TCPC IC Representatives and one Newtek IC Representatives. “Proceeding” has the meaning set forth in Section 7.12(a). “Profit” or “Loss” shall be an amount computed for each period as of the last day thereof that is equal to the Company’s taxable income or loss for such period, determined in accordance with Section 703(a) of the Code (for this purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or loss), with the following adjustments: (i) Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Profit or Loss pursuant to this paragraph shall be added to such taxable income or loss; (ii) Any expenditures of the Company described in Code Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(i) and not otherwise taken into account in computing Profit or Loss pursuant to this paragraph shall be subtracted from such taxable income or loss; (iii) Gain or loss resulting from any disposition of a Company asset with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Adjusted Asset Value of the asset disposed of rather than its adjusted tax basis; (iv) In lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such period; 6
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(v) Gain or loss resulting from any disposition of any Company asset with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Adjusted Asset Value of such asset; and (vi) Notwithstanding any other provision of this definition, any items that are specially allocated pursuant to Section 5.02(a)(ii) shall not be taken into account in computing Profit or Loss. If the Profit or Loss for such Period, as adjusted in the manner provided herein, is a positive amount, such amount will be the Profit for such Period; and if negative, such amount shall be the Loss for such Period. “Proportionate Share” means, as to any Member, the percentage that its Capital Contributions represents of all Capital Contributions. “Regulations” means the United States Treasury Regulations promulgated under the Code, as in effect from time to time. “Sale Period” has the meaning set forth in Section 8.01(g)(iii). “SEC” means the U.S. Securities and Exchange Commission. “Securities Act” has the meaning set forth in the legend on the cover page. “Series A Preferred Shares” means $20,000 liquidation preference, 10% cumulative series A preferred shares issued by the Company. “Servicing Agent” means Small Business Lending, LLC, or an Affiliate thereof, or any back-up servicer, retained by the Company with Board Approval to service the loans originated by the Company. “Shares” means the limited liability company interests into which the membership interests of the Company shall be divided from time to time and includes fractions of Shares as well as whole Shares, including but not limited to Class A Common Shares and Series A Preferred Shares. “Subsidiary” as to any Person, means any corporation, partnership, limited liability company, joint venture, trust, or estate of or in which more than 50% of (a) the issued and outstanding capital stock having ordinary voting power to elect a majority of the board of directors of the corporation (irrespective of whether at the time capital stock of any other class of such corporation may have voting power upon the happening of a contingency), (b) the interest in the capital or profits of such partnership, limited liability company, or joint venture or (c) the beneficial interest in the trust or estate is at the time directly or indirectly owned or controlled through one or more intermediaries, or both, by that Person. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of the Company. 7
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“TCPC” means Conventional Lending TCP Holdings LLC, or any Person substituted for Conventional Lending TCP Holdings LLC, as a Member pursuant to the terms of this Agreement. “TCPC Change of Control” has the meaning set forth in Section 7.11(b). “TCPC IC Representative” has the meaning set forth in Section 7.02. “Temporary Advance” has the meaning set forth in Section 4.02. “Temporary Advance Fee” means, with respect to any Temporary Advance made by an Advancing Member relating to an Investment that closes prior to the time that a Delayed Member has made its Delayed Contribution, an amount equal to the product of (i) the sum of the Daily Interest Amounts for each day beginning on the date the Investment is made and ending on the date prior to which the Delayed makes has made its Delayed Contribution and (ii) the Delayed Member’s Proportionate Share (after giving effect to the Delayed Contribution). “Transfer” or “transfer” means, with respect to any Member’s interest in the Company, the direct or indirect sale, assignment, transfer, withdrawal, mortgage, pledge, hypothecation, exchange, or other disposition of any part or all of that interest, whether or not for value and whether such disposition is voluntary, involuntary, by operation of law, or otherwise, and a “transferee” or “transferor” means a Person that receives or makes a transfer. Notwithstanding the foregoing, a “Transfer” shall not include any pledge or grant of a security interest in a Member’s interest in the Company to a lender. “Treasury Regulations” means all final and temporary federal income tax regulations, as amended from time to time, issued under the Code by the United States Treasury Department. “Undistributed Net Investment Income” means the Company’s net investment income, determined in accordance with generally accepted accounting principles, for the current and all prior periods, reduced by all amounts previously distributed to the Members. “Value” means, as of the date of computation with respect to some or all of the assets of the Company or any assets acquired by the Company, the value of those assets determined in accordance with Section 10.05. ARTICLE II GENERAL PROVISIONS Section 2.01 Formation of the Limited Liability Company. The Company was formed under and pursuant to the Act upon the filing of the Certificate of Formation in the office of the Secretary of State of the State of Delaware, and the Members hereby agree to continue the Company under and pursuant to the Act. The Members agree that the rights, duties, and 8
