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Letter from NeoMedia Technologies (OTC BB: NEOM) to Shareholders Dear Prospective and Current Shareholders: It is with great enthusiasm that I update you on the state of NeoMedia Technologies, Inc. 2007 holds many promising opportunities for us that we believe we can capitalize on with a new team, renewed energy, fresh ideas and a more focused vision for moving our company forward, and creating shareholder value. There are a number of positive developments to report, but none more vital than our evolving business model. Following an internal strategic planning meeting in late January, NeoMedia is now laser focused on our core code-reading business in North America, the UK, mainland Europe and China. All other business units (Micro Paint Repair, 12Snap, and Telecom Services) are either in the process of being sold, or will be sold in the most profitable, timely and viable manner possible. The strategic equity earned through the sale of these assets will greatly reduce our current burn rate, and help us move closer to profitability and provide financial stability for the company. Our goal is to break even by December 31, 2007 and become profitable by the first quarter of next year. Most importantly, the shedding of our non-core assets affords us the ability to focus all our resources on our core business initiatives. We realize the challenges we face in the global application of our technology, and can now present qode to the industry and public in a more systematic and focused approach marketing it as “the next phase of the Internet” and the wireless Web. We are also making great strides to create a global standard for the wireless Web and have scheduled a high-level meeting in London this month with some of the world’s leading technology firms to begin to define and document this important standards-based initiative. Building on the deals we have completed, we will focus on targeting manufacturers within the media and enterprise space, including newspapers, publishers, real estate, physical world advertisers, and beverage producers to design their products to become more interactive. We envision a future in which consumers routinely “qode it” when they want more information on a product or service. We believe the revenues generated by our core business could be significant and our goals include hiring a new sales force, while penetrating three verticals with at least six major customers. Another major goal is to partner with at least three major carriers (North American, UK and mainland European) who will embed, adopt and commit to utilize every feature qode has to offer. We recently signed a performance-based agency and licensing agreement with NexMobil, LLC, to resell our technology into the Middle East, India, Korea and Pakistan.  As you know, we have numerous issued patents with others in process and we will continue to seek to optimize the value of our intellectual property portfolio around in the world. That said, I would like to update you on a recent positive development in the Scanbuy case. Judge John E. Sprizzo dismissed Scanbuy's request for a summary judgment in New York City on Jan. 30. While the case is not over yet, we continue to remain confident in the final outcome. Another of our key strategic goals is to look to attract a minority equity investment from a strategic industry partner to support our current financial structure with Cornell Capital Partners.       In terms of new leadership, we expect to name a permanent CEO by mid-year. In addition, Roger Pavane has recently been brought in as our SVP of Sales and Marketing and is heading up the mobile division efforts in the Americas and the UK. Mr. Pavane is a wireless industry veteran with 20+ years experience in this space. Prior to NeoMedia, Mr. Pavane headed up efforts for Mobliss, a wholly owned subsidiary of the Tokyo-based Index Corporation, and served as Executive Vice President Sales of TruePosition, a Liberty Media (NASDAQ GS: LINTA) owned wireless location technology software company where he lead the start-up company to record growth. We are also very pleased to announce the promotion of Dr. Christian Steinborn, current president of Gavitec, who will now also head up the mobile division efforts in the rest of the world, with a focus on mainland Europe and China. We will also be announcing terms of a company-wide stock option re-pricing today. We are instituting it as a retention tool to align our employees with the new vision of NeoMedia. The re-pricing is to the current market price for vested options, with future vesting at a premium to the current market price to better align our employees with our shareholders who are expecting increasing stock performance.   We also would like to announce that George O’Leary has been named as a member of our Board of Directors. Mr. O’Leary is currently the President of SKS Consulting of South Florida Corp. and is working with NeoMedia under a two year consulting agreement to help right the ship and currently will lead the execution of the strategic plan. Mr. O’Leary started SKS Consulting in 2000 with the mission to help companies focus on execution in their core business while shedding their non-core business assets. Prior to assuming his duties with NeoMedia, he was and still is a consultant to NeoGenomics (NGNM.OB) and was acting Chief Operating Officer from October 2004 to April 2005 were he helped the turnaround of that organization. He is currently a member of their Board of Directors, and the stock price has seen a sevenfold increase since his involvement with the company. From 1996 to 2000, Mr. O’Leary was CEO and President of Communication Resources Incorporated (CRI), where annual revenues grew from $5 million to $40 million during his tenure. Prior to CRI, Mr. O’Leary was Vice President of Operations of Cablevision Industries, where he ran $125 million of business for this major cable operator until it was sold to Time Warner. We look forward to Mr. O’Leary helping NeoMedia in these arenas as well. We embrace the challenges ahead and believe we have a streamlined, focused vision and game plan, and the dedicated team in place to execute it. We look forward to communicating with you at our next earnings conference call at the completion of our 2006 audit and will continue to have quarterly shareholder conference calls going forward.   Thank you for your continued support. Sincerely, Charles W. Fritz Interim CEO and Chairman This letter contains forward-looking statements within the meaning of section of 1934. With the exception of historical information contained herein, the matters discussed in this letter involve risk and uncertainties. Actual results could differ materially from those expressed in any forward-looking statement. qode is a registered trademark, and qode®reader, qode®window and One Click to Content are trademarks of NeoMedia Technologies, Inc. Other trademarks are properties of their respective owners.”      

Execution Version   EIGHTH AMENDMENT TO DATED AS OF APRIL 10, 2017 AMONG OASIS PETROLEUM NORTH AMERICA LLC, AS BORROWER, THE GUARANTORS PARTY HERETO, AS ADMINISTRATIVE AGENT, AND THE LENDERS PARTY HERETO   EIGHTH AMENDMENT TO THIS EIGHTH AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this “Eighth Amendment”) dated as of April 10, 2017, is among OASIS PETROLEUM NORTH AMERICA LLC, a Delaware limited liability company (the “Borrower”); the Guarantors party hereto (the “Guarantors” and collectively with the Borrower, the “Credit Parties”); each of the lenders party to the Credit Agreement referred to below (collectively, the “Lenders”) party hereto; and WELLS FARGO BANK, N.A., as administrative agent for the Lenders (in such capacity, together with its successors in such capacity, the “Administrative Agent”) and as the issuing bank (in such capacity, the “Issuing Bank”). A.    Parent, OP LLC, the Borrower, the Administrative Agent and the Lenders are parties to that certain Second Amended and Restated Credit Agreement dated as of April 5, 2013, as amended by that certain First Amendment to Second Amended and Restated Credit Agreement dated as of September 3, 2013, that certain Second Amendment to Second Amended and Restated Credit Agreement dated as of September 30, 2014, that certain Third Amendment to Second Amended and Restated Credit Agreement dated as of April 13, 2015, that certain Fourth Amendment to Second Amended and Restated Credit Agreement dated as of November 13, 2015, that certain Fifth Amendment to Second Amended and Restated Credit Agreement dated as of February 23, 2016, that certain Sixth Amendment to Amended and Restated Credit Agreement dated as of August 8, 2016 and that certain Seventh Amendment to Second Amended and Restated Credit Agreement dated as of October 14, 2016 (the “Credit Agreement”), pursuant to which the Lenders have made certain credit available to and on behalf of the Borrower. B.    The Borrower, the Guarantors, the Administrative Agent and the Lenders party hereto desire to amend certain provisions of the Credit Agreement as set forth herein effective as of the Eighth Amendment Effective Date (as defined below) C.    Furthermore, the Administrative Agent and the Requisite Increase Lenders desire to redetermine and increase the Borrowing Base to $1,600,000,000 from $1,150,000,000 after giving effect to the amendments contained in this Eighth Amendment. NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: Section 1.Defined Terms. Each capitalized term used herein but not otherwise defined herein has the meaning given such term in the Credit Agreement, as amended by this Eighth Amendment. Unless otherwise indicated, all section references in this Eighth Amendment refer to sections of the Credit Agreement. Section 2.    Amendments to Credit Agreement. 2.1    Amendments to Section 1.02. (a)    The following definitions contained in Section 1.02 of the Credit Agreement are hereby amended and restated as follows: “Agreement” means this Second Amended and Restated Credit Agreement, as amended by the First Amendment, the Second Amendment, the Third Amendment, the Fourth Amendment, the Fifth Amendment, the Sixth Amendment, the Seventh Amendment and the Eighth Amendment and as the same may be further amended or supplemented from time to time. Assumption, and any Person that shall have become a party hereto as an Additional Lender pursuant to Section 2.06(c). “Qualified Convertible Notes Offering” means an issuance of Convertible Notes which satisfies the following conditions: (a) such Convertible Notes have a per annum interest rate less than or equal to 5%, (b) at the time thereof and after giving effect to any adjustment of the Borrowing Base in connection therewith, the Total Commitments Utilization Percentage is less than or equal to 50% and (c) after giving pro forma effect to such issuance, the Borrower is in compliance with the financial covenants contained in Section 9.01(a), Section 9.01(b) and Section 9.01(c). (b)    The following definitions are hereby added to Section 1.02 of the Credit Agreement where alphabetically appropriate to read as follows: “Annualized EBITDAX” means, as of the last day of any fiscal quarter, (a) for the first full fiscal quarter ending after the Trigger Date, EBITDAX for such quarter multiplied by 4, (b) for the second full fiscal quarter ending after the Trigger Date, EBITDAX for the two fiscal quarter period ending on such date multiplied by 2, (c) for the third full fiscal quarter ending after the Trigger Date, EBITDAX for the three fiscal quarter period ending on such date multiplied by 4/3, and (d) for each fiscal quarter thereafter, EBITDAX for the four fiscal quarter period ending on such date. “Eighth Amendment” means that certain Eighth Amendment to Second Amended and Restated Credit Agreement, dated as of April 10, 2017, among the Borrower, the Guarantors, the Administrative Agent and the Lenders party thereto. “Trigger Date” means the first date on which the Aggregate Elected Commitment Amounts exceed $1,150,000,000. 2 “Total Debt” means, at any date, all Debt of the Parent and the Consolidated Subsidiaries on a consolidated basis, excluding (a) non-cash obligations under ASC 815 and (b) accounts payable and accrued expenses, liabilities or other obligations to pay the deferred purchase price of Property or services, from time to time incurred in the ordinary course of business which are not greater than sixty (60) days past the date of invoice or delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP. (c)    The definitions of “Assigned Maximum Credit Amount” and “Dissenting Lender” are hereby deleted from Section 1.02 of the Credit Agreement. 2.2    Amendment to Section 2.07(c). Section 2.07(c) of the Credit Agreement is hereby amended by deleting Section 2.07(c)(iv). 2.3    Amendment to Section 2.07(c)(iii). Section 2.07(c)(iii) of the Credit Agreement is hereby amended by deleting the proviso contained in the fourth sentence of such section. 2.4    Amendment to Section 2.07(d). Section 2.07(d) of the Credit Agreement is hereby amended by deleting the references to “(and subject to Section 2.07(c)(iv))” and “(subject to the provisions of Section 2.07(c)(iv))” in such section. 2.5    Amendment to Section 9.01. Section 9.01 of the Credit Agreement is hereby amended by inserting a new Section 9.01(c) immediately after Section 9.01(b) thereof, to read as follows: (c)    Ratio of Total Debt to EBITDAX. The Borrower will not, as of the last day of any fiscal quarter commencing with the first full fiscal quarter ending after the Trigger Date, permit its ratio of Total Debt as of such time to Annualized EBITDAX to be greater than (i) 4.25 to 1.0 for the first two full fiscal quarters ending after the Trigger Date and (ii) 4.00 to 1.00 for each fiscal quarter thereafter. Section 3.    Borrowing Base Redetermination. Pursuant to Section 2.07 of the Credit Agreement, the Administrative Agent and the Requisite Increase Lenders agree that for the period from and including the Eighth Amendment Effective Date to but excluding the next Redetermination Date, the amount of the Borrowing Base shall be equal to $1,600,000,000. Notwithstanding the foregoing, the Borrowing Base may be subject to further adjustments from time to time pursuant to Section 2.07(e), Section 8.13(c) or Section 9.12(d). For the avoidance of doubt, the redetermination herein shall constitute the April 1, 2017 Scheduled Redetermination and the next Scheduled Redetermination shall be the October 1, 2017 Scheduled Redetermination. Section 4.    Conditions Precedent. This Eighth Amendment shall become effective as of the date when each of the following conditions is satisfied (or waived in accordance with Section 12.02 of the Credit Agreement) (the “Eighth Amendment 3 4.1    The Administrative Agent shall have received from the Borrower, each Guarantor and the Requisite Increase Lenders counterparts (in such number as may be requested by the Administrative Agent) of this Eighth Amendment signed on behalf of such Person. 4.2    No Default shall have occurred and be continuing as of the date hereof prior to and after giving effect to the terms of this Eighth Amendment. 4.3    The Administrative Agent shall have received from the Borrower a duly executed and notarized mortgages and/or mortgage supplements in form and substance reasonably satisfactory to the Administrative Agent so that, after giving effect to the recording of such mortgages and/or mortgage supplements, the Administrative Agent shall be reasonably satisfied that it has first priority, perfected Liens (subject only to Excepted Liens identified in clauses (a) to (d) and (f) of the definition thereof, but subject to the provisos at the end of such definition) on at least 90% of the total value of the Oil and Gas Properties evaluated in the Reserve Report most recently delivered pursuant to Section 8.12(a) of the Credit Agreement. 4.4    The Administrative Agent shall have received such other documents as the Administrative Agent or its special counsel may reasonably require. The Administrative Agent is hereby authorized and directed to declare this Eighth Amendment to be effective when it has received documents confirming or certifying, to the satisfaction of the Administrative Agent, compliance with the conditions set forth in this Section 4 or the waiver of such conditions as permitted hereby. Such declaration shall be final, conclusive and binding upon all parties to the Credit Agreement for all purposes. 5.1    Confirmation and Effect. The provisions of the Credit Agreement, as amended by this Eighth Amendment, shall remain in full force and effect following the effectiveness of this Eighth Amendment. Each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or any other word or words of similar import shall mean and be a reference to the Credit Agreement as amended hereby, and each reference in any other Loan Document to the Credit Agreement or any word or words of similar import shall be and mean a reference to the Credit Agreement as amended hereby. 5.2    No Waiver. Neither the execution by the Administrative Agent or the Lenders of this Eighth Amendment, nor any other act or omission by the Administrative Agent or the Lenders or their officers in connection herewith, shall be deemed a waiver by the Administrative Agent or the Lenders of any Defaults or Events of Default which may exist, which may have occurred prior to the date of the effectiveness of this Eighth Amendment or which may occur in the future under the Credit Agreement and/or the other Loan Documents. Similarly, nothing contained in this Eighth Amendment shall directly or indirectly in any way whatsoever either: (a) impair, prejudice or otherwise adversely affect the Administrative Agent’s or the Lenders’ right at any time to exercise any right, privilege or remedy in connection with the Loan Documents with respect to any Default or Event of Default, (b) except as expressly provided herein, amend or alter any provision of the Credit Agreement, the other Loan Documents, or any other contract or instrument, or (c) constitute 4 any course of dealing or other basis for altering any obligation of the Borrower or any right, privilege or remedy of the Administrative Agent or the Lenders under the Credit Agreement, the other Loan Documents, or any other contract or instrument. 5.3    Ratification and Affirmation; Representations and Warranties. Each Credit Party hereby (a) acknowledges the terms of this Eighth Amendment; (b) ratifies and affirms its obligations under, and acknowledges its continued liability under, each Loan Document to which it is a party and agrees that each Loan Document to which it is a party remains in full force and effect as expressly amended hereby and (c) represents and warrants to the Lenders that as of the date hereof, after giving effect to the terms of this Eighth Amendment: (i) all of the representations and warranties contained in each Loan Document to which it is a party are true and correct in all material respects (or, if already qualified by materiality, Material Adverse Effect or a similar qualification, true and correct in all respects), except to the extent any such representations and warranties are expressly limited to an earlier date, in which case, such representations and warranties shall continue to be true and correct in all material respects (or, if already qualified by materiality, Material Adverse Effect or a similar qualification, true and correct in all respects) as of such specified earlier date, (ii) no Default or Event of Default has occurred and is continuing and (iii) no event or events have occurred which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect. 5.4    Counterparts. This Eighth Amendment may be executed by one or more of the parties hereto in any number of separate counterparts, and all of such counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of this Eighth Amendment by facsimile or email transmission shall be effective as delivery of a manually executed counterpart hereof. 5.5    No Oral Agreement. This Eighth Amendment, the Credit Agreement and the final agreement between the parties and may not be contradicted by evidence of prior, contemporaneous, or unwritten oral agreements of the parties. There are no subsequent oral agreements between the parties. 5.6    GOVERNING LAW. THIS EIGHTH AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED 5.7    Payment of Expenses. In accordance with Section 12.03 of the Credit Agreement, the Borrower agrees to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket costs and reasonable expenses incurred in connection with this Eighth Amendment, any other documents prepared in connection herewith and the transactions contemplated hereby, including, without limitation, the reasonable fees and disbursements of counsel to the Administrative Agent. 5.8    Severability. Any provision of this Eighth Amendment which is prohibited invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render 5 5.9    Successors and Assigns. This Eighth Amendment shall be binding upon and assigns. 5.10    Loan Document. This Eighth Amendment shall constitute a “Loan Document” under and as defined in Section 1.02 of the Credit Agreement. 6 IN WITNESS WHEREOF, the parties hereto have caused this Eighth Amendment to be BORROWER: OASIS PETROLEUM NORTH AMERICA LLC By:    /s/Michael Lou     Name:    Michael Lou Title:    Executive Vice President and Chief Financial Officer GUARANTORS: OASIS PETROLEUM INC. OASIS PETROLEUM LLC OASIS PETROLEUM MARKETING LLC OASIS WELL SERVICES LLC OASIS MIDSTREAM SERVICES LLC Name:    Michael Lou Financial Officer Signature Page to Eighth Amendment to Second Amended and Restated Credit Agreement (Oasis Petroleum North America LLC) ADMINISTRATIVE AGENT, as Administrative Agent, Issuing Bank and as a Lender By:    /s/Edward Pak     Name:    Edward Pak Title:    Director Signature Page to LENDERS: CITIBANK, N.A., as a Lender By:    /s/Cliff Vaz     Name:    Cliff Vaz Title:    Vice President Signature Page to as a Lender By:    /s/Anson Williams     Name:    Anson Williams Title:    Authorized Officer Signature Page to By:    /s/Mark Lumpkin, Jr.     Name:    Mark Lumpkin, Jr. Title:    Authorized Signatory Signature Page to CAPITAL ONE, NATIONAL ASSOCIATION, as a Lender By:    /s/Mark Brewster     Name:    Mark Brewster Title:    Vice President Signature Page to COMPASS BANK, as a Lender By:    /s/Kari McDaniel     Name:    Kari McDaniel Title:    Vice President Signature Page to CANADIAN IMPERIAL BANK OF COMMERCE, NEW YORK BRANCH, as a Lender By:    /s/William M. Reid     Name:    William M. Reid     Title:    Authorized Signatory     By:    /s/Trudy Nelson     Name:    Trudy Nelson     Title:    Authorized Signatory     Signature Page to as a Lender By:    /s/Dusan Lazarov     Name:    Dusan Lazarov     Title:    Director     By:    /s/Marcus Tarkington     Name:    Marcus Tarkington     Title:    Director     Signature Page to ING CAPITAL LLC, as a Lender By:    /s/Josh Strong     Name:    Josh Strong Title:    Director By:    /s/Charles Hall     Name:    Charles Hall Title:    Managing Director Signature Page to CITIZENS BANK, N.A., as a Lender By:    /s/Scott Donaldson     Name:    Scott Donaldson Signature Page to as a Lender By:    /s/John C. Lozano     Name:    John C. Lozano Title:    Vice President Signature Page to ZB, N.A. DBA AMEGY BANK, as a Lender By:    /s/John Moffitt     Name:    John Moffitt Title:    Vice President Signature Page to BOKF, NATIONAL ASSOCIATION DBA BANK OF TEXAS, as a Lender By:    /s/Mari Salazar     Name:    Mari Salazar     Title:    SVP–Energy Lending     Signature Page to as a Lender By:    /s/James Giordano     Name:    James Giordano Signature Page to CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as a Lender By:    /s/Nupur Kumar     Name:    Nupur Kumar Title:    Authorized Signatory By:    /s/Lea Bearlocher     Name:    Lea Bearlocher Title:    Authorized Signatory Signature Page to By:    /s/William A. Philipp     Name:    William A. Philipp Title:    Managing Director Signature Page to IBERIABANK, as a Lender By:    /s/Stacy Goldstein     Name:    Stacy Goldstein Signature Page to

Title: THC Vape cartridge on airplane Topic: Removed Answer #1: Are you mentally deficient? No. First nobody is going to believe an e-juice cartridge maker is going to accidentally have THC cartridges on hand to mix up. And second having illegal drugs on you doesn't require that you did it on purpose to be charged. It's having the drugs in your possession is enough.

Title: Landlord didn't notify of government housing Question:My landlord didn't notify me about government housing / foster care inside of the same building as me. Told me it was private, and that it wasn't my right to know. What can I do? Also they're not cleaning the inside of the apartment building. Is there anything I can do? KANSAS Answer #1: It's not your right to know. You have no recourse. Answer #2: So you liked the apartment just fine until you learned that poor people and traumatized children lived there too?

CONSULTING AGREEMENT THIS AGREEMENT is dated and effective on the 28th day of April, 2014. BETWEEN: LITHIUM EXPLORATION GROUP, INC., with an office at 3800 North Central Avenue, Phoenix, Arizona 85012. AND: BRANDON COLKER with an address at 9740 Limar Way, San Diego, California, 92129. (the “Contractor”) WHEREAS: A. the Company desires to retain the Contractor to provide the Company with the services as a member of the Board of Directors (the “Services”) in regards to the Company’s management and operations; and B. the Contractor has agreed to provide the Services to the Company on the terms NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual covenants and promises set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by each, the parties hereto agree as follows: ARTICLE 1 APPOINTMENT AND AUTHORITY OF CONTRACTOR 1.1 Appointment of Contractor. The Company hereby appoints the Contractor to perform the Services for the benefit of the Company as hereinafter set forth, and the Company hereby authorizes the Contractor to exercise such powers as provided under this Agreement. The Contractor accepts such appointment on the 1.2 Performance of Services. The Services hereunder have been and shall continue to be provided on the basis of the following terms and conditions:   (a) the Contractor shall faithfully, honestly and diligently serve the Company and cooperate with the Company and utilize maximum professional skill and care to ensure that all services rendered hereunder, including the Services, are to the satisfaction of the Company, acting reasonably, and the Contractor shall provide any other services not specifically mentioned herein, but which by reason of the Contractor’s capability the Contractor knows or ought to know to be necessary to ensure that the best interests of the Company are maintained; and   (b) the Company shall report the results of the Contractor’s duties hereunder as may be requested by the Company from time to time. 1.3 Authority of Contractor. The Contractor shall have no right or authority, express or implied, to commit or otherwise obligate the Company in any manner whatsoever except to the extent specifically provided herein or specifically authorized in writing by the Company. 1.4 Independent Contractor. In performing the Services, the Contractor shall be an independent contractor and not an employee or agent of the Company, except that the Contractor shall be the agent of the Company solely in circumstances where the Contractor must be the agent to carry out its obligations as set forth in this Agreement. Nothing in this Agreement shall be deemed to require the Contractor to provide the Services exclusively to the Company and the Contractor hereby acknowledges that the Company is not required and shall not be required to make any remittances and payments required of employers by statute on the Contractor’s behalf and the Contractor or any of its agents shall not be entitled to the fringe benefits provided by the Company to its employees. ARTICLE 2 CONTRACTOR’S AGREEMENTS 2.1 Expense Statements. The Contractor may incur expenses in the name of the Company as agreed in advance in writing by the Company, provided that such expenses relate solely to the carrying out of the Services. The Contractor will immediately forward all invoices for expenses incurred on behalf of and in the name of the Company and the Company agrees to pay said invoices directly on a timely basis. The Contractor agrees to obtain approval from the Company in writing for any individual expense of $500 or greater or any aggregate expense in excess of $2,000 incurred in any given month by the Contractor in connection with the carrying out of the Services. 2.2 Regulatory Compliance. The Contractor agrees to comply with all applicable securities legislation and regulatory policies in relation to providing the Services, including but not limited to United States securities laws (in particular, Regulation FD) and the policies of the United States Securities and Exchange Commission. 2.3 Prohibition Against Insider Trading. The Contractor hereby acknowledges that the Contractor is aware, and further agrees that the Contractor will advise those of its directors, officers, employees and agents who may have access to Confidential Information, that United States securities laws prohibit any person who has material, non-public information about a company from purchasing or selling securities of such a company or from communicating such information to any other person under circumstances in which it is reasonably foreseeable that such person is likely to purchase or sell such securities. ARTICLE 3 COMPANY’S AGREEMENTS 3.1 Compensation Shares. The compensation for agreeing to enter into this Agreement and provide the Services to be rendered by the Contractor pursuant to this Agreement shall be $12,000 (the “Compensation”) in unregistered restricted common shares of the Company (the “Shares”) as consulting fees for the term of this Agreement (the “Compensation Shares”) issuable on May 15, 2014. The deemed value of the Compensation Shares issued to the Contractor under this Agreement shall be $0.05 (the “Deemed Value”). As a result, the number of Compensation Shares issued to the Contractor under this Agreement will equal the amount of the Compensation to be satisfied divided by the Deemed Value. 3.2 Clawback of Unpaid Compensation Shares. The Contractor acknowledges and agrees that any assessable Compensation Shares will be subject to cancellation in the event that this Agreement is terminated for any reason before such Compensation Shares have been paid fully for by the provision of Services, and that the Company’s obligation to issue the balance of the Compensation Shares which have not been fully paid for will terminate immediately upon early termination of this Agreement. If the Agreement is terminated prior to the end of the one year period, the number of Compensation Shares that the Contractor is entitled to receive in respect of such period shall be calculated by reference to the following formula: 240,000 X A 365 where A = the number of days of the period up to and including the date of termination. 3.3 Voting of Compensation Shares. The Contractor covenants and agrees that, with respect to the Compensation Shares that it receives, it shall, at all times that it is the beneficial owner of such shares, vote such shares on all matters coming before it as a stockholder of the Company in the same manner as the majority of the board of directors of the Company shall recommend. 3.4 Information. Subject to the terms of this Agreement, including without limitation Article 5 hereof, and provided that the Contractor agrees that it will not disclose any material non-public information to any person or entity, the Company shall make available to the Contractor such information and data and shall permit the Contractor to have access to such documents as are reasonably necessary to enable it to perform the Services under this Agreement. The Company also agrees that it will act reasonably and promptly in reviewing materials submitted to it from time to time by the Contractor and inform the Contractor of any material inaccuracies or omissions in such materials. ARTICLE 4 DURATION, TERMINATION AND DEFAULT 4.1 Effective Date. This Agreement shall become effective as of April 28, 2014 (the “Effective Date”), and shall continue to April 27, 2015 (the “Term”) or until earlier terminated pursuant to the terms of this Agreement. 4.2 Termination. Without prejudicing any other rights that the Company may have hereunder or at law or in equity, the Company may terminate this Agreement immediately upon it election to do so, or if it so elects, upon delivery of written notice to the Contractor if:   (a) the Contractor breaches section 2.2 of this Agreement;         (b) the Contractor breaches any other material term of this Agreement and such breach is not cured to the reasonable satisfaction of the Company within thirty (30) days after written notice describing the breach in reasonable detail is delivered to the Contractor;         (c) the Company acting reasonably determines that the Contractor has acted, is acting or is likely to act in a manner detrimental to the Company or has violated or is likely to violate the confidentiality of any information as provided for in this Agreement;   (d) the Contractor is unable or unwilling to perform the Services under this Agreement;         (e) upon delivery of 30 days notice to the Contractor; or         (f) the Contractor commits fraud, serious neglect or misconduct in the discharge of the Services. 4.3 Duties Upon Termination. Upon termination of this Agreement for any reason, the Contractor shall upon receipt of all sums due and owing, promptly deliver the following in accordance with the directions of the Company:   (a) a final accounting, reflecting the balance of expenses incurred on behalf of the Company as of the date of termination; and         (b) all documents pertaining to the Company or this Agreement, including but not limited to, all books of account, correspondence and contracts in his possession, provided that the Contractor shall be entitled thereafter to inspect, examine and copy all of the documents which it delivers in accordance with this provision at all reasonable times upon three (3) days’ notice to the Company. 4.4 Compensation of Contractor on Termination. Upon termination of this Agreement, the Contractor shall be entitled to receive as its full and sole compensation in discharge of obligations of the Company to the Contractor under this Agreement all sums due and payable under this Agreement to the date of termination and the Contractor shall have no right to receive any further payments; provided, however, that the Company shall have the right to offset against any payment owing to the Contractor under this Agreement any damages, liabilities, costs or expenses suffered by the Company by reason of the fraud, negligence or wilful act of the Contractor, to the extent such right has not been waived by the Company. ARTICLE 5 CONFIDENTIALITY AND NON-COMPETITION 5.1 Maintenance of Confidential Information. The Contractor acknowledges that in the course of its appointment hereunder the Contractor will, either directly or indirectly, have access to and be entrusted with information (whether oral, written or by inspection) relating to the Company or its respective affiliates, associates or customers (the “Confidential Information”). For the purposes of this Agreement, “Confidential Information” includes, without limitation, any and all Developments (as defined herein), trade secrets, inventions, innovations, techniques, processes, formulas, drawings, designs, products, systems, creations, improvements, documentation, data, specifications, technical reports, customer lists, supplier lists, distributor lists, distribution channels and methods, retailer lists, reseller lists, employee information, financial information, sales or marketing plans, competitive analysis reports and any other thing or information whatsoever, whether copyrightable or uncopyrightable or patentable or unpatentable. The Contractor acknowledges that the Confidential Information constitutes a proprietary right, which the Company is entitled to protect. Accordingly the Contractor covenants and agrees that during the Term and thereafter until such time as all the Confidential Information becomes publicly known and made generally available through no action or inaction of the Contractor, the Contractor will keep in strict confidence the Confidential Information and shall not, without prior written consent of the Company in each instance, disclose, use or otherwise disseminate the Confidential Information, directly or indirectly, to any third party. 5.2 Exceptions. The general prohibition contained in Section 5.1 against the unauthorized disclosure, use or dissemination of the Confidential Information shall not apply in respect of any Confidential Information that:   (a) is available to the public generally in the form disclosed;         (b) becomes part of the public domain through no fault of the Contractor;         (c) is already in the lawful possession of the Contractor at the time of receipt of the Confidential Information; or         (d) is compelled by applicable law to be disclosed, provided that the Contractor gives the Company prompt written notice of such requirement prior to such disclosure and provides assistance in obtaining an order protecting the Confidential Information from public disclosure. 5.3 Developments. Any information, data, work product or any other thing or documentation whatsoever which the Contractor, either by itself or in conjunction with any third party, conceives, makes, develops, acquires or acquires knowledge of during the Contractor’s appointment with the Company or which the Contractor, either by itself or in conjunction with any third party, shall conceive, make, develop, acquire or acquire knowledge of (collectively, the “Developments”) during the Term or at any time thereafter during which the Contractor is engaged by the Company that is related to the business of mining property acquisition and exploration shall automatically form part of the Confidential Information and shall become and remain the sole and exclusive property of the Company. Accordingly, the Contractor does hereby irrevocably, exclusively and absolutely assign, transfer and convey to the Company in perpetuity all worldwide right, title and interest in and to any and all Developments and other rights of whatsoever nature and kind in or arising from or pertaining to all such Developments created or produced by the Contractor during the course of performing this Agreement, including, without limitation, the right to effect any registration in the world to protect the foregoing rights. The Company shall have the sole, absolute and unlimited right throughout the world, therefore, to protect the Developments by patent, copyright, industrial design, trademark or otherwise and to make, have made, use, reconstruct, repair, modify, reproduce, publish, distribute and sell the Developments, in whole or in part, or combine the Developments with any other matter, or not use the Developments at all, as the Company sees fit. 5.4 Protection of Developments. The Contractor does hereby agree that, both before and after the termination of this Agreement, the Contractor shall perform such further acts and execute and deliver such further instruments, writings, documents and assurances (including, without limitation, specific assignments and other documentation which may be required anywhere in the world to register evidence of ownership of the rights assigned pursuant hereto) as the Company shall reasonably require in order to give full effect to the true intent and purpose of the assignment made under Section 5.3 hereof. If the Company is for any reason unable, after reasonable effort, to secure execution by the Contractor on documents needed to effect any registration or to apply for or prosecute any right or protection relating to the Developments, the Contractor hereby designates and appoints the Company and its duly authorized officers and agents as the Contractor’s agent and attorney to act for and in the Contractor’s behalf and stead to execute and file any such document and do all other lawfully permitted acts necessary or advisable in the opinion of the Company to effect such registration or to apply for or prosecute such right or protection, with the same legal force and effect as if executed by the Contractor. 5.5 Remedies. The parties to this Agreement recognize that any violation or threatened violation by the Contractor of any of the provisions contained in this Article 5 will result in immediate and irreparable damage to the Company and that the Company could not adequately be compensated for such damage by monetary award alone. Accordingly, the Contractor agrees that in the event of any such violation or threatened violation, the Company shall, in addition to any other remedies available to the Company at law or in equity, be entitled as a matter of right to apply to such relief by way of restraining order, temporary or permanent injunction and to such other relief as any court of competent jurisdiction may deem just and proper. 5.6 Reasonable Restrictions. The Contractor agrees that all restrictions in this Article 5 are reasonable and valid, and all defenses to the strict enforcement thereof by the Company are hereby waived by the Contractor. ARTICLE 6 DEVOTION TO CONTRACT 6.1 Devotion to Contract. During the term of this Agreement, the Contractor shall devote sufficient time, attention, and ability to the business of the Company, and to any associated company, as is reasonably necessary for the proper performance of the Services pursuant to this Agreement. Nothing contained herein shall be deemed to require the Contractor to devote its exclusive time, attention and ability to the business of the Company. During the term of this Agreement, the Contractor shall, and shall cause each of its agents assigned to performance of the Services on behalf of the Contractor, to:   (a) at all times perform the Services faithfully, diligently, to the best of its abilities and in the best interests of the Company;         (b) devote such of its time, labour and attention to the business of the Company as is necessary for the proper performance of the Services hereunder; and         (c) refrain from acting in any manner contrary to the best interests of the Company or contrary to the duties of the Contractor as contemplated herein. 6.2 Other Activities. The Contractor shall not be precluded from acting in a function similar to that contemplated under this Agreement for any other person, firm or company. ARTICLE 7 PRIVATE PLACEMENT OF COMPENSATION SHARES 7.1 Documents Required from Contractor. The Contractor shall complete, sign and return to the Company as soon as possible, on request by the Company, such additional documents, notices and undertakings as may be required by regulatory authorities and applicable law. 7.2 Acknowledgements of Contractor The Contractor acknowledges and agrees that:   (a) the Contractor agrees and acknowledges that none of the Compensation Shares have been registered under the Securities Act of 1933 or under any state securities or “blue sky” laws of any state of the United States, and, unless so registered, may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons (as that term is defined in Regulation S under the Securities Act of 1933), except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the Securities Act of 1933, or registration requirements of the Securities Act of 1933 and in each case only in accordance with applicable state securities laws. However, the parties acknowledge that the Company shall register the Compensation Shares within one year from the date of this Agreement;   (b) the Contractor has not acquired the Compensation Shares as a result of, and will under the 1933 Act) in the United States in respect of any of the Securities United States for the resale of any of the Compensation Shares; provided, however, that the Contractor may sell or otherwise dispose of any of the Compensation Shares pursuant to registration thereof under the 1933 Act and any applicable state securities laws or under an exemption from such registration requirements;         (c) the Compensation Shares will be subject in the United States to a hold period from the date of issuance of the Compensation Shares unless such Compensation Shares are registered with the Securities and Exchange Commission (“SEC”);         (d) the decision to execute this Agreement and purchase the Compensation Shares agreed to be purchased hereunder has not been based upon any oral or written representation as to fact or otherwise made by or on behalf of the Company other than those made by the Company in the information the Company has filed with the SEC;         (e) it will indemnify and hold harmless the Company and, where applicable, its reasonably incurred in investigating, preparing or defending against any claim, lawsuit, administrative proceeding or investigation whether commenced or threatened) arising out of or based upon any representation or warranty of the Contractor contained herein or in any document furnished by the Contractor to the Company in connection herewith being untrue in any material respect or any breach or failure by the Contractor to comply with any covenant or agreement made by the Contractor to the Company in connection therewith;         (f) the issuance and sale of the Compensation Shares to the Contractor will not be completed if it would be unlawful;         (g) the Compensation Shares are not listed on any stock exchange or subject to quotation and no representation has been made to the Contractor that the Compensation Shares will become listed on any other stock exchange or subject to quotation on any other quotation system except that market makers are currently making markets in the Company’s common stock on the OTC Bulletin Board;         (h) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Compensation Shares;         (i) there is no government or other insurance covering the Compensation Shares;         (j) there are risks associated with an investment in the Compensation Shares, including the risk that the Contractor could lose all of its investment;   (k) the Contractor and the Contractor’s advisor(s) have had a reasonable opportunity to ask questions of and receive answers from the Company in connection with the distribution of the Compensation Shares hereunder, and to obtain additional information, to the extent possessed or obtainable without unreasonable effort or expense, necessary to verify the accuracy of the information about the Company;           (l) the books and records of the Company were available upon reasonable notice for inspection, subject to certain confidentiality restrictions, by the Contractor during reasonable business hours at its principal place of business, and all documents, records and books in connection with the distribution of the Compensation Shares hereunder have been made available for inspection by the Contractor, the Contractor’s lawyer and/or advisor(s);           (m) the Company will refuse to register any transfer of the Compensation Shares not registration statement under the 1933 Act or pursuant to an available exemption from the registration requirements of the 1933 Act;           (n) the statutory and regulatory basis for the exemption claimed for the offer of the Compensation Shares, although in technical compliance with Regulation S, registration provisions of the 1933 Act; and           (o) the Contractor has been advised to consult the Contractor’s own legal, tax and Compensation Shares and with respect to applicable resale restrictions, and it compliance with:           (i) any applicable laws of the jurisdiction in which the Contractor is resident in connection with the distribution of the Compensation Shares hereunder, and           (ii) applicable resale restrictions. 7.3 Representations, Warranties and Covenants of the Contractor. The Contractor hereby represents and warrants to and covenants with the Company (which representations, warranties and covenants shall survive the end of the expiry of the Term or early termination of this Agreement) that:   (a) The Contractor is a U.S. Person and is an “accredited investor” as that term is defined in Rule 501 of Regulation D promulgated under the 1933 Act;         (b) the Contractor is not acquiring the Compensation Shares for the account or benefit of, directly or indirectly, any other U.S. Person;         (c) the sale of the Compensation Shares to the Contractor as contemplated in this Agreement complies with or is exempt from the applicable securities legislation of the jurisdiction of residence of the Contractor;         (d) the Contractor is acquiring the Compensation Shares for investment only and not with a view to distribution and, in particular, it has no intention to distribute either directly or indirectly any of the Compensation Shares in the United States or to U.S. Persons;   (e) the Contractor is executing this Agreement and is acquiring the Compensation Shares as principal for the Contractor’s own account, for investment purposes only, and not with a view to, or for, distribution or fractionalisation thereof, interest in such Compensation Shares;           (f) the entering into of this Agreement and the transactions contemplated hereby Contractor;           (g) the entering into of this Agreement and the transactions contemplated thereby will not result in the violation of any of the terms and provisions of any law applicable to the Contractor, or of any agreement, written or oral, to which the Contractor may be a party or by which the Contractor is or may be bound;           (h) the Contractor has duly executed and delivered this Agreement and it constitutes a valid and binding agreement of the Contractor enforceable against the Contractor in accordance with its terms;           (i) the Contractor has the requisite knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the prospective investment in the Compensation Shares and the Company;           (j) the Contractor is not an underwriter of, or dealer in, the common shares of the Company, nor is the Contractor participating, pursuant to a contractual agreement or otherwise, in the distribution of the Compensation Shares;           (k) the Contractor is not aware of any advertisement of pertaining to the Company or any of the Compensation Shares; and           (l) no person has made to the Contractor any written or oral representations:           (i) that any person will resell or repurchase any of the Compensation Shares;           (ii) that any person will refund the purchase price of any of the Compensation Shares;           (iii) as to the future price or value of any of the Compensation Shares; or           (iv) that any of the Compensation Shares will be listed and posted for trading on any stock exchange or automated dealer quotation system or that application has been made to list and post any of the Compensation Shares of the Company on any stock exchange or automated dealer quotation system, except that currently certain market makers make market in the common shares of the Company on the OTC Bulletin Board. 7.4 Legending of Compensation Shares. The Contractor hereby acknowledges that under the applicable securities laws and regulations, the certificates representing any of the Compensation Shares will bear a legend in substantially the following form: NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT. 7.5 The Contractor hereby acknowledges and agrees to the Company making a notation on its records or giving instructions to the registrar and transfer forth and described in this Agreement. ARTICLE 8 MISCELLANEOUS 8.1 Notices. All notices required or allowed to be given under this Agreement shall be made either personally by delivery to or by facsimile transmission to the address as set forth above or to such other address as may be designated from time to time by such party in writing. 8.2 Independent Legal Advice. The Contractor acknowledges that:   (a) this Agreement was prepared by counsel for the Company;         (b) counsel received instructions from the Company and does not represent the Contractor;         (c) the Contractor has been requested to obtain his own independent legal advice on this Agreement prior to signing this Agreement;         (d) the Contractor has been given adequate time to obtain independent legal advice;         (e) by signing this Agreement, the Contractor confirms that he fully understands this Agreement; and         (f) by signing this Agreement without first obtaining independent legal advice, the Contractor waives his right to obtain independent legal advice. 8.3 Change of Address. Any party may, from time to time, change its address for service hereunder by written notice to the other party in the manner aforesaid. 8.4 Entire Agreement. As of from the date hereof, any and all previous agreements, written or oral between the parties hereto or on their behalf relating to the appointment of the Contractor by the Company are null and void. The parties hereto agree that they have expressed herein their entire understanding and agreement concerning the subject matter of this Agreement and it is expressly agreed that no implied covenant, condition, term or reservation or prior representation or warranty shall be read into this Agreement relating to or concerning the subject matter hereof or any matter or operation provided for herein. 8.5 Further Assurances. Each party hereto will promptly and duly execute and deliver to the other party such further documents and assurances and take such further action as such other party may from time to time reasonably request in order to more effectively carry out the intent and purpose of this Agreement and to establish and protect the rights and remedies created or intended to be created hereby. 8.6 Waiver. No provision hereof shall be deemed waived and no breach excused, unless such waiver or consent excusing the breach is made in writing and signed by the party to be charged with such waiver or consent. A waiver by a party of any provision of this Agreement shall not be construed as a waiver of a further breach of the same provision. 8.7 Amendments in Writing. No amendment, modification or rescission of this Agreement shall be effective unless set forth in writing and signed by the parties hereto. 8.8 Assignment. Except as herein expressly provided, the respective rights and obligations of the Contractor and the Company under this Agreement shall not be assignable by either party without the written consent of the other party and shall, subject to the foregoing, enure to the benefit of and be binding upon the Contractor and the Company and their permitted successors or assigns. Nothing herein expressed or implied is intended to confer on any person other than the parties hereto any rights, remedies, obligations or liabilities under or by 8.9 Severability. In the event that any provision contained in this Agreement shall be declared invalid, illegal or unenforceable by a court or other lawful authority of competent jurisdiction, such provision shall be deemed not to affect or impair the validity or enforceability of any other provision of this Agreement, which shall continue to have full force and effect. 8.10 Headings. The headings in this Agreement are inserted for convenience of reference only and shall not affect the construction or interpretation of this Agreement. 8.11 Number and Gender. Wherever the singular or masculine or neuter is used in this Agreement, the same shall be construed as meaning the plural or feminine or a body politic or corporate and vice versa where the context so requires. 8.12 Time. Time shall be of the essence of this Agreement. In the event that any day on or before which any action is required to be taken hereunder is not a business day, then such action shall be required to be taken at or before the requisite time on the next succeeding day that is a business day. For the purposes of this Agreement, “business day” means a day which is not Saturday or Sunday or a statutory holiday in Scottsdale, Arizona, U.S.A. 8.13 Enurement. This Agreement is intended to bind and enure to the benefit of the Company, its successors and assigns, and the Contractor and the personal legal representatives of the Contractor. 8.14 Counterparts. This Agreement may be executed in several counterparts, each of which will be deemed to be an original and all of which will together 8.15 Currency. Unless otherwise provided, all dollar amounts referred to in this Agreement are in lawful money of the United States of America. 8.16 Electronic Means. Delivery of an executed copy of this Agreement by electronic facsimile transmission or other means of electronic communication of this Agreement as of the effective date of this Agreement. 8.17 Proper Law. This Agreement will be governed by and construed in accordance with the law of Nevada. The parties hereby attorn to the jurisdiction of the Courts in the State of Nevada. IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day   LITHIUM EXPLORATION GROUP, INC.   Per: [exhibit10-69x12x1.jpg]     Alexander Walsh   THE CONTRACTOR Per: Per: [exhibit10-69x12x2.jpg]     Brandon Colker  