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liabilities of the Members shall be as provided in the Act, except as otherwise provided in this Agreement. Each Person being admitted as a Member as of the date of this Agreement shall be admitted as a Member at the time the Person has executed this Agreement or a counterpart of this Agreement. By its signature to this Agreement (or, in the case of substitute Members, the instrument described in Section 8.01(c) below whereby such transferee becomes a party to this Agreement), each Member represents to the Company and to the other Members that (1) the Member is an “accredited investor” as defined in Rule 501 under the Securities Act, and is a “qualified purchaser” as defined in Section 2(a)(51) under the 1940 Act, and (2) the Member understands that the securities represented by this Agreement have not been and will not be registered under the Securities Act or any state securities laws and cannot be sold or otherwise distributed by the Member unless the securities either are registered or otherwise qualified under the Securities Act and any applicable state securities laws or are exempt from such registrations or qualifications. In addition to the foregoing representations, each Member represents to the Company and to the other Members as follows: (a) It is duly organized and validly existing under the laws of the jurisdiction of its organization; (b) It has the power to execute and deliver this Agreement and the documents referred to in this Agreement and to perform its obligations under this Agreement and has taken all necessary action to authorize the execution, delivery, and performance; (c) The execution, delivery, and performance do not violate or conflict with any law applicable to it, any provision of its organizational documents, any order or judgment of any court or other agency of government applicable to it, or any of its assets or any contractual restriction binding on or affecting it or any of its assets; (d) All governmental and other consents that are required to have been obtained by it with respect to this Agreement and the documents referred to in this Agreement have been obtained and are in full force and effect and all conditions of any such consents have been complied with; (e) This Agreement constitutes and, upon execution of the documents referred to in this Agreement, those documents will constitute, its legal, valid, and binding obligation, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium, or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application regardless of whether enforcement is sought in a proceeding in equity or at law); (f) It is entering into this Agreement for its own account for investment and not with a view to any distribution of the interests in the Company. It fully understands, accepts, and is able to bear the economic risks associated with the obligations and undertakings contained in this Agreement; and 9
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(g) It has taken or will take all necessary steps to ensure its compliance with all applicable federal and state securities laws and regulations. Section 2.02 Company Name. The name of the Company shall be “Newtek Conventional Lending, LLC,” or such other name as approved by Board Approval. Section 2.03 Place of Business; Agent for Service of Process. (a) The registered office of the Company in the State of Delaware is located at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Delaware, or such other place as the Members may designate. The name of its registered agent for service at that address is Corporation Trust Center or such other Person as the Members may designate. (b) The initial principal business office of the Company shall be at 0000 Xxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxxxxx, XX 00000. Section 2.04 Purpose and Powers of the Company. (a) The purpose and business of the Company shall be (i) to originate, structure and invest in first lien loans to and other investments in third-party Portfolio Companies (“Investments”), and (ii) to engage in any other lawful acts or activities as the Board deems reasonably necessary or advisable for which limited liability companies may be organized under the Act. (b) Subject to the provisions of this Agreement, the Company shall have the power and authority to take any and all actions necessary, appropriate, proper, advisable, convenient, or incidental to, or for the furtherance of, the purposes set forth in Section 2.04(a). (c) The Company may enter into and perform each of the Administrative Services Agreement, the Loan Administrative Services Agreement and the Loan Servicing Agreement, without any further act, vote, or approval of any Member notwithstanding any other provision of this Agreement, the Act or any other applicable law, rule or regulation. Section 2.05 Fiscal Year. The fiscal year of the Company shall be the period ending on December 31 of each year. Section 2.06 Liability of Members. Except as expressly provided in this Agreement, a Member shall have such liability for the repayment, satisfaction, and discharge of the debts, liabilities, and obligations of the Company only as is provided by the Act. A Member that receives a distribution made in violation of the Act shall be liable to the Company for the amount of that distribution to the extent, and only to the extent, required by the Act. The Members, in their capacities as Members, shall not otherwise be liable for the repayment, satisfaction, or discharge of the Company’s debts, liabilities, and obligations, except that each Member shall be required to 10
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Section 3.04 Rights of Members. The Shares shall be personal property giving only the rights in this Agreement specifically set forth. The ownership of the Assets of every description is vested in the Company. Except as otherwise set forth in this Agreement, the right to conduct and supervise the conduct of the business of the Company is vested exclusively in the Board of Directors (subject to the right of the Board of Directors to delegate all or any part of its authority to any Person or group of Persons, including, without limitation, any employee of any subsidiary of the Company), and the Members shall have no interest therein other than the beneficial interest conferred by their Shares, and they shall have no right to call for any partition or division of any property, profits, rights or interests of the Company nor can they be called upon to share or assume any losses of the Company or suffer an assessment of any kind by virtue of their ownership of Shares. A Person shall cease to be a Member when it no longer has any Shares. Section 3.05 Book Entry. The Shares shall be evidenced only on the books of the Company and no certificates therefor shall be issued unless otherwise determined by the Board of Directors. Any certificate reflecting the number of Shares held by any Person will bear a legend to the following effect unless otherwise agreed by the Company and the holder thereof: “The securities represented by this certificate have not been registered under the Securities Act of 1933 (the “Act”) or applicable state securities laws (the “State Acts”), and shall not be sold, pledged, hypothecated, donated, or otherwise Transferred (whether or not for consideration) by the holder except upon the issuance to the Company of a favorable opinion of its counsel or submission to the Company of such other evidence as may be satisfactory to counsel for the Company, to the effect that any such Transfer shall not be in violation of the Act and the State Acts. Sale, pledge, Transfer or hypothecation of this membership interest is restricted by the provisions of certain agreements among certain Members and the Company, and the limited liability company agreement of the Company, a copy of each of which may be inspected at the principal office of the Company, and all the provisions of which are incorporated by reference herein.” ARTICLE IV COMPANY CAPITAL AND INTERESTS Section 4.01 Capital Commitments. (a) Each Member’s Capital Commitment shall be set forth on the Member List and shall be payable in cash in U.S. dollars. Within three (3) business days after notice from the Administrative Agent specifying the amount of a Capital Contribution then to be paid, or such later date as may be specified in such notice, a Member shall pay the Capital Contribution; provided that any amount of a Capital Contribution to be used for a purpose requiring Prior Investment Committee Approval or Board Approval shall be subject to the Prior Investment Committee Approval or Board Approval, as applicable. Capital Contributions shall be made by all Members pro rata based on their respective Capital Commitments. 12
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initial Directors appointed by TCPC are Xxxxxxxx Xxx and Xxxx Xxxx. Each Director elected, designated, or appointed by a Member shall hold office until a successor is elected and qualified by the Member or until the Director’s earlier death, resignation, expulsion, or removal. A Director need not be a Member. At all times, the Board shall have equal representation between TCPC and Newtek. (b) The Directors will determine the number of members of the Investment Committee and the authorized number of committee members may be increased or decreased by the Directors at any time provided that at all times each Member has appointed an equal number of members to the Investment Committee. The initial number of members of the Investment Committee shall be four (4), and each Member shall elect, designate, or appoint two (2) members of the Investment Committee. The initial members of the Investment Committee appointed by Newtek are Xxxxx Xxxxx and Xxxxxxx Zara and the initial members of the Investment Committee appointed by TCPC are Xxxxxxxx Xxx and Xxxx Xxxx. At any time and from time to time, (x) TCPC may designate, remove, or designate a successor to any Person or Persons designated by TCPC to serve on the Investment Committee (each of those Persons, a “TCPC IC Representative”) by written notice to Newtek and (y) Newtek may designate, remove, or designate a successor to any Person or Persons designated by Newtek to serve on the Investment Committee (each of those Persons, a “Newtek IC Representative”) by written notice to TCPC. (c) Each Director, TCPC IC Representative, and Newtek IC Representative shall devote substantially all of his or her professional time to the Company, the Member by whom he or she was appointed, and that Member’s Affiliates. At such time as any Director, TCPC IC Representative, or Newtek IC Representative shall cease to devote substantially all of his or her professional time to the Company, the Member by whom he or she was appointed, and that Member’s Affiliates, the Director, TCPC IC Representative, or Newtek IC Representative, as applicable, shall be ineligible to serve in that capacity and must be replaced immediately by the Member by whom he or she was appointed. (d) The Investment Committee shall operate in a manner as set forth in Schedule C of this Agreement, and any change to such operations shall require Prior Investment Committee Approval. (e) Subject to matters requiring Board Approval and Prior Investment Committee Approval, the Investment Committee shall have the power to do any and all acts necessary, convenient, or incidental to or for the furtherance of the purposes described in this Agreement, including all powers, statutory or otherwise. The Investment Committee has the authority to bind the Company. 21
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(f) Subject to Board Approval, the Company shall obtain directors and officers insurance coverage on the Company, the Directors, and the members of the Investment Committee. Section 7.03 Meetings of the Board of Directors. The Board may hold meetings, both regular and special, within or outside the State of Delaware. Meetings of the Board may be called by any Director on not less than 24 hours’ notice to each Director by telephone, facsimile, mail, telegram, email, or any other similar means of communication, with the notice stating the place, date, and hour of the meeting (and the means by which each Director may participate by telephone conference or similar communications equipment in accordance with Section 7.05 of this Agreement) and the purpose or purposes for which the meeting is called. Special meetings may be called by a Director in like manner and with like notice upon the written request of any one or more of the Directors. Attendance of a Director at any meeting (including any meeting that occurs less than 24 hours after notice of the meeting) shall constitute a waiver of notice of the meeting, except where a Director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Section 7.04 Quorum; Acts of the Board. (a) At all meetings of the Board the presence of two (2) Directors shall constitute a quorum