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C.20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported):January 4, 2008 (January 4, 2008) NATIONAL PENN BANCSHARES, INC. (Exact Name of Registrant as Specified in Charter) Pennsylvania (State or Other Jurisdiction of Incorporation) 000-22537-01 23-2215075 (Commission File Number) (IRS Employer Identification No.) Philadelphia and Reading Avenues, Boyertown, PA 19512 (Address of Principal Executive Offices) (Zip Code) Registrant’s telephone number, including area code: (610) 367-6001 N/A (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [x] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b)) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Section 8 – Other Events Item 8.01 – Other Events As previously reported, National Penn Bancshares, Inc. (“National Penn”) and Christiana Bank & Trust Company (“Christiana”) entered into an Agreement of Reorganization and Merger, dated as of June 25, 2007, providing for the merger of a newly formed acquisition subsidiary of National Penn with and into Christiana, with Christiana surviving the merger as a subsidiary of National Penn. On January 4, 2008, National Penn and Christiana completed this transaction.The press release concerning the closing of this transaction is filed herein as Exhibit 99.1 and incorporated herein by reference. Section 9 – Financial Statements and Exhibits Item 9.01 – Financial Statements and Exhibits Exhibit Number

Exhibit 11 (IN THOUSANDS EXCEPT PER SHARE DATA) Net Earnings (1) $ $ Weighted average common shares outstanding(2) Common share equivalents relating to stock options when dilutive 3 - Adjusted common and common equivalent shares for computation(3) Net earnings per share: Basic(1 divided by 2) $ $ Diluted(1 divided by 3) $ $

Converted by SEC Publisher, created by BCL Technologies Inc., for SEC Filing Exhibit 10.3.2 CONFIDENTIAL TREATMENT REQUESTED CONFIDENTIAL TREATMENT REQUESTED: INFORMATION FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED IS OMITTED AND IS NOTED AS FOLLOWS **REDACTED**. AN UNREDACTED VERSION OF THIS DOCUMENT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. AMENDMENT NO. 2 AMENDMENT TO LICENSE AND COLLABORATION AGREEMENT THIS AMENDMENT TO LICENSE AND COLLABORATION AGREEMENT (this “ Amendment ”), is entered into this 25 th day of June 2007 (the “ Effective

Exhibit 77(Q) Exhibits (e)(1)Second Amendment and Amended Schedule A, each dated April 4, 2008 to the Amended Investment Management Agreement dated March 1, 2002 between ING Investments LLC and ING Strategic Portfolios, Inc. (e)(2)Third

FINANCING SUPPORT AGREEMENT This Financing Support Agreement (“Agreement”) is made by and between Erin Energy Corporation, a Delaware corporation (“Erin”), and the Public Investment Corporation SOC Ltd (registration number 2005/009094/30), a state-owned company registered and duly incorporated in accordance with the laws of the Republic of South Africa, (acting in its capacity as agent and representative of its client, the Government Employees Pension Fund) (“PIC”). Each of the parties to this Agreement is individually referred to herein as a “Party” and collectively as the “Parties.” Recitals A. PIC currently owns a significant equity interest in Erin. As at the date of this Agreement, PIC holds nearly 30% (thirty percent) of the issued shares in Erin; B. Erin requires debt financing in the amount of U.S. $100 million (one hundred million US dollars) to carry out drilling and related activities to increase production of the number of barrels produced per day; C. By letter, dated 01 February 2016 and further by approval from the relevant investment committee on 3 June 2016, PIC confirmed and approved its interest and willingness to support Erin’s efforts to raise the debt financing referred to in Recital B above, by providing a bank guarantee to any third-party lender providing such financing. It is recorded that for the purpose of this Agreement, the third-party lender shall be either a reputable commercial bank or a reputable crude oil off taker (the “Third-Party Lender”); D. Erin has identified sources of the financing required and has entered into or shall have entered into a facility agreement with the Third-Party Lender regulating the terms and conditions of the financing by the Third-Party Lender to Erin (“Facility Agreement”). In conjunction with the Facility Agreement, the Third-Party Lender requires that a bank guarantee be provided in accordance with the financial support by PIC to Erin as contained in this Agreement and E. In support of its investment in Erin and subject to the terms and conditions hereinafter set forth, PIC has agreed to provide the required bank guarantee and Erin has agreed, in consideration thereof, to provide an indemnity and grant warrants as hereinafter provided. 1.    Agreement In consideration of the mutual promises made herein and for other good and acknowledged, the Parties hereto agree as follows: 1.1 Definitions. In addition to those terms defined above and elsewhere in this Agreement, for the purposes of this Agreement, the following terms shall have Page 1 of 27 “Certificate of Incorporation” means the Amended and Restated Certificate of Incorporation of Erin dated May 3, 2007, in effect and as amended from time to time. “Closing Date” means the date on which Erin receives the funds under the Facility Agreement that are guaranteed by the Guarantee (as defined below). “Common Stock” means the common stock of Erin, as described in Erin’s Certificate of Incorporation. “Conversion Shares” “Conversion Shares” means the shares of Common Stock to be issued to PIC in lieu of receiving cash for any indemnifiable Losses under Section 3.3(b) hereof. “Person” means an individual, partnership, corporation, joint venture, unincorporated organization, cooperative or a governmental authority. “Third-Party Lender” has the meaning set forth in Recital C and shall include any third-party providing funding by way of advance payment for the purchase of crude oil. “Warrant Share” means a share of Common Stock issuable upon exercise of the warrants referred to in Section 3.1 hereof. 2.    Provision of Bank Guarantee PIC agrees to apply for, request, and authorise The Standard Bank of South Africa Limited (“Standard Bank”), or any other reputable commercial bank acceptable to the Third-Party Lender, to issue a bank guarantee in favour of the Third-Party Lender in the amount of one hundred million United States Dollars (US$100,000,000) or such lesser amount as may be agreed by the Parties, which Guarantee shall be in a form as attached hereto as Exhibit A, or such other form as may be reasonably acceptable to PIC for a period of 3 (three) years (the “Guarantee”). In conjunction thereto, PIC agrees to provide to the issuing bank such indemnity and/or other undertaking as may reasonably be requested by such bank. 3. Consideration to be provided by Erin In consideration for the undertaking agreed to by PIC in clause 2 above, Erin shall provide to PIC the following: 3.1 Fee. The Guarantee shall attract an upfront fee of 250 (two hundred and fifty) basis points of the Guarantee amount which shall be payable by Erin to PIC on the date of the disbursement of the first utilisation by the Third-Party Lender to Erin under the Facility Agreement. Erin shall provide PIC with confirmation of payment at the address provided in clause 8.3 below. 3.2 Warrants. Erin shall, on the day following the Closing Date, issue to PIC warrants to purchase shares of Common Stock in an amount equal to the amount of the Guarantee times twenty percent divided by the closing market price of the Common Stock on the NYSE MKT on Page 2 of 27 the Closing Date, with a strike price equal to such closing market price. The warrants shall be in the form attached hereto as Exhibit B. 3.3 Notwithstanding any other provision of this Agreement and without prior approval of the shareholders of Erin, in no event shall the number of shares of Common Stock issued or issuable hereunder as Conversion Shares and/or Warrant Shares exceed an aggregate of 19.99% of the number of shares of Common Stock outstanding on the date of this Agreement. 3.4 Indemnification. 3.2.1 Erin agrees to indemnify and hold PIC harmless from and against any and all reasonable attorney fees and disbursements and other reasonable expenses incurred in connection with investigating, preparing or defending any action, claim or proceeding, pending or threatened, and the costs of enforcement hereof) (collectively, “Losses”) to which PIC may become subject as a result of the Guarantee or any other document or instrument to which PIC is a party or a signatory in relation thereto or arising thereof. 3.2.2 The amount of any and all indemnifiable Losses suffered by PIC agreed or otherwise required to be paid by Erin (the “Indemnifiable Amounts”) shall be paid in cash or, at the option of PIC, may be paid in newly issued shares of Common Stock. If PIC opts to receive newly issued shares of Common Stock in lieu of receiving cash for any indemnifiable Losses, the number of shares to be issued to PIC shall have a fair market value equal to the aggregate amount of the indemnifiable Losses agreed or otherwise required to be paid by Erin. The fair market value of such shares shall be determined by calculating the average closing price of Erin’s Common Stock over a period of thirty (30) days on the principal stock exchange on which the shares are traded (based on the aggregate trading volume on such exchange for the relevant thirty (30) day period), counting back from the first business day immediately prior to the final determination of the Indemnifiable Amounts. 3.5 In no event shall either Party be liable for punitive, exemplary, special, incidental, consequential, lost profits or damages other than actual damages suffered by the other Party with respect to any term or the subject matter of this Agreement, whether based on contract, tort, strict liability, other law or otherwise and whether or not arising from the other person’s or any of its affiliates’ sole, joint or concurrent negligence, strict liability or other fault. 4. Conditions Precedent. 4.1 The obligations of PIC hereunder shall be subject to the satisfaction of any applicable regulatory approvals required to be obtained by PIC to give effect to this Agreement. PIC shall obtain any applicable regulatory approvals or confirmations from the relevant regulatory Page 3 of 27 authority by January 31, 2017. Should PIC be unable to obtain the necessary approvals by the aforementioned date, PIC shall accordingly inform Erin and endeavour to obtain such approvals within a reasonable period. 4.2 The following conditions shall be fulfilled by Erin to the reasonable satisfaction of PIC unless waived by PIC at its sole discretion: 4.2.1 Erin shall as a continuing condition of this agreement, provide PIC with regular feedback, initially on a monthly basis in respect of its strategy, implementation thereof and any amendments and/or changes thereto as well as Erin’s project management plans in relation to its strategy and implementation from time to time. Erin shall also provide PIC with feedback in respect of its balance sheet restructuring and capital expenditure programme, evidencing the funding being channeled to its production. 4.2.2 Erin shall provide PIC with its ESG implementation plan by or before 31 January 2017 or on such later date that shall be agreed upon between the Parties. 4.2.3 In view of Erin’s secondary listing on the Johannesburg Stock Exchange (JSE), Erin shall ensure that its corporate governance is in compliance with the Listing Requirements of the JSE. Erin shall accordingly extend its board committee to include the following: (a) Social and Ethics Committee; and (b) A management of risk and information technology committee; within 6 (six) months of signature of this Agreement and may be satisfied by the establishment of new committees, and/or of sub-committees within existing board committees and/or the elaboration within the charter of existing board committees to reflect either an expansion of the scope of those committees or a clarification that the scope of those committees already encompass the governance matters contemplated by this condition. 4.2.4 Recognizing that PIC desires that Erin appoint its Chief Financial Officer as an executive member of Erin’s board of directors, Erin shall, in good faith, during the three (3) month period following the date of this Agreement, consider the appointment of its Chief Financial Officer as an executive member of Erin’s board of directors, and, if appropriate, taking into account the wishes of the shareholders, including any significant new equity providers, and the laws and regulations to which Erin is subject, determine whether it can comply with PIC's request. If Erin can so comply, it will then take steps to appoint its Chief Financial Officer as an executive member of Erin’s board of directors and to seek ratification of same at its next meeting of shareholders. Page 4 of 27 4.2.5 Erin shall provide PIC with executed off-take agreements as and when such agreements are executed before the Closing Date. 5. PIC agrees to keep all non-public information provided to PIC under this Agreement strictly confidential and to not disclose any such non-public information in any manner whatsoever to any third party without the prior written consent of Erin or until such information becomes available to the general public. 6. Representations, Warranties and Covenants of Erin. Erin represents and warrants to PIC that: Organizational Matters. Erin has the full and requisite power, capacity and authority to enter into and perform its obligations under this Agreement. Erin (i) is duly organized, validly existing and in good standing under the laws of the State of Delaware, (ii) has all requisite power and authority to own its properties and carry on its business and (iii) is qualified to do business and is in good standing in all jurisdictions where it conducts its business and operations. 6.2    Authorization, Execution and Delivery. This Agreement has been duly authorized, executed and delivered by Erin and constitutes legal, valid and binding obligations of Erin, enforceable against Erin in accordance with its reorganization, moratorium or other laws of general application affecting the to the availability of specific performance, injunctive relief or other equitable remedies. 6.3    Non-Contravention. The execution, delivery and performance by Erin of this Agreement will not (i) violate or contravene its organizational documents, any law, rule or regulation or any order, writ, injunction or decree of any court, governmental authority or arbitrator, (ii) conflict with or result in a breach of any agreement, contractual obligation or undertaking to which Erin is a party or by which it is bound or (iii) result in the creation or imposition of or obligation to grant any lien upon any properties of Erin. 6.4    Required Approvals and Consents. No authorization, approval or consent of, and no filing or registration with, any court or governmental authority is or will be necessary for the execution, delivery or performance by Erin of this Agreement or for the validity or enforceability hereof or thereof. 7. Representations, Warranties and Covenants of PIC. PIC represents and warrants to Erin that: 7.1    Organizational Matters. PIC acting in its capacity as representative of its Client, the Government Employees Pension Fund, has the full and requisite power and authority to enter into and perform its obligations under this Agreement. PIC (i) is duly organized, validly existing and in good standing under the laws of the Republic of South Africa, (ii) has all requisite power and to do business and in good standing in all jurisdictions where it conducts operations. Page 5 of 27 7.2    Authorization, Execution and Delivery. This Agreement has been duly authorized, executed and delivered by PIC and constitutes legal, valid and binding obligations of PIC, enforceable against PIC in accordance with its terms moratorium or other laws of general application affecting the enforcement of availability of specific performance, injunctive relief or other equitable remedies. 7.3    Non-Contravention. The execution, delivery and performance by PIC of this Agreement will not (i) violate or contravene its organizational documents, any law, rule or regulation or any order, writ, injunction or decree of any court, governmental authority or arbitrator, (ii) conflict with or result in a breach of any agreement, contractual obligation or undertaking to which PIC is bound or (iii) result in the creation or imposition of or obligation to grant any lien upon any properties of PIC. 7.4    Required Approvals and Consents. No authorization, approval or consent or will be necessary for the execution, delivery or performance by PIC of this Agreement or for the validity or enforceability hereof or thereof other than as provided in clause 4 above. 8. Miscellaneous 8.1    Successors and Assigns. This Agreement may not be assigned by either Party without the prior written consent of the other Party. The provisions of permitted successors and assigns of the Parties. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the Parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement. 8.2    Execution and Counterparts. This Agreement may be executed in two or more each Party hereto and delivered to the other Party hereto, it being understood that both Parties hereto need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by email delivery of a portable document format, or “.pdf” data file, such signature shall create a valid and binding obligation of the Party hereto executing (or on whose behalf or “.pdf” signature page were an original thereof. 8.3    Notices. Unless otherwise provided, any notice required or permitted notice shall be deemed given upon such delivery, (ii) if given by telefax or electronic mail, then such notice shall be deemed given upon receipt of confirmation of complete transmittal, and (iii) if given by an internationally recognized overnight air courier, then such notice shall be deemed given three (3) business days after delivery to such carrier. All notices shall be addressed to the Party to be notified at Page 6 of 27 the address as follows, or at such other address as such Party may designate by ten (10) days advance written notice to the other Party: If to Erin: Erin Energy Corporation 1330 Post Oak Boulevard Suite 2250 Fax: 713.797.2990 Email: [email protected] Attention: Daniel Ogbonna, Senior Vice President and Chief Financial Officer If to PIC by personal delivery: Public Investment Corporation SOC Ltd Block C, Riverwalk Office Park 41 Matroosberg Road (corner of Garsfontein and Matroosberg Roads) Ashlea Gardens Extension 6 Menlo Park, Pretoria South Africa Attention: Dr. Daniel Matjila, Chief Executive Officer Page 7 of 27 If to PIC by mail, telefax or electronic mail: Private Bag X 187 Pretoria South Africa 0001 Email: [email protected] 8.4    Expenses. Erin shall pay any and all ancillary costs and expenses reasonably incurred by PIC in respect of the application for the Guarantee over the three year term thereof. PIC shall, on a quarterly basis issue an invoice to Erin which shall be payable within 10 (ten) days of receipt, or on a later date to be agreed upon between PIC and Erin. 8.5    Amendments and Waivers. Any term of this Agreement may be amended and the particular instance, and either retroactively or prospectively), only with the 8.6    Publicity. Except as set forth below, no public release or announcement concerning the transactions contemplated hereby shall be issued by either Party, except such release or announcement as the Parties collectively and reasonably determine may be required by law or the applicable rules or regulations of the NYSE MKT stock market and/or the South African securities exchange operated by the JSE or any other relevant securities exchange or securities market. 8.7    Severability. Any provision of this Agreement that is prohibited or such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent renders any provision hereof prohibited or unenforceable in any respect. 8.8    Entire Agreement. This Agreement, including any Exhibits thereto, constitute the entire agreement between the Parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, representations and warranties, both oral Page 8 of 27 and written, between or made by the Parties with respect to the subject matter hereof and thereof. 8.9    Further Assurances. The Parties shall execute and deliver all such further instruments and documents and take all such other actions as may reasonably be required to carry out the transactions contemplated hereby and to evidence the fulfillment of the agreements herein contained. 8.10    Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This thereof. Each of the Parties irrevocably submits to the exclusive jurisdiction any Proceeding or judgment relating to or arising out of this Agreement and the transactions contemplated hereby. Service of process in connection with any such Proceeding may be served on each Party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Agreement. Each of the Parties irrevocably consents to the jurisdiction of any such court in any such proceeding and to the laying of venue in such court. Each Party irrevocably waives any objection to the laying of venue of any such proceeding brought in such courts and irrevocably waives any claim that any such proceeding brought in any such court has been brought in an inconvenient forum. Each of the parties waives any right to request a trial by jury in any litigation with respect to this Agreement and represents that counsel has been consulted specifically as to this waiver. Page 9 of 27 IN WITNESS WHEREOF, the Parties have executed this Agreement or caused their written. Erin Energy Corporation                 By: /s/ Daniel Ogbonna   Daniel Ogbonna   Senior Vice President and Chief Financial Officer   Date: February 6, 2017                                 By: /s/ Dr. Daniel Matjila   Dr. Daniel Matjila   Chief Executive Officer   Date: 18/12/2016 Page 10 of 27 EXHIBIT A: FORM OF GUARANTEE TRN No: …………………………….. Beneficiary details BANK GUARANTEE [●] October 2016   Applicant: Public Investment Corporation SOC Ltd (Registration Number: 2005/0090940/30) acting in its capacity as the authorised representatives of the Government Employees Pension Fund Beneficiary: Mauritius Commercial Bank Limited in its capacity as security agent and trustee under the Contract Contract (Underlying Agreement): The USD 100,000,000 (one hundred million United States Dollars) facility agreement entered into between, inter alia, Erin, Erin Petroleum Nigeria Limited and the Beneficiary Erin: Erin Energy Corporation Financing Support     Agreement: The financing support agreement entered into between the Applicant and Erin setting out the terms and conditions under which the Applicant shall provide financial support to Erin Guarantee: The irrevocable on demand, independent guarantee issued by the Bank to the Beneficiary in accordance with the terms and conditions of this document Guaranteed Amount:     US$100,000,000 (One Hundred Million United States Dollars) Page 11 of 27 Reduction in Guarantee Amount: The Guaranteed Amount or balance thereof, shall be capable of being reduced only in the following circumstances: (a) pro rata, as amounts are paid out under the Guarantee and/or (b) pro rata upon Erin making regular scheduled debt service payments in full in accordance with the Contract. Following the occurrence of either of the preceding, the Beneficiary shall notify the Bank in writing and the available Guarantee Amount shall be reduced accordingly Expiry Date: 3 (three) years from the date of issuance hereof or if earlier, the date on which the Beneficiary confirms in writing to the Bank and the Applicant that all amounts due to the Beneficiary under the Contract have been paid in full. For the avoidance of doubt, this date shall not exceed 3 (three) years from the date of issuance of this bank guarantee. Bank: The Standard Bank of South Africa Limited, (Registration Number 1962/000738/06), a public company duly incorporated with limited liability according to the laws of the Republic of South Africa Bank's Address:     SBZAZAJJ. Business Days: A day (other than a Saturday, Sunday or public holiday) on which banks are open for general business in Johannesburg, South Africa and Port-Louis, Mauritius. 1. Erin requires debt financing in a principal amount of USD100,000,000 (one hundred million United States Dollars), in order to carry out drilling and related operational activities to increase the production levels of its 100% owned subsidiary, Erin Petroleum Nigeria Limited. The Applicant is an existing shareholder in Erin and accordingly undertakes to support Erin's efforts to raise debt financing from the Beneficiary and has agreed to secure a bank guarantee in favour of the Beneficiary. 2. By or before the date of this Guarantee, Erin and the Beneficiary shall have entered into the Contract, in terms of which, the Beneficiary undertakes to advance a facility amount of USD100,000,000 (United States Dollars one hundred million only) to Erin subject to the conditions therein. In accordance with the terms and conditions of the Contract, the Beneficiary requires Erin to provide security in the form of a bank guarantee. Page 12 of 27 3. Considering that Erin requires the Applicant support in order to secure debt financing under the Contract, Erin and the Applicant have entered into the Financing Support Agreement in respect of which the Applicant undertakes to provide financial support to Erin by applying for a bank guarantee which will be for the benefit of the Beneficiary in respect of any amounts owing by Erin to the Beneficiary in accordance with the terms of the Contract. 4. At the request of the Applicant, the Bank hereby irrevocably undertakes and guarantees to pay the Beneficiary, on demand in accordance with clause 5 and 6 below, such amount(s) as and when demanded by the Beneficiary, which in aggregate do not exceed the Guaranteed Amount within 5 Business Days following receipt by the Bank of a Complying Demand. 5. A Complying Demand must be issued by the Beneficiary as follows: 5.1. by swift message to the Bank at the Bank’s Address: SBZAZAJJ or to a reputable bank in the United Kingdom who shall act as an intermediary for the purposes of receiving a Complying Demand from the Beneficiary on behalf of the Bank; 5.2. contain a statement, stating that a payment default has occurred under the Contract and that it requires the Guaranteed Amount, or any part thereof, to be paid by the Bank; and 5.3. state the amount(s) that the Beneficiary requires the Bank to pay. 6. Payment of the Guaranteed Amount, or any part thereof, will only be made following notification by the Beneficiary to the Bank’s Addresses or to the swift address of the bank nominated by the Bank as per clause 5.1 above. 7. The Bank will pay on demand under this Guarantee following receipt of a Complying Demand from the Beneficiary pursuant to clauses 5 and 6 above and without verifying: 7.1. the validity or authenticity of the Complying Demand; or 7.2. alleged non-payment under the Contract; or 7.3. the correctness of the amount demanded by the Beneficiary. 8. For the avoidance of doubt, multiple demands and payments are permitted provided that the aggregate of amounts paid by the Bank to the Beneficiary shall not exceed the Guaranteed Amount. Page 13 of 27 9. The Bank's obligation herein is restricted to the payment of money and will not be interpreted as extending the Bank's liability to anything other than the payment of the Guaranteed Amount. 10. This Guarantee is issued in support of the Contract for the benefit of the Beneficiary and its successors and assigns. This Guarantee is transferrable by the Beneficiary and can be transferred by the Beneficiary by means of assignment or novation. Three days prior to such transfer, the Beneficiary shall inform the Bank via swift at the Bank's Address of such pending transfer and the identity of the transferee. Following any such transfer the Beneficiary shall accordingly inform the Bank via swift at the Bank's Address that the guarantee has been transferred and the transferee has acquired all the rights and obligations of the transferor under this Guarantee. 11. Save for any amendments to the Bank's Address or any assignment under clause 10 above, no variation of this Guarantee will be of any force or effect without the prior written consent of the Applicant, the Bank and the Beneficiary. 12. Notwithstanding anything to the contrary contained herein, this Guarantee will expire, whether surrendered to the Bank for cancellation or not, at 14h00 (South African time), on the Expiry Date or on payment of the Guaranteed Amount in full, whichever occurs first, at which time the Bank's liability will cease and no claims will be considered thereafter. 13. This Guarantee must be surrendered to the Bank at the earlier of the: 13.1.    payment in full of the Guaranteed Amount; or 13.2.    the Expiry Date unless there is a Complying Demand which remains unpaid under the Guarantee. 14. The Guarantee shall be subject to the Uniform Rules for Demand Guarantees, ICC Publication No.758 and shall be governed by English law with arbitration pursuant to LCIA rules in London, England. Page 14 of 27 Signed at Johannesburg on the [●] 2016 For: The Standard Bank of South Africa Limited, (Registration Number 1962/000738/06)       Nomphelo Miliswa Mahlati   Kershni Govender Manager Operations Guarantees   Manager, Legal Trade Services, CIB   Trade Services, CIB       As Witnesses:     1.     2.   EXHIBIT B: FORM OF WARRANTS THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR TRANSFERRED UNLESS SUCH SALE OR TRANSFER IS IN ACCORDANCE WITH THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND APPLICABLE LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND APPLICABLE LAWS. COMMON STOCK PURCHASE WARRANT         Warrant No. A-[●]   Number of Shares: [●] shares           Common Stock ERIN ENERGY CORPORATION Effective as of _______, 2016 Void after ________, 2019 1. Issuance. This Common Stock Purchase Warrant (the “Warrant”) is issued to Public Investment Corporation SOC Ltd, a company incorporated in the Republic of South Africa (the “Holder”), by Erin Energy Corporation, a Delaware corporation (hereinafter with its successors called the “Company”). Page 15 of 27 2. Purchase Price; Number of Shares. The Holder is entitled upon surrender of this Warrant with the subscription form annexed hereto duly executed, at the principal office of the Company, to purchase from the Company, at a price per share of $[●] (the “Purchase Price”), up to a maximum of [●] fully paid and nonassessable shares of the Company’s Common Stock, $0.001 par value (the “Common Stock”). Until such time as this Warrant is exercised in full or expires, the Purchase Price and the securities issuable upon exercise of this Warrant are subject to adjustment as hereinafter provided. The person or persons in whose name or names any certificate representing shares of Common Stock is issued hereunder shall be deemed to have become the holder of record of the shares represented thereby as at the close of business on the date this Warrant is exercised with respect to such shares, whether or not the transfer books of the Company shall be closed. 3. Payment of Purchase Price. The Purchase Price may be paid in cash or by electronic transfer. 4. Cashless Exercise Election. The Holder may elect to receive, without the payment by the Holder of any additional consideration, shares of Common Stock equal to the value of this Warrant or any portion hereof by the surrender of this Warrant or such portion to the Company, with the cashless exercise election notice annexed hereto duly executed, at the principal office of the Company. Thereupon, the Company shall issue to the Holder such number of fully paid and non-assessable shares of Common Stock as is computed using the following formula:       X=    Y (A-B)           A       where:   X =   the number of shares of Common Stock to be issued to the Holder pursuant to this Section 4.           Y =   the number of shares of Common Stock covered by this Warrant in respect of which the cashless exercise election is made pursuant to this Section 4.           A =   the Fair Market Value (defined below) of one share of Common Stock as determined at the time the cashless exercise election is made pursuant to this Section 4.           B =   the Purchase Price in effect under this Warrant at the time the cashless exercise election is made pursuant to this Section 4.   “Fair Market Value” of a share of Common Stock as of the date that the cashless exercise election is made (the “Determination Date”) shall mean: Page 16 of 27 (a) If traded on a securities exchange or the Nasdaq National Market, the fair market value of the Common Stock shall be deemed to be the average of the closing or last reported sale prices of the Common Stock on such exchange or market over the five day period ending two trading days prior to the Determination Date; (b) If otherwise traded in an over-the-counter market, the fair market value of the Common Stock shall be deemed to be the average of the closing ask prices of the Common Stock over the five day period ending two trading days prior to the Determination Date; and (c) If there is no public market for the Common Stock, then fair market value shall be determined in good faith by the Company’s Board of Directors. 5. Partial Exercise. This Warrant may be exercised in part, and the Holder shall be entitled to receive a new warrant, which shall be dated as of the date of this Warrant, covering the number of shares in respect of which this Warrant shall not have been exercised. 6. Fractional Shares. In no event shall any fractional share of Common Stock be issued upon any exercise of this Warrant. If, upon exercise of this Warrant in its entirety, the Holder would, except as provided in this Section 6, be entitled to receive a fractional share of Common Stock, then the Company shall issue the next higher number of full shares of Common Stock, issuing a full share with respect to such fractional share. 7. Expiration Date; Automatic Exercise. This Warrant shall expire (the “Expiration Date”) at the close of business on [●], 2019. 8. Reserved Shares; Valid Issuance. The Company covenants that it will at all times from and after the date hereof reserve and keep available such number of its authorized shares of Common Stock, free from all preemptive or similar rights therein, as will be sufficient to permit the exercise of this Warrant in full. The Company further covenants that such shares as may be issued pursuant to such exercise will, upon issuance, be duly and validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof. 9. Stock Splits and Dividends. If after the date hereof the Company shall subdivide the Common Stock, by split-up or otherwise, or combine the Common Stock, or issue additional shares of Common Stock in payment of a stock dividend on the Common Stock, the number of shares of Common Stock issuable on the exercise of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination, and the Purchase Price shall forthwith be proportionately decreased in the case of a subdivision or stock dividend, or proportionately increased in the case of a combination. 11. Mergers and Reclassifications. If after the date hereof the Company shall enter into any Reorganization (as hereinafter defined), then, as a condition of such Reorganization, lawful Page 17 of 27 provisions shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the Holder, so that the Holder shall thereafter have the right to purchase, at a total price not to exceed that payable upon the exercise of this Warrant in full, the kind and amount of shares of stock and other securities and property receivable upon such Reorganization by a holder of the number of shares of Common Stock which might have been purchased by the Holder immediately prior to such Reorganization, and in any such case appropriate provisions shall be made with respect to the rights and interest of the Holder to the end that the provisions hereof (including without limitation, provisions for the adjustment of the Purchase Price and the number of shares issuable hereunder and the provisions relating to the cashless exercise election) shall thereafter be applicable in relation to any shares of stock or other securities and property thereafter deliverable upon exercise hereof. For the purposes of this Section 11, the term “Reorganization” shall include without limitation any reclassification, capital reorganization or change of the Common Stock (other than as a result of a subdivision, combination or stock dividend provided for in Section 9 hereof), or any consolidation of the Company with, or merger of the Company into, another corporation or other business organization (other than a merger in which the Company is the surviving corporation and which does not result in any reclassification or change of the outstanding Common Stock), or any sale or conveyance to another corporation or other business organization of all or substantially all of the assets of the Company. 12. Certificate of Adjustment. Whenever the Purchase Price is adjusted, as herein provided, the Company shall promptly deliver to the Holder a certificate of the Company’s chief financial officer setting forth the Purchase Price after adjustment. 13. Notices of Record Date, Etc. In the event of: (a) any taking by the Company of a record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend or other distribution, or any right to subscribe for, purchase, sell or otherwise acquire or dispose of any shares of stock of any class or any other securities or property, or to receive any other right; (b) any reclassification of the capital stock of the Company, capital reorganization of the Company, consolidation or merger involving the Company, or sale or conveyance of all or substantially all of its assets; or (c) any voluntary or involuntary dissolution, liquidation or winding-up of the Company, then in each such event the Company will provide or cause to be provided to the Holder a written notice thereof. Such notice shall be provided at least twenty (20) days prior to the date specified in such notice on which any such action is to be taken. Page 18 of 27 14. Representations, Warranties and Covenants. This Warrant is issued and delivered by the Company and accepted by the Holder on the basis of the following representations, warranties and covenants made by the Company: (a) The Company has all necessary authority to issue, execute and deliver this Warrant and to perform its obligations hereunder. This Warrant has been duly authorized issued, executed and delivered by the Company and is the valid and binding obligation of the Company, enforceable in accordance with its terms. (b) The shares of Common Stock issuable upon the exercise of this Warrant have been duly authorized and reserved for issuance by the Company and, when issued in accordance with the terms hereof, will be validly issued, fully paid and nonassessable. (c) The issuance, execution and delivery of this Warrant does not, and the issuance of the shares of Common Stock upon the exercise of this Warrant in accordance with the terms hereof will not, (i) violate or contravene the Company’s Articles or by-laws, or any law, statute, regulation, rule, judgment or order applicable to the Company, (ii) violate, contravene or result in a breach or default under any contract, agreement or instrument to which the Company is a party or by which the Company or any of its assets are bound or (iii) require the consent or approval of or the filing of any notice or registration with any person or entity. (d) Except as set forth in the Company’s filings with the U.S. Securities and Exchange Commission, there are no outstanding (i) options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any capital stock of the Company or any of its subsidiaries, or (ii) contracts, commitments, understandings or arrangements by which the Company or any of its subsidiaries is or may become bound to issue additional capital stock of the Company or any of its subsidiaries or (iii) options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any capital stock of any of the Company or any of its subsidiaries as a result of this Warrant or the exercise thereof. 15. Amendment. The terms and provisions of this Warrant may be amended, modified or waived only by a written instrument duly executed by the Company and the Holder. 16. Representations and Covenants of the Holder. This Common Stock Purchase Warrant has been entered into by the Company in reliance upon the following representations and covenants of the Holder, which by its execution hereof the Holder hereby confirms: (a) Investment Purpose. The right to acquire Common Stock contained herein will be acquired for investment and not with a view to the sale or distribution of any part thereof, and the Page 19 of 27 Holder has no present intention of selling or engaging in any public distribution of the same except pursuant to a registration or exemption. (b) Accredited Investor. The Holder is an “accredited investor” within the meaning of Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended (the “Act”), and/or is not a “US Person” within the meaning of Regulation S promulgated under the Act. (c) Private Issue. The Holder understands (i) that the Common Stock issuable upon exercise of the Holder’s rights contained herein is not registered under the 1933 Act or qualified under applicable state securities laws on the grounds that the issuance contemplated by this Warrant will be exempt from the registration and qualification requirements thereof, and (ii) that the Company’s reliance on such exemption is predicated on the representations set forth in this Section 16. (d) Financial Risk. The Holder has such knowledge and experience in financial and business affairs as to be capable of evaluating the merits and risks of its investment. The Holder has not relied upon any representations, warranties or agreements by the Company or any of its affiliates, other than those expressly set forth in this Common Stock Purchase Warrant. The Holder acknowledges that an investment in the Company is speculative and involves a high degree of risk. The Holder is able to bear the economic risk of holding its investment for an indefinite period of time and can afford to suffer a complete loss of its investment. The Holder is not relying on the Company or any of its representatives for legal, investment, tax or other advice. (e) Stockholder Rights. Unless otherwise specified herein or in another agreement between the Company and Holder, until exercise of this Warrant, the Holder shall not have or exercise any rights by virtue hereof as a stockholder of the Company. 17. Notices, Transfers, Etc. (a) Any notice or written communication required or permitted to be given to the Holder may be given by certified mail or delivered to the Holder at the address most recently provided by the Holder to the Company. (b) Subject to compliance with Section 18 below and the applicable federal and state securities laws, this Warrant may be transferred by the Holder with respect to any or all of the shares purchasable hereunder. Upon surrender of this Warrant to the Company, together with the assignment notice annexed hereto duly executed, for transfer of this Warrant as an entirety by the Holder, the Company shall issue a new warrant of the same denomination to the assignee. Upon surrender of this Warrant to the Company, together with the assignment hereof properly endorsed, by the Holder for transfer with respect to a portion of the shares of Common Stock purchasable hereunder, the Company shall issue a new warrant to the assignee, in such denomination as shall be requested by Page 20 of 27 the Holder hereof, and shall issue to such Holder a new warrant covering the number of shares in respect of which this Warrant shall not have been transferred. (c) In case this Warrant shall be mutilated, lost, stolen or destroyed, the Company shall issue a new warrant of like tenor and denomination and deliver the same (i) in exchange and substitution for and upon surrender and cancellation of any mutilated Warrant, or (ii) in lieu of any Warrant lost, stolen or destroyed, upon receipt of an affidavit of the Holder or other evidence reasonably satisfactory to the Company of the loss, theft or destruction of such Warrant. 18. Transfer of Shares. (a) “Restricted Shares” means (a) this Warrant, (b) the shares of Common Stock issued or issuable upon exercise of this Warrant, and (c) any other shares of capital stock of the Company issued in respect of such shares (as a result of stock splits, stock dividends, reclassifications, recapitalizations or similar events); provided, however, that shares of Common Stock which are Restricted Shares shall cease to be Restricted Shares (x) upon any sale pursuant to a registration statement under the 1933 Act, Section 4(1) of the 1933 Act or Rule 144 under the 1933 Act or (y) at such time as they become eligible for sale (b) Restricted Shares shall not be sold or transferred unless either (i) they first shall have been registered under the 1933 Act, or (ii) the Company first shall have been furnished with an opinion of legal counsel, reasonably satisfactory to the Company if requested by the Company or its transfer agent, to the effect that such sale or transfer is exempt from the registration requirements of the 1933 Act. (c) Notwithstanding the foregoing, no registration or opinion of counsel shall be required for (i) a transfer by the Holder to an Affiliated Party (as such term is defined below) of the Holder, (ii) a transfer by the Holder which is a partnership to a partner of such partnership; provided that the transferee in each case agrees in writing to be subject to the terms of this Section 19 to the same extent as if it were the original Holder hereunder, or (iii) a transfer made in accordance with Rule 144 under the 1933 Act. For purposes of this Agreement “Affiliated Party” shall mean, with respect to Holder, any person or entity which, directly or indirectly, controls, is controlled by or is under common control with Holder, including, without limitation, any general partner, officer, manager or director of Holder and any venture capital fund now or hereafter existing which is controlled by one or more general partners or managing members of, or shares the same management company as, Holder. (d) Each certificate representing Restricted Shares shall bear a legend substantially in the following form: SECURITIES ACT OF 1933, AS AMENDED, AND MAY Page 21 of 27 NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL SUCH SHARES ARE REGISTERED UNDER SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT THAT SUCH REGISTRATION IS NOT REQUIRED.” The foregoing legend shall be removed from the certificates representing any Restricted Shares, at the request of the holder thereof, at such time as they become eligible for resale pursuant to Rule 144 under the 1933 Act. (e) The Holder shall have certain registration rights with respect to the Common Stock issued or issuable hereunder. The registration rights will be defined in a registration rights agreement, substantially in the form of the registration rights agreement between the Holder and the Maker dated February 21, 2014. 19. No Impairment. The Company will not, without the prior written consent of the Holder by amendment of its Articles or through any reclassification, capital reorganization, consolidation, merger, sale or conveyance of assets, dissolution, liquidation, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance of performance of any of the terms of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Holder. 20. Governing Law. The provisions and terms of this Warrant shall be governed by and construed in accordance with the internal laws of the State of Delaware. 21. Successors and Assigns. This Warrant shall be binding upon the Company’s successors and assigns and shall inure to the benefit of the Holder’s successors, legal representatives and permitted assigns. 22. Business Days. If the last or appointed day for the taking of any action required of the expiration of any rights granted herein shall be a Saturday or Sunday or a legal holiday in California, then such action may be taken or right may be exercised on the next succeeding day which is not a Saturday or Sunday or such a legal holiday.   Page 22 of 27 ERIN ENERGY CORPORATION PUBLIC INVESTMENT CORPORATION     SOC LTD                                         Name: Daniel Ogbonna Name:         Dr. Daniel Matjila         Title: Senior Vice President and Chief       Financial Officer Title: Chief Executive Officer                                         Page 23 of 27 Execution NOTICE OF EXERCISE TO:    ERIN ENERGY CORPORATION (1)The undersigned hereby elects to purchase ________ Warrant Shares of the all applicable transfer taxes, if any. (2)Payment shall take the form of (check applicable box): [ ] in lawful currency of the United States; or [ ] [if permitted] the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in Section 4, to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in Section 4. _______________________________              physical delivery of a certificate to: _______________________________              _______________________________              _______________________________ FINANCING SUPPORT AGREEMENT/PIC/ERIN Execution December 2016 /Page 24 of 27 Execution [SIGNATURE OF HOLDER]      Name of Investing Entity: ________________________________________________________________________ Signature of Authorized Signatory of Investing Entity: _________________________________________________ ________________________________________________________________________ ________________________________________________________________________ Date: ___________________________________________________________________ /Page 25 of 27 Execution ASSIGNMENT FORM information. Do not use this form to exercise the Warrant.) FOR VALUE RECEIVED, [____] all of or [_______] shares of the foregoing Warrant _______________________________________________ whose address is _______________________________________________________________. _______________________________________________________________ Holder’s Signature:    _____________________________ Holder’s Address:    _____________________________              _____________________________ Signature Guaranteed: ___________________________________________ /Page 26 of 27 Execution /Page 27 of 27

Exhibit 10.12(d) This AMENDMENT NO. 4 is made as of the 30th day of September, 2015 to the Credit Agreement (defined below) by and among Air Products and Chemicals, Inc., the Other Borrowers parties from time to time , HSBC Bank USA, N.A., as Administrative Agent (the “Administrative Agent”), Citibank, N.A. and Lloyds Bank plc (the “Supplemental Lenders”). All capitalized terms used but not otherwise defined herein shall have the meanings given them in the Credit Agreement. The Borrowers, the Administrative Agent and the Lenders are parties to the $2,500,000,000 Revolving Credit Agreement dated as of April 30, 2013 (as amended, restated, modified or supplemented from time to time, the “Credit Agreement”). Pursuant to Section 2.09 of the Credit Agreement, the Borrowers may, at their option, seek to increase the Total Revolving Credit Commitment by obtaining additional Commitments upon satisfaction of certain conditions. Each of the Supplemental Lenders is a new Lender that is a lending institution whose identity the Administrative Agent will approve by its signature below. In consideration of the foregoing, Citibank, N.A. from and after the date hereof shall have a Revolving Credit Committed Amount of $190,000,000 and Lloyds Bank plc from and after the date hereof shall have a Revolving Credit Committed Amount of $95,000,000 as of the date hereof, each of the Supplemental Lenders hereby assumes all of the rights and obligations of a Lender under the Credit Agreement. The Borrowers have executed and delivered to the Supplemental Lenders as of the date hereof, if they were requested by the Supplemental Lenders, Notes in the form attached to the Credit Agreement as Exhibit A to evidence the Commitment of the Supplemental Lenders. IN WITNESS WHEREOF, the Administrative Agent, the Borrowers and the Supplemental Lenders have executed this Amendment as of the date shown above.   AIR PRODUCTS AND CHEMICALS, INC. By:   /s/ Gregory E. Weigard Name: Gregory E. Weigard Title: Corporate Treasurer CITIBANK, N.A. By:   /s/ David Jaffe Name: David Jaffe Title: Vice President LLOYDS BANK PLC By:   /s/ Daven Popat Name: Daven Popat Title: Senior Vice President By:   /s/ Julia R. Franklin Name: Julia R. Franklin Title: Vice President HSBC BANK USA, N.A., as Administrative Agent By:   /s/ Fernando Acebedo Name: Fernando Acebedo Title: Vice President   Consented to: HSBC BANK USA, N.A., as Issuer By:   /s/ David A. Mandell Name: David A. Mandell Title: Managing Director BNP PARIBAS, as Issuer By:   /s/ Michael Kowalozuk Name: Michael Kowalozuk Title: Managing Director By:   /s/ Melissa Dyki Name: Melissa Dyki Title: Director MIZUHO BANK, LTD., as Issuer By:   /s/ Donna DeMagistris Name: Donna DeMagistris Title: Authorized Signatory