for the transaction of business, provided that there are at least one Director is present that was elected, designated, or appointed by each Member. If a quorum shall not be present at any meeting of the Board, then the Directors present at the meeting may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum is present. (b) Every act or decision done or made by the Board shall require majority approval of the Directors present at a meeting duly held at which a quorum is present, provided that at least one Director elected, designated, or appointed by each Member approves any such act or decision. The Company shall not have the authority without Board Approval to approve or undertake any item set forth in Section 1 of Schedule A of this Agreement (as such schedule may be amended from time to time with Board Approval). Any action required or permitted to be taken at any meeting of the Board may be taken without a meeting, without notice, and without a vote if all Directors entitled to vote with respect to the subject matter of that action consent to the action in writing (including by e-mail), and the writing or writings are filed with the minutes of proceedings of the Board. Section 7.05 Electronic Communications. Members of the Board may participate in meetings of the Board, or any committee, by means of telephone conference or similar communications equipment that allows all persons participating in the meeting to hear each other, and such participation in a meeting shall constitute presence in person at the meeting. If all the participants are participating by telephone conference or similar communications equipment, then the meeting shall be deemed to be held at the principal place of business of the Company. 22
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connection with the Proceeding, appeal, inquiry, or investigation (each a “Loss”), unless the Loss is primarily the result of gross negligence, fraud, or willful misconduct by the Person seeking indemnification under this Section 7.12, in which case the indemnification shall not cover the Loss to the extent resulting from gross negligence, fraud, or intentional misconduct. Indemnification under this Section 7.12 shall continue as to a Person who has ceased to serve in the capacity which initially entitled the Person to indemnity under this Section 7.12. The rights granted pursuant to this Section 7.12 shall be deemed contract rights, and no amendment, modification, or repeal of this Section 7.12 shall have the effect of limiting or denying any rights with respect to actions taken or Proceedings, appeals, inquiries, or investigations arising prior to any amendment, modification, or repeal. To the fullest extent permitted by law, no Person entitled to indemnification under this Section 7.12 shall be liable to the Company or any Member for any act or omission performed or omitted by or on behalf of the Company; provided that the act or omission has not been fully adjudicated to constitute gross negligence, fraud, or willful misconduct. In addition, any Person entitled to indemnification under this Section 7.12 may consult with legal counsel selected with reasonable care and shall incur no liability to the Company or any Member to the extent that the Person acted or refrained from acting in good faith in reliance upon the opinion or advice of that counsel. (b) The right to indemnification conferred in Section 7.12(a) shall include the right to be paid or reimbursed by the Company for the reasonable expenses incurred by a Person entitled to be indemnified under Section 7.12(a) who was, is, or is threatened to be made a named defendant or respondent in a Proceeding in advance of the final disposition of the Proceeding and without any determination as to the Person’s ultimate entitlement to indemnification; provided, however, that the payment of the expenses incurred by a Person in advance of the final disposition of a Proceeding shall be made only upon delivery to the Company of a written undertaking by the Person to repay all amounts so advanced if it shall be finally adjudicated that the indemnified Person is not entitled to be indemnified under this Section 7.12 or otherwise. (c) The Company, with Board Approval, may indemnify and advance expenses to an employee or agent of the Company to the same extent and subject to the same conditions under which it may indemnify and advance expenses to a Member under Sections 7.12(a) and (b). (d) The right to indemnification and the advancement and payment of expenses conferred in this Section 7.12 shall not be exclusive of any other right that a Member or other Person indemnified pursuant to this Section 7.12 may have or hereafter acquire under any law (common or statutory) or provision of this Agreement. 25
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ownership of such Member, if permitted by such Member, provided, that in the case of Newtek or TCPC, such Transfer or redemption does not result in a Newtek Change in Control or TCPC Change of Control, as applicable. (b) No Transfer by a Member shall be binding upon the Company until the Company receives an executed copy of the documentation as reasonably requested by the other Member to show the Transfer is in accordance with this Article VIII. (c) Any Person which acquires an interest in the Company by Transfer in accordance with the provisions of this Agreement shall be admitted as a substitute Member, provided the requirements of this Agreement are satisfied. The admission of a transferee as a substitute Member shall be conditioned upon the transferee’s written assumption, in form and substance reasonably satisfactory to the other Member, of all obligations of the transferor in respect of the Transferred interest and execution of an instrument reasonably satisfactory to the other Member whereby the transferee becomes a party to this Agreement and makes the representations set forth in Section 2.01 of this Agreement. (d) In the event any Member shall be adjudicated as bankrupt, or in the event of the winding up or liquidation of a Member, the legal representative of the Member shall, upon written notice to the other Member of the happening, become a transferee of the Member’s interest, subject to all of the terms of this Agreement as then in effect. (e) Any transferee of the interest of a Member, irrespective of whether the transferee has accepted and adopted in writing the terms and provisions of this Agreement, shall be deemed by the acceptance of the Transfer to have agreed to be subject to the terms and provisions of this Agreement in the same manner as its transferor. (f) As additional conditions to the validity of any Transfer of a Member’s interest, the assignment shall not: (i) violate the registration provisions of the Securities Act or the securities laws of any applicable jurisdiction; (ii) cause the Company to cease to be entitled to the exemption from the definition of an “investment company” pursuant to Section 3(c)(7) of the 1940 Act and the rules and regulations of the Securities and Exchange Commission under the 1940 Act; (iii) result in the termination of the Company under the Code or in the Company being classified as a “publicly traded partnership” under the Code; 27