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C.20549 SCHEDULE 13G Under the Securities Exchange Act of 1934 (Amendment No.4)* InnerWorkings, Inc. (Name of Issuer) Common Stock, $.0001 par value per share (Title of Class of Securities) 45773Y105 (CUSIP Number) December 31, 2010 (Date of Event Which Requires Filing of this Statement) Check the appropriate box to designate the rule pursuant to which this Schedule is filed: oRule 13d-1(b) oRule 13d-1(c) xRule 13d-1(d) *The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page. The information required in the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). CUSIP No. 45773Y105 13G Page2of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) New Enterprise Associates 11, Limited Partnership 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) PN CUSIP No. 45773Y105 13G Page3of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) NEA Partners11, Limited Partnership 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) PN CUSIP No. 45773Y105 13G Page4of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) NEA 11 GP, LLC 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) OO CUSIP No. 45773Y105 13G Page5of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Michael James Barrett 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page6of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Peter J. Barris 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.7% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page7of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Forest Baskett 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page8of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Ryan D. Drant 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page9of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Krishna S. Kolluri 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page10of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) C. Richard Kramlich 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page11of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Charles M. Linehan 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER 0 EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 0 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 0.0% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page12of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Charles W. Newhall III 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page13of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Mark W. Perry 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page14of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Scott D. Sandell 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH: 8 SHARED DISPOSITIVE POWER 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 15.6% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page15of 25 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Eugene A. Trainor III 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)o (b) o 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 5 SOLE VOTING POWER 0 SHARES BENEFICIALLY OWNED BY 6 SHARED VOTING POWER 0 EACH REPORTING PERSON 7 SOLE DISPOSITIVE POWER 0 WITH 8 SHARED DISPOSITIVE POWER 0 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) o 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 0.0% 12 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 45773Y105 13G Page16of 25 Schedule 13G Item 1(a). Name of Issuer:InnerWorkings, Inc. Item1(b). Address of Issuer’s Principal Executive Offices: 600 West Chicago Avenue, Suite 850, Chicago, IL 60654. Item2(a). Names of Persons Filing:This statement is being filed by New Enterprise Associates 11, Limited Partnership (“NEA 11”); NEA Partners 11, Limited Partnership (“NEA Partners11”), which is the sole general partner of NEA 11; NEA 11 GP, LLC (“NEA 11 GP”), which is the sole general partner of NEA Partners 11; Michael James Barrett (“Barrett”), Peter J. Barris (“Barris”), Forest Baskett (“Baskett”), Ryan D. Drant (“Drant”), Krishna S. Kolluri (“Kolluri”), C.Richard Kramlich (“Kramlich”), CharlesW. Newhall III (“Newhall”), Mark W. Perry (“Perry”) and Scott D. Sandell (“Sandell”) (collectively, the “Managers”); Charles M. Linehan (“Linehan”) and Eugene A. Trainor III (“Trainor”).The Managers are the individual managers of NEA 11 GP.NEA 11 GP, NEA Partners 11, NEA 11, the Managers, Linehan and Trainor are sometimes referred to collectively herein as the “Reporting Persons.” Item2(b). Address of Principal Business Office or, if None, Residence: The address of the principal business office of NEA 11, NEA Partners 11, NEA 11 GP and Newhall is New Enterprise Associates, 1954 Greenspring Drive, Suite 600, Timonium, MD 21093.The address of the principal business office of Baskett, Kolluri, Kramlich, Perry and Sandell is New Enterprise Associates, 2855 Sand Hill Road, Menlo Park, California 94025.The address of the principal business office of Barris, Barrett and Drant is New Enterprise Associates, 5425 Wisconsin Ave., Suite 800, Chevy Chase, MD 20815. Item2(c). Citizenship:NEA 11 and NEA Partners 11 are limited partnerships organized under the laws of the State of Delaware.NEA 11 GP is a limited liability company organized under the laws of the State of Delaware.Each of the Managers is a United States citizen. Item2(d). Title of Class of Securities:Common Stock, $.0001 par value (“Common Stock”). Item2(e). CUSIP Number:45773Y105. Item3. If this statement is filed pursuant to §§ 240.13d-1(b) or 240.13d-2(b) or (c), check whether the person filing is a: Not applicable. Item 4. Ownership. (a) Amount Beneficially Owned: NEA 11 is the record owner of 7,127,067 shares of Common Stock as of December 31, 2010 (the “Record Shares”). As the sole general partner of NEA 11, NEA Partners 11 may be deemed to own beneficially the Record Shares. As the sole general partner of NEA Partners 11, NEA 11 GP likewise may be deemed to own beneficially the Record Shares. As the individual Managers of NEA 11 GP, each of the Managers also may be deemed to own beneficially the Record Shares. Additionally, as of December 31, 2010, Drant is the record owner of 365 shares of Common Stock and The Kramlich Living Trust U/A/D 6/1/94, C. Richard Kramlich and Pamela P. Kramlich, Co-Trustees (the “Kramlich Trust”) is the record owner of 729 shares of Common Stock. As a Co-Trustee of the Kramlich Trust, CUSIP No. 45773Y105 13G Page17of 25 Kramlich may be deemed to own beneficially the Kramlich Trust shares. Barris is the record owner of 29,775 shares of Common Stock and options to purchase 26,462 shares of Common Stock (the “Option Shares”), PJ Barris, LLC (“Barris LLC”) is the record owner of 670 shares of Common Stock (the “PJ Barris Shares”) and PDB LLC (“PDB”) is the record owner of 168 shares of Common Stock (together with the PJ Barris shares, the “Barris LLC Shares”).As a member of Barris LLC and the Investment Advisor of PDB, Barris may be deemed to own beneficially the Barris LLC Shares. Finally, New Enterprise Associates, LLC (“NEA LLC”) is the record owner of 2,213 shares of Common Stock (the “NEA LLC Shares”).As members of NEA LLC’s board of directors, each of Barris, Drant, Kramlich, Newhall, Perry and Sandell may also be deemed to beneficially own the NEA LLC Shares. (b) Percent of Class:See Line 11 of cover sheets.The percentages set forth on the cover sheets for each Reporting Person are calculated based on 45,680,986 shares of Common Stock (the “10-Q Shares”) reported by the Issuer to be outstanding as of November 5, 2010 on Form 10-Q as filed with the Securities and Exchange Commission on November 5, 2010.The percentage set forth on the cover sheet for Barris is calculated based on 45,707,448 shares, which includes the 10-Q Shares and the Option Shares. (c) Number of shares as to which such person has: (i) sole power to vote or to direct the vote: See Line 5 of cover sheets. (ii) shared power to vote or to direct the vote: See Line 6 of cover sheets. (iii) sole power to dispose or to direct the disposition of: See Line 7 of cover sheets. (iv) shared power to dispose or to direct the disposition of: See Line 8 of cover sheets. Each Reporting Person disclaims beneficial ownership of such shares of Common Stock except for the shares, if any, such Reporting Person holds of record. Item 5. Ownership of Five Percent or Less of a Class. Each of Linehan and Trainor has ceased to beneficially own five percent (5%) or more of the Issuer’s Common Stock as a result of ceasing to be a Manager of NEA 11 GP. Item 6. Ownership of More than Five Percent on Behalf of Another Person. Not applicable. Item 7. Identification and Classification of the Subsidiary Which Acquired the Security Being Reported on by the Parent Holding Company. Not applicable. Item 8. Identification and Classification of Members of the Group. CUSIP No. 45773Y105 13G Page18of 25 Not applicable.The Reporting Persons expressly disclaim membership in a “group” as used in Rule13d-5(b). Item 9. Notice of Dissolution of Group. Not applicable. Item 10. Certification. Not applicable.This Amendment No. 4 to Schedule13G is not filed pursuant to Rule 13d-1(b) or Rule 13d–1(c). CUSIP No. 45773Y105 13G Page19of 25 SIGNATURE After reasonable inquiry and to the best of its knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct. Date:February10, 2011 NEW ENTERPRISE ASSOCIATES 11, LIMITED PARTNERSHIP By: NEA PARTNERS 11, LIMITED PARTNERSHIP General Partner By: NEA 11 GP, LLC General Partner By: * Peter J. Barris Manager NEA PARTNERS 11, LIMITED PARTNERSHIP By: NEA 11 GP, LLC General Partner By: * Peter J. Barris Manager NEA 11 GP, LLC By: * Peter J. Barris Manager * Michael James Barrett * Peter J. Barris CUSIP No. 45773Y105 13G Page20of 25 * Forest Baskett * Ryan D. Drant * Krishna S. Kolluri * C. Richard Kramlich * Charles M. Linehan * Charles W. Newhall III * Mark W. Perry * Scott D. Sandell * Eugene A. Trainor III *By: /s/ Louis S. Citron Louis S. Citron As attorney-in-fact This Amendment No. 4 to Schedule13G was executed by Louis S. Citron on behalf of the individuals listed above pursuant to a Power of Attorney, a copy of which is attached as Exhibit2. CUSIP No. 45773Y105 13G Page21of 25 EXHIBIT 1 AGREEMENT Pursuant to Rule13d-1(k)(1) under the Securities Exchange Act of 1934, the undersigned hereby agree that only one statement containing the information required by Schedule13G need be filed with respect to the ownership by each of the undersigned of shares of stock of InnerWorkings, Inc. EXECUTED this 10th day of February, 2011 NEW ENTERPRISE ASSOCIATES 11, LIMITED PARTNERSHIP By: NEA PARTNERS 11, LIMITED PARTNERSHIP General Partner By: NEA 11 GP, LLC General Partner By: * Peter J. Barris Manager NEA PARTNERS 11, LIMITED PARTNERSHIP By: NEA 11 GP, LLC General Partner By: * Peter J. Barris Manager NEA 11 GP, LLC By: * Peter J. Barris Manager * Michael James Barrett * Peter J. Barris CUSIP No. 45773Y105 13G Page22of 25 * Forest Baskett * Ryan D. Drant * Krishna S. Kolluri * C. Richard Kramlich * Charles M. Linehan * Charles W. Newhall III * Mark W. Perry * Scott D. Sandell * Eugene A. Trainor III *By: /s/ Louis S. Citron Louis S. Citron As attorney-in-fact This Agreement was executed by Louis S. Citron on behalf of the individuals listed above pursuant to a Power of Attorney, a copy of which is attachedas Exhibit2. CUSIP No. 45773Y105 13G Page23of 25 EXHIBIT 2 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby constitutes and appoints CharlesW. Newhall III, Louis S. Citron, Eugene A. Trainor III, Timothy Schaller and Shawn Conway, and each of them, with full power to act without the others, his true and lawful attorney-in-fact, with full power of substitution, to sign any and all instruments, certificates and documents that may be necessary, desirable or appropriate to be executed on behalf of himself as an individual or in his capacity as a direct or indirect general partner, director, officer or manager of any partnership, corporation or limited liability company, pursuant to section13 or 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and any and all regulations promulgated thereunder, and to file the same, with all exhibits thereto, and any other documents in connection therewith, with the Securities and Exchange Commission, and with any other entity when and if such is mandated by the Exchange Act or by the Financial Industry Regulatory Authority, granting unto said attorney-in-fact full power and authority to do and perform each and every act and thing necessary, desirable or appropriate, fully to all intents and purposes as he might or could do in person, thereby ratifying and confirming all that said attorney-in-fact, or his substitutes, may lawfully do or cause to be done by virtue hereof. IN WITNESS WHEREOF, this Power of Attorney has been signed as of the 4th day of May, 2009. /s/ M. James Barrett M. James Barrett /s/ Peter J. Barris Peter J. Barris /s/ Forest Baskett Forest Baskett /s/ Rohini Chakravarthy Rohini Chakravarthy /s/ Patrick Chung Patrick Chung /s/ Ryan Drant Ryan Drant /s/ Shawn Conway Shawn Conway /s/ Anthony A. Florence Anthony A. Florence /s/ Robert Garland Robert Garland /s/ Paul Hsiao Paul Hsiao CUSIP No. 45773Y105 13G Page24of 25 /s/ Vladimir Jacimovic Vladimir Jacimovic /s/ Patrick J. Kerins Patrick J. Kerins /s/ Suzanne King Suzanne King /s/ Krishna S. Kolluri Krishna S. Kolluri /s/ C. Richard Kramlich C. Richard Kramlich /s/ Charles M. Linehan Charles M. Linehan /s/ Edward Mathers Edward Mathers /s/ David M. Mott David M. Mott /s/ John M. Nehra John M. Nehra /s/ Charles W. Newhall III Charles W. Newhall III /s/ Jason R. Nunn Jason R. Nunn /s/ Mark W. Perry Mark W. Perry /s/Jon Sakoda Jon Sakoda /s/ Scott D. Sandell Scott D. Sandell /s/ Peter W. Sonsini Peter W. Sonsini CUSIP No. 45773Y105 13G Page25of 25 /s/ A. Brooke Seawell A. Brooke Seawell /s/ Eugene A. Trainor III Eugene A. Trainor III /s/ Ravi Viswanathan Ravi Viswanathan /s/ Paul E. Walker Paul E. Walker /s/ Harry Weller Harry Weller

Exhibit 10.4 TEXT MARKED BY [* * *] HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND WAS FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. EXECUTION VERSION ASSET PURCHASE AGREEMENT by and between OREXO AB and GALENA BIOPHARMA, INC. March 15, 2013 TABLE OF CONTENTS        Page   ARTICLE I   DEFINITIONS      1    Section 1.01.   Definitions      1    Section 1.02.   Interpretation      7    ARTICLE II   PURCHASE AND SALE OF ACQUIRED ASSETS      8    Section 2.01.   Purchase and Sale      8    Section 2.02.   Assumed Liabilities      10    Section 2.03.   Consents of Third Parties      10    Section 2.04.   First Right to Future Fentanyl Product      11    ARTICLE III   CLOSING      12    Section 3.01.   Closing      12    Section 3.02.   Purchase Price      13    Section 3.03.   Withholding      14    ARTICLE IV   CONDITIONS TO CLOSING      14    Section 4.01.   Conditions to Obligations of Purchaser      14    Section 4.02.   Conditions to Obligation of Seller      15    Section 4.03.   Frustration of Closing Conditions      16    ARTICLE V        16    Section 5.01.   Authority      16    Section 5.02.   No Conflicts; Consents      16    Section 5.03.   Acquired Assets      17    Section 5.04.   Product Liability      17    Section 5.05.   Intellectual Property      17    Section 5.06.   Transferred Contracts      18    Section 5.07.   Litigation      18    Section 5.08.   Brokers or Finders      19    ARTICLE VI   COVENANTS OF SELLER      19    Section 6.01.   Access      19    Section 6.02.   Other Covenants      19    Section 6.03.   Exclusive Dealing      19      i Section 6.04.   Competing Products      20    Section 6.05.   Financial Accounting Information      20    Section 6.06.   Payment of Indebtedness      20    ARTICLE VII        21    Section 7.01.   Authority      21    Section 7.02.   No Conflicts; Consents      21    Section 7.03.   Litigation      22    Section 7.04.   Availability of Funds      22    Section 7.05.   Brokers or Finders      22    ARTICLE VIII   COVENANTS OF PURCHASER      22    Section 8.01.   Advise Seller      22    Section 8.02.   Access to Information      23    Section 8.03.   Records      23    Section 8.04.   Efforts      23    Section 8.05.   DISCLAIMER      25    ARTICLE IX   MUTUAL COVENANTS      26    Section 9.01.   Efforts      26    Section 9.02.   Transfer Agreement      27    Section 9.03.   Bulk Transfer Laws      27    Section 9.04.   Transfer Taxes      27    Section 9.05.   Purchase Price Allocation      27    Section 9.06.   Recordation of Transferred Intellectual Property      27    Section 9.07.   Confidentiality and Confidential Information      28    ARTICLE X   INDEMNIFICATION      29    Section 10.01.   Indemnification by Seller      29    Section 10.02.   Indemnification by Purchaser      29    Section 10.03.   Indemnification Procedure      30    Section 10.04.   Procedures Related to Indemnification for Other Claims      31    Section 10.05.   Losses Net of Insurance, Tax Benefits      31    Section 10.06.   Limitation on Indemnification      31    Section 10.07.   Termination of Indemnification      32    Section 10.08.   Tax Treatment of Indemnification Payments      32    Section 10.09.   No Setoff      33      ii Section 10.10.   No Double Recovery      33    ARTICLE XI   TERMINATION      33    Section 11.01.   Termination      33    Section 11.02.   Return of Confidential Information      33    Section 11.03.   Effect of Termination      34    ARTICLE XII   MISCELLANEOUS      34    Section 12.01.   Assignment      34    Section 12.02.   Non-Waiver      34    Section 12.03.        34    Section 12.04.   Severability      35    Section 12.05.   Entire Agreement; Amendments      35    Section 12.06.   Notices      35    Section 12.07.   Public Announcements      36    Section 12.08.   Governing Law      36    Section 12.09.   Dispute Resolution      36    Section 12.10.   Expenses      37    Section 12.11.   Relationship of the Parties      37    Section 12.12.   Counterparts      37      iii Exhibits   Exhibit A    -    Transfer Agreement Exhibit 1.01(ii)    -    Seller’s Knowledge Individuals Exhibit 2.01(a)(i)(A)    -    Transferred Marks Exhibit 2.01(a)(i)(B)    -    Transferred Copyrights Exhibit 2.01(a)(ii)    -    Transferred Contracts Exhibit 3.01(b)(ii)    -    Form of Bill of Sale Exhibit 3.01(b)(iii)    -    Form of Assignment and Assumption Agreement Exhibit 3.01(b)(iv)    -    Form of Trademark Assignment Agreement Exhibit 3.01(b)(v)    -    Form of License Agreement Schedules       Schedule 5.02(a)    -    Third Party Consents Schedule 5.02(b)    -    Governmental or Regulatory Approvals Schedule 5.03    -    Acquired Assets Schedule 5.05    -    Intellectual Property Schedule 5.06    -    Transferred Contracts Schedule 5.07    -    Litigation   iv ASSET PURCHASE AGREEMENT THIS ASSET PURCHASE AGREEMENT (this “Agreement”), dated as of March 15, 2013, is made by and between Orexo AB, a public limited company organized and existing under the laws of Sweden (“Seller”), and Galena Biopharma, Inc., a Delaware corporation (“Purchaser”). Seller and Purchaser are sometimes individually referred to herein as a “Party” and are sometimes collectively referred to herein as the “Parties”. Capitalized terms not otherwise defined in the text of this Agreement shall have the meanings set forth in ARTICLE I of this Agreement. WHEREAS, Seller is the owner of certain patents and know-how relating to its proprietary product for pain treatment marketed as Abstral™ in the United States that contains fentanyl as its sole active ingredient and is approved under the Product NDA, including all dosage strengths thereof (the “Product”); WHEREAS, Seller is a party to that certain Termination and Asset Transfer Agreement for Abstral in the United States of America by and between Seller and Strakan International SARL (“Strakan”) dated as of June 1, 2012 (the “Termination Agreement”), as amended on November 1, 2012, and attached hereto as Exhibit A (the “First Amendment,” and together with the Termination Agreement, the “Transfer Agreement”); WHEREAS, pursuant to the terms of the Transfer Agreement Strakan is obligated to transfer and license to Seller certain assets relating to the Product (collectively, the “Strakan Assets”); WHEREAS, Seller desires to sell, and Purchaser desires to purchase from Seller, certain assets of Seller (including the Transfer Agreement) relating exclusively to the Product in the Territory, upon the terms and subject to the conditions set forth in this Agreement; and WHEREAS, in connection with such sale, the Parties desire to enter into the License Agreement (as defined below) whereby certain intellectual property rights of Seller related to the Product will be licensed to Purchaser. NOW, THEREFORE, in consideration of the mutual covenants herein set forth, and intending to be legally bound hereby, the Parties hereby agree as follows: ARTICLE I DEFINITIONS Section 1.01. Definitions. (a) For purposes of this Agreement, the following terms shall have the corresponding meanings set forth below: “Acquisition” means the consummation of the transactions contemplated by this Agreement and the Ancillary Agreement. “Affiliate” means, with respect to any specified Person, any other Person common control with such specified Person; and for the purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or correlative to the foregoing. For the avoidance of doubt, Strakan is not, and shall not be considered an “Affiliate” of Seller for any purpose pursuant to this Agreement or any Ancillary Agreement. “Ancillary Agreement” means individually and collectively, each of the Confidentiality Agreement and the Other Acquisition Documents (as and when executed and delivered). “Average Field Force” means, for any month or calendar quarter, the simple average number of Field Personnel in the Field Force each day of such month or calendar quarter, as applicable, which shall be the quotient determined by dividing (i) the sum of the number of Field Personnel in the Field Force on each day of such month or calendar quarter by (ii) the number of days in such month or calendar quarter, as applicable. “Business Day” means a day other than Saturday or Sunday or a day on which banks are required or authorized to close in the State of New York. “Closing Consideration” means ten million dollars ($10,000,000). “Code” means the United States Internal Revenue Code of 1986, as amended. “Competing Product” means any fast-acting formulation of fentanyl with fentanyl as its sole active ingredient. “Confidentiality Agreement” means that certain letter agreement, dated October 25, 2012, between Seller and Purchaser. “Confidential Information” means all information provided by one Party to the other Party in connection with this Agreement, including know-how, scientific information, pre-clinical and clinical data, adverse event information, formulas, methods and processes, pricing information (including discounts, rebates and other price adjustments) and other terms and conditions of sales, customer information, business plans, and all other intellectual property which is not publicly available and is owned or controlled by a Party. “Contracts” means all leases, subleases, indentures, licenses, agreements, contracts, commitments and all other legally binding arrangements, whether written or oral. “Deferred Consideration” means five million dollars ($5,000,000).   2 “Detail” means an interactive face-to-face visit by Field Personnel with a medical professional having prescribing authority or who is able to influence prescribing and purchasing decisions, including pharmacists, pharmacy benefits managers, contracting agents, and payors within the target audience, during which approved uses, safety, effectiveness, contraindications, side effects, warnings and/or other relevant characteristics of a pharmaceutical product are discussed in an effort to increase prescribing preferences and purchases of a pharmaceutical product for its approved uses. “Detailing” means the act of performing Details. “Dollars” and “$” mean lawful money of the United States of America. “FDA” means the United States Food and Drug Administration. “Field Personnel” means full-time employees of Purchaser and independent contractors engaged by Purchaser on a [***] basis who (x) are [***]; (y) spend [***] of their time as a [***]; and (z) [***]. consistently applied. “Governmental or Regulatory Authority” means any court, tribunal, arbitrator, agency, commission, official or other instrumentality of any country, federal, state, county, city or other political subdivision, foreign or domestic, including without limitation the FDA and any other governmental instrumentality with responsibility for granting any licenses, registrations or regulatory approvals. “Law” means all laws, statutes, rules, regulations, ordinances and other pronouncements or orders having the effect of law of any Governmental or Regulatory Authority. “Liabilities” means any and all assessments, losses, damages (compensatory, punitive or other), liabilities, obligations, commitments, reimbursements, costs and expenses of any kind or nature, actual, contingent, present or future. “Licensed Intellectual Property” has the meaning defined in the License Agreement. “Liens” means liens, claims, encumbrances, security interests, options or charges. “Material Adverse Effect” means any event that has a material, adverse effect on the manufacture, distribution, marketing or sale by or on behalf of the Purchaser of the Product in the Territory as contemplated by this Agreement and the Ancillary Agreements, but excluding the events or effects of: (i) changes to the pharmaceutical industry and markets in which Purchaser or Seller operate, to the extent such changes do not have a disproportionately adverse effect on the Intended Use of the Product in the Territory; (ii) changes in the United States or world financial markets in general; (iii) changes arising in connection with earthquakes, hostilities, acts of war, sabotage or terrorism or military actions or any escalation or material worsening of any such hostilities, acts of war, sabotage or terrorism or military actions existing or underway as of the date hereof; (iv) any action taken by Purchaser or its Affiliates with respect to the transactions contemplated hereby or with respect to the Product or the Intended   3 Use of the Product in the Territory; (v) any matter of which Purchaser is aware on the date hereof; or (vi) any effect resulting from the public announcement of this Agreement, compliance with terms of this Agreement or the consummation of “NDA” means a New Drug Application or supplemental New Drug Application, as defined in the United States Federal Food, Drug and Cosmetic Act. “Net Sales” means, for any period, the aggregate of the gross amounts invoiced or otherwise billed, charged or received by a Selling Person for the arms’ length sale or other commercial disposition to non-Affiliates of such Selling Person of a Product, less the following deductions to the extent specifically related to the Product and actually allowed, incurred or paid during such period: (i) reasonable cash discounts, returns, allowances, rebates, or chargebacks; (ii) sales, value-added, excise taxes, tariffs and duties, and other taxes directly related to the sale (but excluding income or net profit taxes or franchise taxes of any kind); and (iii) amounts allowed or credited on returns, provided that all of the foregoing deductions are incurred in the ordinary course and calculated in accordance with GAAP during the applicable calculation period throughout the Selling Person’s organization. All such discounts, allowances, credits, rebates and other deductions shall be fairly and equitably allocated to the Product and other products or services of a Selling Person, such that the Product does not bear a disproportionate portion of such deductions. Any disposal of the Product at no charge for, or use without charge in, clinical or preclinical trials (but excluding post-approval clinical trials for which compensation is received by the Selling Person), given as free samples, or distributed at no charge to patients unable to purchase the same shall not be included in Net Sales, in each case, except to the extent that a Selling Person has received any consideration for such Product. For sake of clarity and avoidance of doubt, the transfer of Product by a Selling Person or one of its Affiliates to another Affiliate of such Selling Person or to a sublicensee of such Selling Person for resale shall not be considered a sale; in such cases, Net Sales shall be determined based on the amount invoiced or otherwise billed by such Affiliate or sublicensee to an independent Third Party, less the Net Sales deductions allowed under this definition. In the case of any sale of a Product for value other than in an arm’s length transaction exclusively for cash, such as barter or counter-trade, Net Sales shall be calculated based on the fair market value of the non-cash consideration received in connection with such sale and based on the full list price for non-arm’s length transactions. If a Product is sold together with another product and not separately invoiced or billed, the Parties shall agree upon the appropriate allocation of the amount received in consideration for the Product, which allocation shall reflect the fair market value of the Product and the other product. “Other Acquisition Documents” means (i) the Bill of Sale, (ii) the Assignment and Assumption Agreement, (iii) the License Agreement, and (iv) the Trademark Assignment Agreement. “Permitted Liens” means all (i) mechanics’, carriers’, workmen’s, repairmen’s, warehousemen’s or other like Liens arising or incurred in the ordinary course of business and Liens for Taxes and other governmental charges which are not yet due and payable; (ii) Liens in   4 favor of Purchaser or its Affiliates; and (iii) other imperfections of title or encumbrances, if any, which do not, individually or in the aggregate, materially impair the value or continued use and operation of the assets to which they relate. pool, syndicate, sole proprietorship, unincorporated organization, Governmental or Regulatory Authority, or any other form of legal entity not specifically listed herein. “Product NDA” means NDA No. 22-510 relating to the Product in the Territory. “Product Patents” means each of (i) the United States Patent Number 6,761,910, (ii) United States Patent Number 6,759,059, and (iii) United States Patent Number 7,910,132, including any divisions, continuations, reissues and reexaminations thereof in the Territory. “Seller Liability Cap” means an amount equal to $[*******]. “Seller’s Knowledge” means the actual knowledge, without investigation, of any of the individuals employed by Seller as of the date hereof with the titles set forth in Exhibit 1.01(ii). “Selling Person” means the Purchaser, each of its Affiliates and each (A) licensee, sublicensee, assignee or other grantee of rights from Purchaser or any of its Affiliates or another Selling Person to develop, market or sell the Product, (B) buyer, transferee or assignee of any Transferred Intellectual Property or Licensed Intellectual Property from Purchaser or its Affiliates or another Selling Person, or (C) any Affiliate of the foregoing. “Subsidiary” means an entity as to which Seller or Purchaser or any other relevant entity, as the case may be, owns directly or indirectly 50% or more of the voting power or other similar interests. Any Person which comes within this definition as of the date of this Agreement but thereafter fails to meet such definition shall from and after such time not be deemed to be a Subsidiary of Seller or Purchaser or any other relevant entity, as the case may be. Similarly, any Person which does not come within such definition as of the date of this Agreement but which thereafter meets such definition shall from and after such time be deemed to be a Subsidiary of Seller or Purchaser or any other relevant entity, as the case may be. “Tax” or “Taxes” means all federal, state, local and foreign income, payroll, withholding, excise, value added, sales, use, personal property, use and occupancy, business and occupation, mercantile, real estate, gross receipts, license, employment, severance, stamp, premium, windfall profits, social security (or unemployment), disability, transfer, registration, alternative or add-on minimum, estimated or capital stock and franchise and other taxes and assessments of any kind whatsoever, including all interest, penalties and additions imposed with respect to such amounts, whether disputed or not. “Taxing Authority” means any Governmental or Regulatory Authority exercising any authority to impose, regulate or administer the imposition of Taxes.   5 “Tax Return” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof. “Territory” means the United States of America including its territories and possessions. “Third Party” means any Person other than: (1) Purchaser or Seller, and (2) any Affiliates of Purchaser or Seller. “Trailing Four Quarter Net Sales” shall mean the Net Sales during any consecutive four calendar quarter period. “VAT” means any value added tax, goods and services tax or any other similar tax, including any sales tax, service tax, or use tax imposed by any Governmental or Regulatory Authority in any country at whatever level. (b) The following terms have the meanings given to such terms in the Sections set forth below:   Term    Section Acquired Assets    2.01(a) Acquisition Proposal    6.07 Additional Assumption Documents    3.01(b)(vi) Additional Transfer Documents    3.01(c)(v) Agreement    Preamble Allocation    9.05(a) Assignment and Assumption Agreement    3.01(b)(iii) Assumed Liabilities    2.02(a) Bill of Sale    3.01(b)(ii) Call Option    8.04(b)(iv) Called Assets    8.04(b)(iv) Claim Dispute Notice    10.04 Closing    3.01(a) Closing Date    3.01(a) Compliance Report    8.04(b)(iii) Direct Claim Notice    10.04 Excluded Assets    2.01(b) Excluded Liabilities    2.02(b) Exercise Notice    8.04(b)(iv) FDA Permits    2.01(a)(ii) Field Force    8.04(b)(i) Field Force Floor    8.04(b)(iv) First Amendment    Recitals First Position    8.04(b)(i)   6 Term    Section Future Fentanyl Product    2.04 Indemnitee    10.03(a) Indemnitor    10.03(a)(i) Independent Auditor    8.03 Intended Use    2.01(a)(a)(A) License Agreement    3.01(b)(v) Losses    10.01 Marketing Period    8.04(b)(ii) Negotiation Notice    2.04 Notice Period    2.04 Option Period    8.04(b)(iv) Party or Parties    Preamble Payment Period    3.02(b) Permits    2.01(a)(iii) Product    Recitals Product Inventory    2.01(a)(vi) Product Royalties    3.02(d) Purchase Price    3.02(a) Purchaser    Preamble Purchaser Indemnitees    10.01 Quarterly Report    3.02(e) Royalty Period    3.02(d) Sales Milestones    3.02(c) Seller    Preamble Seller Indemnitees    10.02 State Permits    2.01(a)(iii) Strakan    Recitals Strakan Assets    Recitals Termination Agreement    Recitals Third Party Claim    10.03(a) Trademark Assignment Agreement    3.01(b)(iv) Transfer Agreement    Recitals Transfer Taxes    9.04 Transferred Contracts    2.01(a)(ii) Transferred Copyrights    2.01(a)(i)(B) Transferred FDA Permits    2.01(a)(ii) Transferred Intellectual Property    2.01(a)(i) Transferred Marks    2.01(a)(i)(A) Transferred State Permits    2.01(a)(  ) Section 1.02. Interpretation. The definitions of the terms herein shall apply context may require, any   7 pronoun shall include the corresponding masculine, feminine and neuter forms. the same meaning and effect as the word “shall”. Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or or modifications set forth therein); (ii) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof; (iii) the word “extent” in the phrase “to the extent” means the degree to which a subject or other thing extends and such phrase does not mean simply “if”; (iv) all references herein to Articles, Sections, Exhibits or Schedules shall be construed to refer to Articles, Sections, Exhibits and Schedules of this Agreement; and (v) the headings contained in this Agreement or any Exhibit or Schedule and in the table of contents to this Agreement are for reference this Agreement. Any matter set forth in any provision, subprovision, section or subsection of the Schedules to this Agreement shall be deemed set forth for all purposes of the Schedules hereto to the extent reasonably apparent that such matter is relevant to another provision, subprovision, section or subsection of the Schedules hereto. All Schedules attached hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any capitalized terms used in the Exhibits and Schedules attached hereto but not otherwise defined therein, shall have the meaning as defined in this Agreement. In the event of an ambiguity or a question of intent or interpretation, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring either Party by virtue of the authorship of any provisions of this Agreement. ARTICLE II Section 2.01. Purchase and Sale. the Closing, Seller shall, or shall cause its Subsidiaries to, sell, assign, transfer, convey and deliver to Purchaser, and Purchaser shall purchase from Seller, free and clear of all Liens, all right, title and interest of Seller and its Subsidiaries in, to and under the following assets, properties and rights of Seller and its Subsidiaries (collectively, the “Acquired Assets”): (i) the following (collectively, the “Transferred Intellectual Property”): (A) all marks (whether registered or not), trademark registrations, trademark applications, service mark registrations, service mark applications and domain name registrations of Seller and its Subsidiaries, exclusively used, or held for use, in the distribution, marketing, sale, and manufacture (the “Intended Use”) of the Product in the Territory, which are set forth on Exhibit 2.01(a)(i)(A), together with all extensions and renewals thereof (the “Transferred Marks”); and   8 (B) all copyrights (whether registered or not) and copyright registrations of Seller and its Subsidiaries exclusively related to the Intended Use of the Product in the Territory, which are set forth on Exhibit 2.01(a)(i)(B), together with all extensions and renewals thereof (the “Transferred Copyrights”); (ii) all governmental, regulatory filings, correspondence, submissions, marketing authorizations, permits, licenses, registrations (including product registration data), regulatory clearances, certificates, approvals, variances, consents and similar items of Seller and its Subsidiaries with the FDA exclusively related to the Intended Use of the Product in the Territory (the “FDA Permits”), including those related to marketing, pricing or reimbursement approval, set forth on Exhibit 2.01(a)(ii) (such listed FDA Permits, the “Transferred FDA Permits”); (iii) to the extent transferrable, all state governmental and federal governmental (other than the FDA Permits), regulatory filings, correspondence, submissions, marketing authorizations, permits, licenses, registrations (including product registration data), regulatory clearances, certificates, approvals, variances, consents and similar items of Seller and its Subsidiaries exclusively related to the Intended Use of the Product in the Territory (“State approval, set forth on Exhibit 2.01(a)(iii) (such listed State Permits, the “Transferred State Permits” and, together with the Transferred FDA Permits, the “Permits”). (iv) the Contracts set forth on Exhibit 2.01(a)(iv) (the “Transferred Contracts”) and all rights and claims of Seller arising under or with respect to the Transferred Contracts; (v) all books and records prepared and maintained by Seller and its Subsidiaries as of the Closing Date that relate exclusively to Intended Use of the Product in the Territory (excluding any records prepared exclusively in connection with the transactions contemplated by this Agreement, including bids received from Third Parties and related analyses); (vi) all inventory of the Product owned by the Seller or its Subsidiaries, including but not limited to, the existing finished quantities, work in process, raw materials, constituent substances, materials (including but not limited to, packaging materials and other collateral), stores and supplies, as well as any trade, sample or prototype inventories owned by Seller and its Subsidiaries of the Product in the Territory (the “Product Inventory”). (vii) any “Asset” (as such term is defined in the Transfer Agreement) exclusively relating to the Product in the Territory transferred to Seller or any of its Subsidiaries on or prior to the Closing;   9 (viii) copies of (A) all current marketing and sales assets that relate solely to the Intended Use of the Product in the Territory and (B) all books, ledgers, files, reports, data, plans and records that relate exclusively to the Intended Use of the Product in the Territory; (ix) all claims, causes of action or other rights of the Seller, if any, arising out of any of the Acquired Assets arising before, on or after the Closing Date; and (x) any goodwill associated with the Acquired Assets. (b) Purchaser is not purchasing or acquiring, and Seller is not selling or assigning, any assets or properties of Seller or any of its Affiliates that are not specifically listed above, and all such other assets and properties shall be excluded from the Acquired Assets (the “Excluded Assets”). Section 2.02. Assumed Liabilities. (a) Subject to the conditions of this Agreement, Purchaser shall assume, effective as of the Closing, and from and after the Closing, Purchaser shall pay, perform and discharge when due, in accordance with the Assumption Agreement, all Liabilities of Seller arising under or related to the Acquired Assets (whether such Liability arose from any events, circumstances, acts, or omissions existing or occurring prior to or after the Closing) (collectively, and subject to the exclusions in the following subclauses (i) and (ii), the “Assumed Liabilities”), excluding (i) any Liabilities of Seller for monies due but not yet payable as of the Closing Date under any Transferred Contract, and (ii) any Liabilities resulting from (1) any breach or violation of any Transferred Contract by Seller occurring prior to the Closing or (2) any act or omission of Seller prior to the Closing that would have constituted a breach or violation upon notice or passage of time under any Transferred Contract. (b) Purchaser shall not assume and shall not be responsible to pay, perform or discharge any Liabilities described in subclauses 2.02(a)(i) and (ii) or any other Liabilities of Seller or its Affiliates other than the Assumed Liabilities (the “Excluded Liabilities”). (c) Each of Purchaser’s and Seller’s obligations under this Section 2.02 will not be subject to offset or reduction by reason of any actual or alleged breach of any representation, warranty, covenant or agreement contained in this Agreement, any Ancillary Agreement or any right or alleged right to indemnification hereunder. Section 2.03. Consents of Third Parties. (a) Notwithstanding anything in this Agreement to the contrary, this Agreement shall not constitute an agreement to assign any asset (including any Contract) or any claim, right or benefit arising under or resulting from any such asset (including any Contract), if the assignment or transfer thereof, without the consent of a Third Party, would constitute a breach or other contravention of the rights of such Third Party, would be ineffective with respect to any party to an agreement concerning such asset (including any Contract), claim, right or benefit, or, upon assignment or transfer, would in any way adversely affect the rights of Seller or any of its Affiliates or, upon transfer, Purchaser. If any transfer or assignment by Seller to, or   10 any assumption by Purchaser of, any interest in, or liability, obligation or commitment under, any asset (including any Contract), or any claim, right or benefit requires the consent of a Third Party, then such transfer or assumption shall be made subject to such consent being obtained. (b) If any such consent is not obtained prior to the Closing, (i) Seller shall use commercially reasonable efforts following the Closing to obtain such consents, and (ii) Seller and Purchaser shall cooperate (each at their own expense) in any lawful and reasonable arrangement reasonably proposed by Purchaser under which Purchaser shall obtain the economic claims, rights and benefits under the asset (including any Contract) or related claim, right or benefit with respect to which the consent has not been obtained in accordance with this Agreement. Such reasonable arrangement may include (i) the subcontracting, sublicensing or subleasing to Purchaser of any and all rights of Seller against the other party to such Contract arising out of a breach or cancellation thereof by the other party, and (ii) the enforcement by Seller of such rights. None of Seller, Purchaser or their respective Affiliates shall be required to commence, defend or participate in any litigation, incur any obligation in favor of, or offer or grant any accommodation (financial or otherwise) to, any Third Party in connection with entering into or implementing such arrangement unless Purchaser agrees to reimburse Seller for any related costs with respect to such litigation or accommodation. Section 2.04. First Right to Future Fentanyl Product. During the Royalty Period, if Seller seeks to sell, license or sublicense to any Third Party the intellectual property primarily related to the use, distribution, marketing, sale, offer for sale and import in the Territory any new pharmaceutical product containing a rapid-acting formulation of fentanyl as an active ingredient (either as the sole active ingredient or in combination with one or more other active ingredients) having the same clinical utility as the Product owned or licensed by Seller or its Subsidiaries (“Future Fentanyl Products”), Seller shall give Purchaser the first right to negotiate an asset purchase or exclusive license or sublicense to such intellectual property solely in the Territory and shall notify Purchaser of the availability of such intellectual property before offering such Future Fentanyl Product to any Third Party for sale, license or sublicense to other companies in the Territory. Purchaser shall notify Seller in writing (the “Negotiation Notice”) within thirty (30) days thereafter (the “Notice Period”) if Purchaser is interested in acquiring or licensing or sublicensing such intellectual property, and, if so, Purchaser and Seller will enter into good faith negotiation with respect to a mutually acceptable agreement for the sale or license or sublicense of the same to Purchaser. If (i) Purchaser does not deliver to Seller a Negotiation Notice within the Notice Period, or (ii) Seller and Purchaser fail to reach a mutually acceptable agreement within sixty (60) days following receipt by Seller of a Negotiation Notice delivered within such Notice Period, and such forty-five-day period is not extended by mutual agreement, then Seller shall be entitled to offer, sell, license or sublicense such intellectual property without obligation to Purchaser under this Agreement or otherwise.   11 ARTICLE III CLOSING Section 3.01. Closing. (a) The closing of the Acquisition (the “Closing”) shall be held at the offices of Dechert LLP, 1095 Avenue of the Americas, New York, NY 10036, or remotely by exchange of electronic copies of the agreements, documents, certificates and other instruments set forth in Section 3.01(b) and Section 3.01(c) if mutually agreed by the Parties, at 10:00 a.m. on the date which is three (3) Business Days after the conditions to the Closing set forth in Section 4.01 and Section 4.02 shall have been satisfied or waived (other than those conditions which by their nature are to be fulfilled at the Closing, but subject to the fulfillment or waiver of such conditions). The date on which the Closing shall occur is hereinafter referred to as the “Closing Date”. The Closing shall be deemed to be effective as of 12:00:01 a.m. eastern standard time on the Closing Date. (b) At the Closing, Purchaser shall deliver or cause to be delivered to Seller: (i) an amount equal to the Closing Consideration by wire transfer of immediately available funds denominated in Dollars to a bank account designated in writing (ii) an executed counterpart of the Bill of Sale, in the form attached hereto as Exhibit 3.01(b)(ii) (the “Bill of Sale”); (iii) an executed counterpart of the Assumption Agreement, in the form attached hereto as Exhibit 3.01(b)(iii) (the “Assignment and Assumption Agreement”); (iv) an executed counterpart of the Trademark Assignment Agreement, in the form attached hereto as Exhibit 3.01(b)(iv) (the “Trademark Assignment Agreement”); (v) an executed counterpart of the License Agreement, in the form attached hereto as Exhibit 3.01(b)(v) (the “License Agreement”); (vi) such other executed instruments of transfer, conveyance, assignment, and assumption as the Seller may reasonably request in order to effect the sale, transfer, conveyance and assignment to the Purchaser of all obligations, liabilities, right, title and interest in and to the Assumed Liabilities (the “Additional Assumption Documents”); and (vii) a certificate, dated as of the Closing Date, executed by an authorized officer of Purchaser, in his or her capacity as such, confirming the satisfaction of the conditions specified in Section 4.01(b) and Section 4.01(c).   12 (c) At the Closing, Seller shall deliver or cause to be delivered to Purchaser: (i) an executed counterpart of the Bill of Sale; (ii) an executed counterpart of the Assignment and Assumption Agreement; (iii) an executed counterpart of the Trademark Assignment Agreement; (iv) an executed counterpart of the License Agreement; (v) such other executed instruments of transfer, conveyance and assignment as the Purchaser may reasonably request in order to effect the sale, transfer, conveyance and assignment to the Purchaser of all right, title and interest in and to the Acquired Assets (the “Additional Transfer Documents”); and (vi) a certificate, dated as of the Closing Date, executed by an authorized officer of Seller, in his or her capacity as such, confirming the satisfaction of the conditions specified in Section 4.02(b) and Section 4.02(c). Section 3.02. Purchase Price. (a) The aggregate consideration (the “Purchase Price”) for the Acquired Assets includes the assumption of the Assumed Liabilities: (i) the Closing Consideration; (ii) the Deferred Consideration; (iii) the Sales Milestones; and (iv) the Product Royalty. (b) Purchaser shall pay to Seller the Deferred Consideration within 30 days (the “Payment Period”) of the earlier of (i) the approval by the FDA of [***] as a manufacturer with respect to the Product and (ii) the first anniversary of the Closing Date; provided, however, that if a CBE-30 notification with respect to the Product is not filed with the FDA on or before May 1, 2013, then the Payment Period shall be increased by the number of days between May 1, 2013 and the date such CBE-30 notification is filed. (c) Purchaser shall pay to Seller each of the following one-time only, non-refundable, non-creditable sales milestones (the “Sales Milestones”) within thirty (30) days after the end of the first calendar quarter, if any, in which each Trailing Four Quarter Net Sales dollar values set forth below is achieved, in each case, by wire transfer in immediately available funds to an account or accounts designated in writing by Seller at least two (2) Business Days prior to the time for such payment; provided, that, two or more Sales Milestones may become payable in the same calendar quarter.   13 Trailing Four Quarter Net Sales:     Sales Milestone:   $ [*** ]    $ [*** ]  $ [*** ]    $ [*** ]  $ [*** ]    $ (d) Purchaser shall pay to Seller an amount in dollars equal to [***]% of the Net Sales (the “Product Royalties”) each calendar quarter (or portion of such calendar quarter) commencing on the Closing Date and ending on the date on which all claims of the last remaining Product Patents shall have expired or been invalidated by a patent office, court or other governmental agency of competent jurisdiction in a final and non-appealable judgment (or judgment from which no appeal was taken within the allowable time period), taking into account any extensions granted thereto (such period, the “Royalty Period”). Purchaser shall pay the Product Royalties to Seller in arrears not later than thirty (30) days following the end of each calendar quarter during the Royalty Period. (e) Concurrently with each Product Royalties payment with respect to a calendar quarter, Purchaser shall deliver to Seller a written report with respect to such quarter (the “Quarterly Report”) that sets forth each of the following information for each month in such quarter and in the aggregate: (a) the gross sales and number of units sold of the Product in the Territory during such calendar quarter and each month in such calendar quarter, (b) the “gross to net” adjustments with respect to the calculation of Net Sales for such calendar quarter and each month in such calendar quarter, (c) the Net Sales during such calendar quarter and each month in such calendar quarter, (d) a calculation of the Product Royalties due to Seller for such calendar quarter, and (e) the Trailing Four Quarter Net Sales for the consecutive four calendar quarter period ending during such calendar quarter. Section 3.03. Withholding. Purchaser covenants and agrees that it will not be subjecting any payments due to the Seller under this Agreement or any Ancillary Agreement to US Federal (or other) withholding (or other) Taxes, provided that with respect to the Product Royalties, the Seller shall deliver to Purchaser an executed copy of IRS Form W-8 prior to the payment of such Product Royalty certifying under penalties of perjury that Seller is a resident of Sweden, within the meaning of the US-Sweden Income Tax Treaty, eligible for benefits under such treaty. The parties to this Agreement will take all actions consistent with the foregoing. ARTICLE IV CONDITIONS TO CLOSING Section 4.01. Conditions to Obligations of Purchaser. The obligation of Purchaser to effect the closing of the Acquisition is subject to the satisfaction (or written waiver by Purchaser) as of the Closing of the following conditions: (a) No Injunctions or Restraints. No Law, temporary restraining order, preliminary or permanent injunction or other order enacted, entered, promulgated, enforced or   14 issued by any Governmental or Regulatory Authority or other legal restraint or prohibition by a Governmental or Regulatory Authority shall be pending or in effect seeking to prevent or preventing the Acquisition. (b) Accuracy of Representations and Warranties. All of the representations and warranties made by Seller in ARTICLE V that are qualified by any reference to any materiality qualifications shall each be true and correct as of the Closing Date as though such representations and warranties were made at such date (except that any representations and warranties that are made only as of a specified date shall be true and correct only as of such date), and all other representations and warranties made by the Seller shall each be true and correct in all material respects as of the Closing Date as though such representations and warranties were made at such date (except that any representations and warranties that are made only as of a specified date shall be true and correct only as of such date). (c) Performance of Covenants. The covenants and obligations that Seller is required to perform or comply with under this Agreement on or before the Closing Date shall have been duly performed and complied with by Seller in all material respects. (d) Deliverables. Purchaser shall have received each of the items set forth in Section 3.01(c). (e) No Material Adverse Effect. No Material Adverse Effect shall have occurred and be continuing. (f) No Recalls. No Governmental or Regulatory Authority shall have initiated a generally recall of the Product in the Territory (g) Required Approvals. All authorizations, consents and approvals of any Governmental or Regulatory Authority set forth on Schedule 4.01(g) shall have been obtained and shall be in full force and effect. Section 4.02. Conditions to Obligation of Seller. The obligation of Seller to, and to cause its Affiliates to, effect the closing of the Acquisition is subject to the satisfaction (or written waiver by Seller) as of the Closing of the following conditions: promulgated, enforced or issued by any Governmental or Regulatory Authority or other legal restraint or prohibition by a Governmental or Regulatory Authority shall be pending or in effect seeking to prevent or preventing the Acquisition. warranties made by Purchaser in ARTICLE VII that are qualified by any materiality qualifications shall each be true and correct as of the Closing Date as though such representations and warranties were made at such date (except that any representations and warranties that are made only as of a specified representations and warranties of the Purchaser shall each be true and correct   15 (c) Performance of Covenants. The covenants and obligations that Purchaser is Date shall have been duly performed and complied with by Purchaser in all material respects. (d) Deliverables. Seller shall have received each of the items set forth in Section 3.01(b). Section 4.03. Frustration of Closing Conditions. Neither Purchaser nor Seller may rely on the failure of any condition set forth in this ARTICLE IV to be satisfied if such failure was caused by such Party’s failure to act in good faith or to comply with its obligations under Section 9.01 or Section 9.01(b) to cause the Closing to occur. ARTICLE V Except as set forth in the Schedules attached hereto, Seller hereby represents and warrants to Purchaser as follows: Section 5.01. Authority. Seller is a public limited company duly organized, validly existing and in good standing under the laws of Sweden. Seller has the requisite power and authority to enter into this Agreement, and Seller has the requisite power and authority to enter into the Ancillary Agreements to which it is, or is specified to be, a party and to consummate the transactions contemplated hereby and thereby. All acts and other proceedings required to be taken by Seller to authorize the execution, delivery and performance of this Agreement and the Ancillary Agreements to which it is, or is specified to be, a party and to consummate the transactions contemplated hereby and thereby have been duly and properly taken. This Agreement has been duly executed and delivered by Seller and, assuming this Agreement has been duly authorized, executed and delivered by Purchaser, constitutes, and the Other Acquisition Documents on the Closing Date will be duly executed and delivered by Seller and upon the due authorization, execution and delivery by each other party to the Other Acquisition Documents will constitute, a legal, valid and binding subject, as to enforcement, to applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting creditors’ rights generally and to general equitable principles. Section 5.02. No Conflicts; Consents. (a) Except as set forth on Schedule 5.02, the execution and delivery of this Agreement by Seller does not, and the execution and delivery by Seller of each other Ancillary Agreement to which it is, or is specified to be, a party will not, and the consummation of the transactions contemplated hereby and thereby and compliance with the terms hereof and thereof will not, conflict with, or acceleration of any obligation, or result in the creation of any Lien upon any of the Acquired Assets under, any   16 provision of (i) Seller’s certificate of incorporation or by-laws (or the comparable governing instruments), (ii) any Contract to which Seller is a party and by which any of Acquired Assets are bound, or (iii) any judgment, order, or decree, or, subject to the matters referred to in Section 5.02(b) below, any Law applicable to Seller or its properties or assets, other than, in the case of clauses (i) and (ii) above, any such items that would not be reasonably likely, individually or in the aggregate, to have a material adverse effect on the ability of Seller to consummate the Acquisition. (b) Except as set forth in Schedule 5.02(b), no consent, approval, license, permit, order or authorization of, or registration, declaration or filing with, any Governmental or Regulatory Authority is required to be obtained or made by or with respect to Seller in connection with the execution, delivery and performance of this Agreement, the Ancillary Agreements or the consummation of the transactions contemplated hereby or thereby, other than such consents, approvals, licenses, permits, orders, authorizations, registrations, declarations and filings the absence of which, or the failure to make which, individually or in the aggregate, (i) would not be reasonably likely to have a material adverse effect on the ability of Seller to consummate the Acquisition or perform its obligations under this Agreement or the Ancillary Agreements, and (ii) would not give rise to any liability of Purchaser as a result of the consummation of the Acquisition. Section 5.03. Acquired Assets. Except as set forth in Schedule 5.03, the Acquired Assets and the Licensed Intellectual Property constitute all of the material assets, rights or property (other than (x) any intellectual property that are licenses for commercial “off-the-shelf” or “shrink-wrap” software, and (y) administrative, finance and other infrastructure and back office information technology systems, networks and software) owned by Seller or its Affiliates and primarily related to the Intended Use of the Product in the Territory. Section 5.04. Product Liability. Neither Seller nor any of its Affiliates nor, to the Seller’s Knowledge, the Product has been subject to any recall initiated or requested by any Governmental or Regulatory Authority with respect to the Product in the Territory. Section 5.05. Intellectual Property. (a) Except as set forth in Schedule 5.05(a), Seller or its Affiliate owns, or as of the Closing Date will own, free and clear of all Liens (except (i) to the extent licensed from Third Parties, (ii) for any Liens in favor of Purchaser or its Affiliates, (iii) for any Liens that will be terminated on or prior to the Closing Date, and (iv) to the extent subject to the Transfer Agreement), the Transferred Intellectual Property, and the consummation of the Acquisition will not conflict with, alter or impair any such rights in any material respect. (b) Except as set forth in Schedule 5.05(b), as of the date hereof, no claims are pending before any court, arbitrator or other tribunal, or before any administrative law judge, hearing officer or administrative agency or, to Seller’s knowledge, threatened in writing, against Seller or any of its Affiliates by any Third Party with respect to the ownership, validity or enforceability of any Transferred Intellectual Property or Licensed Intellectual Property.   17 (c) Except as set forth in Schedule 5.05(c), none of Seller or its Affiliates have granted any options, licenses or agreements relating to the Transferred Intellectual Property or, with respect to the Product in the Territory, relating to the Licensed Intellectual Property, except (i) non-exclusive implied licenses to end-users in the ordinary course of business, (ii) options, licenses or agreements with Purchaser or its Affiliates, (iii) options, licenses or agreements that will be terminated on or prior to the Closing Date, and (iv) Transferred Contracts. Except as set forth in Schedule 5.04(c), as of the date hereof, none of Seller or its Affiliates is bound by or a party to any material options, licenses or agreements of any kind for intellectual property of any Third Party relating to the Product in the Territory, except (i) options, licenses or agreements with Purchaser or its Affiliates, (ii) options, licenses or agreements that will be terminated on or prior to the Closing Date, and (iii) Transferred Contracts. (d) To Seller’s Knowledge, no Third Party is infringing or violating or misappropriating any of the Transferred Intellectual Property or has made any claim of ownership or right to any Transferred Intellectual Property. Seller has neither asserted nor threatened in writing any action or claim against any Third Party involving or relating to any Transferred Intellectual Property. Seller has not received any written request from any Third Party that Seller enter into a license with respect to any Third Party Intellectual Property right in relation to the Product, the Acquired Assets or the Intended Use of the Product in the Territory. (e) To Seller’s Knowledge, the Intended Use of the Product in the Territory does not infringe or violate or constitute a material misappropriation of any intellectual property of any Third Party. Seller has not received any written claim or notice alleging any such infringement, violation or misappropriation. (f) There is no pending or, to Seller’s Knowledge, threatened claim, interference, opposition or demand of any Third Party challenging the ownership, validity or scope of any Transferred Intellectual Property. (g) Seller has not sought or procured a “freedom to operate” opinion or analysis from patent counsel with respect to the Intended Use of the Product in the Territory. Section 5.06. Transferred Contracts. Each Transferred Contract is valid, binding and in full force and effect and, to Seller’s knowledge, is enforceable by Seller in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws affecting creditors’ rights generally, general principles of equity and the discretion of courts in granting equitable remedies. As of the date hereof and as of the Closing Date, Seller has performed in all material respects all material obligations required to be performed by it under the Transferred Contracts and is not (with or without the lapse of time or the giving of notice, or both) in breach or default in any material respect thereunder and, to Seller’s knowledge, as of the date hereof, no other party to any of the Transferred Contracts is (with or without the lapse of time or the giving of notice, or both) in breach or default in any material respect thereunder. Except as set forth in the First Amendment, the Termination Agreement has not been amended in any respect. Section 5.07. Litigation. Except as set forth in Schedule 5.07, as of the date hereof, there are no (a) outstanding judgments, orders, injunctions or decrees of any Governmental or   18 Regulatory Authority or arbitration tribunal against Seller, (b) lawsuits, actions or proceedings pending or, to the knowledge of Seller, threatened against Seller, or (c) investigations by any Governmental or Regulatory Authority which are pending or, to the knowledge of Seller, threatened against Seller, which, in the case of each of clauses (a), (b) and (c), relating to the Intended Use of the Product in the Territory and have had or would be reasonably likely to have a Material Adverse Effect or a material adverse effect on the ability of Seller to consummate the Acquisition and the other transaction contemplated by this Agreement and the Ancillary Agreements. Section 5.08. Brokers or Finders. No agent, broker, investment banker or other firm or Person is or will be entitled to any broker’s or finder’s fee or any other commission or similar fee in connection with any of the transactions contemplated by this Agreement or the Ancillary Agreements based upon arrangement made by or on behalf of Seller or any of its Affiliates for which Purchaser will have any Liability. ARTICLE VI COVENANTS OF SELLER Seller hereby covenants and agrees as follows: Section 6.01. Access. From the date hereof until the Closing, Seller shall give Purchaser and its representatives, employees, counsel and accountants reasonable access, during normal business hours and upon reasonable advance notice, to the Acquired Assets for purposes of conducting due diligence or otherwise in connection with the transactions contemplated hereby; provided, however, that such access (i) does not unreasonably disrupt the normal operations of Seller, (ii) would not reasonably be expected to violate any attorney-client privilege of Seller or violate any applicable Law, and (iii) would not reasonably be expected to breach any duty of confidentiality owed to any Person whether the duty arises contractually, statutorily or otherwise. Section 6.02. Other Covenants. From the date hereof until the Closing, except as otherwise contemplated by the terms of this Agreement or any Ancillary Agreement, Seller will not, and will cause its Affiliates not to, without the prior written consent of Purchaser (such consent not to be unreasonably withheld): (a) sell, assign, lease, license, transfer, hypothecate or otherwise dispose of any of the Acquired Assets or, with respect to the Product in the Territory, the Licensed Intellectual Property; (b) amend, terminate, renew, extend or waive in writing any right under any Transferred Contract if such amendment, termination, renewal, extension or waiver would adversely affect the rights to be transferred to Purchaser at the Closing; or (c) authorize, commit, or agree to take any of the foregoing actions. Section 6.03. Exclusive Dealing. Seller shall not (and shall cause its Affiliates not to), directly or indirectly, through any officer, director, partner, employee, investment banker, financial advisor, attorney, accountant or other representative of any of them or otherwise, take   19 any action to encourage, solicit or initiate or continue any discussions or negotiations with, or provide any information to, any Person (other than Purchaser and its representatives) concerning any purchase (or transfer) of all or any portion of the Acquired Assets, or enter into a confidentiality agreement, letter of intent or purchase agreement, or other similar agreement with respect to any such transaction with any Person, firm or corporation other than Purchaser or its Affiliates, and shall immediately cease and cause to be terminated any activities, discussions or negotiations existing with respect to any of such matters. Seller will promptly notify Purchaser orally and in writing of the existence of any proposals by a Third Party to do any of the foregoing which Seller or any of its officers, directors, employees, investment bankers, financial advisors or other representatives may receive relating to any of such matters. Section 6.04. Competing Products. Seller agrees that for the period commencing on the Closing Date and ending on the earlier of [***] ([***]) anniversary of the Closing Date and the delivery of an Exercise Notice, neither Seller nor its Subsidiaries will directly or indirectly sell, market or otherwise promote, including pursuant to a license, any Competing Product in the Territory. Notwithstanding the foregoing, this Section 6.04 shall not restrict Seller from ownership of less than [***] percent ([***]%) of the stock of any corporation, limited liability company or other enterprise engaged in the sale, marketing or promotion of any Competing Product (other than the Product as contemplated by this Agreement and the Ancillary Agreements) in the Territory. Section 6.05. Financial Accounting Information. Following the Closing Date, promptly following Purchaser’s written request at any time and from time to time, Seller and its Subsidiaries will cooperate with Purchaser in connection with Purchaser’s preparation of audited and unaudited financial statements relating to the Product and any “business” (within the meaning of Item 3-05 and related Items of Regulation S-X under promulgated by the U.S. Securities and Exchange Commission (the “SEC”)) attributable to the Product as of and for any of the years ended in the three-year period ended December 31, 2012 and any calendar quarter ended prior to the Closing Date as may be necessary to enable Purchaser to comply with applicable financial reporting and other requirements with respect to reports and filings with the SEC. If requested by Purchaser, Seller shall engage Seller’s or its Subsidiaries’ independent auditors, at Purchaser’s sole cost and expense, to audit such financial statements for the periods required by Regulation S-X of the SEC and to render an opinion on such financial statements. Seller will provide, if required by Purchaser’s independent auditors, customary executed representation letters required to enable independent auditors to render an opinion on audited financial statements. Seller shall request, and take reasonable steps to encourage, its and its Subsidiaries’ auditors to cooperate with Purchaser and its auditors. For the avoidance of doubt, (i) all reasonable and documented out-of-pocket costs incurred by Seller and its Subsidiaries in performing its obligations under this Section 6.05 shall be the sole responsibility of Purchaser, and (ii) Seller and its Subsidiaries shall have no obligation to provide, or cause any Third Party to provide, any such information of any Third Party, including Strakan, in performing its obligations under this Section 6.05. Section 6.06. Payment of Indebtedness. On or prior to the Closing, Seller shall pay or cause to be paid, in full, any Liabilities of Seller for monies due but not yet payable as of the Closing Date under the Transferred Contracts.   20 Section 6.07 Acquisition Proposals. Prior to the earlier of the Closing and termination of this Agreement, Seller shall not, and shall not permit any officer, director, employee or agent of Seller or any Affiliate thereof to (a) solicit, initiate or encourage submission of proposals or offers, or accept any offers, from any Third Party relating to any acquisition or purchase of all or any material amount of the Acquired Assets and the Licensed Intellectual Property (an “Acquisition Proposal”) or (b) participate in any discussions or negotiations regarding, or furnish to any Third Party any information with respect to, or otherwise cooperate in any way with or assist, facilitate or encourage, any Acquisition Proposal by any Third Party. ARTICLE VII Purchaser hereby represents and warrants to Seller as follows: Section 7.01. Authority. Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware. Purchaser the Ancillary Agreements to which it is, or is specified to be, a party and to consummate the transactions contemplated hereby and thereby. All corporate acts and other proceedings required to be taken by Purchaser to authorize the execution, delivery and performance of this Agreement and the Ancillary transactions contemplated hereby and thereby have been duly and properly taken. This Agreement has been duly executed and delivered by Purchaser and, assuming this Agreement has been duly authorized, executed and delivered by Seller, constitutes, and the Other Acquisition Documents on the Closing Date will be duly executed by Purchaser, and upon the due authorization, execution and delivery by each other party to the Other Acquisition Documents, will constitute a legal, valid and binding obligation of Purchaser, enforceable against Purchaser in accordance with its terms, subject, as to enforcement, to applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting creditors’ rights generally and to general equitable principles. Section 7.02. No Conflicts; Consents. (a) The execution and delivery of this Agreement by Purchaser does not, and the execution and delivery by Purchaser of each other Ancillary Agreement to which it is, or is specified to be, a party will not, and the consummation of the transactions contemplated hereby and thereby and compliance with the terms hereof and thereof will not, conflict with, or result in any violation of or to a right of termination, cancellation or acceleration of any obligation, or Purchaser under, any provision of (i) its certificate of incorporation or by-laws (or the comparable governing instruments), (ii) any Contract to which Purchaser is a party or by which any of its properties or assets are bound, or (iii) any judgment, order, or decree, or, subject to the matters referred to in Section 7.02(b) below, any Law applicable to Purchaser or its properties or assets, other than, in the case of clause (i) and (ii) above, any such items that would not be reasonably likely, individually or in the aggregate, to have a material adverse effect on the ability of Purchaser to consummate the Acquisition.   21 (b) No consent, approval, license, permit, order or authorization of, or registration, declaration or filing with, any Governmental or Regulatory Authority is required to be obtained or made by or with respect to Purchaser in connection with the execution, delivery and performance of this Agreement, the Ancillary Agreements or the consummation of the transactions contemplated hereby or thereby, other than such consents, approvals, licenses, permits, orders, authorizations, registrations, declarations and filings the absence of which, or the failure to make which, individually or in the aggregate, (i) would not be reasonably likely to have a material adverse effect on the ability of Purchaser to consummate the Acquisition or perform its obligations under this Agreement or the Ancillary Agreements, and (ii) would not give rise to any liability of Seller or any of its Affiliates as a result of the consummation of the Acquisition. Section 7.03. Litigation. As of the date hereof, there are no (a) outstanding judgments, orders, injunctions or decrees of any Governmental or Regulatory Authority or arbitration tribunal against Purchaser, (b) lawsuits, actions or proceedings pending or, to the knowledge of Purchaser, threatened against Purchaser, or (c) investigations by any Governmental or Regulatory Authority which are pending or, to the knowledge of Purchaser, threatened against Purchaser, which, in the case of each of clauses (a), (b) and (c), have had or would be reasonably likely to have a material adverse effect on the ability of Purchaser to consummate the Acquisition and the other transaction contemplated by this Agreement and the Ancillary Agreements. Section 7.04. Availability of Funds. Purchaser has, and will have at the Closing, cash available or has existing committed borrowing facilities which together are sufficient to enable it to consummate the Acquisition. Section 7.05. Brokers or Finders. No agent, broker, investment banker or other arrangement made by or on behalf of Purchaser or any of its Affiliates. ARTICLE VIII COVENANTS OF PURCHASER Purchaser hereby covenants and agrees as follows: Section 8.01. Advise Seller. Purchaser shall promptly advise Seller in writing of any change or event occurring between the date hereof and the Closing Date which Purchaser believes (i) would be reasonably likely to result in the failure of any of the conditions to the Closing set forth in ARTICLE IV to be satisfied as of the Closing Date, or (ii) would be reasonably likely, individually or in the aggregate, to have a material adverse effect on the ability of Purchaser to consummate the Acquisition or the other transactions contemplated by this Agreement and the Ancillary Agreements.   22 Section 8.02. Access to Information. Purchaser acknowledges that it and its representatives have received or been afforded the opportunity to review prior to the date hereof all written materials which Seller was required to deliver or make available, as the case may be, to Purchaser pursuant to this Agreement on or prior to the date hereof. Purchaser acknowledges that it and its representatives have been permitted full and complete access to the books and records, facilities, equipment, Contracts and other properties and assets of Seller and its Affiliates to the extent relating to the Product, the Acquired Assets or the Assumed Liabilities in the Territory that it and its representatives have desired or requested to see or review, and that it and its representatives have had a full opportunity to meet with the officers and employees of Seller and its Affiliates to discuss the Product, the Acquired Assets and the Assumed Liabilities. Section 8.03. Records. Purchaser shall, from the date hereof until the date that is two (2) years following the end of the Royalty Period, keep full and accurate books of all accounts and other records in sufficient detail so that the Product Royalties payable hereunder can be properly and fully ascertained. Purchaser shall, at the request of Seller, permit a nationally recognized independent certified public accountant selected by Seller (the “Independent Auditor”) to have access during ordinary business hours, to such books and records as may be necessary to determine the accuracy of any Payment Report or payment made under this Agreement or to obtain information as to Product Royalties payable in case of failure to report or pay pursuant to the terms of this Agreement. The Independent Auditor shall be bound by a confidentiality agreement to keep all information acquired from Seller confidential, and shall be permitted to disclose to Seller only the amount and accuracy of the Product Royalties reported and actually paid or otherwise payable under this Agreement. The Independent Auditor will send a copy of its written reports to Purchaser at the same time it is sent to Seller. Seller shall be responsible for the fees and expenses of the Independent Auditor, provided, however, that Purchaser shall reimburse Seller in full for all such documented costs and expenses of the Independent Auditor if the Independent Auditor determines that the Product Royalties paid by Purchaser to Seller are less than ninety-five percent (95%) of the amount actually owed for the relevant period of the audit. Section 8.04. Efforts. (a) General Efforts. Purchaser, from the Closing Date until the date that Purchaser pays to Seller the last Sales Milestone payment pursuant to Section 3.02(c), shall, subject to Section 8.04(b), take commercially reasonable efforts to cause each of the Trailing Four Quarter Net Sales targets set forth in Section 3.02(c) to occur as soon as reasonably practicable. (b) Specific Actions. Without limiting the generality of the matters set forth in Section 8.04(a), unless otherwise agreed by the Parties, Purchaser shall satisfy each of the following requirements: (i) Establishment of Field Force. Purchaser shall, on or before December 31, 2013, establish a field force to promote the Product to physicians and other customers or potential customers (the “Field Force”) in the Territory comprised of at least [***] ([***]) Field Personnel dedicated to Detailing the Product in the first position (i.e., no other product shall be presented to or discussed with the healthcare professional   23 before the Product and the predominant portion of time is devoted to the Detailing of such pharmaceutical product, the “First Position”)). Notwithstanding the foregoing, in the event the FDA delays unduly the approval of, or refuses to approve, [***] as a manufacturer of the Product as contemplated by Section 3.02(b), the Parties shall agree in good faith on an adjusted timetable for Purchaser’s establishment and maintenance of the Field Force as provided above and in clause (ii) below. (ii) Maintenance of Commercialization Efforts. Subject to clause (i), above, Purchaser shall, from January 1, 2014 through December 31, 2015 (the “Marketing Period”) use commercially reasonable efforts to maintain the Field Force at or above [***] ([***]) Field Personnel. During the Marketing Period, Purchaser shall use commercially reasonable efforts to (a) cause the Field Force to achieve not less than customary productivity standards in the industry and (b) direct at least [***]% of Field Force efforts towards Detailing the Product. (iii) Reporting Obligations. Within thirty (30) days after the end of each calendar quarter, commencing with the first full calendar quarter ending after the Closing Date and ending at the expiration of the Marketing Period, Purchaser shall deliver to Seller a written report with respect to such preceding calendar quarter (the “Compliance Report”) that sets forth each of the following information for each month in such preceding calendar quarter and on an aggregate basis for such calendar quarter: (a) performance versus key performance indicators for areas such as payor contracting, medical affairs and education, clinical development and registries, marketing calendar and promotional materials; (b) the number of Field Personnel comprising the Field Force at the end of each such month and calendar quarter; (c) the Average Field Force; (d) the total number of Details for each such quarter performed by the Field Force; (e) the percentage of Details in such calendar quarter in which the Product was detailed to appropriately targeted primary prescribing physicians; (f) the number of products (including the Product) that were presented to or discussed with the healthcare professional in each Detail in such quarter; (g) the position of the Product in such Detail; (h) the percentage of Details in such calendar quarter in which the Product was detailed in at least the First Position; (i) if, with respect to such calendar quarter either (I) the Average Field Force is less than the Field Force Floor, or (II) the Product is not Detailed in at least the First Position by the Field Force in such calendar quarter, then such Compliance Report shall set forth a reasonably detailed description of the actions Purchaser has taken and intends to take to comply with the requirements of this Section 8.04(b); and (j) a description of any other material actions Purchase has taken to comply with its obligations under Section 8.04(a). (iv) Breaches. In the event that at any time during the Marketing Period, (a) Purchaser shall fail to deliver a Compliance Report within thirty (30) days following the end of any calendar quarter, or (b) Seller determines in good faith (it being understood that any such determination made solely with reference to the information contained in any one or more Compliance Reports shall be deemed made in good faith) that (I) the Average Field Force during any two consecutive calendar quarters is less than [***] ([***]) Field Personnel (the “Field Force Floor”), or (II) the Product has not been consistently Detailed in the First Position by the Field Force during any two consecutive   24 calendar quarters, then Seller shall have an irrevocable right (the “Call Option”) to cause Purchaser to transfer to Seller (or a designee of Seller) each of the Acquired Assets, the Strakan Assets, and any assets acquired or developed by Purchaser following the Closing primarily related to the Business (the “Called Assets”) for no additional consideration, and Purchaser shall have the obligation to transfer all Called Assets to Seller on terms and conditions (other than with respect to any payments) reasonably consistent with the terms of the Transfer Agreement (without giving effect to any amendments thereto following the Closing). Seller shall have the right to exercise the Call Option within thirty (30) days following the earlier of (x) receipt of a Compliance Report, and (y) the thirtieth calendar day following the end of each calendar quarter (such thirty (30) day period the “Option Period”), by giving notice thereof to Purchaser (the “Exercise Notice”) pursuant to Section 12.06 before the end of the Option Period. The Exercise Notice shall (i) identify in reasonable detail the basis of the breach giving rise to Seller’s right to exercise the Call Option, and (ii) identify the party (or parties) to which the Called Assets shall be transferred. Upon receipt by Purchaser of the Exercise Notice from Seller, the License Agreement shall terminate automatically and without further action by either Party hereto in accordance with its terms and the parties shall use their best efforts, and shall cooperate with each other, to transfer the Called Assets to Seller or its designees as soon as reasonably practicable. For the avoidance of doubt, if Seller does not deliver an Exercise Notice within the Option Period, Seller shall have no right to exercise the Call Option or deliver an Exercise Notice to Purchaser until the commencement of the next Option Period. Section 8.05. DISCLAIMER. PURCHASER ACKNOWLEDGES THAT (A) EXCEPT AS EXPRESSLY SET FORTH IN ARTICLE V OR IN ANY ANCILLARY AGREEMENT, NEITHER SELLER NOR ANY OTHER PERSON HAS MADE ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE PRODUCT, THE ACQUIRED ASSETS OR THE ASSUMED LIABILITIES, THE MANUFACTURE, DISTRIBUTION, MARKETING OR SALE OF THE PRODUCT BY SELLER AND ITS AFFILIATES, ANY OTHER ASPECT OF THE RESPECTIVE BUSINESSES OF SELLER OR ITS AFFILIATES OR THE ACCURACY OR COMPLETENESS OF ANY INFORMATION REGARDING THE PRODUCT, THE ACQUIRED ASSETS OR THE ASSUMED LIABILITIES FURNISHED OR MADE AVAILABLE TO PURCHASER AND ITS REPRESENTATIVES, AND (B) PURCHASER HAS NOT RELIED ON ANY REPRESENTATION OR WARRANTY FROM SELLER OR ANY OTHER PERSON WITH RESPECT TO THE PRODUCT, THE ACQUIRED ASSETS OR THE ASSUMED LIABILITIES, ANY OTHER ASPECT OF THE RESPECTIVE BUSINESSES OF SELLER OR ITS AFFILIATES OR THE ACCURACY OR COMPLETENESS OF ANY INFORMATION REGARDING THE PRODUCT, THE ACQUIRED ASSETS OR THE ASSUMED LIABILITIES FURNISHED OR MADE AVAILABLE TO PURCHASER AND ITS REPRESENTATIVES IN DETERMINING TO ENTER INTO THIS AGREEMENT, EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN ARTICLE V AND IN THE ANCILLARY AGREEMENTS, AND PURCHASER ACKNOWLEDGES THAT NONE OF SELLER OR ANY OTHER PERSON SHALL HAVE OR BE SUBJECT TO ANY LIABILITY TO PURCHASER OR ANY OTHER PERSON RESULTING FROM THE DISTRIBUTION TO PURCHASER, OR PURCHASER’S USE OF, ANY SUCH INFORMATION, OR OF ANY INFORMATION, DOCUMENTS OR MATERIAL MADE AVAILABLE TO PURCHASER   25 AND ITS REPRESENTATIVES IN CERTAIN VIRTUAL OR PHYSICAL “DATA ROOMS”, VISITS TO PHYSICAL PREMISES INCLUDING THOSE OF THIRD PARTY MANUFACTURERS, OR IN ANY OTHER FORM IN EXPECTATION OF THE TRANSACTIONS CONTEMPLATED HEREBY. PURCHASER ACKNOWLEDGES THAT, SHOULD THE CLOSING OCCUR, EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT OR IN ANY OTHER ANCILLARY AGREEMENT, PURCHASER SHALL ACQUIRE THE ACQUIRED ASSETS WITHOUT ANY REPRESENTATION OR WARRANTY AS TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, IN AN “AS IS” CONDITION AND ON A “WHERE IS” BASIS AND PURCHASER SHALL BEAR THE ECONOMIC AND LEGAL RISKS THAT ANY CONVEYANCE SHALL PROVE TO BE INSUFFICIENT TO VEST IN PURCHASER GOOD AND MARKETABLE TITLE, FREE AND CLEAR OF ANY LIENS, THAT ANY NECESSARY CONSENTS OR GOVERNMENTAL APPROVALS ARE NOT OBTAINED AND THAT ANY REQUIREMENTS OF APPLICABLE LAWS OR JUDGMENTS ARE NOT COMPLIED WITH. ARTICLE IX MUTUAL COVENANTS Section 9.01. Efforts. (a) Subject to the terms and conditions of this Agreement, following the date hereof, each Party shall use its commercially reasonable efforts to cause the Closing to occur as soon as practicable thereafter. Following the date hereof, each of Seller and Purchaser shall not, and shall not permit any of their respective Affiliates to, take any action that would, or that would reasonably be expected to, result in any of the conditions set forth in ARTICLE IV not being satisfied. This Section 9.01 shall not, and shall not be deemed to, restrict or prohibit Seller or Purchaser in any way whatsoever from exercising any and all rights and remedies available to it under this Agreement or any of the Ancillary Agreements. (b) Each of Seller and Purchaser shall cooperate with the other Party and its employees, legal counsel, accountants and other representatives and advisers in connection with the steps required to be taken as part of their respective obligations under this Agreement; and each of them shall, at any time and from time to time after the Closing, upon the reasonable request of the other, do, execute, acknowledge and deliver, or cause to be done, executed, acknowledged and delivered, all such further acts, deeds, assignments, transfers, conveyances, receipts, acknowledgments, acceptances and assurances as may be reasonably required (without incurring unreimbursed expense) to satisfy and perform the obligations of such party hereunder, and to allow Purchaser to accomplish the Intended Use of the Product in the Territory after the Closing. Without limiting the generality of the foregoing, in the event that the FDA does not approve [***] as a manufacturer of the Products as contemplated by Section 3.02(b) or the Parties reasonably determine, in good faith, that any such approval is unlikely to be granted on a timely basis, the Parties shall mutually agree upon a new qualified manufacturer for the Product in the Territory, and Seller shall cooperate with Purchaser to support such manufacturer in obtaining the requisite FDA approval as a manufacturer with respect to the Product.   26 Section 9.02. Transfer Agreement. Following the date hereof and prior to the Closing, Seller shall use its commercially reasonable efforts to assist Purchaser in coordinating with Strakan regarding the transfer of the Strakan Assets from Strakan to Purchaser and the transition from Strakan to Purchaser following the Closing. Section 9.03. Bulk Transfer Laws. Purchaser hereby waives compliance by Seller and its Affiliates with the provisions of any so-called “bulk transfer law” of any jurisdiction in connection with the sale of the Acquired Assets to Purchaser. Section 9.04. Transfer Taxes. All transfer, documentary, sales, use, stamp, VAT, registration and other such Taxes, applicable to the Acquisition (such Taxes, together with any interest, penalties and additions thereto, collectively, “Transfer Taxes”), shall be paid by Purchaser. Purchaser shall file all necessary Tax Returns and other documentation required to be filed by it under applicable Law with respect to all Transfer Taxes, and, if required by applicable Law, Seller will, and will cause its Affiliates to, join in the execution of any such Tax Returns and other documentation. Purchaser and Seller shall cooperate in providing each other with any appropriate resale exemption certifications and other similar documentation required to obtain any exemption from (or reduction in) Transfer Taxes, and shall cooperate in taking any commercially reasonable steps to minimize the Parties’ liability for Transfer Taxes. Section 9.05. Purchase Price Allocation. (a) The Parties agree that the Purchase Price and Assumed Liabilities shall be allocated among the Acquired Assets sold by Seller and each Selling Affiliate and purchased by Purchaser in a manner consistent with Section 1060 of the Code and the Treasury Regulations promulgated thereunder (and corresponding provisions of applicable foreign Law) and in accordance with an allocation schedule set forth by Seller and delivered to Purchaser within ninety (90) days after Closing (the “Allocation”), which Allocation shall be reasonably acceptable to Purchaser. In the event of a disagreement, a nationally recognized independent accounting firm mutually acceptable to Purchaser and Seller shall settle such dispute with the costs of such firm being borne equally by Seller and Purchaser. (b) Purchaser and Seller agree to (i) be bound by the Allocation, (ii) act in accordance with the Allocation in the preparation of financial statements and filing of all Tax Returns (including filing Form 8594 with its federal income Tax Return for the taxable year that includes the Closing Date), and (iii) take no position inconsistent with the Allocation for all Tax purposes. In the event that any Taxing Authority disputes the Allocation, Seller or Purchaser, as the case may be, shall promptly notify the other Party of the nature of such dispute. Section 9.06. Recordation of Transferred Intellectual Property. Purchaser shall be responsible, at its sole cost and expense, for all applicable recordations of the assignment of the Transferred Intellectual Property. Seller agrees to execute and deliver to Purchaser, within a reasonable time after the Closing, such assignments and other documents, certificates and instruments reasonably requested by Purchaser for Purchaser’s filing with the applicable registries and other recording authorities to record the transfer of the Transferred Intellectual Property in accordance with applicable Law.   27 Section 9.07. Confidentiality and Confidential Information. (a) Each Party acknowledges that it may receive Confidential Information (as defined below) of the other Party in the performance of or in furtherance of this Agreement. Each Party shall hold confidential and not, directly or indirectly, disclose or publish to any Third Party or use for the benefit of a Third Party or, except in carrying out its duties hereunder, itself or its Affiliates, any Confidential Information of the other Party, without first having obtained the furnishing Party’s written consent to such disclosure or use. Purchaser acknowledges that it continues to remain bound by the terms of the Confidentiality Agreement and that Confidential Information received by it under or in connection with this Agreement and the performance of its obligations hereunder shall be deemed to be, and shall be treated as, Evaluation Materials under the Confidentiality Agreement. These restrictions shall not apply to any Confidential Information which: (i) is known to the receiving Party or its Affiliates prior to the time of disclosure to it; (ii) is independently developed by employees, agents, or independent contractors of the receiving Party or its Affiliates without aid or use of the disclosing Party’s Confidential Information (and such independent development can be demonstrated by the receiving Party); (iii) is disclosed, without restriction as to confidentiality, to the receiving Party or its Affiliates by a Third Party that has a right to make such disclosure; or (iv) becomes part of the public domain through no breach by the receiving Party of its obligations under this Agreement or any Ancillary Agreement. Each receiving Party shall disclose Confidential Information of the disclosing Party only to those employees and contractors of such Party and of its Affiliates who have reason to know such information in furtherance of a Party’s duties under this Agreement and who are bound by an obligation of confidentiality to the receiving Party (or its Affiliate) that is no less stringent than the confidentiality obligations set forth in this Section 9.07. (b) The receiving Party shall also be entitled to disclose the other Party’s Confidential Information that is required to be disclosed (i) to or by any Governmental or Regulatory Authorities; (ii) to comply with applicable Laws (including, without limitation, to comply with SEC, Swedish Financial Supervisory Authority, or stock exchange disclosure requirements), (iii) to comply with judicial process or an order of any Governmental or Regulatory Authority of competent jurisdiction, or (iv) to defend or prosecute litigation; provided, however, that in each case the Party required to disclose such Confidential Information shall use reasonable efforts to notify the other Party in advance of such disclosure and shall provide the disclosing Party with reasonable assistance to obtain a protective order and/or confidential treatment of such Confidential Information, to the extent available, and thereafter only discloses the minimum Confidential Information required to be disclosed in order to ensure legal compliance.   28 (c) This obligations set forth in this Section 9.07 shall survive the termination of this Agreement or the Closing for five (5) years. Upon termination of this Agreement, a receiving Party shall return to the disclosing Party or destroy all Confidential Information provided to it by the disclosing Party, including all copies, notes and extracts thereof or other written records containing such Confidential Information, except for (x) one (1) copy that it may keep in counsel’s secure files for the sole purpose of verifying its continuing confidentiality obligations hereunder, and (y) archival copies residing on back-up tapes made by such party in the ordinary course of business; provided, that Purchaser shall not be obligated hereby to return or destroy any Confidential Information that constitutes Acquired Assets actually purchased by it hereunder. ARTICLE X INDEMNIFICATION Section 10.01. Indemnification by Seller. From and after the Closing, Seller shall defend, indemnify and hold harmless Purchaser, its Affiliates and their respective employees, agents, officers and directors (collectively, the “Purchaser Indemnitees”), from and against any and all losses, liabilities, obligations, claims, fees (including, without limitation, reasonable documented attorneys’ fees and documented fees of other professionals), expenses and lawsuits (“Losses”) suffered or incurred by any Purchaser Indemnitee to the extent arising from or relating to any of the following: (a) the breach of any representation or warranty of Seller contained in ARTICLE V, any Ancillary Agreement or any certificate delivered hereunder; (b) the breach of or failure to comply with any covenant or obligation of Seller under this Agreement or any Ancillary Agreement; and (c) the Excluded Liabilities; and (d) the failure by Purchaser to withhold Taxes with respect to payments due to the Seller as provided in Section 3.04. Section 10.02. Indemnification by Purchaser. From and after the Closing, Purchaser shall defend, indemnify and hold harmless Seller, its Affiliates and their respective employees, agents, officers and directors (collectively, the “Seller Indemnitees”), from and against any and all Losses suffered or incurred by any Seller Indemnitee to the extent arising from or relating to any of the following: (a) the breach of any representation or warranty of Purchaser contained in ARTICLE VII, any Ancillary Agreement or any certificate delivered hereunder; (b) the breach of any covenant of Purchaser contained in this Agreement or any Ancillary Agreement; (c) any Assumed Liability;   29 (d) any product liability claim in the Territory with respect to Product sold on or after the Closing in the Territory; (e) any product liability claim in the Territory with respect to Product sold prior to the Closing in the Territory; (f) the development, testing, manufacture, distribution, marketing, promotion or sale of the Product in the Territory after the Closing; (g) the development, testing, manufacture, distribution, marketing, promotion or sale of the Product in the Territory prior to the Closing; and (h) any Transfer Taxes. Section 10.03. Indemnification Procedure. (a) Procedures Relating to Indemnification for Third Party Claims. In order to receive the benefits of the indemnity under Section 10.01 or Section 10.02, as applicable, in respect of, arising out of or involving a claim or demand made by any Third Party (a “Third Party Claim”) against a Purchaser Indemnitee or Seller Indemnitee (either, an “Indemnitee”), such Indemnitee must: (i) give the indemnifying Party (the “Indemnitor”) written notice of any claim or potential claim promptly after the Indemnitee receives notice thereof; provided, that failure of the Indemnitee to provide such notice shall not constitute a waiver of, or result in the loss of, such Party’s right to indemnification under this Agreement, except in the event that the Indemnitor’s rights, and/or its ability to defend against or settle such claim or potential claim, are materially prejudiced by such failure to notify; (ii) allow the Indemnitor to assume the control of the defense and settlement (including all decisions relating to litigation, defense and appeal) of any such claim, provided, that: (A) no such settlement may materially adversely affect the rights or obligations of the Indemnitee under this Agreement without the Indemnitee’s prior written consent; and (B) any settlement reached without the prior written consent of the Indemnitee shall be for monetary damages only (which amount shall be fully indemnified hereunder by the Indemnitor) and not for any equitable relief and shall not include any admission or ongoing obligation or restriction on the part of the Indemnitee; and (iii) reasonably cooperate with the Indemnitor in its defense of the claim (including, without limitation, making documents and records available for review and copying and making persons within the Indemnitee’s control available for pertinent interview and testimony), so long as such cooperation does not vitiate any legal privilege to which such Indemnitee is entitled. If the Indemnitor defends the claim, the Indemnitee may at its expense and using attorneys of its choice, participate in, but shall not have any control of, the defense of such claim. The Indemnitor shall have no liability under this ARTICLE X as to any claim for which settlement or compromise of such claim, or an offer of settlement or compromise of such claim, is made by an Indemnitee without the prior written consent of the Indemnitor.   30 Section 10.04. Procedures Related to Indemnification for Other Claims. An Indemnitee seeking indemnification under Section 10.01 or Section 10.02, as applicable, that does not involve a Third Party Claim shall, within as soon as reasonably practicable deliver to the Indemnitor, written notice (a “Direct Claim Notice”) describing in reasonable detail the facts giving rise to the indemnification claim, provided, however, that the failure by any Indemnitee to so notify the Indemnitor shall not relieve the Indemnitor from any liability which it may have to such Indemnitee under Section 10.01 or Section 10.02, as applicable, except to the extent that the Indemnitor has been materially prejudiced by such failure. The Indemnitor shall have thirty (30) days after its receipt of a Direct Claim Notice to (i) agree to the amount set forth in the Direct Claim Notice and pay such amount to such Indemnified Party in immediately available funds or (ii) provide such Indemnitee with written notice that it disputes its obligation to provide the indemnification sought in the Direct Claim Notice (a “Claim Dispute Notice”). If the Indemnitor does not notify the Indemnitee within thirty (30) days following its receipt of such notice that Indemnitor disputes its liability to the Indemnitee with respect to such claim, such claim specified in the Direct Claim Notice shall be conclusively deemed a liability of the Indemnitor. If the Indemnitor delivers a Claim Dispute Notice, the Indemnitee and the Indemnitor shall negotiate in good faith to resolve the matter. In the event that the controversy is not resolved within twenty (20) Business Days after the giving of the Claim Dispute Notice, the parties thereafter may pursue any and all available remedies at law (subject to the limitations and conditions provided in this Agreement). Section 10.05. Losses Net of Insurance, Tax Benefits. The amount of any Loss for which indemnification is provided under this ARTICLE X shall be net of any amounts recovered or recoverable with commercially reasonable efforts by the Indemnitee under insurance policies or in respect of any indemnity or contribution with respect to such Loss (including under the Transfer Agreement) and shall be reduced to take account of any net Tax benefit (including as a result of any basis adjustment) actually realized by the Indemnitee arising from the incurrence or payment of any such Loss. In computing the amount of any such Tax benefit, the Indemnitee shall be deemed to recognize all other items of income, gain, loss, deduction or credit before recognizing any item arising from the incurrence or payment of any indemnified Loss. Section 10.06. Limitation on Indemnification. (a) Notwithstanding anything to the contrary herein, (i) Seller shall not have any liability under Section 10.01(a) unless the aggregate of all Losses for which Seller would be liable under Section 10.01(a), but for this clause (i), exceeds on a cumulative basis, an amount equal to $50,000, and then only to the extent of any such excess, (ii) Seller’s aggregate liability under Section 10.01(a) shall in no event exceed, on a cumulative basis, the Seller Liability Cap and (iii) Sellers aggregate liability under this ARTICLE X shall in no event exceed, on a cumulative basis, the Closing Consideration. (b) Notwithstanding anything to the contrary herein, Purchaser shall only have liability under Section 10.02(e) or Section 10.02(g) only to the extent that Purchaser is entitled to seek indemnification for such liability from Strakan (or its successors or assigns) under Section 11.1 of the Strakan Agreement (without giving effect to any amendments thereto following the Closing).   31 (c) Following the Closing, the Parties’ rights to indemnification pursuant to this ARTICLE X shall, except for equitable relief and specific performance of covenants that survive Closing, be the sole and exclusive remedy available to the parties with respect to any matter arising under or in connection with this Agreement or the transactions contemplated hereby, other than for claims of fraud. Purchaser hereby waives, from and after the Closing Date, to the fullest extent permitted under applicable Law, any and all rights, claims and causes of action it or any of its Affiliates may have against Seller and its Affiliates arising under or based upon this Agreement, the Ancillary Agreements, any document or certificate delivered in connection herewith, the Product, the Acquisition, the Acquired Assets and the Assumed Liabilities, or any federal, state, local or foreign statute, law, ordinance, rule or regulation or otherwise (except pursuant to the indemnification provisions set forth in this ARTICLE X). (d) Notwithstanding any provision herein, neither Seller nor Purchaser shall in any event be liable to the other Party or any Indemnitee on account of any indemnity obligation set forth in Section 10.01 or Section 10.02 for any indirect, consequential, special, incidental or punitive damages (except punitive damages payable to a Third Party ), including loss of future revenue or income, loss of business reputation or opportunity relating to the breach or alleged breach of this Agreement, or diminution of value or any damages based on any type of multiple. Section 10.07. Termination of Indemnification. (a) The obligations to indemnify and hold harmless an Indemnitee pursuant to (i) Section 10.01(a) and Section 10.02(a), shall terminate when the applicable representation or warranty terminates pursuant to Section 10.07(b) below, and (ii) the other clauses of Section 10.01 and Section 10.02, shall not terminate; provided, however, that as to foregoing clause (i) such obligations to indemnify and hold harmless shall not terminate with respect to any item as to which the Indemnitee or the related Party thereto shall have, before the expiration of the applicable period, previously made a claim by delivering a notice of such claim (stating in reasonable detail the basis of such claim) to the indemnifying Party. (b) The representations and warranties of Seller contained in ARTICLE V shall survive the Closing solely for purposes of Section 10.01(a) and shall terminate at the close of business on the first anniversary of the Closing Date (other than with respect to those representations and warranties of Seller contained in Section 5.01, Section 5.02, and Section 5.08, which shall survive indefinitely), and the representations and warranties of Purchaser contained in ARTICLE VII shall survive the Closing solely for purposes of Section 10.02(a), and shall terminate at the close of business on the first anniversary of the Closing Date (other than with respect to those representations and warranties of Purchaser contained in Section 7.01, Section 7.02 and Section 7.05, which shall survive indefinitely). Section 10.08. Tax Treatment of Indemnification Payments. For all Tax purposes, each of Purchaser, Seller and their respective Affiliates agrees to treat any indemnity payment under this Agreement as an adjustment to the Purchase Price received by Seller for the transactions contemplated by this Agreement unless a final determination (as defined in Section 1313 of the Code) provides otherwise.   32 Section 10.09. No Setoff. Purchaser shall not, and shall have no right to, setoff any Losses suffered by Purchaser or any Purchaser Indemnitee against the Deferred Consideration, any Sales Milestone, any Product Royalties, or any payments to be made by Purchaser to Seller under this Agreement or any of the Other Acquisition Documents. Section 10.10. No Double Recovery. Neither Party shall be entitled to recover the same or duplicative damages with respect to the same breach from the other Party under more than one of this Agreement and the Ancillary Agreements. For the purposes of this Section 10.10, each Party shall be deemed to have made and received all payments made and received by its Affiliates. ARTICLE XI TERMINATION Section 11.01. Termination. This Agreement may be terminated and the transactions contemplated hereby abandoned by: (a) mutual written consent of Seller and Purchaser; (b) Seller if any of the conditions set forth in Section 4.02 shall have become incapable of fulfillment, and shall not have been waived by Seller, in each case, prior to the Closing; (c) Purchaser if any of the conditions set forth in Section 4.01 shall have become incapable of fulfillment, and shall not have been waived by Purchaser, in each case, prior to the Closing; (d) either Party, if the Closing does not occur on or prior to June 30, 2013; or (e) automatically and without further action by either Party, upon the consummation of the transactions contemplated by the Exercise Notice; provided, however, that the Party seeking termination pursuant to any of the foregoing clauses (b), (c) or (d) is not in breach in any material respect of any of its representations, warranties, covenants or agreements contained in this Agreement. Section 11.02. Return of Confidential Information. If the transactions contemplated by this Agreement are terminated as provided herein: (a) Purchaser shall return to Seller all documents and other material received by Purchaser, its Affiliates and their respective representatives from Seller, any of its Affiliates or any of their respective Affiliates or representatives relating to the transactions contemplated hereby and by the Ancillary Agreements, whether so obtained before or after the execution hereof, to Seller; and   33 (b) all confidential information received by Purchaser, its Affiliates and their respective representatives with respect to Seller, any of its Affiliate or any of their respective Affiliates and the Acquired Assets shall be treated in accordance with the Confidentiality Agreement, which shall remain in full force and effect notwithstanding the termination of this Agreement. Section 11.03. Effect of Termination. In the event of termination by Seller or Purchaser pursuant to this ARTICLE XI, written notice thereof shall forthwith be given to the other Party and the transactions contemplated by this Agreement shall be terminated, without further action by either Party. If this Agreement is terminated and the transactions contemplated hereby are abandoned as described in this ARTICLE XI, this Agreement shall become void and of no further force or effect, except for the provisions of (a) Section 9.07 relating to the confidentiality obligations of the Parties; (b) Section 12.07 relating to public announcements; (c) Section 12.08 relating to governing law; (d) Section 12.09 relating to dispute resolution; (e) Section 12.10 relating to expenses; and (f) this ARTICLE XI. Nothing in this ARTICLE XI shall be deemed to release either Party from any liability for any breach by such Party of the terms and provisions of this Agreement prior to the termination of this Agreement. ARTICLE XII MISCELLANEOUS Section 12.01. Assignment. Except as otherwise expressly permitted by this Agreement, neither Party shall assign or otherwise transfer this Agreement or any interest herein or right hereunder without the prior written consent of the other Party, and any such purported assignment, transfer or attempt to assign or transfer any interest herein or right hereunder shall be void and of no effect; provided, however, that, following the Closing, either Party shall have the right, without such consent, on written notice to the other Party, to assign all of its rights and obligations hereunder to a successor to all or substantially all of such Party’s business or assets, whether by way of merger, sale of stock, sale of assets or other transaction (or series of related transactions), provided, further, that in the case of an assignment by Purchaser, any assignee shall expressly agree to assume Purchaser’s obligations pursuant to this Agreement, including, the payment obligations under Section 3.02 and the covenants in Section 8.04. Subject to the foregoing, this Agreement will be Section 12.02. Non-Waiver. Any failure on the part of a Party to enforce at any time or for any period of time any of the provisions of this Agreement shall not be deemed or construed to be a waiver of such provisions or of any right of such Party thereafter to enforce each and every such provision on any succeeding occasion or breach thereof. Section 12.03. No Third-Party Beneficiaries. This Agreement is for the sole benefit of the Parties and their successors and permitted assigns and the Indemnitees, and nothing herein express or implied shall give or be construed to give to any Person, other than the Parties and such successors and permitted assigns and the Indemnitees, any legal or equitable rights hereunder.   34 Section 12.04. Severability. If any term or other provision of this Agreement is determined to be invalid, illegal or incapable of being enforced by any rule of Law or public policy, all other terms and provisions of the Agreement shall remain in full force and effect. Upon such determination, the Parties shall negotiate in good faith to modify this Agreement so as to give effect to the original intent of the Parties to the fullest extent permitted by applicable Law. Section 12.05. Entire Agreement; Amendments. This Agreement, together with the Ancillary Agreements (in each case, following execution and delivery thereof), contains the entire understanding of the Parties with respect to the subject matter hereof and thereof and supersedes all previous and contemporaneous verbal and written understandings, agreements, representations and warranties with respect to such subject matter or on which the Parties may have relied. This Agreement may not be amended, supplemented or modified except by an instrument in writing signed on behalf of each Party. No waiver of any provision of this Agreement shall be valid unless the waiver is in writing and signed by the waiving Party. Section 12.06. Notices. Unless otherwise explicitly set forth herein, any notice delivered personally by hand, or sent by reputable overnight courier, signature required, to the addresses of each Party set forth below or to such other address or addresses as shall be designated in writing in the same matter: (a) If to Purchaser: Galena Biopharma, Inc. 310 N. State Street, Suite 208 Lake Oswego, Oregon 97034 TroyGould PC 1801 Century Park East, 16th Floor Attention: Dale E. Short Facsimile: (310) 201-4746 Orexo AB P.O. Box 303 SE-751 05 Uppsala Sweden Attention:    Chief Executive Officer Facsimile:    +46 (0)18 780 88 88   35 Dechert LLP New York, New York 10036-6797 Attention:    David S. Rosenthal, Esq. Facsimile:    (212) 698-3599 All notices shall be deemed given when received by the addressee. Section 12.07. Public Announcements. Neither Party shall make any public announcement regarding this Agreement, or the subject matter contained herein, without the prior written consent of the other Party (which consent may be withheld in the sole discretion of such other Party), except to the extent required to be disclosed (i) to or by any Governmental or Regulatory Authorities; (ii) to comply with applicable Laws (including, without limitation, to comply with SEC, Swedish Financial Supervisory Authority, or stock exchange disclosure requirements), or (iii) to comply with judicial process or an order of any Governmental or Regulatory Authority of competent jurisdiction; provided, however, that in each case the Party required to disclose such information shall endeavor to give the other Party reasonable advance notice and review of any such disclosure. Notwithstanding the foregoing, the Parties shall coordinate on a mutually acceptable joint press released to be issued by each of the Parties in connection with the execution of this Agreement. Section 12.08. Governing Law. This Agreement (and all disputes arising out of it including non-contractual disputes) shall be governed by and interpreted in accordance with the substantive laws of Sweden, without regard to the U.N. Convention on Contracts for the Sale of Goods or the choice of law provisions thereof. Section 12.09. Dispute Resolution. (a) The Parties recognise that a bona fide dispute as to certain matters governed by this Agreement may arise that relate to any Party’s rights or obligations hereunder. In the event of the occurrence of any dispute arising out of or relating to this Agreement, including any question regarding its existence, validity or termination, either Party may, by written notice to the other, have such dispute referred to its respective officer designated below or their successors, for attempted resolution by good faith negotiations within sixty (60) days after such notice is received. If either Party desires to pursue arbitration under paragraph (b) below to resolve any such dispute, a referral to such executives under this paragraph (a) shall be a mandatory condition precedent. Said designated officers are as follows. For Purchaser: Chief Executive Officer For Seller: Chief Executive Officer (b) In the event that such officers shall be unable to resolve the dispute by executive mediation within such sixty (60) day period, then the dispute shall be finally settled by binding arbitration as provided below.   36 (c) Any arbitration proceeding shall be administered by the Arbitration Institute of the Stockholm Chamber of Commerce. The place of arbitration shall be in Stockholm, Sweden. The arbitration shall be conducted in English. The award of arbitration shall be final and binding upon both Parties. (d) The procedures specified in this Section 12.09 shall be the sole and exclusive procedures for the resolution of disputes between the Parties arising out of or relating to this Agreement; provided, that a Party, without prejudice to the above procedures, may seek injunctive relief or other provisional judicial relief if in its sole judgment such action is necessary to avoid irreparable damage. Despite such action the Parties will continue to participate in good faith in the procedures specified in this Section 12.09. (e) Each party is required to continue to perform its obligations under this Agreement pending final resolution of any such dispute. Section 12.10. Expenses. Whether or not the transactions contemplated hereby are consummated, and except as otherwise specifically provided in this Agreement, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the Party incurring such costs or expenses. Section 12.11. Relationship of the Parties. In making and performing this Agreement, the Parties are acting, and intend to be treated, as independent entities and nothing contained in this Agreement shall be construed or implied to create an agency, partnership, joint venture, or employer and employee relationship between Seller and Purchaser or any of their respective Affiliates. Except as otherwise expressly provided herein, neither Party may act on behalf of the other Party, and neither Party may make (or has any authority to make) any representation, warranty or commitment, whether express or implied, on behalf of the other Party or incur any charges or expenses for or in the name of the other Party. No Party shall be liable for the act of any other Party unless such act is expressly authorized in writing by both Parties. The relationship of the Parties under this Agreement is, and is intended to be, one of independent contractors hereunder. Section 12.12. Counterparts. This Agreement shall become binding when any one or more counterparts hereof, individually or taken together, shall bear the signatures of each of the Parties. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against the Party whose signature appears thereon, but all of which taken together shall constitute but one and the same instrument. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.   37   SELLER: OREXO AB /s/ Nicolaj Sorensen Name:   Nicolaj Sorensen Title:   CEO and President PURCHASER: GALENA BIOPHARMA, INC. /s/ Mark J. Ahn Name:   Mark J. Ahn, Ph.D. Title:   President and Chief Executive Officer   38 OREXO ASSET PURCHASE AGREEMENT EXHIBITS EXECUTION VERSION Exhibit A Transfer Agreement [Attached] Private & Confidential    Execution Copy     DATED   2012         OREXO AB    (1)   and      STRAKAN INTERNATIONAL SARL    (2)   (formerly known as Strakan International Limited)        TERMINATION AND ASSET TRANSFER AGREEMENT FOR ABSTRAL® IN THE UNITED STATES OF AMERICA       LOGO [g515003exa_logo.jpg] Tel +44 (0)870 903 1000    Fax +44 (0)870 904 1099    [email protected]    www.wragge.com CONTENTS   Clause   Heading    Page   1   DEFINITIONS      3    2   TERMINATION OF RAPINYL NORTH AMERICA LICENCE AGREEMENT AND THE ABSTRAL TRADE MARK AGREEMENT      10    3   TRANSFER OF THE ASSETS      12    4   TRANSFER OF REGULATORY APPROVALS IN THE USA AND PROVISION OF TRANSITION SERVICES TO OREXO      13    5   TRANSFER OF CONTRACTS AND RECORDS      16    6   TRANSFER OF STOCK      17    7   ASSIGNMENT OF THE US ABSTRAL MARK      18    8   DEVELOPMENT, MANUFACTURE AND COMMERCIALISATION      19    9   CONFIDENTIALITY      22    10   REPRESENTATIONS AND WARRANTIES      23    11   INDEMNIFICATION      26    12   MISCELLANEOUS PROVISIONS      27    This Termination and Asset Transfer Agreement is made as of the Signature Date (hereinafter defined) between Orexo AB, a limited liability company organised and existing under the laws of Sweden and having its principal place of business at Virdings allé 32, Uppsala, Sweden (“Orexo”) and Strakan International S.à r.l, a limited liability company organised and existing under the laws of Luxembourg and having its principal place of business at Galabank Business Park, Galashiels TD1 1QH, UK (“Strakan”) (each a “Party” and collectively, the WITNESSETH WHEREAS, Orexo is the owner of all right, title and interest in certain patents and know-how relating to its proprietary Product (as defined below) for pain treatment in the Orexo Territory (as defined below); and WHEREAS, the Parties have previously entered into the Rapinyl North America Licence Agreement (as defined below) under which certain exclusive rights were granted to Strakan in the United States of America, Canada and Mexico in respect of Orexo’s patents and know-how; and WHEREAS, the Parties have previously entered into the Rapinyl EU Licence Agreement (as defined below) under which certain exclusive rights were granted to Strakan in the EU and certain other countries in respect of Orexo’s patents and know-how; and WHEREAS, in 2011 Kyowa Hakko Kirin Co. Ltd (“KHK”) acquired all issued shares of ProStrakan Group Plc thereby making Strakan an Affiliate of KHK; and WHEREAS, the Parties on even date herewith have entered into a licence and asset transfer agreement in relation to the Product in the RoW Territory (as defined below) (“Abstral RoW Agreement”); and WHEREAS, the Parties have agreed to terminate the Rapinyl North America Licence Agreement and to enter into this termination and asset transfer arrangement in relation to the Product in relation to the United States of America upon the terms and conditions hereinafter set forth and to have Mexico and Canada governed by the Abstral RoW Agreement with effect from the Signature Date; and WHEREAS, the Parties on even date herewith have entered into an Amended and Restated Licence Agreement for Abstral in the EU and certain other countries whereby the Rapinyl EU Licence Agreement is terminated. NOW, THEREFORE, in consideration of the covenants and obligations expressed herein, and intending to be legally bound, the Parties agree as follows:   1 DEFINITIONS   1.1 “Abstral Domain Names” means the domain names listed in Exhibit 7.   1.2 “Abstral Trade Mark Agreement” means the letter agreement between the Parties dated 22 September 2011 under which Orexo was granted certain rights in relation to the mark ABSTRAL and Strakan’s trade dress and artwork for the Product as well as Strakan’s training and marketing materials relevant to the Product.   1.3 “Abstral US Mark” means the trade mark ABSTRAL, registered in the United States of America under registration number 3563010 together with all good will associated therewith.   3 1.4 “Affiliate” means a person or entity that directly or indirectly through one or more intermediates, controls, is controlled by, or is under common control with the person or entity specified. For the purpose of this definition, “control” shall mean with respect to an entity, the direct or indirect ownership of (a) more than fifty percent (50%) of the capital stock or share capital entitled to vote for the election of directors of the entity (or such lesser percentage which is the maximum allowed to be owned by a foreign corporation in a particular jurisdiction) or (b) more than fifty percent (50%) of equity or voting interest of the entity (or such lesser percentage which is the maximum allowed to be owned by a foreign corporation in a particular jurisdiction). An entity will be an Affiliate for purposes of this Agreement only so long as it satisfies the definition set forth herein.   1.5 “Assets” means the Abstral US Mark, the Stock, the benefit of the Contracts, the Regulatory Approvals, and the Records.   1.6 “Business Day” means a day other than a Saturday, Sunday or a public holiday in England and Sweden when the banks are open for business in London and Stockholm.   1.7 “cGMP” means the current good manufacturing practices for pharmaceutical products published in Title 21, Parts 210 and 211 of the United States Code of Federal Regulations.   1.8 “Competing Product” means any fast acting formulation of fentanyl.   1.9 “Confidential Information” means all information disclosed, directly or indirectly, by one Party to the other during the term of this Agreement or prior to the Signature Date (including any information disclosed pursuant to the Rapinyl North America Licence Agreement), that is identified as confidential or is customarily regarded as confidential within the pharmaceutical industry, whether disclosed in electronic, tangible, oral or visual form. Confidential Information shall not include such information that: (a) was or becomes generally available to the public other than as a result of an unauthorised disclosure by a Party hereto or any of such Party’s Affiliates, employees, agents or representatives; or (b) was or becomes available to a Party hereto or any of such Party’s Affiliates on a non-confidential basis from a source other than the other Party hereto (or any of such Party’s   4   Affiliates, employees, agents or representatives); provided that such source was not known by such other Party or its Affiliates to be bound by an agreement to keep such information confidential or otherwise prohibited from transmitting the information by a contractual, legal or fiduciary obligation. Information that is otherwise Confidential Information and consists of a combination of information shall not be deemed to be in the public domain if individual elements of such information are in the public domain, unless the specific combination of those elements is also in the public domain.   1.10 “Contracts” means contracts between Strakan or a Strakan Affiliate and a Third Party exclusively relating to the Product or its Exploitation in the Orexo Territory in force as at the Signature Date, being those contracts brief particulars of which are set out at Exhibit 2.   1.11 “Contract Liabilities” means all losses, costs (including legal costs on an indemnity basis, other professional fees and disbursements and associated VAT), damages, expenses, compensation, interest, charges, actions, proceedings, claims, demands and other liabilities associated with the Contracts.   1.12 “Control” or “Controlled” means possession by a Party of the right to grant to the other Party a licence, sublicense or other right to use, of the scope provided for in this Agreement, to intangible or intellectual property rights (including patent rights, know-how, trade secrets, data and rights to access or cross-reference to a regulatory filing) without violating the terms of any agreement or other arrangement with any Third Party existing at the time such Party would be first required hereunder to grant the other Party such licence, sub-licence or other right.   1.13 “Exploit” means to research, develop, make or have made, use, offer for sale, market and promote.   1.14 “FDA” means the Food and Drug Administration of the United States Department of Health and Human Services or any successor agency thereof performing similar functions   1.15 “Global Safety Agreement” means the Pharmacovigilance Agreement Regarding Abstral between the Parties dated 24 May 2010.   5 1.16 “Good Marketable Condition” means that the Products supplied to Orexo hereunder (i) have been manufactured, packaged and stored in accordance with all applicable Laws, including without limitation the cGMPs, and the NDA Approval; (ii) will at the time of delivery and during the applicable shelf life conform with the NDA Approval and all other applicable Laws provided that Strakan shall not be liable for any failure to meet Good Marketable Condition resulting from Orexo’s or any entity acting on its behalf failure to comply with the NDA Approval.   1.17 “IND” means Investigational New Drug application number 69,190 in relation to the Product in the Orexo Territory.   1.18 “Know-How” means all proprietary methods, discoveries, inventions, devices, technology, trade secretes, compositions, designs, formulae, know-how, show-how, documentation, data and other information processes and analytical methods used in development, manufacture and medical, pre-clinical, clinical and toxicological testing or formulation, development, registration, manufacture, packaging, labelling, import, export, receipt, shipment, or storage, whether now known or hereafter developed, all relating to the Product or its manufacture or use.   1.19 “Landed Cost” means the Ex-Works price to be paid by Orexo to Strakan for purchased Stock that is in Good Marketable Condition being the price set out in Exhibit 4.   1.20 “Law” means all applicable laws (including the United Stated Federal Food, Drug, and Cosmetic Act, the cGMPs, the Prescription Drug Marketing Act, and the Controlled Substances Act) governing the manufacture, marketing, advertising, distribution and sale of the Product or any other obligations of the Parties, including regulations promulgated thereunder.   1.21 “Licensed Field” means all fields of use in humans in all indications.   1.22 “NDA Approval” means NDA approval number 22-510 in relation to the Product in the Orexo Territory.   1.23 “Orexo Know-How” means Know-How which is (a) Controlled by Orexo, its Affiliates or, to the extent Controlled by Orexo, its licensees during the period in which Strakan is complying with its obligations under Section 4 of this Agreement and (b) is useful for Strakan to Exploit the Product in the Orexo Territory in accordance with Strakan’s obligations under this Agreement.   