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(iv) unless the other Member waives in writing the application of this clause (iv) with respect to such assignment (which the other Member may refuse to do in its absolute discretion), be to a Person which is an ERISA Plan; or (v) cause the Company or the other Member to be in violation of, or effect an assignment to a Person that is in violation of, applicable Investor Laws. The non-Transferring Member may require reasonable evidence as to the conditions set forth in clauses (i) through (v), including an opinion of counsel reasonably acceptable to the non-Transferring Member. Any purported Transfer as to which the conditions set forth in clauses (i) through (v) are not satisfied shall be void ab initio. A Transferring Member shall be responsible for all costs and expenses incurred by the Company, including reasonable legal fees and expenses, in connection with any assignment or proposed assignment. (g) Except for Transfers of all of a Member’s Entire Interest to an Affiliate of the Member who remains liable for the transferring Member’s Capital Commitments, each Member hereby unconditionally and irrevocably grants to the other Member or its designee a right of first offer to purchase or designate a third party to purchase all, but not less than all, of any interest in the Company that the other Member may propose to Transfer to another Person at the valuation most recently approved in accordance with Section 10.05. (i) The Member proposing to make a Transfer that would be subject to this Section 8.01(g) must deliver written notice of its intention to Transfer the interest (the “Notice of Intent”) to the other Member not later than thirty (30) days prior to the proposed closing date of the Transfer. The Notice of Intent shall contain the material terms and conditions of the proposed Transfer and shall identify the proposed transferee of such interest, if known. (ii) The Member receiving the Notice of Intent shall have the right, for a period of fifteen (15) business days from the date of receipt of the Notice of Intent (the “Acceptance Period”), to accept the interest or to designate a third-party purchaser to accept the interest at the valuation most recently approved in accordance with Section 10.05 and on the terms stated in the Notice of Intent. The acceptance shall be made by delivering a written notice to the selling Member and the Company within the Acceptance Period stating that it elects to exercise its right of first offer and, if applicable, providing the identity of any Person that the non-transferring Member designates as the purchaser. (iii) Following expiration of the Acceptance Period, the selling Member shall be free to sell its interest in the Company to a third party in a Transfer (which third party shall be the party identified in the Notice of Intent, if known by the selling Member) that otherwise meets the requirements of 28
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immediately preceding sentence), Expenses and all other obligations of the Company. Subject to the foregoing provisions of this Section 9.03(b), the Members shall continue to bear an allocable share of Expenses and other obligations of the Company, in proportion to their respective Capital Accounts, until all Investments in which the Company participates are repaid or otherwise disposed of in the normal course of the Company’s activities. (c) Distributions to the Members during the winding down of the Company shall be made no less frequently than quarterly to the extent consisting of a Member’s allocable share of cash and cash equivalents, after taking into account reasonable reserves deemed appropriate by Board Approval (or in the event of a dissolution and winding up of the Company pursuant to Sections 9.02(c) or 9.02(d), by a Member that has elected to act as liquidating agent pursuant to Section 9.03(a)), to fund Investments in which the Company continues to participate (as set forth in the immediately preceding paragraph), Expenses and all other obligations (including contingent obligations) of the Company. Unless waived by Board Approval, the Company also shall withhold ten percent (10%) of distributions in any calendar year, which withheld amount shall be distributed within sixty (60) days after the completion of the annual audit covering that year. A Member shall remain a member of the Company until all Investments in which the Company participates are repaid or otherwise disposed of, the Member’s allocable share of all Expenses and all other obligations (including contingent obligations) of the Company are paid, and all distributions are made under this Agreement, at which time the Member shall have no further rights under this Agreement. (d) Upon dissolution of the Company, final allocations of all items of Company’s Profit and Loss shall be made in accordance with Section 5.02. Upon dissolution of the Company, the assets of the Company shall be applied in the following order of priority: (i) To creditors (other than Members) in satisfaction of liabilities of the Company (whether by payment or by the making of reasonable provision for payment of those liabilities), including to establish any reasonable reserves which the Board may by Board Approval, in its reasonable judgment, deem necessary or advisable for any contingent, conditional, or unmatured liability of the Company; (ii) To creditors who are Members in satisfaction of liabilities of the Company (whether by payment or by the making of reasonable provision for payment of those liabilities), including to establish any reasonable reserves which the Board may by Board Approval, in its reasonable judgment, deem necessary or advisable for any contingent, conditional, or unmatured liability of the Company; 32