6 1.24 “Orexo Patents” means (i) the patents and patent applications identified in Exhibit 1, all patents issued from any such applications, and any other patents issuing from applications that claim the same priority date as any of the patents and patent applications identified on Exhibit 1, (ii) all other patent and patent applications that are Controlled by Orexo or any of its Affiliates at any time during the period in which Strakan is complying with its obligations under Section 4 and that claim the composition-of-matter of a Product, or its formulation or its method of manufacture or use, and (iii) any provisionals, continuations, divisionals, continuation-in-part applications, substitutions, reissues, renewals, re-examinations, supplementary protection certificates, extensions, registrations and confirmations of any of (i) and (ii) above, all to the extent Controlled by Orexo or any of its Affiliates at any time during this Agreement.   1.25 “Orexo Technology” means all Orexo Patents and Orexo Know-How that are Controlled by Orexo or any of its Affiliates during the period in which Strakan is complying with its obligations under Section 4 of this Agreement.   1.26 “Orexo Territory” means the United States of America including its territories and possessions.   1.27 “Product” means fentanyl citrate sublingual tablets, as described in the NDA Approval and including all dosage strengths thereof.   1.28 “Rapinyl EU Licence Agreement” means the licence agreement dated 2 January 2006 between the Parties (as amended) under which certain exclusive rights relating to Orexo’s proprietary product for pain treatment then referred to as Rapinyl™ were granted to Strakan in respect of the territories being member states of the European Union as of 2 January 2006 and also including Iceland, Norway, Switzerland, and Turkey, Bulgaria and Romania and certain other countries.   1.29 “Rapinyl North America Licence Agreement” means the licence agreement dated 31st July 2008 between the Parties (as amended) under which certain exclusive rights relating to Orexo’s proprietary product for pain treatment then referred to as Rapinyl™ were granted to Strakan in respect of the United States of America, Canada and Mexico and their possessions and territories.   1.30 “Records” means (a) a copy of the Contracts; (b) copies of artwork relating to the packaging of the Product in the USA; (c) registration certificates and prosecution history files for the Abstral US Mark; (d) all batch documentation relating solely to   7   the Stock purchased by Orexo in accordance with Section 6.3; (e) all physician lists, customer lists, marketing materials, market research materials, advertising and promotional materials, other similar information and data, including records of sales and cost data, to the extent pertaining to the marketing or distribution of the Product in the Orexo Territory; (f) copies of all books and records and documents relating to field force activities prior to Signing Date including without limitation customer type and visits, frequency of visiting, Abstral position in visit and notes from the sales reps after visit, (g) copies of all books and records and documents generated in the performance of Transition Services, (h) copies of all books and records and documents exclusively relating to the Product in the Orexo Territory; (i) promotional panels specific to the Product applied to booths and displays, and all equipment and other materials used exclusively in connection with the sale or promotion of the Product whether or not located at Strakan’s address; and (j) the Product NDA and IND, in each case to the extent in the possession or control of Strakan or its Affiliates.   1.31 “Regulatory Approvals” means the NDA Approval and the IND.   1.32 “RoW Territory” means all countries of the world except the United States, the countries of the Rapinyl EU Licence Agreement and Japan.   1.33 “Signature Date” means the date of the signature of the last Party to execute this Agreement.   1.34 “Stock” means the supplies of manufactured Product (including any validation batches) held on behalf of Strakan at the warehouse facilities in Cardinal Health SPS, Nashville and Exel Logistics, Mechanicsburg, PA or at the facilities of Pharmaceuticals International Inc or Sharp Corporation, Allentown, PA as at the Signature Date including any additional quantities of Product finally released by or on behalf of Strakan thereafter during the Transition Period.   1.35 “Strakan Know-How” means Know-How which is (a) Controlled by Strakan, its Affiliates or, to the extent Controlled by Strakan, its licensees during the term of this Agreement and (b) is useful for Orexo to Exploit the Product in the Orexo Territory in accordance with its rights under this Agreement.   1.36 “Strakan Patents” means (i) all patent and patent applications that are Controlled by Strakan or any of its Affiliates in the United States of America that claim the composition-of-matter of the Product, or its formulation or its method of   8   manufacture or use, and (ii) any provisionals, continuations, divisionals, continuation-in-part applications, substitutions, reissues, renewals, re-examinations, supplementary protection certificates, extensions, registrations and confirmations of any of (i) above, all to the extent Controlled by Strakan or any of its Affiliates.   1.37 “Strakan Technology” means all Strakan Patents and Strakan Know-How.   1.38 “Third Party” means any entity other than Orexo or Strakan or their respective Affiliates.   1.39 “Third Party Costs” means payments made by or on behalf of Strakan or its Affiliates to Third Parties for the provision of Transition Services.   1.40 “Transition Date” means the date when Orexo begins to book sales of Product as provided in Section 4.3 which shall be not later than 31 December 2012.   1.41 “Transition Services” means the regulatory, marketing, promotion, sales, distribution, administrative and other services in respect of the Product that are to be provided by Strakan pursuant to the terms and conditions of this Agreement and the transition plan in Exhibit 5 (the “Transition Plan”).   1.42 Interpretation     (a) Whenever any provision of this Agreement uses the term “including” (or “includes”), such term shall be deemed to mean “including without limitation” and “including but not limited to” (or “includes without limitations” and “includes but is not limited to”) regardless of whether the words “without limitation” or “but not limited to” actually follow the term “including” (or “includes”);     (b) “Herein”, “hereby”, “hereunder”, “hereof”, and other equivalent words shall refer to this Agreement in its entirety and not solely to the particular portion of this Agreement in which any such word is used;     (c) All definitions set forth herein shall be deemed applicable whether the words defined are used herein in the singular or the plural;     (d) Wherever used herein, any pronoun or pronouns shall be deemed to include both the singular and plural and to cover all genders;   9   (e) The recitals set forth at the start of this Agreement, along with the Exhibits to this Agreement, and the terms and conditions incorporated in such recitals or Exhibits shall be deemed integral parts of this Agreement and all references in this Agreement to this Agreement shall encompass such recitals, Exhibits and the terms and conditions incorporated in such recitals or Exhibits, provided, that in the event of any conflict between the terms and conditions of this Agreement and any terms and conditions set forth in the Exhibits the terms of this Agreement shall control;     (f) In the event of any conflict between the terms and conditions of this Agreement and any terms and conditions that may be set forth on any order, invoice, verbal agreement or otherwise, the terms and conditions of this Agreement shall govern;     (g) The Agreement shall be construed as if both Parties drafted it jointly, and shall not be construed against either Party as principal drafter;     (h) Unless otherwise provided, all references to Sections and Exhibits in this Agreement are to Sections and Exhibits of and to this Agreement;     (i) All references to days, months, quarters or years are references to calendar days, calendar months, calendar quarters or calendar years;     (j) Any reference to any federal, national, state, local or foreign statute or law shall be deemed to also refer to all rules and regulations promulgated thereunder, unless to context requires otherwise; and     (k) Wherever used, the word “shall” and the word “will” are each understood to be imperative or mandatory in nature and are interchangeable with one another; and     (l) The term “book sales” as applied to a Party shall mean that the applicable Party issues an invoice to a Third Party in respect of the applicable sale of the Product.   2 TERMINATION OF RAPINYL NORTH AMERICA LICENCE AGREEMENT AND THE ABSTRAL TRADE MARK AGREEMENT   2.1 With respect to the Orexo Territory, the Rapinyl North America Licence Agreement and the Abstral Trade Mark Agreement are terminated with effect from the   10   Transition Date. With respect to Mexico and Canada the Abstral RoW Agreement will govern these countries from the Signature Date. With respect to the Orexo Territory from the Signature Date until the Transition Date, the Rapinyl North America Licence Agreement shall remain in full force and effect with the following amendment: Articles 2, 3, 4, 5 (subject to Section 2.2 below), 6, 7.1, 7.2, 8, 10 and 11 of the Rapinyl North America Licence Agreement are deleted in their entirety and shall be deemed “Not Used” for the purposes of the Rapinyl North America Licence Agreement. With respect to the Orexo Territory the definition of Net Sales shall from the Signature Date (and with effect on sales made thereafter) be deleted “Net Sales” means the gross amount invoiced by Strakan, its Affiliates or Sub-Licensees for sale of Product, less deductions for: (i) cash discounts actually given; (ii) freight, shipping insurance and other transportation expenses; (iii) sales, value- added, excise taxes, tariffs and duties, and other taxes directly related to the sale; (all to the extent that such items are included in the gross invoice price and specified on the invoice (but not including taxes assessed against the income derived from such sale)); (iv) rebates and returns; (v) bad debts which have been written off by Strakan in accordance with its standard accounting practices provided that bad debts may be deducted only to the extent they do not exceed 2% of the gross amount invoiced. All such discounts, allowances, credits, rebates and other deductions shall be fairly and equitably allocated to the Products and other products or services of Strakan or its Affiliates, such that the Products do not bear a disproportionate portion of such deductions. In the event that Strakan subsequently receives payment in respect of a bad debt previously deducted under (v) above, Strakan shall pay Orexo any royalty which would have been due on such sum. The transfer of Product by Strakan to an Affiliate will not be deemed a sale.   2.2 Notwithstanding anything to the contrary in this Agreement or the Rapinyl North America Licence Agreement, Strakan shall make payment of all royalties, sales milestones and other sales based payments (if any) set forth in the Rapinyl North America Licence Agreement, that accrue on Net Sales of Product made by Strakan, its Affiliates or Sub-Licensees (i) in the case of the Orexo Territory, prior to the date on which Orexo begins to book the sales of the Product in accordance with the Transition Plan and, (ii) in the case of Mexico and Canada, prior to the Signature   11   Date. Termination of the Rapinyl North America Licence Agreement shall not affect the following provisions of the Rapinyl North America Licence Agreement, which shall continue in full force and effect: 5.5, 5.6, 5.7 and 12.   2.3 All other provisions of the Rapinyl North America Licence Agreement and all provisions of the Abstral Trade Mark Agreement, including any which are expressly stated in the Rapinyl North America Licence Agreement or the Abstral Trade Mark Agreement (as applicable) as surviving its termination, or which might otherwise have done so by implication, will be terminated (i) from the Transition Date in respect of the Orexo Territory and (ii) from the Signature Date in respect of Mexico and Canada.   2.4 Subject to Section 2.5, each Party hereby releases and discharges the other from all claims or demands under or in connection with the Rapinyl North America Licence Agreement and the Abstral Trade Mark Agreement including without limitation claims for negligence, whether arising before or on the Signature Date, in each case whether known or unknown to the releasing Party.   2.5 The release and waiver at Section 2.4 shall not apply to:     (a) the Parties’ past and future obligations and liabilities arising under the surviving provisions of the Rapinyl North America Licence Agreement as set out in Sections 2.1 and 2.2;     (b) the Parties obligations under this Agreement.   3 TRANSFER OF THE ASSETS   3.1 In consideration of the mutual promises and releases set out in this Agreement and the payment of the Landed Cost in accordance with Section 6.3 below, Strakan shall transfer the Assets to Orexo in accordance with the terms of this Agreement.   3.2 Title, right and interest in and to the Assets shall pass as follows:     (a) title to and beneficial ownership of the Regulatory Approvals shall pass to Orexo as provided in Section 4;     (b) title to and beneficial ownership of the Contracts shall pass to Orexo as provided in Section 5;     (c) title to and beneficial ownership of the Abstral US Mark shall pass to Orexo as provided in Section 7;   12   (d) title to and beneficial ownership of the Stock shall pass to Orexo as     (e) title to and beneficial ownership of the Records shall pass to Orexo as provided in Section 5.2.   3.3 As from the Signature Date, all the Assets shall, pending any necessary payment, legal assignment, novation or assurance, be held by Strakan on trust for Orexo absolutely meaning that Orexo shall be entitled to all benefit out of such Assets during such period. Any payments emanating from such Assets shall be considered held on Orexo’s account (sw: redovisningsmedel).   4 TRANSFER OF REGULATORY APPROVALS IN THE USA AND PROVISION OF TRANSITION SERVICES TO OREXO   4.1 Following the Signature Date, the Parties shall cooperate to secure the transfer of the Regulatory Approvals from Strakan to Orexo in accordance with the Transition Plan. Strakan and Orexo shall use reasonable endeavours to complete such transfer as soon as possible after the Signature Date and in accordance with the Transition Plan.   4.2 Strakan will sign any notices, applications or other documents presented to it by Orexo that are necessary to transfer the Regulatory Approvals to Orexo unless Strakan reasonably believes that any document presented is misleading. Any communications with the FDA by Strakan in relation to the Product after the Signature Date shall be made in consultation with Orexo.   4.3 Subject to Section 6.2, during the period beginning on the Signature Date and ending on the Transition Date or, if Orexo begins to book sales prior to 31st December 2012, as long as requested by Orexo but not beyond 31st December 2012 (“the Transition Period”), Strakan shall provide the Transition Services to Orexo in accordance with the Transition Plan. Strakan agrees that if requested in writing by Orexo it will provide transition services (excluding marketing and promotion services) relating to the Product after 31 December 2012 subject to (i) Orexo reimbursing Strakan for any Third Party Costs incurred in connection therewith and (ii) Orexo paying Strakan for its FTE Costs incurred in provided such services at Strakan’s then prevailing FTE rates provided that such services will not be provided   13   beyond 31 March 2013. Strakan shall be responsible for its costs and all Third Party costs incurred by Strakan in connection with the provision of the Transition Services and as described in the Transition Plan except that Orexo will reimburse Strakan for all Third Party costs incurred by Strakan and relating to the period after 30 September 2012 as set out in the Transition Plan. Strakan will invoice Orexo for any such Third Party costs incurred by Strakan after 30 September 2012 and Orexo shall pay such sums to Strakan with thirty (30) days of the date of the applicable invoice. Orexo shall provide Strakan with any assistance it reasonably requires to comply with its obligations under this Section 4.3. Upon Orexo’s request, Strakan shall provide reasonable supporting documentation of Third Party Costs. Strakan shall not incur Third Party Costs without Orexo prior written approval if exceeding $1,000 per item or $5,000 in the aggregate, unless identified in a budget approved by Orexo in writing in advance. For clarity the budgeted items identified in the Transition Plan shall be deemed approved. Notwithstanding anything to the contrary herein or in the Transition Plan, the annual establishment and product user fees payable in 2012 shall be proportioned between the Parties such that Strakan bears the cost of such fees to the extent such fees relate to the period when Strakan books the sales and Orexo bears the remaining part of said user fees.   4.4 Any assets involved in the provision of services by Strakan under this Section 4 shall remain at all times the property of Strakan or its Affiliates, save as expressly provided in this Agreement.   4.5 Strakan shall perform the Transition Services under the Transition Plan in compliance with all applicable Laws, enactments, orders, regulations and standards and will obtain and maintain in force for the Transition Period all applicable licences, permissions, authorisations, consents and permits reasonably required to perform the Transition Services in accordance with this Section 4 and the terms of this Agreement and the Transition Plan.   4.6 Orexo shall have the option, but not the obligation, to assume full responsibility for all or any part of the Transition Services prior to the end of the Transition Period. Orexo, in its sole discretion, shall have the right to determine the timing of the Transition Date, provided that such date shall not be later than December 31, 2012.   4.7 No staff shall transfer between Strakan and Orexo at the commencement or expiration of the Transition Period.   14 4.8 Strakan agrees to notify Orexo promptly of any event which could reasonably be expected to have a material adverse effect on the business related to the Product. Strakan shall not offer prices, rebates, discounts and other sales terms which have not previously and customarily been offered by Strakan. During said period Strakan shall also observe customary stock rotation principles.   4.9 During the Transition Period, Strakan shall have a non-exclusive royalty-free licence right under the Orexo Technology and the Abstral US Mark to carry out the activities under this Section 4 in the Orexo Territory. Such licence shall be sublicensable to the extent required by Strakan to comply with its obligations under this Section 4.   4.10 From the Transition Date or, if earlier, the date on which the applicable Regulatory Approval is assigned to Orexo pursuant to the Transition Plan and subject to Strakan’s obligations under this Section 4, Orexo shall be responsible for fulfilling all legal and regulatory obligations under the Regulatory Approvals, including maintaining the Regulatory Approvals.   4.11 Product Returns. Returns shall be the responsibility of the Party who shipped the lot with respect to which a return has occurred. During the Transition Period, Strakan shall be responsible for all Product returns. From and after the Transition Date, Strakan shall be responsible for, and shall reimburse Orexo for, the originally invoiced value of the returns of the Product from batches from which any sale has been made by Strakan prior to the Transition Date.   4.12 Recalls. If the FDA or any other regulatory authority with applicable jurisdiction shall order, or it shall otherwise become necessary to perform, any corrective action or market action with respect to the Product following the date of transfer of the NDA to Orexo (including, without limitation, any recall, field correction, market withdrawal, stock recovery, customer notice or restriction), Orexo shall have the exclusive responsibility to appropriately manage such action. If such corrective action or market action is necessitated by the breach by one of the Parties of any of its warranties, representations, obligations, covenants or agreements contained herein, then such Party shall be liable, and shall reimburse the other Party, for all reasonable costs incurred by the non-breaching Party in connection with such action (including, without limitation, reasonable attorney’s fees and expenses). If each of the Parties is partly responsible for such corrective action or market action, then each Party shall be responsible for its proportionate   15   share of such costs. If neither Party is responsible for such corrective action or market action, then Orexo shall be responsible for such costs. Strakan shall appropriately cooperate with Orexo, including the completion of an investigation and the preparation and submission of a complaint report to Orexo or its designees. The preceding shall not be in lieu or limitation of any obligation of indemnity of a Party pursuant to Section 11.   5 TRANSFER OF CONTRACTS AND RECORDS   5.1 The Contracts shall be dealt with as follows:     (a) this Agreement shall constitute an assignment to Orexo of the benefit of all the Contracts which Strakan is entitled to assign without the consent of any Third Party in each case with effect from the Transition Date;     (b) as from the Transition Date Strakan shall hold the benefit of those of the Contracts which cannot be assigned without the consent of a Third Party for Orexo (and all rights, revenues, obligations, liabilities and losses arising from them after the Transition Date shall belong to and be borne by Orexo) and Strakan shall, at Orexo’s request, give to Orexo all reasonable assistance at no cost to Strakan to enable Orexo to enforce the Contracts;     (c) Orexo and Strakan shall each use their reasonable endeavours to obtain all necessary consents for and subsequently effect the assignment or novation of each of the Contracts referred to in Section 5.1(b) using the agreed form deed of novation attached at Exhibit 6; and     (d) with effect from the Transition Date and subject to Strakan performing its obligations under this Section 5 and Section 4 above Orexo shall assume the obligations and carry out, complete and discharge all of the obligations of Strakan under the Contracts and shall indemnify Strakan from all Contract Liabilities to the extent arising from any event, circumstance or condition occurring after the Transition Date.   5.2 During the Transition Period and in accordance with the Transition Plan Strakan will deliver the Records to Orexo. Strakan shall be entitled to retain a copy of the Records to enable Strakan and its Affiliates to comply with all applicable Laws and regulations or to comply with its obligations or enforce its rights under this Agreement or the other agreements referred to in the Background section of this Agreement.   16 6 TRANSFER OF STOCK   6.1 The Stock shall transfer to Orexo as follows. Orexo shall have the right but not the obligation to purchase at its election all or part of Strakan’s Stock existing on the date on which Orexo starts to book the sales of Product in the Orexo Territory that is in Good Marketable Condition at the Landed Cost. Upon Orexo’s written request to purchase selected part of the Stock (which request shall be made no later than ten (10) days prior to the date on which Orexo begins to book sales of Product in the Orexo Territory) Strakan shall provide in writing within five (5) days after such request information specifying in detail the inventory of Stock and the remaining shelf-life of the Stock to the extent such information has not previously been provided by Strakan to Orexo. Orexo may inspect the inventory of Stock, at its option within five (5) days of receiving such written information from Strakan. Orexo shall inform Strakan in writing within ten (10) days after receiving such written information (or after any inspection by Orexo whichever is later) what Stock it shall purchase. Strakan shall promptly ship the purchased Stock to Orexo or its designated Third Party at Orexo’s cost and risk. Payment for Stock so purchased by Orexo shall be made as provided in Section 6.3. Each delivery of Stock shall be accompanied by a Certificate of Analysis for each Product batch delivered. Any Stock which Orexo does not purchase shall be destroyed by Strakan unless otherwise agreed in writing by the Parties. Any quantities of the Stock purchased by Orexo that is not in Good Marketable Condition may be returned by Orexo for a full refund of the Landed Cost paid for such Stock and reimbursement of direct costs incurred by Orexo in connection with transport of such Stock to Strakan or its destruction. Orexo shall notify Strakan in writing of any such defective Stock within (i) 30 days from delivery in the case of a defect that is apparent on normal visual inspection; or (ii) 30 days from the date on which Orexo became aware of the defect in the case of a defect that is not apparent on normal visual inspection. If Strakan does not acknowledge a defect claimed by Orexo, the parties shall endeavour to settle such disagreement in an amicable and constructive manner. In the event that the Parties fail to agree within four (4) weeks after receipt of the notice of defects, the Parties agree to nominate an independent, reputable laboratory, acceptable to both Parties, which shall examine representative examples taken from such consignment, using the methods of analysis agreed upon by both Parties, and the result shall be binding on both   17   Parties. The Party whose opinion is not supported by the laboratory, shall pay the fees to the laboratory. It shall be Strakan’s responsibility at its cost to destroy any Stock that is not in Good Marketable Condition and shall provide Orexo with appropriate documentation evidencing that such destruction has taken place.   6.2 From the date on which the Stock is shipped to Orexo pursuant to Section 6.1 above, Orexo shall be responsible for all costs associated with storing, marketing and distributing the Stock including warehousing, insurance and transportation costs.   6.3 Strakan shall invoice Orexo for the Stock upon shipment as provided in Section 6.1. Within 30 days of the date of such invoice, Orexo shall pay to Strakan a sum equivalent to the Landed Cost of the Stock so purchased.   6.4 The payment due under Section 6.3 shall be paid in immediately available funds in USD to the bank account designated in writing by Strakan.   6.5 In the event that the payment due under Section 6.3 is not paid in full within thirty (30) days after the due date as per Section 6.3, the sums owing shall, after prior notice from Strakan and a five (5) Business Day cure period, bear interest at an annual rate of interest equal to the London Interbank Offered Rate (“LIBOR”), plus five (5) percentage points, calculated on the number of days such sums are delinquent.   6.6 Orexo shall have a non-exclusive licence to use any Strakan trade marks which are present on the packaging of the Stock purchased by Orexo and to use such marks to the extent required by applicable law or regulation in the Orexo Territory to promote and sell the Stock so purchased. Such trade marks shall be used in accordance with Strakan’s reasonable instructions and Orexo shall not do or cause to be done anything which might damage, tarnish or jeopardise such trade marks and the goodwill associated with them.   7 ASSIGNMENT OF THE US ABSTRAL MARK   7.1 Strakan agrees to assign all right, title and interest in and to the Abstral US Mark and the Abstral Domain Names to Orexo. On execution of this Agreement, the Parties shall enter into the agreed form assignment document at Exhibit 3 in order to give effect to the assignment of the Abstral US Mark. Strakan hereby grants Orexo a free of charge non-terminable and perpetual sublicensable right and   18   license to use in the Orexo Territory for the Exploitation of the Product any Strakan’s trade dress and artwork for the Product as well as Strakan’s training and marketing material relevant for the Product under any intellectual property rights Controlled by Strakan provided that such licence shall not include Strakan’s trade marks which are covered in Section 6.6.   7.2 Strakan shall sign any documents and do all such other things as are reasonably necessary to transfer the Abstral Domain Names to Orexo together with the 1-800-ABSTRAL freephone telephone number.   8 DEVELOPMENT, MANUFACTURE AND COMMERCIALISATION   8.1 From the Transition Date, subject to Strakan’s obligations under Section 4, Orexo shall be responsible for the Exploitation of the Product in the Orexo Territory at its sole discretion. Orexo shall provide prior written notice to Strakan of the identity of any Third Party which it or its Affiliates or licensees or distributors are proposing to appoint to manufacture the Product. If such Third Party manufacturer could, in the reasonable opinion of Strakan, be considered to be a potential generic supplier of the Product in any part of the world Strakan shall be entitled to object to such appointment provided such objection is notified to Orexo within fourteen (14) days of the date of Orexo’s notice containing the identity of the proposed Third Party manufacturer. If Strakan provides such a notice of objection Orexo will not and will procure that its Affiliates, licensees and distributors will not appoint the proposed Third Party manufacturer to manufacture the Product.   8.2 Licence Grant: Strakan hereby grants to Orexo, and Orexo hereby accepts, an exclusive (even as to Strakan) perpetual non-terminable paid-up sublicensable licence to develop, make or have made, use, sell, offer for sale, market and promote the Product for all uses in the United States of America under the Strakan Technology. The following provisions in the Rapinyl EU Licence Agreement shall apply mutatis mutandis to Orexo’s license rights to the Strakan Patents in the United States of America: Sections 9.2 through 9.5.   8.3 Competing Products: Strakan agrees that for five years from the Signature Date neither it nor its Affiliates will directly or indirectly sell, market or otherwise promote including by means of a licence any Competing Product in the Orexo Territory.   19 8.4 Reporting Adverse Events: In accordance with the Global Safety Agreement between the Parties, Strakan shall continue to own the global safety database for the Product. Orexo shall keep Strakan informed of any information of which it becomes aware concerning adverse events (as defined in the applicable FDA regulations, the then current edition of ICH Guidelines and any other relevant regulations or regulatory guidelines or any other safety problem of any significance, hereafter “Adverse Events”), product quality and product complaints involving Adverse Events relating to the Product. The Parties will negotiate in good faith any necessary amendments to the Global Safety Agreement within sixty (60) days of the Signature Date. Each of the Parties hereto shall disclose to the other Party all safety reports and other information (collectively “Safety Data”) which they may from time to time receive or obtain (whether from sources within or without the Orexo Territory) with respect to any adverse drug experiences with respect to the Product, in accordance with a reporting protocol to be mutually agreed by the Parties as promptly as possible following the Signature Date. Orexo shall be responsible for the reporting of Safety Data to FDA as of the Transition Date, Strakan shall be responsible for such reporting before the Transition Date.   8.5 General Reporting: After the Transition Date:     (a) Strakan shall immediately pass to Orexo all notices and correspondence which Strakan or its Affiliates receive after the Transition Date in relation to the Product in the Orexo Territory (other than relating to the activities of Strakan or its Affiliates before the Transition Date); and     (b) Orexo shall immediately pass to Strakan all notices and correspondence with Orexo or its Affiliates receive after the Transition Date in relation to the activities of Strakan or its Affiliates with regard to the Product in the Orexo Territory before the Transition Date.   8.6 Regulatory Matters.     (a) Responsibility for the Product. Subject to compliance by the Parties with the applicable provisions of the Transition Plan, from and after the Transition Date (or such earlier date as the NDA transfers to Orexo in accordance with Section 8.6(b) below), Orexo shall have all regulatory responsibilities under applicable Laws and regulations, reporting and otherwise, in connection with the Product in the Orexo Territory.   20   (b) Transfer of NDA. On the Transition Date (or an earlier date agreed upon by the Parties), the Parties shall file with the FDA all of the documents and information required by the FDA to effect the transfer of the NDA from Strakan or any Affiliate to Orexo or an Affiliate of Orexo designated by Orexo. Strakan shall file and shall cause its Affiliates to file all of the documents and the information required of a former owner, including but not limited to a letter acknowledging the transfer of ownership of the NDA, and Orexo shall file the information required of a new owner. Each of Orexo and Strakan shall take any and all other actions required by the FDA or other relevant regulatory authorities, if any, to effect the transfer of the NDA from Strakan or its Affiliate to Orexo or its designated Affiliate as soon as reasonably practicable after the Transition Date (or other agreed upon date). Strakan may retain an archival copy of the NDA, including supplements and records that are required to be kept under applicable Law.     (c) Communications with Regulatory Agencies. Subject to the respective obligations of the Parties set forth in the Transition Plan, from and after the Transition Date (or, if earlier, the date of transfer of the NDA Approval to Orexo in accordance with Section 8.6(a) above), Orexo shall have responsibility for all communication with the FDA with respect to the matters relating to the Product in or with respect to the Orexo Territory. From and after the Signature Date, Strakan shall make available to Orexo, copies of all correspondence to or from the FDA or other applicable regulatory authority relating to the manufacturing and testing of the Product in the Orexo Territory. From and after the Signature Date, Strakan shall make available to Orexo copies of all regulatory correspondence regarding regulatory warning letters, untitled letters, and correspondence bearing on the safety and efficacy of the Product in the Orexo Territory.     (d) Additional Information. From and after the Transition Date, Strakan shall provide to Orexo in a timely manner, but in no event less than sixty (60) days prior to the due date of Orexo’s annual report to the FDA with respect to the Product, all information (in written form) which Orexo reasonably requests regarding the manufacture of the Stock which Orexo purchases from Strakan in accordance with Section 6.1 which may be needed for Orexo to comply with applicable annual reporting requirements of the FDA and applicable Laws.   21 9 CONFIDENTIALITY   9.1 Confidentiality: Except to the extent expressly authorised by this Agreement, the Parties agree that, for a period of ten (10) years after the Signature Date of this Agreement, the Party that has received (“Recipient”) Confidential Information from the other Party (whether under the terms of this Agreement or the Rapinyl North America Licence Agreement) will keep confidential and will not publish or otherwise disclose to any Third Party other than its employees, directors, sublicensees, licensees, advisors or Affiliates or, to the extent reasonably necessary to exercise its rights hereunder, other Third Parties, who, in each case, are under a confidentiality obligation substantially equivalent to that of the Recipient, and will not use for any purpose other than exercising its rights and performing its obligations under this Agreement any Confidential Information furnished to it by the other Party pursuant to this Agreement. Each Party will use at least the same standard of care with any Confidential information it receives as it uses to protect its own Confidential Information, but no less than reasonable care, and each Party will promptly notify the other Party upon discovery of any unauthorised use or disclosure of the other party’s Confidential Information.   9.2 Permitted Disclosures: The confidentiality obligations contained in Section 9.1 will not apply to the extent that the Recipient is required (a) to disclosure information by law, order, or regulation of a governmental agency or a court of competent jurisdiction, (b) to disclose information to any regulatory authority for purposes of obtaining approval to test or market a Product or (c) to satisfy either Party’s duty of disclosure or other requirement in the prosecution of any patent rights, provided, that in each case, that the Recipient will give written notice thereof to the other party and sufficient opportunity to prevent or limit any such disclosure or to request confidential treatment thereof; and provided further, that the Recipient will give reasonable assistance to the disclosing Party to preserve the information as confidential, that the Recipient will only disclose such Confidential Information to the extent required and that such information will remain Confidential Information hereunder despite such disclosure.   9.3 Disclosure of Financial and Other Terms: Except as required by applicable laws, treaties and agreements (including securities laws), the Parties agree that the material terms of this Agreement will be considered Confidential Information of both Parties. Notwithstanding the foregoing, (a) either party may disclose such terms as are required to be disclosed in its publicly-filed financial statements or   22   other public statements, pursuant to applicable laws, regulations and stock exchange rules (e.g. the London Stock Exchange, the Tokyo Stock Exchange, Nasdaq OMX Nordic (Stockholmsbörsen), or any other stock exchange on which securities issued by Strakan or Orexo or their Affiliates may be issued); provided, such party shall provide the other Party with a copy of the proposed text of such statements or disclosure (including any exhibits containing this Agreement) sufficiently in advance of the scheduled release or publication thereof to afford such other Party a reasonable opportunity to review and comment upon the proposed text (including redacted versions of this Agreement), (b) either Party shall have the further right to disclose the terms of this Agreement under a confidentiality obligation no less protective than those set forth in this Agreement, to any potential acquirer, merger partner or potential providers of financing and their advisors.   10 REPRESENTATIONS AND WARRANTIES   10.1 Mutual Representations and Warranties of Orexo and Strakan hereby represent and warrants to the other Party as of the Signature Date as follows:     (a) It is duly organised, validly existing and in good standing under the laws of the jurisdiction of incorporation. It has the requisite legal and company power and authority to conduct its business as presently being conducted and as proposed to be conducted by it and is duly qualified to do business in those jurisdictions where its ownership of property or the conduct of its business requires;     (b) It has all requisite legal and company power and authority (including shareholder authority) to enter into this Agreement and to perform the obligations contemplated hereunder. All company actions on its part, its boards of directors or managers, or similar governing body and its equity holders necessary for (i) the authorisation, execution, delivery and performance by it of this Agreement, and (ii) the consummation of the transactions contemplated hereby, have been duly taken.     (c) This Agreement is a legally valid and binding obligation of it, enforceable against it in accordance with its terms (except in all cases as such enforceability may be limited by applicable bankruptcy, insolvency, reorganisation, moratorium or similar laws affecting the enforcement of   23   creditors’ rights generally and except that the availability of the equitable remedy of specific performance or injunctive relief is subject to the discretion of the court or other tribunal before which any proceeding may be brought).     (d) Each Party covenants and agrees as to any Third Party suit, action, arbitration or judicial proceeding or any governmental investigation or inquiry, relating to the Assets or the Product, being prosecuted or defended by the other Party, to cooperate in making records available to such other Party and to provide such access to, and use of, such information and data as reasonably requested by such other Party in connection therewith. Each Party will reimburse the Party providing such cooperation for its reasonable out-of-pocket expenses incurred in connection with its obligations under this Section 10.1(d).   10.2 Additional Representations and Warranties of Strakan Strakan hereby further represents and warrants to Orexo as of the Signature Date that:     (a) As far as Strakan and its Affiliates are aware there are no threatened or actual claims, litigation or disputes (including product liability claims and governmental actions or investigations) relating to the Product in the Orexo Territory.     (b) Strakan, its Affiliates and licensees have complied with, and will comply with in respect of Transition Services, all applicable Laws and regulations in relation to the development, manufacture, marketing, promotion, distribution or sale of the Product in the Orexo Territory.     (c) Strakan has, prior to the Signature Date, provided Orexo with true, complete and up-to-date copies of all documents comprising each of the Contracts and there has been no amendment or addition to any of them, whether express or implied, which is not contained in those documents.     (d) Each of the Contracts is in full force and effect, none of Strakan, any of its Affiliates or any Third Party is in breach of any of its obligations under the Contracts and there are no circumstances likely to give rise to any such breach by Strakan, any of its Affiliates or any Third Party.   24   (e) No event or omission has occurred which would entitle Strakan, any of its Affiliates or any Third Party to terminate prematurely any of the Contracts.     (f) No provision of the Contracts is void, voidable or otherwise unenforceable in any respect (including in relation to the payment or receipt of interest).     (g) Strakan and its Affiliates have complied with all its and their obligations under the Contracts and none of the Contracts is or will become liable to termination because of any breach by or on behalf of Strakan or the transaction contemplated by this Agreement.     (h) The Stock purchased by Orexo will be in Good Marketable Condition.     (i) Strakan or its Affiliates are the legal and beneficial owners of the Abstral US Mark, the Regulatory Approvals, the Abstral Domain Names and the Stock.     (j) Strakan or its Affiliates has the right to provide the Records to Orexo for the intended purpose in accordance with this Agreement.   10.3 Disclaimer of Warranties: Except as otherwise expressly provided in this Agreement or mandated by applicable law (without the right to waive or disclaim), neither party makes any representation or warranty with respect to the licensed compounds, product, any technology, goods, services, rights, or other subject matter of this Agreement and hereby disclaims all warranties, conditions or representations of any kind, express or implied, including implied warranties of performance, merchantability, satisfactory quality, fitness for a particular purpose of non-infringement of third party intellectual property rights.   10.4 Limitation of Liability: Orexo shall not be entitled to make any claim in relation to any representation or warranty of Strakan in Section 10.2 in respect of:     (a) Anything arising directly or indirectly from any fact, matter or circumstance fairly disclosed in any of the documents provided to Orexo by Strakan prior to the Signature Date;     (b) Any matter of which Orexo, its agents or advisers or any of them has actual or imputed knowledge as at the Signature Date;     (c) Any matter or thing done or omitted to be done in accordance with this Agreement or otherwise at the written request or the approval in writing of Orexo.   25 11 INDEMNIFICATION   11.1 Indemnification by Strakan: Except to the extent required to be indemnified by Orexo under Section 11.2, Strakan shall indemnify, defend and hold harmless Orexo, its Affiliates, and its and their respective, directors, officers, employees and agents (collectively “the Orexo Indemnified Party”) against any and all claims, liabilities, losses, damages, costs or expenses, including reasonable attorneys’ fees, arising out of any claim or action brought by a Third Party (collectively, “Losses”) incurred or suffered by the Orexo Indemnified Party to the extent arising out of or caused by:     (i) The breach by Strakan of one or more of its representations, warranties or other material obligations under this Agreement;     (ii) The development, testing, manufacture, distribution, marketing, promotion or sale of Products by or on behalf of Strakan, its Affiliates and Sub-Licensees in the Orexo Territory as well as Mexico and Canada, including their possessions and territories (including without limitation any claims based upon product liability) prior to the Transition Date or, in the case of Mexico and Canada, Signature Date.   11.2 Indemnification by Orexo: Except to the extent required to be indemnified by Strakan under Section 11.1, Orexo shall indemnify, defend and hold harmless Strakan, its Affiliates, and its and their respective, directors, officers, employees and agents (collectively “the Strakan Indemnified Party”) against any and all Losses (as defined above) incurred or suffered by the Strakan Indemnified party to the extent arising out of or caused by:     (i) The breach of Orexo of one or more of its representations, warranties or     (ii) The development, manufacture, distribution, marketing, promotion or sale of the Product by or on behalf of Orexo or its Affiliates or licensees in the Orexo Territory (including without limitation any claims based upon product liability) after the Transition Date.   26 11.3 Notification of Liabilities/Losses: In the event that either party intends to seek indemnification for any claim under any of Sections 11.1 or 11.2, it shall inform the other Party of the claim promptly after receiving notice of the claim.     (i) In the case of a claim for which Orexo seeks indemnification under Section 11.1, Orexo shall permit Strakan to direct and control the defence of the claim and shall provide such reasonable assistance as is reasonably requested by Strakan (at Strakan’s cost) in the defence of the claim, provided that nothing in this Section 11.3 shall permit Strakan to make any admission on behalf of Orexo, or to settle any claim or litigation which would impose any financial obligations on Orexo without the prior written consent of Orexo, such consent not to be unreasonably withheld or delayed.     (ii) In the case of a claim for which Strakan seeks indemnification under Section 11.2, Strakan shall permit Orexo to direct and control the defence of requested by Orexo (at Orexo’s cost) in the defence of the claim, provided always that nothing in this Section 11.3 shall permit Orexo to make any admission on behalf of Strakan, or to settle any claim or litigation which would impose any financial obligations on Strakan without the prior written consent of Strakan, such consent not to be unreasonably withheld or delayed.   11.4 Neither Party limits or excludes its liability for fraudulent misrepresentation nor for death or personal injury arising from its negligence.   11.5 Exclusive Remedy: Each Party agrees that its sole and exclusive remedy with respect to Losses shall be pursuant to the indemnification provisions of this Section 11.   11.6 Insurance: Immediately upon execution of this Agreement, and for a period of five (5) years thereafter, each party shall maintain adequate liability insurance coverage in such amounts and with such coverage as is customary for similar products in the Orexo Territory, including any legally mandatory insurance.   12 MISCELLANEOUS PROVISIONS   12.1 Consequential Damages: In no event shall either Party or their Affiliates be liable for special, punitive, indirect, incidental or consequential damages, whether based on contract, tort or any other legal theory and irrespective of whether such Party   27   has been advised of the possibility of any such loss or damage, provided, that this limitation shall not limit the indemnification obligation of such Party under the provisions of Section 11 for such damages claimed by a Third Party and nothing in this Section 12.1 is intended to limit Orexo’s payment obligations under Section 6.   12.2 Further Actions: Each Party agrees at its own cost to execute, acknowledge and deliver such further instructions or documents, and to do all such other actions, as may be necessary or appropriate in order to carry out the full purposes and intent of this Agreement.   12.3 Compliance with Laws: Each Party shall review in good faith and cooperate in taking actions to ensure compliance of this Agreement and the parties’ activities hereunder with all applicable Laws, rules, ordinances, regulations and guidelines. Each Party shall provide the other Party such reasonable assistance as may be required for the Party requesting such assistance to comply with all such Laws, rules, ordinances, regulations and guidelines of all governmental entities, bureaus, and agencies having jurisdiction pertaining to this Agreement, including obtaining all import, export and other permits, certificates, licenses or the like required by such Laws, rules, ordinances, regulations and guidelines necessary to permit the Parties to perform hereunder and to exercise their respective rights hereunder.   12.4 Force Majeure: Neither Party shall be responsible or liable in any way for failure or delay in carrying out the terms of this Agreement (other than any payment or confidentiality obligations) resulting from fire, flood, other natural disasters, war, labour difficulties, interruption of transit, accident, explosion, civil commotion, and acts of any governmental authority; provided, that the Party so affected shall give prompt notice thereof to the other. If any such cause prevents either Party from performing any of its material obligations hereunder for more than ninety (90) days, the other Party may then terminate this Agreement upon thirty (30) days prior notice. Except as provided in the preceding sentence, no such failure or delay shall terminate this Agreement, and each party shall complete its obligations hereunder as promptly as reasonably practicable following cessation of the cause or circumstances of such failure or delay.   12.5 Amendment: No amendment, modification or supplement of any provision of this Agreement shall be valid or effective unless made in a writing that explicitly refers to this Agreement and that is signed by a duly authorised officer of each Party.   28 12.6 Waiver: Except to the extent otherwise expressly set forth in this Agreement, the rights and remedies of the Parties set forth herein or otherwise available at law or equity are cumulative and not alternative. No provision of this Agreement shall be waived by any act, omission or knowledge of any Party or its agents or employees except by an instrument in writing expressly waiving such provision and signed by a duly authorised officer of the waiving Party.   12.7 Counterparts: This Agreement shall be executed in two or more counterparts, each of which shall contain the signature of the Parties and all such counterparts shall constitute one and the same agreement.   12.8 Descriptive Headings: The descriptive headings of this Agreement are for convenience only, and shall be of no force or effect in construing or interpreting any of the provisions of this Agreement.   12.9 Assignment: Neither Party shall have the right to assign this Agreement nor any of its rights hereunder, nor delegate any of its obligations hereunder, without the prior written consent of the other party, which shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, (i) Orexo and Strakan may assign this Agreement to any purchaser of all or substantially all of its assets or all of its assets to which this Agreement relates or to any successor entity resulting from any merger or consolidation of Orexo or Strakan with or into such entity, or (ii) Orexo and Strakan may assign this Agreement to any of its Affiliates but only for as long as such Affiliate remains an Affiliate of the assigning Party provided that the assigning Party remains primarily liable for all of its obligations hereunder and such Affiliate agrees to be bound hereunder. Any attempt to assign this Agreement in breach of the foregoing shall be void. This Agreement shall be binding upon and inure to the benefit of the Parties hereto and each of their successors and permitted assigns.   12.10 Notices: All notices and other communications hereunder shall be in writing and shall be deemed given when delivered personally or by email or facsimile transmission (receipt verified), five (5) days after mailed by registered or certified air mail (return receipt requested), postage prepaid, or two (2) days after sent by express courier service, to the Parties at the by like notice; provided, that notices of a change of address shall be effective only upon receipt thereof): If to OREXO, addressed to: Orexo AB Att: CEO P.O. Box 303 Sweden [email protected]   29 If to Strakan, addressed to: Andrew McLean Director Strakan International Sarl Galabank Business Park Galashiels TD1 1QH UK [email protected]   12.11 Severability: Whenever possible, each provision of this Agreement will be but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement and the parties shall in good faith seek to agree on an alternative provision reflecting the intent of the Parties that is enforceable.   12.12 Entire Agreement: This Agreement will constitute and contain the complete, final and exclusive understanding and agreement of the Parties and cancels and supersedes any and all prior negotiations, correspondence, understandings and agreements, whether oral or written, between the Parties with respect to the subject matter hereof.   12.13 Governing Law: This Agreement (and all disputes arising out of it accordance with the substantive laws of Sweden, without regard to the choice of law provisions thereof.   30 12.14 Dispute Resolution   precedent. Said designated offices are as follows.   For Orexo:    Chief Executive Officer For Strakan:    Chief Executive Officer   (b) In the event that they shall be unable to resolve the dispute by executive mediation within such sixty (60) day period, then the dispute shall be finally settled by binding arbitration as provided below.     (d) The procedures specified in this Section 12.12 shall be the sole and in good faith in the procedures specified in this Section 12.12.     31 12.15 Independent Contracts: Nothing herein shall be construed to create any relationship of employer and employee, agent and principal, partnership or joint venture between the Parties. Each Party is an independent contractor. Neither Party shall have authority to make any statements, representations, or commitments of any kind, or to take any action which shall be binding on the other Party, except as may be explicitly provided for herein or otherwise authorised in writing. [Remainder of page intentionally left blank - Signature pages to follow]   32 This Agreement has been executed in two (2) original copies of which the (Parties) have taken one (1) each. The Agreement shall come into force on the date given at the beginning of this Agreement.   For and on behalf of Orexo AB      Date:    June 1 2012      Signed by:    /s/ Anders Lundstrom      [ILLEGIBLE] Full name    Anders Lundstrom      [ILLEGIBLE] Position:    CEO      CFO For and on behalf of Strakan International S.à r.l      Date:    1st June 2012      Signed by:    /s/ Andrew McLean      Full name:    Andrew McLean      Position:    Director & General Counsel        33 EXHIBIT 1 Orexo Patents   1 Fentanyl Composition for the Treatment of Acute Pain US Patent No. 6,759,059   2 Pharmaceutical Composition for the Treatment of Acute Disorders US Patent No. 6,761,910   34 EXHIBIT 2 Contracts   1 Additional Service Agreement dated 30 June 2010 between Strakan International Limited and Pharmaceuticals International Inc   2 Additional Service Agreement dated 11 October 2010 between Strakan International Limited and Pharmaceuticals International Inc   3 Additional Service Agreement dated 11 March 2011 between Strakan International   4 Supply Agreement dated 1 September 2010 between Strakan International Limited and Sharp Corporation.   35 EXHIBIT 3 Agreed Form Trade Mark Assignment Private & Confidential DATED              20             STRAKAN INTERNATIONAL SARL   (1)   and     OREXO AB   (2)     TRADE MARK ASSIGNMENT       36 THIS AGREEMENT is dated [DATE] PARTIES   (1) Strakan International S.à r.l a limited liability company organised and existing under the laws of Luxembourg and having its principal place of business at Galabank Business Park, Galashiels TD1 1QH, UK (“Strakan”).   (2) Orexo AB a limited liability company organised and exiting under the laws of Sweden and having its principal place of business at Virdings allé 32, Uppsala, Sweden (“Orexo”). Each a “Party” and collectively, the “Parties”. BACKGROUND   (A) Strakan is the proprietor of the Abstral US Mark (as defined below).   (B) By the Main Agreement (as defined below) Strakan has agreed to assign the Abstral US Mark to Orexo on the terms set out in this Agreement. AGREED TERMS   1 Interpretation   1.1 The definitions and rules of interpretation in this clause apply in this Agreement. Abstral US Mark: the registered trade mark ABSTRAL, registered in the United States of America under registration number 3563010 together with all goodwill associated therewith. Main Agreement: the Termination and Asset Transfer Agreement for Abstral™ in the United States of America dated [DATE] between Strakan and Orexo.   1.2 Clause and schedule headings shall not affect the interpretation of this Agreement.   1.3 References to clauses are to the clauses of this Agreement.   1.4 Unless the context otherwise requires, words in the singular shall include the plural and in the plural include the singular and a reference to one gender shall include a reference to the other genders.   1.5 A reference to a statute or statutory provision shall include any subordinate legislation made from time to time under that statute or statutory provision.   1.6 Writing or written includes faxes but not e-mail.   1.7 Any words following the terms including, include, in particular or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms. 1.8 A person includes a natural person, corporate or unincorporated body (whether or not having separate legal personality) and that person’s legal and personal representatives, successors and permitted assigns.   2 Assignment   2.1 Pursuant to and in consideration of the mutual obligations and promises set out in the Main Agreement, Strakan hereby assigns to Orexo all right, title and interest in and to the Abstral US Mark, including:     (a) all statutory and common law rights (including goodwill) attaching to the Abstral US Mark; and     (b) the right to bring, make, oppose, defend, appeal proceedings, claims or actions and obtain relief (and to retain any damages recovered) in respect of any infringement, or any other cause of action (including passing off) arising from ownership, of the Abstral US Mark whether occurring before, on or after the   3 Further assurance   3.1 Strakan shall and shall use all reasonable endeavours to procure that any necessary third party shall, at Strakan’s cost, execute such documents and perform such acts as may reasonably be required for the purpose of giving full effect to this Agreement.   4 Waiver   4.1 Except to the extent otherwise expressly set forth in this Agreement, the rights and remedies of the Parties set forth herein or otherwise available at law or equity are cumulative and not alternative. No provision of this Agreement shall be waived by any act, omission or knowledge of any Party or its agents or employees except by an instrument in writing expressly waiving such provision and signed by a duly authorised officer of the waiving Party.   5 Entire agreement   5.1 This Agreement will constitute and contain the complete, final and exclusive understanding and agreement of the Parties and cancels and supersedes any and all prior negotiations, correspondence, understandings and agreements, whether oral or written, between the Parties with respect to the subject matter hereof.   5.2 Each party acknowledges that, in entering into this Agreement, it has not relied on, and shall have no right or remedy in respect of, any statement, representation, assurance or warranty (whether made negligently or innocently) other than as expressly set out in this Agreement. 5.3 Nothing in this clause shall limit or exclude any liability for fraud.   6 Severance   6.1 Wherever possible, each provision of this Agreement will be interpreted in provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement and the Parties shall in good faith seek to agree on an alternative provision reflecting the intent of the Parties that is enforceable.   7 Counterparts   7.1 This Agreement may be executed in two or more counterparts, each of which shall contain the signature of the Parties and all such counterparts shall   8 Third party rights   8.1 No person other than a party to this Agreement shall have any rights to enforce any term of this agreement.   9 Notices   9.1 All notices and other communications hereunder shall be in writing and shall be deemed given when delivered personally or by email or facsimile transmission (receipt verified), five (5) days after mailed by registered or certified air mail (return receipt requested), postage prepaid, or two (2) days after sent by express courier service, to the Parties at the following addresses (or at such other address for a Party as shall be specified by like notice; provided, that notices of a change of address shall be effective only upon receipt thereof): If to OREXO, addressed to: Orexo AB Att: CEO P.O. Box 303 Sweden [email protected] Andrew McLean Director Strakan International Sarl Galabank Business Park Galashiels TD1 1QH UK [email protected] 10 Governing law and jurisdiction   10.1 This Agreement (and all disputes arising out of it including non-contractual disputes) shall be governed by and interpreted in accordance with the substantive laws of Sweden, without regard to the choice of law provisions thereof.   10.2 In the event of the occurrence of any dispute arising out of or relating to this Agreement, including any question regarding its existence, validity or termination, either Party may, by written notice to the other, have such dispute referred to its respective officer designated below or their successors, for attempted resolution by good faith negotiations within sixty (60) days after such notice is received. If either Party desires to pursue arbitration under clause 10.3 below to resolve any such dispute, a referral to such executives under this clause 10.2 shall be a mandatory condition precedent. Said designated offices are as follows.     10.3 In the event that they shall be unable to resolve the dispute by executive   10.4 Any arbitration proceeding shall be administered by the Arbitration   10.5 The procedures specified in this clause 10 shall be the sole and exclusive procedures for the resolution of disputes between the Parties arising out of or relating to this Agreement; provided, that a Party, without prejudice to the above procedures, may seek injunctive relief or other provisional judicial relief if in its sole judgment such action is necessary to avoid irreparable damage. Despite such action the Parties will continue to participate in good faith in the procedures specified in this clause 10. This Agreement has been entered into on the date stated at the beginning of it. For and on behalf of Strakan International S.à r.l Date: Signed by: Full name: Position: For and on behalf of Orexo AB (publ) Date: Signed by: Full name: Position: EXHIBIT 4 Landed Cost of Stock ProStrakan: Abstral US formulation/presentation inventories Inventories: The following sets out the current on hand Abstral US inventories by location, quantity, value and expiry date. Precise on hand quantities with warehouse location will vary slightly be day due to outbound shipments and reverse logistics flow. There are two locations for finished goods:     1. Cardinal Health SPS, Nashville TN (ProStrakan Inc Prewholesaler), this is a live warehouse, supporting sales, reported quantities will reduce with actual sales (on hand quantities reported as at month end February 2012)     2. Exel Logistics (3rd party warehouse engaged by ProStrakan to store those inventories exceeding CII storage space at Cardinal), this is a static warehouse, will replenish Cardinal at the Cardinal re order point. ProStrakan have an Operational Services Agreement for Vault Services with Exel. This Agreement is effective as of 04/04/11 and remains effective until 03/04/13. The Agreement covers an allocation of 40, CII vault pallets spaces to ProStrakan, together with material receiving and outbound movements. Typical monthly costs are $16,750. This is based on a per pallet rate of $11.33/day. There are two locations for Work In Progress Inventories (bulk tablets)     1. Pii, Hunt Valley MD (ProStrakan selected ongoing manufacturer for bulk tablets)     2. Sharp Corp, Allentown PA (ProStrakan contract packager)     A. Finished Goods Inventories        Exel Logistics   Pack ID    Lot    Expiry    Units (packs of 32 tabs)      Unit cost $      Value $   100x32    7305B    April 2014      3509         11.57       100x32    7305C    April 2014      5184         11.57                                  Total 100X32            8693            100,546                               200X32    7306B    April 2014      3500         11.91       200X32    7306C    April 2014      5216         11.91                                  Total 200X32            8716            103,822                               300X32    7386B    April 2014      3500         12.27       300X32    7386C    April 2014      5144         12.27                                  Total 300X32            8644            106,101                               400X32    7307B    April 2014      7560         12.60       400X32    7307C    April 2014      2694         12.60                                  Total 400X32            10254            129,161                               600X32    7308B    April 2014      7452         14.83       600X32    7308C    April 2014      5327         14.83                                  Total 600X32            12779            189,458                               800X32    7309B    April 2014      10126         16.69       800X32    9751A    September 2014      3516         16.69                                  Total 800X32            13642            227,670                               Total Exel            62728            856,758                                    Cardinal Health   100X32    7305A    April 2013      2142         11.57       100X32    7305C    April 2014      3360         11.57                                  Total 100X32            5502            63,638                               200X32    7306A    April 2013      2184         11.91       200X32    7306C    April 2014      3360         11.91                                  Total 200X32            5544            66,038                               300X32    7386A    April 2013      2628         12.27       300X32    7386C    April 2014      3360         12.27                                  Total 300X32            5988            73,500                               400X32    7307A    April 2013      2467         12.60       400X32    7307C    April 2014      3360         12.60                                  Total 400X32            5827            73,398                               600X32    7308A    April 2013      2601         14.83       600X32    7308C    April 2014      3360         14.83                                  Total 600X32            5961            88,376                               800X32    7309A    April 2013      2569         16.69                                  Total 800X32            2569            42,874                               Total Cardinal            31391            407,824                               Grand Total Abstral US Finished Goods            94,119            1,264,582                                   B. Work In Progress Inventories   Sharp Corp   Strength    Expiry     Quantity/tablets      Value $   100      April 2014        449370         57,103    200      April 2014        448916         61,889    300      April 2014        450951         67,284    400      April 2014        405559         64,587    600      April 2014        0         0    800      September 2014        357095         102,541                        Total Sharp        2111891         353,404                        Pii (based on standard/expected batch yields)   100      March 2016 See note 1      1000000         123,000    100See note 2      March 2016         1000000 See note 2      123,000 See  note 2, see note 3  200      March 2016         1000000        129,000 See note 3  300      March 2016         1000000        136,000 See note 3  400      March 2016         300000        42,600 See note 3  600      March 2016         200000        37,000 See note 3  800      March 2016         150000        34,200 See note 3                      Total Pii         3650000        501,800            4650000        624,800                        Grand Total US WIP         5761891        855,204    (bulk tablets)         6761891 See note  2      978,204 See note 2                        Note 1: Pii batches in validation March 2012, 4 year expiry is in place for US tablets and is expected to remain unchanged Note 2: 2 batches of 100ug strength were made at Pii. The second batch will be made because the first batch had assay results in specification but towards the bottom end of specification. As all these Pii batches will go on stability, it is considered prudent to have a batch of 100ug that is at least middle of specification at stability set down. Note 3: Aliquots of Pii produced batches will be packaged at Sharp. Packaged quantities will be quantity sufficient for stability set down at Pii and not more, the balance of each batch will be maintained as bulk tablets. EXHIBIT 5 Transition Plan   1 Costs. Chargebacks, credits, cost of returns and rebates that are addressed in Section III, below, shall not be considered Third Party Costs. A summary of costs is provided in Schedule 5-1.   2 Transition Services. The term “Transition Services” shall mean the following services:   2.1 Risk Evaluation and Mitigation Strategy (“REMS”). Strakan shall maintain the Product REMS program to meet all required FDA requirements as NDA holder including:     (a) Preparation and timely submission of all REMS bridging and assessment reports to FDA     (b) Preparation and timely submission of the first Transmucosal Immediate Release Fentanyl (“TIRF”) REMS assessment report to FDA     (c) TIRF REMS Data Management and adverse event reporting system (“AERS”) monitoring     (d) Protocol approval and pre-testing of the TIRF REMS survey     (e) Management and operation of the TIRF REMS non-compliance program     (f) Daily prescription adjudication, monitoring and enrollment issue resolution     (g) The processing of adverse event (“AE”) reports for the REMS program     (h) Maintenance of the Abstral call center and handling of all Product-related (e.g. REMS, Abstral) queries     (i) Closed system project (enrollment of government programs into REMS)     (j) Non-Compliance Project     (k) Pay/process invoices from TIRF REMS vendors (I) Processing REMS-related final invoices     (m) Development of the plan to remove ProStrakan and enable Orexo to be added as a sponsor on the REMS program at point of NDA assignment     (n) TIRF REMS website management     (o) Call center medical information including maintaining 1-888-ABSTRAL and education materials     (p) Closed system materials and program operations materials     (q) Patient Prescriber Agreement Form     (r) All REMS business related matters     (s) In addition, Strakan shall:     (i) Copy Orexo on all reports, communications and correspondence, written and oral, related to the REMS     (ii) Include Orexo in the closed system project subject in each case to Orexo being a member of the TRIG,     (iii) In addition, Strakan shall be responsible for any termination fees or wind down costs associated with Strakans REMS management. 2.2 Commercial Operations. Strakan shall provide the following services:     (a) Continue to fill customer orders and distribute Product as part of the normal course of business, including Product storage at the current third party logistics (“3PL”) vendors (Cardinal and Exel), order processing, Product distribution, returns processing and any required destruction of material.     (b) Maintain all required licenses and agreements including:     (i) All required State licenses (e.g., prescription drug wholesaler licenses and controlled substance registrations, as required in applicable States)     (ii) All distributor agreements that are in place as of the Signature Date. Strakan will be responsible for any wind down costs associated with termination of the distributor agreements.     (iii) All necessary federal licenses including the Drug Enforcement Administration (“DEA”) registrations     (iv) Data processing through ValuCentric and Wolters Kluwer     (c) In addition, Strakan shall:     (i) Copy Orexo on all material communications and correspondence related to Abstral     (ii) Provide Orexo with access to routinely-generated sales and/or other reports relating to Abstral, subject in each case to any applicable Third Party restrictions   2.3 Drug Safety. Strakan shall maintain its Drug Safety Team in the same manner as before the Signature Date, including:     (a) Continue to maintain the Product call center and process all adverse events, product complaints and product inquiries in accordance with applicable standard operating procedures (“SOPs”) and FDA requirements     (b) Prepare and submit periodic safety update reports (“PSURs”) to FDA     (c) Review, evaluate and follow up as required by FDA and any other federal or state agency on AEs     (d) Prepare any required AE reports for submission to FDA     (e) In addition, Strakan shall:     (i) Provide Orexo with monthly reports on AEs, product complaints, or product inquiries     (ii) Copy Orexo on PSURS   2.4 Sales Force Operations.     (a) Focus on the most critical customers (prescribers, key opinion leaders (“KOLs”), speakers and active accounts) as set forth below     (i) Use best efforts to continue marketing to the approximately 153 key prescribers and influential persons listed in Schedule 5-2   (ii) Perform at least bi-weekly face-to-face sales calls on the 76 prescribers listed in Schedule 5-2 where the Product is the first product discussed in the meeting (“Primary Position”)     (iii) Perform at least one call per month on the non-prescribing KOLs and speakers listed in Schedule 5-2 with the Product in the Primary Position     (iv) Use reasonable efforts to identify and call on a further 150 target prescribers who have expressed interest in the Product or have a high potential for prescribing the product in the next 6 months     (v) Deliver approximately 3150 calls to target prescribers subject to such prescribers being in reasonable geographic locations. The final activities plan will be agreed by Strakan and Orexo.     (b) Strakan’s obligations hereunder are subject to Strakan’s compliance requirements and the availability of the targeted health care professionals and compliance with applicable Law     (c) Maintain an incentive compensation (“IC”) plan for the Product sales force as outlined below:     (i) Sales representatives: $200/Rx over baseline (defined as the greater of (i) last 3 month rolling TRX average, or (ii) YTD TRX average) with a $2k/Qtr cap, plus 5% of all non-retail net sales over baseline (same definition), capped at $5k/Qtr. Contract sales force (15 FTE) is eligible for 50% of the payouts compared to a PSK sales representative     (ii) District Managers, $75/Rx over entire district’s baseline (defined as the greater of (i) last 3 month rolling TRX average, or (ii) YTD TRX average) with a $3k/Qtr cap, plus 2.5% of all non-retail net sales over baseline (same definition) capped at $5k.     (iii) Abstral sales continue to count toward President’s Club and Million Dollar Club in Strakans existing IC plan     (iv) Maintain a compliance system that ensures all sales force operations are conducted in accordance with all applicable laws. - 2.5 Managed Care.     (a) Maintain and manage performance of the United Healthcare contract     (b) Maintain and process all rebates due under Medicaid and other federal and state government programs (VA, Tricare, etc)     (c) Current team will continue its efforts to increase parity access versus competitive products     (d) Continue “Strike Force” Operations     (e) Consult with Orexo before introducing any new or committing to any terms, and entering or renewing any managed care agreements     (f) In addition, Strakan shall     (i) Allow Orexo to travel to accounts with the NAM team     (ii) Allow Orexo access to National Accounts Director for discussion on strategies, tactics, customer response and overall disposition of contracts and contract discussions   (iii) Allow Orexo final right of approval of all contracts, pricing, rebates, discounts, returns, or any other allowance     (iv) Share pricing committee guidelines and minutes relating to Abstral     (v) Allow Orexo to take over contracting functions as soon as Orexo deems practicable to take over that discrete function   2.6 Marketing. Strakan shall provide the following services:     (a) Maintain the following activities:     (i) Distribution, management and processing of Co Pay Cards and Vouchers     (ii) Storage of all sales and marketing materials and displays     (iii) Maintenance and management of website     (iv) Honor any outstanding advertising commitments (if any) and work with Orexo to determine if any should be canceled     (v) Lunch & Learn and speaker programs with targeted accounts and allow Orexo to attend as reasonably requested by Orexo     (b) Work on transferring the following items to Orexo:     (i) Placebos (if any)     (ii) All market research materials and information     (iii) List of KOLs and Speakers     (iv) Training materials     (c) Attendance and representation at American Society of Clinical Oncology (“ASCO”) and Multinational Association of Supportive Care in Cancer (“MASCC”)     (d) Continue targeting ASCO activities and coordinate with Orexo to attend any pre conference meetings     (e) Until notice is sent to FDA of the NDA transfer to Orexo, new, revised or changes in the use of Product promotional and marketing materials must be reviewed and approved by Strakan and Orexo prior to dissemination or change   2.7 Regulatory.     (a) Transferring to Orexo the IND, NDA other FDA-related documents and information to label changes to be completed by 31 December 2012     (b) Compile data and information for, and prepare, a supplement to the NDA (whether a changes-being-effected (“CBE”) or prior approval supplement (“PAS”)) for change in the Product manufacturer, and allow Orexo to review prior to submission where submission is being made prior to 31 December 2012 or supply Orexo with all materials relating to NDA supplement if submission occurs after 31 December 2012     (c) Submit quarterly PSURs     (d) Submit REMS assessment reports   (e) Submit REMS bridging reports     (f) Submit all required NDA post-approval reports (annual reports, Medwatch, Form FDA-2253s, etc.)     (g) Submit any required DEA reports or State controlled substance reports     (h) Send documents to Orexo prior to submission for review and approval   2.8 Finance. Strakan shall provide the following finance related services. The Parties recognize that the scope of the finance services may need to be appropriately adjusted by agreement of Orexo and Strakan when Orexo begins booking the Product sales.     (a) Process all sales and continue to calculate royalty due under current agreement     (b) Capture all relevant data for State Aggregate Spend reporting and potential Sunshine Act reporting     (c) Continue to pay all vendors related to the Product     (d) Recognize revenue until Orexo begins to book Product sales     (e) Maintain all Commercial Insurance obligations in relation to sales of Abstral by Strakan.   2.9 Publications. Strakan shall continue to work on the following publications, in cooperation with Orexo:     (a) International Association for the Study of Pain (“IASP”) abstract presentation     (b) Abstral Dossier - work with Orexo to complete     (c) MASCC poster presentation     (d) Dissolution Manuscript     (e) Any work in progress as of 31 December 2012 will be transitioned to Orexo to enable timely and orderly completion   2.10 Continuing Medical Education. Tailoring Opioid-Based Therapy for Persistent and Breakthrough Cancer Pain   2.11 Manufacturing.     (a) Complete validation of Product validation batches 4 through 6, inclusive, (400,600,800) common blend     (b) Complete Product validation batches 4, 5, 6     (c) Incremental work (repeat validation batch 1 (100ug))     (d) Delivery of final validation reports     (e) Continue to pay for materials and testing (time and materials basis)     (f) Continue performing all services, including any testing and storage, that are required for all ongoing and proposed Product stability studies     (g) Initiate any new stability studies that are required by the approved stability protocol, FDA requirements, or planned Product/manufacturing changes     (h) Contingency - validation batches release testing (repeat if outside 30 day window (packaging lead time))     (i) Packaging of stability set down quantities   (j) Maintain Product storage and pay related fees     (k) Stability study on NCH produced validation batches - 18 month pull     (l) Packaging of stability set down quantities at Sharps     (m) Storage of 40 pallet spots of CII at Excel Logistics     (n) At Orexo’s option (to be exercised in advance of the Transition Date), transfer to Orexo the Prostrakan-owned equipment at Pii and Sharp specific to the manufacture of Abstral at the then present net book value of such equipment     (o) Orexo will need to work with PII to make DEA fentanyl quotas for 2013 and 2014. Strakan will work with Orexo to facilitate completion of Pii contract and submitting annual fentanyl citrate quota to needed Federal and/or State agencies     (p) Adhere to all notice provisions to ensure vendor contracts are current through December 31, 2012     (q) Work with Orexo to facilitate transfer of Sharp agreement (notice must be given by 1 June 2012)   3 Chargebacks, Credits Rebates, and Returns. It is the Parties’ intent that the Party that ultimately receives the benefit (books the sale) of a Product sale shall be responsible for paying any chargeback, credit, rebate or return (“Credits”) related to that sale and to process all aspects of the Credit (including, with regard to returns, cost of destruction). This Section III shall survive the expiration or termination of the Agreement.   3.1 Allocation of Responsibility by Product Lot. It is the Parties’ intent that only one Party book Product sales from each Product lot. Orexo shall be responsible for Credits resulting from Product units within the Product lots for which Orexo booked the sale, and Strakan shall be responsible for Credits resulting from Product units within the Product lots for which Strakan book the sale. In the event there is a Product lot for which both Parties have booked sales, the Parties shall work together in good faith to equitably allocate responsibility for the Credits for such a Product lot based on the benefit received by the respective Parties from the sale of such lot.   3.2 Prostrakan will be responsible for all other lots in the chain (3PL, Wholesaler, Pharmacy), prior to the Orexo Transition Date.   4 Additional Services. If during the Transition Period the Parties identify additional services not listed above and which are reasonably required by Orexo in order to transition to Orexo the commercialization of the Product in the Orexo Territory, the Parties will negotiate in good faith an amendment to this Transition Plan to include such services. Schedule 5-1: Costs to be paid by the Parties. Schedule 5-2 EXHIBIT 6 Agreed Form Novation Deed Private & Confidential DATED              2012              [CONTINUING PARTY]   (1)   and     STRAKAN INTERNATIONAL SARL   (2)   and     OREXO AB   (3)     DEED OF NOVATION     THIS DEED is dated [DATE] PARTIES   (1) [FULL COMPANY NAME] incorporated and registered in [TERRITORY] with company number [NUMBER] whose registered office is at [REGISTERED OFFICE ADDRESS] (“Continuing Party”).   (2) Strakan International S.à r.l a limited liability company organised and   (3) Orexo AB a limited liability company organised and exiting under the laws of Sweden and having its principal place of business at Virdins allé 32, Uppsala, BACKGROUND   (A) The Continuing Party and Strakan are party to a contract relating to Orexo’s proprietary product for pain treatment known as Abstral dated [DATE] (“Contract”), a copy of which is annexed to this deed.   (B) Under a licence agreement dated 31 July 2008, Strakan was granted certain exclusive rights relating to Abstral (known at the date of signing as Rapinyl™) in respect of the United States of America, Canada and Mexico (“Rapinyl North America Licence Agreement”).   (C) The Rapinyl North America Licence Agreement has been terminated by a subsequent agreement between Orexo and Strakan dated [DATE]. As a result, Strakan wishes to transfer all its rights, obligations and liabilities under the Contract to Orexo.   (D) The parties have agreed that Strakan’s rights, obligations and liabilities under the Contract shall be novated to Orexo on the terms of this deed. AGREED TERMS   1 Novation   1.1 Strakan transfers all its rights and obligations under the Contract to Orexo. Orexo shall enjoy all the rights and benefits of Strakan under the Contract, and all references to Strakan in the Contract shall be read and construed as references to Orexo.   1.2 Orexo agrees to perform the Contract and be bound by its terms in every way as if it were the original party to it in place of Strakan.   1.3 The Continuing Party agrees to perform the Contract and be bound by its terms in every way as if Orexo were the original party to it in place of Strakan. 2 Release of obligations and liabilities   2.1 The Continuing Party and Strakan release each other from all future obligations to the other under the Contract.   2.2 Nothing in this deed shall affect or prejudice any claim or demand that the Continuing Party or Strakan may have against the other under or in connection with the Contract arising before the date of this Deed.   3 Governing law and jurisdiction   3.1 This Deed and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the governing law of the Contract, without regard to the choice of law provisions thereof.   3.2 In the event of the occurrence of any dispute arising out of or relating to this Deed, including any question regarding its existence, validity or termination, any party may, by written notice to the other(s), have such dispute such notice is received. If any Party desires to pursue resolution of such dispute under clause 3.3 below, a referral to such executives under this clause 3.2 shall be a mandatory condition precedent. Said designated offices are as follows.   For Continuing Party:    [INSERT] For Orexo:    Chief Executive Officer For Strakan:    Chief Executive Officer   3.3 In the event that they shall be unable to resolve the dispute by executive settled as provided in the Contract. This document has been executed as a deed and is delivered and takes effect on the date stated at the beginning of it. Executed as a deed by [NAME OF       CONTINUING PARTY ] acting by     [SIGNATURE OF DIRECTOR] [NAME OF DIRECTOR], a director,     Director in the presence of:           [SIGNATURE OF WITNESS]     [NAME, ADDRESS [AND     OCCUPATION] OF WITNESS]     Executed as a deed by Strakan       International S.à r.l acting by     [SIGNATURE OF DIRECTOR] [NAME OF DIRECTOR], a director,     Director in the presence of:               Executed as a deed by Orexo AB acting by [NAME OF DIRECTOR], a     [SIGNATURE OF DIRECTOR] Director director, in the presence of:         ANNEX The Contract EXHIBIT 7 Abstral Domain Names abstral.com abstralrems.com remsabstral.com Amendment to Termination and Asset Transfer Agreement for Abstral® in the United States of America between OREXO AB and STRAKAN INTERNATIONAL SARL (formerly known as Strakan International Limited) This Amendment is made as of the 1st day of November, 2012 (“Effective Date”) by and between     1. Orexo AB (publ), a limited liability company duly established and existing under the laws of Sweden and having its principal office at Virdings Allé 32 A, Uppsala, Sweden (“Orexo”), and     2. Strakan International SARL, a limited liability company organized and (each a “Party” and collectively, the “Parties”) WHEREAS, the Parties have entered into a Termination and Asset Transfer Agreement dated 1st June 2012 (the “Termination Agreement”) whereby the Rapinyl North America Licence Agreement was terminated in relation to the Product in the United States of America. Mexico and Canada are governed by the Abstral RoW Agreement; WHEREAS, the Parties have agreed to amend the scope and extend the term of the Transition Services through 30th June 2013 and to amend certain associated terms and conditions of the Termination Agreement; NOW, THEREFORE, IT IS HEREBY AGREED as follows:   1 Definitions 1.1 The definitions in the Termination Agreement shall have the same meaning in this Amendment, unless otherwise expressly agreed in this Amendment.   2 Amendments 2.1 The date “31st December 2012” is replaced with “30th June 2013” in the following sections: Sections 1.40, and 4.6, as well as in the following sections in Exhibit 5 (Transition Plan): Section 2.7 (all three places), and 2.11. The date “December 24th 2012” in Schedule 5-1 is replaced with “June 30th 2013”. 2.2 The Transition Plan in Exhibit 5 is amended as follows:     (i) Section 2.4 (Sales Force Operations) is deleted.     (ii) Section 2.5 (Managed Care) subparagraph (c) is deleted.     (iii) Section 2.6 (Marketing) subparagraphs a, i (as it pertains to vouchers), iv, and v as well as subparagraphs c and d are deleted.     (iv) Section 2.11 (Manufacturing) is deleted except for subparagraphs (j), (m) (until April 3, 2013), (n) and (o). With respect to the storage agreement with Excel Logistics, Inc., Strakan shall have no further obligations under that   2   agreement after April 3, 2013 and Orexo shall be responsible for any costs, fees, or penalties associated with the storage and transfer of inventory, of the drug product due to the expiration or termination of the storage agreement with Excel Logistics, Inc. consistent with Section 6.1 of the Termination Agreement and subject to Section 3.5 below. Orexo shall be responsible for any such costs arising from Third Party Agreements covering “Essential” costs included in Schedule 5-1.     (v) Section 2.9 (Publications) is deleted.     (vi) Section 2.10 (Continuing Medical Education) is deleted.     (vii) An Updated Schedule -1 (Budget) for the extended Transition Period is attached hereto as Appendix 1. 2.3 Section 4.3 is deleted and replaced with the following, wording: “Subject to Section 6.2, during the period beginning on the Signature Date and ending on the Transition Date or, if Orexo begins to book sales prior to 30th June 2013, as long as requested by Orexo but not beyond 30th June 2013 (“the Transition Period”) Strakan agrees to provide the Transition Services to Orexo in accordance with the Transition Plan. Notwithstanding the foregoing, in the event that Orexo begins to book sales prior to 30th June 2013, all applicable Third Party Agreements shall be assigned to Orexo or terminated (as the case may be) as determined by Strakan and in consultation with Orexo, and Orexo shall be responsible for any penalties associated with any such assignment or termination of those Third Party Agreements covering “Essential” costs included in schedule 5-1. Strakan will negotiate in good faith with the respective Third Party vendors to eliminate or reduce payment of an such penalties.” Strakan shall be responsible for its costs and all Third Party costs incurred by Strakan in connection with the provision of the Transition Services and as described in the Transition Plan except that Orexo will reimburse Strakan for:     (i) the Third Party costs incurred by Strakan identified as “Essential” costs as listed in the attached Updated Schedule 5-1 relating to the period after 30 September 2012;     (ii) the Third Party costs incurred by Strakan identified as “Non-Essential” costs as listed in the attached Updated Schedule 5-1 relating to the period after 30 September 2012 and through the notice of termination period; and     (iii) any cancellation fees for early termination of the “Non-Essential” activities. Strakan will negotiate in good faith with the respective Third Party vendors to eliminate or reduce payment of any such fees. Strakan agrees that Orexo shall have no obligation to reimburse the costs incurred by Strakan identified as “Overhead” costs as listed in the attached Updated Schedule 5-1 relating to the period after 30 September 2012. The parties agree that these “Overhead” costs (ie, 3PL storage, order processing fees, distribution fees, state license fees, government rebate processing fees) as provided in the Updated Schedule 5-1 shall be deducted from Net Sales before calculating the Royalty Payment. Notwithstanding the foregoing, in the event that the “Overhead” costs exceed Net Sales, Strakan shall have no obligation to make Royalty Payment and Orexo agrees to reimburse Strakan for the excess amount.   3 Notwithstanding anything to the contrary herein or in the Transition Plan, the annual establishment and product user fees payable in 2012 shall be proportioned between the Parties such that Strakan bears the cost of such fees to the extent such fees relate to the period when Strakan books the sales and Orexo bears the remaining part of said user fees. Orexo shall bear the costs of the annual establishment and product user fees payable in 2013 and thereafter. 2.4 A new Section 4.13 is added as follows: “For clarity, nothing herein shall restrict Orexo from activities during, the Transition Period to facilitate agreements between Strakan and Medicare, Medicaid, Group Purchasing Organizations, Managed Care Organizations and similar organizations provided that Orexo shall consult with Strakan in respect of such activities provided that Orexo shall have no right to legally bind Strakan under any such agreements without the prior consent of Strakan which consent shall not be unreasonably withheld. If requested by Orexo, Strakan will respond with comments on the dossiers and publications no later than five (5) business days.”   3 Miscellaneous/Additional Provisions: 3.1 This Amendment shall constitute an integrated part of the Termination Agreement and all the other provisions not amended in this Amendment shall remain effective. In case of any inconsistency between the provisions of the Termination Agreement and this Amendment, the latter shall prevail. 3.2 This Amendment shall become effective upon the date of the last Party’s signature to this Amendment. 3.3 Each Party hereby releases and discharges the other from all claims or demands under or in connection with the Transition Services provided in Exhibit 5 (Transition Plan) of the Termination Agreement including without limitation claims for negligence, whether arising before or on the Effective Date of this Amendment, in each case whether known or unknown to the releasing Party. For avoidance of doubt, the foregoing is not intended to limit or amend, the Parties indemnity obligations under the Termination Agreement. 3.4 The parties agree that Strakan will lead the preparation of and draft the supplement to FDA for approval of PII as manufacturing site and provide the initial draft of the supplement to Orexo for review and approval no later than December 30, 2012 prior to submission to the FDA. In the event that Orexo provides comments to the draft submission, Strakan shall include any such comments into the supplement submission provided any such inclusion is consistent with applicable laws and regulations. The parties agree to use best effort to agree on the overall strategy for FDA submission. Orexo agrees to provide their comments, if any, to the initial supplement draft to Strakan, no later than ten (10) business days after receipt of the initial supplement draft from Strakan. The Parties will discuss such comments in good faith. Strakan shall submit the final supplement to the FDA no later than January 31, 2013. Upon submission to the FDA and until the end of the Transition Period and thereafter, Orexo shall be responsible for obtaining the final approval of the supplement from the FDA including, but not limited to, responding timely to inquiries from the FDA, submission of modifications, supplements, amendments, and attachments. Any communications with FDA shall be submitted by Strakan during the Transition Period, and any such communications will take place directly between Orexo and FDA following transfer of NDA to Orexo on or before   4 Orexo will be responsible for any Third Party costs associated with securing FDA approval of the supplement. Strakan agrees to be collaborative in supporting Orexo obtain FDA approval of the supplement during the Transition Period. 3.5 The parties acknowledge that the storage agreement between ProStrakan and Excel Logistics for the storage of the drug product will expire on April 3, 2013. Orexo shall be responsible for securing the storage of the drug product after expiration of the Excel Logistics agreement including the costs associated with the transfer of the drug product in accordance with Section 6.1 of the Termination Agreement. Section 6.1 of the Termination Agreement shall be modified as follows: Orexo’s right to purchase Strakan’s Stock shall start upon the expiration date of the Excel Logistics Agreement (April 3, 2013), rather than when Orexo starts to book the sales of Product, as currently provided in Section 6.1. Further, Orexo’s written request to purchase selected part of the Stock shall be made no later than thirty (30) days prior to the expiration of the Excel Logistics Agreement (April 3, 2013), rather than ten (10) days prior to the date on which Orexo begins to book sales of Product. 3.6 Strakan represents and warrants to Orexo to comply with the applicable reporting obligations related to the Sunshine Act for its promotional activities that occurred in 2012. Orexo shall be responsible for complying with the reporting obligations under the Sunshine Act for any applicable activities in 2013. [SIGNATURE PAGE FOLLOWS ON THE NEXT PAGE]   5 [SIGNATURE PAGE TO AMENDMENT TO TERMINATION AGREEMENT] date below. This Amendment has been executed in two (2) copies, of which each party has taken one.   OREXO AB (publ)     STRAKAN INTERNATIONAL SARL By:       By:   Name:   Anders Lundstrom     Name:   Andrew McLean Title:   CEO     Title:   Director Date:       Date:     6 APPENDIX 1 Updated Schedule 5-1: Costs to be paid by the Parties. {Updated 10.24.12}   Activity    Updated Cost Projection for Q4    Essential [Orexo will reimburse effective October 1, 2012]    Overhead [PSK will pay]    Non-Essential [PSK will terminate immediately and Orexo to reimburse for any cancellation fees] TIRF REMS Operations and Prescription Monitoring    $30,000/Q    X       TIRF REMS Survey Launch, Reports, Assessment Reports, Data Management and AERS Monitoring    $12,099.12/Q    X       Closed system project (enrollment of government programs into REMS)    $10,500/Q    X       McKesson Non-Compliance Project Development    Development Cost: $24,712.50/Q             Non-Compliance Project Report: $4,000 (one-time fee) plus $2,262/Q (recurring charge)    X       REMS Anti-Trust Counsel        $6,749/Q                X         7 - This would include product storage at 3PL, order processing, product distribution and returns processing    Approx $30,000/Q               (Monthly/$10, 000)       X   [PSK will pay and the cost will be deducted from Royalty Payment calculation.      - State Licenses (30 pharmaceutical licenses and 7 Controlled substance licenses) (Portion allocated to Abstral)    $18,158/Q [license fee]   $2,000/Q [license renewal service]       X      - All distributor agreements ProStrakan specific, NOT product)(Portion allocated to Abstral)    $20,000/Q       X      - Data processing through ValuCentric and Wolters Kluwer (portion allocated to Abstral)        -$7,500/Q [ValuCentric Wholesale Data]   -$59,375/Q [WK Data]   - $24,418/Q [WK AMA Fees for Data]          X   [PSK recommends terminating this service - Orexo to pay for any costs associated with early termination, if applicable]   8    - $ 24,787/Q [ArchiTech- data warehouse processing]   - $ 26,325/Q [Synergistic - Sales CRM]   TOTAL: $142,405          Continue to maintain call center for the appropriate handling of all Adverse events    Approx $30,000/Q    X       Incentive Compensation    Approx. $25,000/Q                X       Maintain and process all rebates due under Medicaid and other core government programs (VA, Tricare, etc)    PharmaMetrics rebate processing fees are $17,310/Q       X      - Distribution and processing of Co Pay Cards and Vouchers   [Vouchers discontinued per Orexo]           X, in part            $9,000/Q [Transaction and Redemption Fee]   $12,600/Q [Admin Fee]    [Voucher program has been terminated per Orexo. Co-Pay cards will continue until expire]   Orexo will reimburse for fees until co-pay expire]         9 - Storage of all materials and displays until transfer    Approx. $4,000/Q    X       - Lunch & Learn and speaker programs with targeted accounts    (4 L&L per month per rep : $96,000)   (2 L&L per month per flex rep: $18,000)   TOTAL: $114,000          X   [L&L and Speaker Programs have terminated per Orexo] Transfer the following items to Orexo:    Data Room/Knipper    See storage of materials and displays above       - Placebos    Knipper    X       - Market research materials    Data Room/ Knipper    X       - List of KOLs and Speakers    Data Room/ Knipper    Dataroom       - Training materials    Data Room/ Knipper    X       ASCO    PSK paid    Completed       Abstral Dossier    $10,778               Original Estimate from CHC Feb. 23, 2012: $16,088   PSK paid $13,071 of the Original Estimate.      X [PSK recommends discontinuing Dossier - Orexo will take over per Orexo 10/22/12].         10    CHC is charging an additional $7,761 to deliver completed Dossier due to Orexo’s request for further revisions/comments.   Final Dossier to be delivered by Nov. 16, 2012.   Total Balance Due to CHC: $10,778          MASCC poster presentation - Project completed       Completed       REMS commentary    $5,500   [PSK agreed to pay the additional $5,500]          Completed       Abstral review article    $17,750               Original Cost estimate for article is $17,750. Anticipate project completion by EOY. Orexo provided comments on manuscript.      X   [PSK recommends discontinuing article - Orexo to take over per Orexo 10/22/12]         11 TIRF review article    $17,750   [Due upon submission, awaiting final author approval to submit manuscript]          X   [PSK recommends immediate termination] Dissolution Manuscript       Completed       IND and NDA transfer - To be completed by December 24th 2012             Prior Approval Supplement for Change in Manufacturer             Submit Quarterly PSUR             Submit REMS Assessment Report             Submit REMS Bridging Report             Submit Quarterly PSUR    Approx. $2,000 [Submission]   Approx. $7,000 (onetime preparation fee)    X       Submit REMS Assessment Report    Approx. $3,000    X       Commencement of Abstral validation batches 4-6 inclusive (400,600,800) common blend    Completed            12 Completion of Abstral validation batches 4, 5, 6    Completed          Incremental work (repeat validation batch 1 (100ug))    Completed          Delivery of validation Report    Completed          Materials and testing (time and materials basis)    Completed          6 month stability study (packaged lots), Engineering batches, 6 month pull    [6 month pull point is completed]   Stability Study On-going at Pii for 9, 12, 18, 24, 36 & 48 months pull points.    X   [See Contract with Pii regarding on- going stability study costs]       Contingency - Validation batches release testing (repeat if outside 30 day window (packaging lead time)    Completed          Validation batches stability set down    Completed          18 month pull    Completed          Packaging of stability set down quantities    Completed          Storage - 40 pallet spots CII, monthly fee    $16,770/per month   Contract with Vendor will expire April, 2013    X         13 QPharma   (Aggregate Spend)    $624/Q    X       Cover My Meds   (Online System for Prior Auth)    $750/Q    X       MMR   (Medicare/Medicaid Support)    $13,200/Q    X       MMIT   (Formulary Compass)    $6,129/Q          X Zitter   (Managed Market Research, Competitive Data)    $4,938/Q          X Abstral.com    $2,000/Q   [includes only minor changes if needed 2-3 hours for design    X       1-888-Abstral    $6,000/Q    X         14 Exhibit 1.01(ii) Seller’s Knowledge Individuals   1. Nikolaj Sorensen   2. Carl-Johan Blomberg   3. Thomas Lundqvist   4. Sofia Mogensen   5. Åsa Holmgren   6. Cecilia Coupland   2 Exhibit 2.01(a)(i)(A) Transferred Marks US Trademark Reg No 3,563,010 (“ABSTRAL”)   3 Exhibit 2.01(a)(i)(B) Transferred Copyrights None.   4 Exhibit 2.01(a)(ii) Transferred FDA Permits None.   5 Exhibit 2.01(a)(iii) Transferred State Permits None.   6 Exhibit 2.01(a)(iv) Transferred Contracts 1. Transfer Agreement 2. Agreement for the Manufacture Process Validation Batch of Abstral for the 400, 600, and 800mcg Bulk Tablets by and between Pharmaceutics International, Inc. and Seller, dated as of November 13, 2012, and work orders thereunder. 3. Proposal for Revision of the Draft AMCP Format-compliant Dossier for Abstral, by and between Formulary Resources, LLC and Seller, dated as of October 24, 2012. 4. Trade Mark Assignment from Strakan in favor of Seller, dated as of September 17, 2012.   7 Exhibit 3.01(b)(ii) [See Attached]   8 EXECUTION VERSION BILL OF SALE This BILL OF SALE (this “Bill of Sale”) dated as of March 15, 2013, is made by and between Orexo AB, a public limited company organized and existing under the (“Purchaser”). Capitalized terms used but not otherwise defined in this Bill of Sale shall have the meanings set forth in that certain Asset Purchase Agreement, of even date herewith, by and among Seller and Purchaser (as may be amended, supplemented or otherwise modified from time to time, the “Purchase Agreement”). WHEREAS, pursuant to the Purchase Agreement (the terms of which, including all Schedules and Exhibits thereto, being incorporated herein by this reference), Purchaser has agreed to purchase and acquire, from Seller, and Seller has agreed to sell, transfer, assign, convey and deliver to Purchaser, all of Seller’s right, title and interest in, to and under all of the Acquired Assets, free and clear of all Liens, upon the terms and subject to the conditions of the Purchase Agreement. NOW, THEREFORE, for and in consideration of the Purchase Price and the mutual covenants set forth in the Purchase Agreement and for other good and valuable consideration, the receipt and sufficiency of which Seller and Purchaser hereby acknowledge, and subject to the terms and conditions of the Purchase Agreement: 1) In accordance with and subject to all of the terms and conditions of the Purchase Agreement, Seller by this Bill of Sale hereby grants, sells, assigns, conveys, transfers and delivers to, and vests in Purchaser, to have and to hold forever unto Purchaser, its successors and permitted assigns, forever, effective as of the date hereof, all of Seller’s right, title and interest, legal and equitable, in and to the Acquired Assets (other than the Transferred Contracts) (the assets to be conveyed hereunder the “Bill of Sale Assets”) free and clear of all Liens. Notwithstanding anything to the contrary contained herein, Seller shall not be obligated to sell, convey, assign, transfer or deliver, nor does Seller sell, convey, assign, transfer or deliver pursuant hereto, any of the Excluded Assets, and Seller shall retain all right, title and interest in and to the Excluded Assets. 2) This Bill of Sale is an instrument of transfer and conveyance contemplated by, and is executed and delivered under and pursuant to, the Purchase Agreement, and nothing contained in this Bill of Sale shall (i) itself modify, amend, extend or alter (nor shall it be deemed or construed as modifying, amending, extending or altering) any of the provisions of the Purchase Agreement or (ii) itself limit, or be deemed or construed to limit, any of the rights, duties or obligations of Seller or Purchaser under the Purchase Agreement in any manner whatsoever. 3) Each party hereby acknowledges that the other party is making no representation or warranty, express or implied, with respect to the Bill of Sale Assets being conveyed hereby, other than those set forth in the Purchase Agreement. 4) All notices and other communications to be given under the terms of this Bill of Sale or which any of the parties desire to give hereunder shall be in writing and shall be made in accordance with the Purchase Agreement notice provisions. 5) This Bill of Sale shall be binding upon and inure to the benefit of the 6) This Bill of Sale may be executed in any number of counterparts, each of which shall for all purposes be deemed an original, and all such counterparts shall together constitute but one document. 7) This Bill of Sale (and all disputes arising out of it including provisions thereof. ————THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK———— IN WITNESS WHEREOF, Purchaser and Seller have duly executed this Bill of Sale as   SELLER: OREXO AB   Name: Title: PURCHASER:   Name: Title: SIGNATURE PAGE TO BILL OF SALE Exhibit 3.01(b)(iii) [See Attached]   9 EXECUTION VERSION ASSIGNMENT AND ASSUMPTION AGREEMENT This ASSIGNMENT AND ASSUMPTION AGREEMENT (this “Assignment and Assumption Agreement”) dated as of March 15, 2013, is made by and between Orexo AB, a public limited company organized and existing under the laws of Sweden (“Seller”), and Galena Biopharma, Inc., a Delaware corporation (“Purchaser”). Capitalized terms used but not otherwise defined in this Assignment and Assumption Agreement shall have the meanings set forth in that certain Asset Purchase Agreement, of even date herewith, by and among Seller and Purchaser (as may be amended, supplemented or otherwise modified from time to time, the “Purchase Agreement”). WITNESSETH: Seller has agreed to assign to Purchaser all of Seller’s right, title and interest in and to the Purchased Assets, and Purchaser has agreed to assume from Seller, the Assumed Liabilities, upon the term and subject to the conditions of the Purchase Agreement; WHEREAS, Purchaser and Seller now desire to evidence and effectuate the assumption by Purchaser of the Assumed Liabilities and all of Seller’s rights, title and interest to (i) the Transferred Contracts, and (ii) the goodwill set forth in Section 2.01(a)(i) of the Purchase Agreement (together, the “Assigned Assets”). forth in the Purchase Agreement and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and subject to the terms and conditions of the Purchase Agreement, Seller and Purchaser hereby agree as follows: 1. Seller hereby assigns, transfers and conveys to Purchaser, and Purchaser hereby takes assignment and transfer of and assumes from Seller, all of Seller’s rights, title and interest (as applicable) in and to the Assigned Assets. Notwithstanding the foregoing, Seller does not assign or transfer any agreement or contract or any claim of right or any benefit or obligation thereunder or resulting therefrom if an assignment or transfer thereof, without the consent of a third party thereto, would constitute a breach or violation thereof. 2. Purchaser hereby assumes and agrees to pay, perform, fulfill and discharge when due, the Assumed Liabilities. 3. Notwithstanding anything to the contrary in this Assignment and Assumption Agreement, the Purchase Agreement or in any other document delivered in connection herewith or therewith, the Assumed Liabilities expressly exclude the Excluded Liabilities (such Excluded Liabilities to remain the sole responsibility of Seller). 4. This Assignment and Assumption Agreement may be executed in counterparts (including by means of telecopied signature pages), each of which shall be deemed an original, but all such counterparts taken together shall constitute 5. This Assignment and Assumption Agreement is being executed and delivered pursuant and subject to the Purchase Agreement. In the event of any conflict or inconsistency between the terms of the Purchase Agreement and the terms of this Assignment and Assumption Agreement, the terms of the Purchase Agreement shall govern. 6. The Assignment and Assumption Agreement shall be binding upon and inure to assigns. 7. This Assignment and Assumption Agreement (and all disputes arising out of it law provisions thereof. 8. If any term or other provision of this Assignment and Assumption Agreement shall be held invalid or unenforceable, the remainder of this Assignment and Assumption Agreement shall not be affected. 9. This Assignment and Assumption Agreement may not be amended or altered except by a written instrument executed by Seller and Purchaser.   2 Assumption Agreement to be duly executed as of the day and year first above written.   SELLER: OREXO AB   Name: Title: PURCHASER: GALENA BIOPHARMA, INC.   Name: Title:   3 Exhibit 3.01(b)(iv) Form of Trademark Assignment Agreement [See Attached]   10 EXECUTION VERSION TRADEMARK ASSIGNMENT AGREEMENT This TRADEMARK ASSIGNMENT AGREEMENT (this “Trademark Assignment Agreement”) dated as of March 15, 2013, is made by and between Orexo AB, a public limited company organized and existing under the laws of Sweden (“Assignor”), and Galena Biopharma, Inc., a Delaware corporation (“Assignee”). Capitalized terms used but not otherwise defined in this Trademark Assignment Agreement shall have the meanings set forth in that certain Asset Purchase Agreement, of even date herewith, by and among Assignor and Assignee (as may be amended, supplemented or WITNESSETH: WHEREAS, Assignor owns the Transferred Trademarks (as defined below); Assignor has agreed to assign to Assignee all of Assignor’s right, title and interest in and to the Transferred Trademarks; WHEREAS, pursuant to the Purchase Agreement, Assignor wishes to assign to Assignee, and Assignee wishes to acquire from Assignor, the Transferred Trademarks. terms and conditions of the Purchase Agreement, Assignor and Assignee hereby agree as follows:   1. Assignor hereby sells, transfers, conveys, assigns and delivers to Assignee any and all rights, title and interests Assignor holds in and to the trademark registrations, trademark applications, service mark registrations, service mark applications and domain name registrations of Assignor set forth on Exhibit A, together with all extensions and renewals thereof (the “Transferred Trademarks”), and any and all goodwill connected with and symbolized by, in, to and under the Transferred Trademarks, together with all rights to collect royalties, profits and proceeds in connection with any of the foregoing and all rights to sue for past, present or future infringement, misappropriation or other violation of the foregoing, and all rights to recover damages or lost profits in connection therewith.   2. Assignor hereby authorizes and requests the Patent and Trademark Office officials in all countries and jurisdictions throughout the world, including the United States of America, to record this Trademark Assignment Agreement and to issue trademarks based upon pending applications included in the Transferred Trademarks to Assignee of Assignor’s entire right, title and interest in and to the same.   3. This Trademark Assignment Agreement may be executed in counterparts 4. This Trademark Assignment Agreement is being executed and delivered pursuant Trademark Assignment Agreement, the terms of the Purchase Agreement shall govern.   5. This Trademark Assignment Agreement shall be binding upon and inure to the assigns.   6. This Trademark Assignment Agreement (and all disputes arising out of it law provisions thereof.   7. If any term or other provision of this Trademark Assignment Agreement shall be held invalid or unenforceable, the remainder of this Trademark Assignment Agreement shall not be affected.   8. This Trademark Assignment Agreement may not be amended or altered except by a written instrument executed by Assignor and Assignee. IN WITNESS WHEREOF, the Assignor and Assignee hereto have caused this Trademark Assignment Agreement to be duly executed as of the day and year first above written.   ASSIGNOR: OREXO AB   Name: Title: ASSIGNEE: GALENA BIOPHARMA, INC.   Name: Title: Signature Page to Trademark Assignment Agreement Exhibit A Transferred Trademarks Exhibit 3.01(b)(v) Form of License Agreement [See Attached]   11 DECHERT DRAFT March 7, 2013 EXHIBIT A Licensed Patents United States Patent Number 6,759,059 United States Patent Number 6,761,910 United States Patent Number 7,910,132 EXECUTION VERSION Seller Disclosure Schedules This Seller Disclosure Schedule (this “Seller Disclosure Schedule”) is the disclosure schedule referred to in the Asset Purchase Agreement (the “Agreement”), dated as of March 15, 2013, by and between Orexo AB, a public limited company organized and existing under the laws of Sweden (“Seller”), and Galena Biopharma, Inc., a Delaware corporation (“Purchaser”). Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Agreement. This Seller Disclosure Schedule has been arranged in sections corresponding to each representation and warranty set forth in Article V of the Agreement. Any item listed or referred to in any section or subsection of this Seller Disclosure Schedule will be deemed to be incorporated by reference into each other section or subsection of any representation and warranty in such Article V where it is reasonably apparent that such disclosure would be applicable to such other section or subsection. This Company Disclosure Letter is qualified in its entirety by reference to the specific provisions of the Agreement and is not intended to constitute and shall not constitute representations, warranties or covenants of the Company. Schedule 5.02(a) Third Party Consents None.   109 Schedule 5.02(b) Governmental or Regulatory Approvals None.   110 Schedule 5.03 Acquired Assets Strakan owns or has rights to the Strakan Assets.   111 Schedule 5.05 Intellectual Property (a) None. (b) US Patent Number 6,761,910 (the “910 Patent”) is subject to the following claim and litigation: Civil Action No. 3:11-cv-03788 (FLW)(LHG) Mylan Pharmaceuticals Inc. and Mylan Inc. (collectively “Mylan”) vs Orexo AB in the United States District Court for the District of New Jersey In a Paragraph IV Certification (ANDA) case commenced on 30 June 2011 Mylan claims that the 910 Patent is invalid and unenforceable and that Mylan’s generic version of Edluar does not infringe the 910 Patent. Edluar contains zolpidem as the active ingredient and has been licensed to Meda AB for the United States. (c) US Patent Number 6,761,910 is subject to the following: 1. In a license agreement dated 14 April 2008, Orexo AB has granted Meda AB the exclusive rights to make, have made, use and sell Edluar (zolpidem including all solvates, prodrugs, salts, isomers, hydrates and esters thereof) under the 910 Patent. 2. In a license (settlement) agreement dated 21 February 2011, Orexo AB and Meda AB have granted Par Formulations, Pvt. Ltd a non-exclusive license under the 910 Patent to make, use, sell offer to sell, import , and distribute its generic Edluar from 1 January 2017 until the expiry of the 910 Patent. Under certain circumstances the Entry Date may be earlier. 3. After the Closing, Orexo AB will retain all rights under the 910 Patent not granted to Purchaser under the License Agreement, including the rights to make, have made, use, and sell products containing active ingredients other than fentanyl, and may exercise such rights at its discretion.   112 Schedule 5.07 Litigation See Schedule 5.05(b).   113

Exhibit 10.1     PURCHASE AGREEMENT dated as of June 24, 2015 between SANTANDER CONSUMER USA INC., as Seller and SANTANDER DRIVE AUTO RECEIVABLES LLC, as Purchaser     TABLE OF CONTENTS       Page   ARTICLE I DEFINITIONS AND USAGE   1    SECTION 1.1 Definitions   1    SECTION 1.2 Other Interpretive Provisions   1    ARTICLE II PURCHASE   2    SECTION 2.1 Agreement to Sell and Contribute on the Closing Date   2    SECTION 2.2 Consideration and Payment   2    ARTICLE III   2    SECTION 3.1 Representations and Warranties of Santander Consumer   2    SECTION 3.2 Representations and Warranties of Santander Consumer as to each Receivable   4    SECTION 3.3 Repurchase upon Breach   4    SECTION 3.4 Protection of Title   5    SECTION 3.5 Other Liens or Interests   6    SECTION 3.6 Perfection Representations, Warranties and Covenants   6    ARTICLE IV MISCELLANEOUS   6    SECTION 4.1 Transfers Intended as Sale; Security Interest   6    SECTION 4.2 Notices, Etc   7    SECTION 4.3 Choice of Law   7    SECTION 4.4 Headings   8    SECTION 4.5 Counterparts   8    SECTION 4.6 Amendment   8    SECTION 4.7 Waivers   9    SECTION 4.8 Entire Agreement   9    SECTION 4.9 Severability of Provisions   9    SECTION 4.10 Binding Effect   10    SECTION 4.11 Acknowledgment and Agreement   10    SECTION 4.12 Cumulative Remedies   10    SECTION 4.13 Nonpetition Covenant   10    SECTION 4.14 Submission to Jurisdiction; Waiver of Jury Trial   10    SECTION 4.15 Third-Party Beneficiaries   11    EXHIBIT A Form of Assignment SCHEDULE I   -i- THIS PURCHASE AGREEMENT is made and entered into as of June 24, 2015 (as amended, supplemented or otherwise modified and in effect from time to time, this “Agreement”) by SANTANDER CONSUMER USA INC., an Illinois corporation (“Santander Consumer”), and SANTANDER DRIVE AUTO RECEIVABLES LLC, a Delaware limited liability company (the “Purchaser”). WITNESSETH: WHEREAS, the Purchaser desires to purchase from Santander Consumer a portfolio of motor vehicle receivables, including motor vehicle retail installment sales contracts and/or installment loans that are secured by new and used automobiles, light-duty trucks and vans; and WHEREAS, Santander Consumer is willing to sell such portfolio of motor vehicle receivables and related property to the Purchaser on the terms and conditions NOW, THEREFORE, in consideration of the premises and the mutual agreements set ARTICLE I DEFINITIONS AND USAGE SECTION 1.1 Definitions. Except as otherwise defined herein or as the context may otherwise require, capitalized terms used but not otherwise defined herein are defined in Appendix A to the Sale and Servicing Agreement dated as of the date hereof (as from time to time amended, supplemented or otherwise modified and in effect, the “Sale and Servicing Agreement”) among Santander Drive Auto Receivables Trust 2015-3, Santander Consumer, as Servicer, the Purchaser, as Seller, and Deutsche Bank Trust Company Americas, as Indenture Trustee, which also contains rules as to usage that are applicable herein. SECTION 1.2 Other Interpretive Provisions. For purposes of this Agreement, unless the context otherwise requires: (a) accounting terms not otherwise defined in this Agreement, and accounting terms partly defined in this Agreement to the extent not defined, shall have the respective meanings given to them under GAAP (provided, that, to the extent that the definitions in this Agreement and GAAP conflict, the definitions in this Agreement shall control); (b) terms defined in Article 9 of the UCC as in effect in the relevant jurisdiction and not otherwise defined in this Agreement are used as defined in that Article; (c) the words “hereof,” “herein” and “hereunder” and words of similar import Agreement; (d) references to any Article, Section, Schedule, Appendix or Exhibit are references to Articles, Sections, Schedules, Appendices and Exhibits in or to this Agreement and references to any paragraph, subsection, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (e) the term “including” and all variations thereof means “including without limitation”; (f) except as otherwise expressly provided herein, references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (g) references to any Person include that Person’s successors and assigns; and (h) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof.   Purchase Agreement (2015-3) ARTICLE II PURCHASE SECTION 2.1 Agreement to Sell and Contribute on the Closing Date. On the terms and subject to the conditions set forth in this Agreement, Santander Consumer does hereby irrevocably sell, transfer, assign, contribute and otherwise convey to the Purchaser without recourse (subject to the obligations herein) on the Closing Date all of Santander Consumer’s right, title and interest in, to and under the Receivables, the Collections after the Cut-Off Date, the Receivable Files and the Related Security relating thereto, whether now owned or hereafter acquired, as evidenced by an Assignment substantially in the form of Exhibit A delivered on the Closing Date (collectively, the “Purchased Assets”). The sale, transfer, assignment, contribution and conveyance made hereunder does not constitute and is not intended to result in an assumption by the Purchaser of any obligation of Santander Consumer or any Originator to the Obligors, the Dealers or any other Person in connection with the Receivables or the other assets and properties conveyed hereunder or any agreement, document or instrument related thereto. SECTION 2.2 Consideration and Payment. The purchase price for the sale of the Purchased Assets sold to the Purchaser on the Closing Date shall equal the estimated fair market value of the Purchased Assets. Such purchase price shall be paid in cash to Santander Consumer in an amount agreed to between Santander Consumer and the Purchaser, and, to the extent not paid in cash by the Purchaser, shall be paid by a capital contribution by Santander Consumer of an undivided interest in such Purchased Assets that increases its equity interest in the Purchaser in an amount equal to the excess of the estimated fair market value of the Purchased Assets over the amount of cash paid by the Purchaser to Santander Consumer. ARTICLE III SECTION 3.1 Representations and Warranties of Santander Consumer. Santander Consumer makes the following representations and warranties as of the Closing Date, on which the Purchaser will be deemed to have relied in acquiring the Purchased Assets. The representations and warranties will survive the conveyance of the Purchased Assets to the Purchaser pursuant to this Agreement, the conveyance of the Purchased Assets to the Issuer pursuant to the Sale and Servicing Agreement and the Grant thereof by the Issuer to the Indenture Trustee pursuant to the Indenture: (a) Existence and Power. Santander Consumer is a corporation validly existing and in good standing under the laws of its state of organization and has, in all material respects, full power and authority to own its assets and operate its business as presently owned or operated, and to execute, to deliver and to perform its obligations under the Transaction Documents to which it is a party. Santander Consumer has obtained all necessary licenses and approvals in each jurisdiction where the failure to do so would materially and adversely affect the ability of Santander Consumer to perform its obligations under the Transaction Documents or affect the enforceability or collectability of the Receivables or any other part of the Purchased Assets.   -2- Purchase Agreement (2015-3) (b) Authorization and No Contravention. The execution, delivery and performance by Santander Consumer of the Transaction Documents to which it is a party have been duly authorized by all necessary corporate action on the part of Santander Consumer and do not contravene or constitute a default under (i) any applicable law, rule or regulation, (ii) its organizational documents or (iii) any material indenture or material agreement or instrument to which Santander Consumer is a party or by which its properties are bound (other than violations of such laws, rules, regulations, organizational documents, indentures, agreements or instruments which do not affect the legality, validity or enforceability of any of such agreements and which, individually or in the aggregate, would not materially and adversely affect the transactions contemplated by, or Santander Consumer’s ability to perform its obligations under, the Transaction Documents). (c) No Consent Required. No approval or authorization by, or filing with, any Governmental Authority is required in connection with the execution, delivery and performance by Santander Consumer of any Transaction Document other than (i) UCC filings, (ii) approvals and authorizations that have previously been obtained and filings that have previously been made and (iii) approvals, authorizations or filings which, if not obtained or made, would not have a material adverse effect on the enforceability or collectability of the Receivables or any other part of the Purchased Assets or would not materially and adversely affect the ability of Santander Consumer to perform its obligations under the Transaction Documents. (d) Binding Effect. Each Transaction Document to which Santander Consumer is a party constitutes the legal, valid and binding obligation of Santander Consumer enforceable against Santander Consumer in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, receivership, conservatorship or other similar laws affecting the enforcement of creditors’ rights generally and, if applicable, the rights of creditors of corporations from time to time in effect or by general principles of equity. (e) No Proceedings. There are no actions, orders, suits or proceedings pending or, to the knowledge of Santander Consumer, threatened against Santander Consumer before or by any Governmental Authority that (i) assert the invalidity or unenforceability of this Agreement or any of the other Transaction Documents, (ii) seek to prevent the issuance of the Notes or the consummation of any of the transactions contemplated by this Agreement or any of the other Transaction Documents, (iii) seek any determination or ruling that would materially and adversely affect the performance by Santander Consumer of its obligations under this Agreement or any of the other Transaction Documents or (iv) relate to Santander Consumer that would materially and adversely affect the federal or Applicable Tax State income, excise, franchise or similar tax attributes of the Notes. (f) Lien Filings. Santander Consumer is not aware of any material judgment, ERISA or tax lien filings against Santander Consumer.   -3- Purchase Agreement (2015-3) SECTION 3.2 Representations and Warranties of Santander Consumer as to each Receivable. On the date hereof, Santander Consumer hereby makes the representations and warranties set forth on Schedule I to the Sale and Servicing Agreement to the Purchaser as to the Receivables sold, transferred, assigned, contributed and otherwise conveyed to the Purchaser under this Agreement on which such representations and warranties the Purchaser relies in acquiring the Receivables. Santander Consumer hereby further represents and warrants that, as to the Receivables sold, transferred, assigned, contributed and otherwise conveyed to the Purchaser under this Agreement, each such Receivable was selected using selection procedures that were not known or intended by Santander Consumer to be adverse to the Issuer. Such representations and warranties shall survive the conveyance of the Purchased Assets to the Purchaser pursuant to this Agreement, the sale of the Receivables to the Issuer under the Sale and Servicing Agreement and the Grant of the Receivables by the Issuer to the Indenture Trustee pursuant to the Indenture. Notwithstanding any statement to the contrary contained herein or in any other Transaction Document, Santander Consumer shall not be required to notify any insurer with respect to any Insurance Policy obtained by an Obligor or to notify any Dealer about any aspect of the transaction contemplated by the Transaction Documents. SECTION 3.3 Repurchase upon Breach. Upon discovery by or notice to the Purchaser or Santander Consumer of a breach of any of the representations and warranties set forth in Section 3.2 with respect to any Receivable at the time such representations and warranties were made which materially and adversely affects the interests of the Issuer or the Noteholders in such Receivable, the party discovering such breach or receiving such notice shall give prompt written notice thereof to the other party; provided, that delivery of a Servicer’s Certificate shall be deemed to constitute prompt notice by Santander Consumer and the Purchaser of such breach; provided, further, that the failure to give such notice shall not affect any obligation of Santander Consumer hereunder. If the breach materially and adversely affects the interests of the Purchaser, the Issuer or the Noteholders in such Receivable, then Santander Consumer shall either (a) correct or cure such breach or (b) repurchase such Receivable from the Purchaser (or its assignee), in either case on or before the Payment Date following the end of the Collection Period which includes the 60th day (or, if Santander Consumer elects, an earlier date) after the date Santander Consumer became aware or was notified of such breach. Any such breach or failure will be deemed not to have a material and adverse effect if such breach or failure does not affect the ability of the Purchaser (or its assignee) to receive and retain timely payment in full on such Receivable. Any such purchase by Santander Consumer shall be at a price equal to the related Repurchase Price. In consideration for such repurchase, Santander Consumer shall make (or shall cause to be made) a payment to the Purchaser equal to the Repurchase Price by depositing such amount into the Collection Account prior to noon, New York City time, on such date of repurchase (or, if Santander Consumer elects, an earlier date). Upon payment of such Repurchase Price by Santander Consumer, the Purchaser shall release and shall execute and deliver such instruments of release, transfer or assignment, in each case without recourse or representation, as may be reasonably requested by Santander Consumer to evidence such release, transfer or assignment or more effectively vest in Santander Consumer or its designee any Receivable and related Purchased Assets repurchased pursuant to this Section 3.3. It is understood and agreed that the obligation of Santander Consumer to repurchase any Receivable as described above shall constitute the sole remedy respecting such breach available to the Purchaser.   -4- Purchase Agreement (2015-3) SECTION 3.4 Protection of Title. (a) Santander Consumer shall authorize and file such financing statements and cause to be authorized and filed such continuation and other statements, all in such manner and in such places as may be required by law fully to preserve, maintain and protect the interest of the Purchaser under this Agreement in the Receivables (other than any Related Security with respect thereto, to the extent that the interest of the Purchaser therein cannot be perfected by the filing of a financing statement). Santander Consumer shall deliver (or cause to be delivered) to the Purchaser file-stamped copies of, or filing receipts for, any document filed as provided above, as soon as available following such filing. (b) Santander Consumer shall notify the Purchaser in writing within ten (10) days following the occurrence of (i) any change in Santander Consumer’s organizational structure as a corporation, (ii) any change in Santander Consumer’s “location” (within the meaning of Section 9-307 of the UCC of all applicable jurisdictions) and (iii) any change in Santander Consumer’s name, and (A) shall have taken all action prior to making such change (or shall have made arrangements to take such action substantially simultaneously with such change, if it is not possible to take such action in advance) reasonably necessary or advisable in the opinion of the Purchaser to amend all previously filed financing statements or continuation statements described in paragraph (a) above and (B) shall have delivered to the Indenture Trustee within 30 days after such change an Opinion of Counsel either (a) stating that, in the opinion of such counsel, all financing statements and continuation statements and amendments thereto have been executed and filed that are necessary to preserve and protect the interest of the Issuer in the Receivables or (b) stating that, in the opinion of such counsel, no such action shall be necessary to preserve and protect such interest. (c) Santander Consumer shall maintain (or shall cause its Sub-Servicer to maintain) accounts and records as to each Receivable accurately and in sufficient detail to permit (i) the reader thereof to know at any time the status of such Receivable, including payments and recoveries made and payments owing (and the nature of each) and (ii) reconciliation between payments or recoveries on (or with respect to) each Receivable and the amounts from time to time deposited in the Collection Account in respect of such Receivable. (d) Santander Consumer shall maintain (or shall cause its Sub-Servicer to maintain) its computer systems so that, from time to time after the conveyance under this Agreement of the Receivables, the master computer records (including any backup archives) that refer to a Receivable shall indicate clearly the interest of the Purchaser (or any subsequent assignee of the Purchaser) in such Receivable and that such Receivable is owned by such Person. Indication of such Person’s interest in a Receivable shall not be deleted from or modified on such computer systems until, and only until, the related Receivable shall have been paid in full or repurchased. (e) If at any time Santander Consumer shall propose to sell, grant a security interest in or otherwise transfer any interest in motor vehicle receivables to any prospective purchaser, lender or other transferee, Santander Consumer shall give to such prospective purchaser, lender or other transferee computer tapes, records or printouts (including any restored from backup archives) that, if they shall refer in any manner whatsoever to any Receivable, shall indicate clearly that such Receivable has been sold and is owned by the Purchaser (or any subsequent assignee of the Purchaser).   -5- Purchase Agreement (2015-3) SECTION 3.5 Other Liens or Interests. Except for the conveyances and grants of security interests pursuant to this Agreement and the other Transaction Documents, Santander Consumer shall not sell, pledge, assign or transfer the Receivables or other property transferred to the Purchaser to any other Person, or grant, create, incur, assume or suffer to exist any Lien (other than Permitted Liens) on any interest therein, and Santander Consumer shall defend the right, title and interest of the Purchaser in, to and under such Receivables or other property transferred to the Purchaser against all claims of third parties claiming through or under Santander Consumer. SECTION 3.6 Perfection Representations, Warranties and Covenants. Santander Consumer hereby makes the perfection representations, warranties and covenants attached hereto as Schedule I to the Purchaser and the Purchaser shall be deemed to have relied on such representations, warranties and covenants in acquiring the Purchased Assets. ARTICLE IV MISCELLANEOUS SECTION 4.1 Transfers Intended as Sale; Security Interest. (a) Each of the parties hereto expressly intends and agrees that the transfers contemplated and effected under this Agreement are complete and absolute sales, transfers, assignments, contributions and conveyances without recourse rather than pledges or assignments of only a security interest and shall be given effect as such for all purposes. It is further the intention of the parties hereto that the Purchased Assets shall not be part of Santander Consumer’s estate in the event of a bankruptcy or insolvency of Santander Consumer. The sales and transfers by Santander Consumer of the Receivables and related Purchased Assets hereunder are and shall be without recourse to, or representation or warranty (express or implied) by, Santander Consumer, except as otherwise specifically provided herein. The limited rights of recourse specified herein against Santander Consumer are intended to provide a remedy for breach of representations and warranties relating to the condition of the property sold, rather than to the collectability of the Receivables. (b) Notwithstanding the foregoing, in the event that the Receivables and other Purchased Assets are held to be property of Santander Consumer, or if for any reason this Agreement is held or deemed to create indebtedness or a security interest in the Receivables and other Purchased Assets, then it is intended that: (i) This Agreement shall be deemed to be a security agreement within the meaning of Articles 8 and 9 of the New York UCC and the UCC of any other applicable jurisdiction;   -6- Purchase Agreement (2015-3) (ii) The conveyance provided for in Section 2.1 shall be deemed to be a grant by Santander Consumer of, and Santander Consumer hereby grants to the Purchaser, a security interest in all of its right (including the power to convey title thereto), title and interest, whether now owned or hereafter acquired, in and to the Receivables and other Purchased Assets, to secure such indebtedness and the performance of the obligations of Santander Consumer hereunder; (iii) The possession by the Purchaser or its agent of the Receivable Files and any other property as constitute instruments, money, negotiable documents or chattel paper shall be deemed to be “possession by the secured party” or possession by the purchaser or a person designated by such purchaser, for purposes of perfecting the security interest pursuant to the New York UCC and the UCC of any other applicable jurisdiction; and (iv) Notifications to persons holding such property, and acknowledgments, receipts or confirmations from persons holding such property, shall be deemed to be notifications to, or acknowledgments, receipts or confirmations from, bailees or agents (as applicable) of the Purchaser for the purpose of perfecting such security interest under applicable law. SECTION 4.2 Notices, Etc. All demands, notices and communications hereunder shall be in writing and shall be delivered or mailed by registered or certified first-class United States mail, postage prepaid, hand delivery, prepaid courier service, or by facsimile or by electronic transmission, and addressed in each case as specified on Schedule II to the Sale and Servicing Agreement or at such other address as shall be designated by any of the specified addressees in a written notice to the other parties hereto. Any notice required or permitted to be mailed to a Noteholder shall be given by first class mail, postage prepaid, at the address of such Noteholder as shown in the Note Register. Delivery shall occur only upon receipt or reported tender of such communication by an officer of the recipient entitled to receive such notices located at the address of such recipient for notices hereunder; provided, however, that any notice to a Noteholder mailed within the time prescribed in this Agreement shall be conclusively presumed to have been duly given, whether or not the Noteholder shall receive such notice. SECTION 4.3 Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL, SUBSTANTIVE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE RULES THEREOF RELATING TO CONFLICTS OF LAW, OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.   -7- Purchase Agreement (2015-3) SECTION 4.4 Headings. The section headings hereof have been inserted for convenience only and shall not be construed to affect the meaning, construction or effect of this Agreement. SECTION 4.5 Counterparts. This Agreement may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument. SECTION 4.6 Amendment. (a) Any term or provision of this Agreement may be amended by Santander Consumer and the Purchaser without the consent of the Indenture Trustee, any Noteholder, the Issuer, the Owner Trustee or any other Person subject to the satisfaction of one of the following conditions: (i) Santander Consumer or the Purchaser delivers an Opinion of Counsel to the (ii) the Rating Agency Condition is satisfied with respect to such amendment and Santander Consumer or the Purchaser notifies the Indenture Trustee in writing that the Rating Agency Condition is satisfied with respect to such amendment; provided, that no amendment pursuant to this Section 4.6 shall be effective which affects the rights, protections or duties of the Indenture Trustee or the Owner Trustee without the prior written consent of such Person. (b) This Agreement may also be amended from time to time by Santander Consumer and the Purchaser, with the consent of the Holders of Notes evidencing not less than a majority of the aggregate principal balance of the Controlling Class, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders. It will not be necessary for the consent of Noteholders to sufficient if such consent approves the substance thereof. The manner of obtaining such consents (and any other consents of Noteholders provided for in this Agreement) and of evidencing the authorization of the execution thereof by Noteholders will be subject to such reasonable requirements as the Indenture Trustee may prescribe, including the establishment of record dates pursuant to the Depository Agreement. (c) Any term or provision of this Agreement may also be amended from time to time by Santander Consumer and the Purchaser for the purpose of conforming the terms of this Agreement to the description thereof in the Prospectus or, to the extent not contrary to the Prospectus, to the description thereof in an offering memorandum with respect to the Non-Investment Grade Notes or the Certificates without the consent of the Indenture Trustee, any Noteholder, the Issuer, the Owner Trustee or any other Person, provided, however, that Santander Consumer and the Purchaser shall provide written notification of the substance of such amendment to the Indenture Trustee, the Issuer and the Owner Trustee and promptly after the execution of such amendment, Santander Consumer and the Purchaser shall furnish a copy of such amendment to the Indenture Trustee, the Issuer and the Owner Trustee.   -8- Purchase Agreement (2015-3) (d) Prior to the execution of any amendment or consent pursuant to this Section 4.6, Santander Consumer shall provide written notification of the substance of such amendment to each Rating Agency; and promptly after the execution of any such amendment or consent, Santander Consumer shall furnish a copy of such amendment or consent to each Rating Agency and the Indenture Trustee. (e) Prior to the execution of any amendment to this Agreement, the Owner Trustee and the Indenture Trustee shall be entitled to receive and conclusively rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement and that all conditions precedent to the execution and delivery of such amendment have been satisfied. The Owner Trustee and the Indenture Trustee may, but shall not be obligated to, enter into any such amendment which adversely affects the Owner Trustee’s or the Indenture Trustee’s, as applicable, own rights, duties or immunities under this Agreement. (f) Notwithstanding subsections (a) and (b) of this Section 4.6, this Agreement may only be amended by the Seller and the Purchaser if (i) the Majority Certificateholders consent to such amendment or (ii) such amendment shall not, as evidenced by an Officer’s Certificate of the Seller or the Purchaser or an Opinion of Counsel delivered to the Indenture Trustee and the Owner Trustee, materially and adversely affect the interests of the Certificateholders. SECTION 4.7 Waivers. No failure or delay on the part of the Purchaser, the Servicer, Santander Consumer, the Issuer or the Indenture Trustee in exercising any power or right hereunder (to the extent such Person has any power or right hereunder) shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right. No notice to or demand on the Purchaser or Santander Consumer in any case shall entitle it to any notice or demand in similar or other circumstances. No waiver or approval by either party under this Agreement shall, except as may otherwise be stated in such waiver or approval, be applicable to subsequent transactions. No waiver or approval under this Agreement shall require any similar or dissimilar waiver or approval thereafter to be granted hereunder. SECTION 4.8 Entire Agreement. The Transaction Documents contain a final and complete integration of all prior expressions by the parties hereto with respect to the subject matter thereof and shall constitute the entire agreement among the parties hereto with respect to the subject matter thereof, superseding all prior oral or written understandings. There are no unwritten agreements among the parties. SECTION 4.9 Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall be for any reason whatsoever held invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement.   -9- Purchase Agreement (2015-3) SECTION 4.10 Binding Effect. This Agreement shall be binding upon and inure to assigns. This Agreement shall create and constitute the continuing obligations force and effect until such time as the parties hereto shall agree. SECTION 4.11 Acknowledgment and Agreement. By execution below, Santander Consumer expressly acknowledges and consents to the sale of the Purchased Assets and the assignment of all rights of the Purchaser under this Agreement by the Purchaser to the Issuer pursuant to the Sale and Servicing Agreement and the Grant of a security interest in the Receivables, the other Purchased Assets and the Issuer’s rights under this Agreement by the Issuer to the Indenture Trustee pursuant to the Indenture for the benefit of the Noteholders. In addition, Santander Consumer hereby acknowledges and agrees that for so long as the Notes are outstanding, the Indenture Trustee will have the right to exercise all powers, privileges and claims of the Purchaser under this Agreement in the event that the Purchaser shall fail to exercise the same. SECTION 4.12 Cumulative Remedies. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. SECTION 4.13 Nonpetition Covenant. Each party hereto agrees that, prior to the date which is one year and one day after payment in full of all obligations of each Bankruptcy Remote Party in respect of all securities issued by any Bankruptcy Remote Party (i) such party hereto shall not authorize any Bankruptcy Remote Party to commence a voluntary winding-up or other voluntary case or other Proceeding seeking liquidation, reorganization or other relief with respect to such Bankruptcy Remote Party or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect in any jurisdiction or seeking the appointment of an administrator, a trustee, receiver, liquidator, custodian or other similar official with respect to such Bankruptcy Remote Party or any substantial part of its property or to consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other Proceeding commenced against such Bankruptcy Remote Party, or to make a general assignment for the benefit of its creditors generally, any party hereto or any other creditor of such Bankruptcy Remote Party, and (ii) such party shall not commence, join with any other Person in commencing or institute with any other Person, any Proceeding against such Bankruptcy Remote Party under any bankruptcy, reorganization, liquidation or insolvency law or statute now or hereafter in effect in any jurisdiction. This Section shall survive the SECTION 4.14 Submission to Jurisdiction; Waiver of Jury Trial. Each of the parties hereto hereby irrevocably and unconditionally: relating to this Agreement or any documents executed and delivered in connection herewith, or for recognition and enforcement of any judgment in respect thereof, to the nonexclusive general jurisdiction of the courts of the State of New York, the courts of the United States of America for the Southern District of New York and appellate courts from any thereof;   -10- Purchase Agreement (2015-3) (b) consents that any such action or proceeding may be brought and maintained in such courts and waives any objection that it may now or hereafter have to the venue of such action or proceeding in any such court or that such action or the same; substantially similar form of mail), postage prepaid, to such Person at its address determined in accordance with Section 4.2 of this Agreement; (e) to the extent permitted by applicable law, each party hereto irrevocably waives all right of trial by jury in any action, proceeding or counterclaim based on, or arising out of, under or in connection with this Agreement, any other Transaction Document, or any matter arising hereunder or thereunder. SECTION 4.15 Third-Party Beneficiaries. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns and each of the Issuer and the Indenture Trustee shall be an express third-party beneficiary hereof and may enforce the provisions hereof as if it were a party hereto. Except as otherwise provided in this Section, no other Person will have any right hereunder.   -11- Purchase Agreement (2015-3) day and year first written above.   SANTANDER CONSUMER USA INC. By: /s/ John P. Ebbott, Jr. Name: John P. Ebbott, Jr. Title: Senior Vice President   S-1 Purchase Agreement (2015-3) SANTANDER DRIVE AUTO RECEIVABLES LLC By: /s/ Mark McCastlain Name: Mark McCastlain Title: Vice President   S-2 Purchase Agreement (2015-3) EXHIBIT A FORM OF ASSIGNMENT PURSUANT TO PURCHASE AGREEMENT [            ], 2015 For value received, in accordance with the Purchase Agreement (the “Agreement”) dated as of June 24, 2015, between Santander Consumer USA Inc., an Illinois corporation (“Santander Consumer”), and Santander Drive Auto Receivables LLC, a Delaware limited liability company (the “Purchaser”), on the terms and subject to the conditions set forth in the Agreement, Santander Consumer does hereby irrevocably sell, transfer, assign, contribute and otherwise convey to the Purchaser on the Closing Date, without recourse (subject to the obligations in the Agreement), all right, title and interest of Santander Consumer, whether now owned or hereafter acquired, in, to and under the Receivables set forth on the schedule of Receivables delivered by Santander Consumer to the Purchaser on the date hereof, the Collections after the Cut-Off Date, the Receivable Files and the Related Security relating thereto, which sale shall be effective as of the The foregoing sale does not constitute and is not intended to result in an assumption by the Purchaser of any obligation of any Originator to the Obligors, the Dealers, insurers or any other Person in connection with the Receivables, or the other assets and properties conveyed hereunder or any agreement, document or instrument related thereto. This assignment is made pursuant to and upon the representations, warranties and agreements on the part of the undersigned contained in the Agreement and is governed by the Agreement. Capitalized terms used herein and not otherwise defined shall have the meaning assigned to them in the Agreement.   A-1 Purchase Agreement (2015-3) IN WITNESS HEREOF, the undersigned has caused this assignment to be duly     Name: Title:   A-2 Purchase Agreement (2015-3) SCHEDULE I PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS In addition to the representations, warranties and covenants contained in the Agreement, Santander Consumer hereby represents, warrants, and covenants to the Purchaser as follows on the Closing Date: General 1. This Agreement creates a valid and continuing security interest (as defined in the applicable UCC) in the Receivables and the other Purchased Assets in favor of the Purchaser, which security interest is prior to all other Liens, and is enforceable as such as against creditors of and purchasers from Santander Consumer. 2. The Receivables constitute “chattel paper,” “accounts,” “instruments” or “general intangibles,” within the meaning of the UCC. 3. Immediately prior to the sale, assignment and transfer thereof pursuant to this Agreement, each Receivable was secured by a first priority validly perfected security interest in the related Financed Vehicle in favor of the applicable Originator (or its assignee), as secured party, or all necessary actions with respect to such Receivable have been taken or will be taken to perfect a first priority security interest in the related Financed Vehicle in favor of the applicable Originator (or its assignee), as secured party. Creation 4. Immediately prior to the sale, transfer, assignment and conveyance of a Receivable by Santander Consumer to the Purchaser, Santander Consumer owned and had good and marketable title to such Receivable free and clear of any Lien and immediately after the sale, transfer, assignment and conveyance of such Receivable to the Purchaser, the Purchaser will have good and marketable title to such Receivable free and clear of any Lien. 5. Santander Consumer has received all consents and approvals to the sale of the Receivables hereunder to the Purchaser required by the terms of the Receivables that constitute instruments. Perfection 6. Santander Consumer has caused or will have caused, within ten days after the effective date of this Agreement, the filing of all appropriate financing statements in the proper filing office in the appropriate jurisdictions under applicable law in order to perfect the sale of the Receivables from Santander Consumer to the Purchaser, and the security interest in the Receivables granted to the Purchaser hereunder; and the Servicer, in its capacity as custodian, has in its possession the original copies of such instruments or tangible chattel paper that constitute or evidence the Receivables, and all financing statements referred to in this paragraph contain a statement that: “A purchase of or security interest in any collateral described in this financing statement will violate the rights of the Secured Party/Purchaser.”   -1- Purchase Agreement (2015-3) 7. With respect to Receivables that constitute instruments or tangible chattel paper, either:     (i) All original executed copies of each such instrument or tangible chattel paper have been delivered to the Indenture Trustee; or     (ii) Such instruments or tangible chattel paper are in the possession of the Servicer and the Indenture Trustee has received a written acknowledgment from the Servicer that the Servicer (in its capacity as custodian) is holding such instruments or tangible chattel paper solely on behalf and for the benefit of the Indenture Trustee, as pledgee of the Issuer; or     (iii) The Servicer received possession of such instruments or tangible chattel paper after the Indenture Trustee received a written acknowledgment from the Servicer that the Servicer is acting solely as agent of the Indenture Trustee, as pledgee of the Issuer. Priority 8. Santander Consumer has not authorized the filing of, and is not aware of, any financing statements against Santander Consumer that include a description of collateral covering the Receivables other than any financing statement (i) relating to the security interest granted to the Purchaser hereunder or (ii) that has been terminated. 9. Santander Consumer is not aware of any material judgment, ERISA or tax lien filings against Santander Consumer. 10. Neither Santander Consumer nor a custodian or vaulting agent thereof holding any Receivable that is electronic chattel paper has communicated an “authoritative copy” (as such term is used in Section 9-105 of the UCC) of any loan agreement that constitutes or evidences such Receivable to any Person other than the Servicer. 11. None of the instruments, tangible chattel paper or electronic chattel paper that constitute or evidence the Receivables has any marks or notations indicating that they have been pledged, assigned or otherwise conveyed to any Person other than the Purchaser, the Issuer or the Indenture Trustee. Survival of Perfection Representations 12. Notwithstanding any other provision of this Agreement or any other Transaction Document, the perfection representations, warranties and covenants contained in this Schedule I shall be continuing, and remain in full force and effect until such time as all obligations under the Transaction Documents and the Notes have been finally and fully paid and performed.   No Waiver 13. Santander Consumer shall provide the Rating Agencies with prompt written notice of any material breach of the perfection representations, warranties and covenants contained in this Schedule I, and shall not, without satisfying the Rating Agency Condition, waive a breach of any of such perfection representations, warranties or covenants.  