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(iii) To establish any reserves which the Board may by Board Approval, in its reasonable judgment, deem necessary or advisable for any contingent, conditional, or unmatured liability of the Company to Members; and (iv) The balance, if any, to the Members in accordance with Section 6.01(b). (e) Notwithstanding Sections 9.02(a) through 9.02(d), upon the occurrence of an event described in Sections 9.02(c) or 9.02(d), the Member that may elect a dissolution and winding up (or, in the case of a full withdrawal of a Member under Section 9.02(c)(i), the non-withdrawing Member) (the Member, the “Electing Member”) may elect alternatively by written notice to the other Member, for a period of fifteen (15) business days following the occurrence of that event, to purchase the other Member’s Entire Interest or designate a third party to effect the purchase (the election, the “Election to Purchase”). The purchase price for the Entire Interest shall be payable in cash within ninety (90) days after the Election to Purchase is delivered to the other Member and shall be equal to the Capital Account of the other Member adjusted to reflect the Value of the Company as determined as of the date of the last valuation pursuant to Section 10.05. Each Member hereby agrees to sell its Entire Interest to the Electing Member or the third party designated by the Electing Member at that price if the Election to Purchase is timely exercised by the Electing Member. If the Electing Member does not exercise the Election to Purchase within the 15-business day period set forth in this Section 9.02(e) or if the Electing Member or its third-party designee does not purchase the other Member’s Entire Interest within ninety (90) days after the Election to Purchase is delivered to the other Member, then the Election to Purchase shall terminate, and (i) in the case of a full withdrawal by a Member under Section 9.02(c)(i), the other Member shall withdraw its Entire Interest pursuant to Section 8.02, and the Company shall terminate as provided by Article IX or (ii) in the case of the occurrence of an event described Section 9.02(c)(ii)-(iv) or Section 9.02(d), the Electing Member shall retain the option to elect the dissolution of the Company pursuant to Section 9.02(c) or (d), as applicable. After any purchase pursuant to an Election to Purchase, the other Member shall no longer be a member of the Company, and the Electing Member or third party designee of the Electing Member that has consummated the purchase may dissolve or continue the Company as it may determine. (f) If an audit or reconciliation relating to the fiscal year in which a Member receives a distribution under this Section 9.03 reveals that the Member received a distribution in excess of that to which the Member was entitled, then the other Member may, in its discretion, seek repayment of the distribution to the extent that the distribution exceeded what was due to the Member. (g) Each Member shall be furnished with a statement prepared by the Company’s accountant, which shall set forth the assets and liabilities of the Company as at the date of complete liquidation, and each Member’s share of those assets and 33
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copies of any financial statements, tax returns, or other records or reports, or other information or materials provided or made available to the Member by the Company, the other Member, the Loan Administrative Agent, the Administrative Agent, the Servicing Agent or their Affiliates or the Company’s auditors, legal counsel or other service providers with respect to their respective businesses and activities; and each Member agrees not to disclose to any other Person any information contained in those materials (including any information respecting Portfolio Companies), without the express prior written consent of the disclosing party; provided that: (i) each Member may disclose any such information as may be required by law in connection with its filings with the SEC, and each Member may disclose the names of Portfolio Companies and summaries of the loan transactions in any marketing materials (including tombstone ads) of each Member and its Affiliates, subject to applicable confidentiality restrictions that a Member may have with the Portfolio Company; and (ii) any Member may provide financial statements, tax returns, and other information contained in those statements and returns: (1) to the Member’s accountants, internal and external auditors, legal counsel, financial advisors, and other fiduciaries and representatives (who may be Affiliates of the Member) as long as the Member instructs the Persons to maintain the confidentiality of that information and not to disclose that information to any other Person; (2) to bona fide potential transferees of the Member’s Entire Interest that agree in writing, for the benefit of the Company, to maintain the confidentiality of that information, but only after reasonable advance notice to the Company; (3) if and to the extent required by law (including judicial or administrative order); provided that, to the extent legally permissible, the Company is given prior notice to enable it to seek a protective order or similar relief; (4) to representatives of any governmental regulatory agency or authority with jurisdiction over the Member, or as otherwise may be necessary to comply with regulatory requirements applicable to the Member; and (5) in order to enforce rights under this Agreement. (b) Notwithstanding Section 10.04(a), the following shall not be considered confidential information for purposes of this Agreement: (i) information generally known to the public; (ii) information obtained by a Member from a third party who is not prohibited from disclosing the information; (iii) information in the possession of a Member prior to its disclosure by the Company, the other Member, the Loan Administrative Agent, the Administrative Agent, the Servicing Agent, or their Affiliates; or (iv) information which a Member can show by written documentation was developed independently of disclosure by the Company, the other Member, the Loan Administrative Agent, the Administrative Agent, the Servicing Agent, or their Affiliates. 36