Exhibit 10.1   [g21371ksi001.jpg]     1550 Wynkoop Street, 3rd Fl Denver, Colorado 80202 (303) 893-0012 Office (303) 893-6993 Fax summit-materials.com   December 19, 2017   Dear Karl,   It is my pleasure to confirm the offer by Summit Materials Holdings, L.P., a Delaware limited partnership (together with its affiliates Summit Materials, LLC, a Delaware limited liability company, and Summit Materials, Inc., a Delaware corporation, “Summit”), to you for the position of Executive Vice President and Chief Operating Officer of Summit, reporting to Tom Hill, Summit’s President and Chief Executive Officer.  Your appointment is subject to approval by the Board of Directors of Summit Materials, Inc. (the “Board”), and your compensation package as outlined herein is subject to approval of the Board’s Compensation Committee (the “Compensation Committee”).  This offer is contingent upon your completing all applicable pre-employment screening and paperwork as further detailed below.  The terms of our offer are as follows:   1.  Commencement Date:  The date your employment with Summit commences (the “Commencement Date”) will be January 8, 2018.   2.  Annual Base Salary:  Starting annual base salary of $550,000, payable in accordance with Summit’s customary payroll practices.  The annual base salary will be reviewed annually by the Compensation Committee, and may be increased (but not decreased) in the sole discretion of the Board and/or Compensation Committee.   3.  Annual Cash Bonus Target:  Seventy-five percent (75%) of annual base salary, with a potential bonus of up to two (2) times the target annual bonus for extraordinary performance, and performance metrics to be established in accordance with the Compensation Committee’s policies applicable to Summit’s executive officers.   4.  Long Term Equity Incentive Plan:  Annual target award established by the Compensation Committee.  Initial award of $2 million in restricted stock units, to be made on or promptly following the Commencement Date, which award will vest in equal annual installments over three (3) years, subject to continued employment through each such vesting date; provided that such award will become fully vested in the event your employment is terminated by Summit without Cause (as defined in the applicable award agreement).   5.  Sign-on Bonus:  On or within thirty (30) days following the Commencement Date, Summit will pay you a one time, lump sum sign-on bonus of $300,000 (the “Sign-on Bonus”), less applicable withholding; provided, that you will be required to repay the full Sign-On Bonus should you resign from Summit within twenty-four (24) months following the Commencement Date.   6.  Executive Severance Plan:  You will participate in Summit’s Executive Severance Plan, with eligibility at the level applicable to Executive Vice Presidents; provided, that the     definition of “Constructive Termination” contained therein as it applies to you shall include Summit not appointing you as its Chief Executive Officer on or prior to the third (3rd) anniversary of the Commencement Date, subject to all of the other terms and conditions of the Executive Severance Plan, including, without limitation, the cure and notice provisions contained therein.   7.  Employee Benefits.  You will be eligible to participate in Summit’s employee benefits plans and programs as in effect from time to time, on the same basis as those benefits are generally made available to other executive officers of Summit.  Medical benefits will commence on the first day of the month following the sixtieth (60th) day after the Commencement Date, and for the interim period from the Commencement Date to the date coverage begins, Summit will reimburse you for “COBRA” premiums you pay for continued medical coverage from your prior employer.   8.  Relocation.  In connection with your employment by Summit, you hereby agree to relocate your primary residence to the Denver, Colorado area.  In connection with such relocation, Summit will reimburse you for the following expenses:   a.              One seven (7)-day house hunting trip to the Denver, Colorado area for you and your significant other including airfare, lodging, meals and car rental.   b.              Reimbursement for all closing costs associated with the sale of your current primary home including realtor sales commissions, attorney fees, document preparation and transfer fees.   c.               Direct payment for reasonable expenses associated with the packing, shipping and unpacking of your household goods from your current primary home, including full replacement insurance.   d.              Reimbursement for reasonable expenses associated with the physical move of your family including airfare, lodging, meals and car rental.   e.               Shipment of one vehicle to the Denver, Colorado area with associated vehicle shipment insurance.   f.                Up to three (3) months of storage for household goods subsequent to your permanent relocation to the Denver, Colorado area.   All of the expenses listed above in this paragraph 8 must be documented and submitted to Summit in accordance with its ordinary reimbursement practices.  At its discretion, Summit may utilize a third-party relocation services provider to coordinate with you directly and manage your relocation to the Denver, Colorado area.   Any taxable reimbursements/payments by Summit described above in this paragraph 8 will be “grossed up” by Summit using an assumed tax rate that Summit deems applicable to your situation.     Should you resign from Summit within twenty-four (24) months following the Commencement Date, you hereby agree to reimburse Summit for one hundred percent (100%) of the above-listed relocation costs (as well as any other costs that Summit may elect to pay or reimburse you for in connection with your relocation), including any “gross up” payment, within thirty (30) days following your resignation.   9.  Vacation.  You will be entitled to three (3) weeks of vacation per year as well as the holidays that Summit observes.   10.  Executive Representation.  By signing this letter you represent that: (1) you are not a party to any agreement that would prohibit you from entering into employment with Summit; (2) no trade secret or proprietary information belonging to your previous employers will be disclosed by you at Summit and that no such information, whether in the form of documents, memoranda, software, drawings, etc., will be retained by you or brought with you to Summit; and (3) you have brought to Summit’s attention and provided Summit with a copy of any agreement, order of any court or administrative body or any other similar item that may affect your future employment at Summit, including but not limited to any non-disclosure, non-competition, non-solicitation or invention assignment agreements containing future work restrictions.   11.  Conditional Offer.  This letter is a confirmation of a conditional employment offer and should not be construed as an employment contract.  Upon acceptance, we will provide you with new-hire paperwork, including an acknowledgement of your agreement to abide by Summit’s Code of Conduct, an Officer’s Questionnaire, and an I-9 form, which is required by the government to verify employment eligibility.  Our offer is further subject to satisfactory completion of a background check, drug screening and reference checks.   Please acknowledge your agreement with the terms of this letter by signing and returning this letter for our files by email to [email protected].   Karl, we are excited about our future and delighted to welcome you to Summit.   Sincerely,           /s/ Tom Hill   Name: Tom Hill               AGREED AND ACCEPTED:           /s/ Karl Watson   Karl Watson  