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provisions and the Company’s valuation guidelines then in effect (which shall be consistent with each of TCPC’s and Newtek’s valuation guidelines then in effect): (i) Within thirty-five (35) days after the date as of which a valuation is to be made, the Administrative Agent shall deliver to the Board a report as to the recommended valuation as of that date, and provide those Persons with a reasonable opportunity to request information and to provide comments with respect to the report. (ii) If the recommended valuation as of that date is approved by Board Approval, then the valuation that has been approved shall be final. (iii) If there is an objection to the recommended valuation by the Board, then the Administrative Agent shall cause a valuation of the asset(s) subject to unresolved objection to be made as of such date by an approved valuation expert (if not already made) and shall determine a valuation of those asset(s) consistent with the valuation as of that date by the approved valuation expert, and the valuation shall be final. For this purpose, a valuation of an asset as of that date shall be considered consistent with a valuation of an approved valuation expert if it is equal to the recommended value or within the recommended range of values determined by the approved valuation expert as of that date. An approved valuation expert shall mean an independent valuation consultant that either has been approved by Board Approval or has been referenced as the independent valuation consultant of the Company in a previous valuation report by the Administrative Agent without objection by any Director. (iv) Liabilities of the Company shall be taken into account at the amounts at which they are carried on the books of the Company, and provision shall be made in accordance with GAAP for contingent or other liabilities not reflected on those books and, in the case of the liquidation of the Company, for the Expenses (to be borne by the Company) of the liquidation and winding up of the Company’s affairs. (v) No value shall be assigned to the Company name and goodwill or to the office records, files, statistical data, or any similar intangible assets of the Company not normally reflected in the Company’s accounting records. (b) All valuations shall be made in accordance with the foregoing shall be final and binding on all Members, absent actual and apparent error. Valuations of the Company’s assets by independent valuation consultants shall be at the Company’s expense. 38
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ARTICLE XI MISCELLANEOUS PROVISIONS Section 11.01 Governing Law; Jurisdiction; Jury Waiver. This Agreement shall be governed by, and construed in accordance with, the law of the State of Delaware. Each Member irrevocably consents and agrees that (i) any action or proceeding seeking injunctive relief or specific performance in respect of any breach by any Member of its obligations hereunder, (ii) any action for enforcement of any judgment in respect thereof, (iii) any action brought to compel arbitration in accordance with the terms of this Agreement, and (iv) any action confirming and entering judgment upon any arbitration award may be brought in the courts of the State of New York or the United States federal courts for the Southern District of New York, and, by execution and delivery of this Agreement, each Member hereby submits to and accepts for itself and in respect of its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts and appellate courts from any appeal thereof. Each Member further irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof in the manner set forth in Section 11.06. Each Member hereby irrevocably waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in connection with this Agreement brought in the courts referred to above and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum. Nothing herein shall affect the right of any Member or the Membership to serve process in any other manner permitted by law or to commence legal actions or proceedings or otherwise proceed against any other Member hereunder in any other jurisdiction. Nothing in this section shall be deemed to constitute a submission to jurisdiction, consent or waiver with respect to any matter not specifically referred to herein. THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF THOSE PARTIES IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE, OR ENFORCEMENT OF THIS AGREEMENT. Section 11.02 Certificate of Formation; Other Documents. The Members hereby approve and ratify the filing of the Certificate of Formation on behalf of the Company. The Members agree to execute such other instruments and documents as may be required by law or which a Member or the Board deems necessary or appropriate to carry out the intent of this Agreement. Section 11.04 Force Majeure. Whenever any act or thing is required of the Company or a Member under this Agreement to be done within any specified period of time, the Company and the Member shall be entitled to an additional period of time to do the act or thing as shall equal any period of delay resulting from causes beyond the reasonable control of the Company or the Member, including bank holidays and actions of governmental agencies, and excluding economic hardship; provided that this provision shall not have the effect of relieving the Company or the Member from the obligation to perform any act or thing. 39
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Loan Servicing Agreement constitute the entire agreement between the parties and supersede all prior agreements, understandings, and arrangements with respect to the subject matter of this Agreement. [Signatures appear on next page] 42
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Appendix A Member List/Capital Contributions Initial # Date of Initial Member of Initial Capital Capital Total Capital Name/Address Shares Contribution Contribution Commitment SERIES A PREFERRED SHARES Conventional Lending TCP Holdings LLC 0000 00xx Xxxxxx, Xxxxx x0 X/X $100,000,000 1000, Xxxxx Xxxxxx, XX 00000 Newtek Commercial Lending, Inc. 0000 Xxxxxx Xxxxxx, $0 N/A $100,000,000 Xxxxx 000, Xxxx Xxxxxxx, XX 00000 CLASS A COMMON SHARES Conventional Lending TCP Holdings LLC November 27, 0000 00xx Xxxxxx, Xxxxx 000 $100 $100 2018 1000, Xxxxx Xxxxxx, XX 00000 Newtek Commercial Lending, Inc. November 27, 0000 Xxxxxx Xxxxxx, 100 $100 $100 0000 Xxxxx 000, Xxxx Xxxxxxx, XX 00000 *List to be maintained by the Company in its books and records. 41231606.1
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Schedule A Board Approval 1. Board Approval shall be required in advance for the Company or any Subsidiary to do any of the following: i. Enter into any transaction with a Member or an Affiliate of a Member (except as expressly permitted by this Agreement); ii. Make an Investment in the securities of a Member or an Affiliate of a Member; iii. Enter into hedging, swaps, forward contracts or other derivative or commodities transactions; iv. Enter into any credit facility or total return swap, or materially modify or waive the terms thereof, make a voluntary prepayment (excluding increases and decreases in borrowings under such facility in the ordinary course that do not impact the commitment amount) or extend the term thereof; v. Organize, acquire an interest in, or transfer or otherwise dispose of an interest in, any Subsidiary or any other investment or financing vehicle, or materially modify or waive the terms thereof; vi. Replace the Administrative Agent, the Loan Administrative Services Agent or Servicing Agent for the Company, or materially modify or waive the terms of any administrative services agreement or servicing agreement, as applicable; vii. Approve a Transfer of an interest in the Company where required by Article VIII; viii. Take any action or decision which pursuant to any provision of this Agreement requires Board Approval; ix. Modify or waive any material provision of this Agreement, including this Schedule A or modify the Certificate of Formation of the Company in a manner adverse to the rights of any Member under this Agreement; x. Materially change the business of the Company or Subsidiaries from its current business or enter into any line of business other than existing or related lines of business; xi. Make, change, or rescind any tax election; xii. Settle or compromise with respect to any tax audit, claim, deficiency notice, suit, or other proceeding relating to taxes; make a request for a written ruling to any tax authority; or enter into a written and legally binding agreement with any tax
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the end of each fiscal year, or materially modify or waive the terms of such engagement; iv. Engage Legal Counsel on behalf of the Company; and v. Take any action or decision which pursuant to any provision of this Agreement requires Board Approval. For the avoidance of doubt, Board Approval in advance shall be required for all matters set forth in Section 1 of this Schedule A.
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Schedule B Prior Investment Committee Approval Prior Investment Committee Approval shall be required for the Company or any Subsidiary to do any of the following: i. Take any action or make any decision that results in the acquisition or disposition of an Investment other than funding of Investments pursuant to commitments previously approved by Prior Investment Committee Approval; ii. Materially modify or waive the terms of any Investment which results in: (1) an extension of additional capital or commitments; (2) an amendment or waiver of a financial covenant of a borrower for more than four consecutive quarters; (3) approval of a material acquisition or disposition; (4) the incurrence of additional senior debt by the borrower in an amount equal to or greater than 10% of the existing senior debt commitments or which results in leverage increases by more than 0.5 times; or (5) an amendment or waiver of any payment term, including mandatory prepayments; iii. Make any Investment that requires derivation from any investment restrictions set forth in this Agreement; or iv. Take any action or make any decision which pursuant to any provision of this Agreement requires Prior Investment Committee Approval. Each Member, TCPC IC Representative, and Newtek IC Representative and their respective designees may, in the name and on behalf of the Company, do all things which he, she, or it deems necessary, advisable, or appropriate to make investment opportunities available to the Company, to carry out and implement matters approved by Board Approval or Prior Investment Committee Approval, as applicable, and to administer the activities of the Company, including: i. Execute and deliver all agreements, amendments, and other documents and exercise and perform of all rights and obligations with respect to any Person in which the Company holds an interest, including Subsidiaries and other investment and financing vehicles; ii. Execute and deliver other agreements, amendments, and other documents and exercise and perform all rights and obligations with respect to matters approved by Board Approval or Prior Investment Committee Approval, as applicable, or which are necessary, advisable, or appropriate for the administration of the Company, including with respect to any contracts evidencing indebtedness for borrowed funds; and iii. Take any and all other acts delegated to a Member or Director by this Agreement or by Board Approval; provided that if the acts require Board Approval or Prior
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Investment Committee Approval, Board Approval or Prior Investment Committee Approval, as applicable, has been obtained.
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Schedule C Investment Committee Approval Process The Investment Committee shall review potential Investments in the below manner, unless otherwise approved by Prior Investment Committee Approval. i. Each proposed Investment shall be submitted to the Investment Committee, or its designees, for approval. ii. Any Investment opportunity submitted for consideration shall be documented in a consistent memo format and made available to the Investment Committee. Supporting data and documentation will be made available for review by the Investment Committee and its designees. iii. A decision on the potential Investment will be made by the Investment Committee within one business day of receipt of the Investment memo by the Investment Committee. 50
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