EXHIBIT 32.1 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION -OXLEY ACT OF 2002 In connection with the Quarterly Report of All American Pet Company, Inc. (the “Company”) on Form 10-Q for the period ended March 31, 2010, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Barry Schwartz, CEO and Principal Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /S/ Barry Schwartz Barry Schwartz CEO and Principal Executive Officer May 24, 2010

Exhibit32.1 Written Statement of Chairman, President and Chief Executive Officer Pursuant to Section906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section1350) The undersigned, the Chairman, President and Chief Executive Officer of Orbital Sciences Corporation (the “Company”), hereby certifies that, to his knowledge, on the date hereof: (a) the Quarterly Report on Form 10-Q of the Company for the quarter ended June 30, 2012 filed on the date hereof with the Securities and Exchange Commission (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (b) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ David W. Thompson David W. Thompson Chairman, President and Chief Executive Officer July 26, 2012 A signed original of this written statement required by Section906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit CERTIFICATION I, John Howard Howland, President and Chief Operating Officer of Southern Connecticut Bancorp, Inc., certify that: 1.I have reviewed this quarterly report on Form 10-Q of Southern Connecticut Bancorp, Inc. (the “Company”); 2.Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this quarterly report; 4.The Company’s other certifying officers and I, are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15 (e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(b)) for the Company and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this quarterly report based on such evaluation; and (d)Disclosed in this quarterly report any change in the Company’s internal controls over financial reporting that occurred during the most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and 5.The Company’s other certifying officers and I, have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal controls. By: /s/ John Howard Howland John Howard Howland Date: May 14, 2010 President and Chief Operating Officer

Name: Commission Implementing Decision (EU) 2017/500 of 21 March 2017 on recognition of the â Bonsucro EUâ voluntary scheme for demonstrating compliance with the sustainability criteria under Directives 98/70/EC and 2009/28/EC of the European Parliament and of the Council Type: Decision_IMPL Subject Matter: technology and technical regulations; environmental policy; energy policy; research and intellectual property Date Published: 2017-03-22 22.3.2017 EN Official Journal of the European Union L 76/40 COMMISSION IMPLEMENTING DECISION (EU) 2017/500 of 21 March 2017 on recognition of the Bonsucro EU voluntary scheme for demonstrating compliance with the sustainability criteria under Directives 98/70/EC and 2009/28/EC of the European Parliament and of the Council THE EUROPEAN COMMISSION, Having regard to the Treaty on the Functioning of the European Union, Having regard to Directive 98/70/EC of the European Parliament and of the Council of 13 October 1998 relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC (1), and in particular the second subparagraph of Article 7c(4) thereof, Having regard to Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the promotion of the use of energy from renewable sources and amending and subsequently repealing Directives 2001/77/EC and 2003/30/EC (2), and in particular the second subparagraph of Article 18(4) thereof, Whereas: (1) Articles 7b and 7c of, and Annex IV to, Directive 98/70/EC and Articles 17 and 18 of, and Annex V to, Directive 2009/28/EC lay down similar sustainability criteria for biofuels and bioliquids, and similar procedures for the verification of compliance with those criteria. (2) Where biofuels and bioliquids are to be taken into account for the purposes referred to in Article 17(1)(a), (b) and (c) of Directive 2009/28/EC, Member States must require economic operators to show the compliance of biofuels and bioliquids with the sustainability criteria set out in Article 17(2) to (5) of Directive 2009/28/EC. (3) The Commission may decide that voluntary national or international schemes setting standards for the production of biomass products contain accurate data for the purposes of Article 17(2) of Directive 2009/28/EC, and/or demonstrate that consignments of biofuel or bioliquid comply with the sustainability criteria set out in Article 17(3), (4) and (5), and/or that no materials have been intentionally modified or discarded so that the consignment or part thereof would fall under Annex IX. When an economic operator provides proof or data obtained in accordance with a voluntary scheme that has been recognised by the Commission, to the extent covered by the recognition decision, a Member State is barred from requiring the supplier to provide further evidence of compliance with the sustainability criteria. (4) The request to recognise that the Bonsucro EU voluntary scheme demonstrates that consignments of biofuel comply with the sustainability criteria set out in Directive 98/70/EC and Directive 2009/28/EC was submitted to the Commission on 18 October 2016. The scheme that is based in 50-52 Wharf Road, London N1 7EU, United Kingdom, covers biofuels produced from sugar cane including residues. The recognised scheme documents will be made available at the transparency platform established under Directive 2009/28/EC. (5) Assessment of the Bonsucro EU voluntary scheme found it to cover adequately the sustainability criteria of Directive 98/70/EC and of Directive 2009/28/EC, as well as applying a mass balance methodology in line with the requirements of Article 7c(1) of Directive 98/70/EC and Article 18(1) of Directive 2009/28/EC. (6) The evaluation of the Bonsucro EU voluntary scheme found that it meets adequate standards of reliability, transparency and independent auditing and also complies with the methodological requirements in Annex IV to Directive 98/70/EC and Annex V to Directive 2009/28/EC. (7) The measures provided for in this Decision are in accordance with the opinion of the Committee on the Sustainability of Biofuels and Bioliquids, HAS ADOPTED THIS DECISION: Article 1 The Bonsucro EU voluntary scheme (hereinafter the scheme), submitted for recognition to the Commission on 18 October 2016, demonstrates that consignments of biofuels and bioliquids produced in accordance with the standards for the production of biofuels and bioliquids set in the scheme comply with the sustainability criteria as laid down in Article 7b(3), (4) and (5) of Directive 98/70/EC and Article 17(3), (4) and (5) of Directive 2009/28/EC. The scheme also contains accurate data for the purposes of Article 17(2) of Directive 2009/28/EC and Article 7b(2) of Directive 98/70/EC. Article 2 The Decision is valid for a period of 5 years after it enters into force. If the contents of the scheme, as submitted for recognition to the Commission on 18 October 2016, change in a way that might affect the basis of this Decision, such changes shall be notified to the Commission without delay. The Commission shall assess the notified changes with a view to establish whether the scheme is still adequately covering the sustainability criteria for which it is recognised. Article 3 The Commission may decide to repeal this Decision, inter alia, under the following circumstances: (a) if it has been clearly demonstrated that the scheme has not implemented elements considered to be decisive for this Decision or if severe and structural breach of those elements has taken place; (b) if the scheme fails to submit annual reports to the Commission as provided for in Article 7c(6) of Directive 98/70/EC and Article 18(6) of Directive 2009/28/EC; (c) if the scheme fails to implement standards of independent auditing specified in implementing acts referred to in the third subparagraph of Article 7c(5) of Directive 98/70/EC and the third subparagraph of Article 18(5) of Directive 2009/28/EC or improvements to other elements of the scheme considered to be decisive for a continued recognition. Article 4 This Decision shall enter into force on the day following that of its publication in the Official Journal of the European Union. Done at Brussels, 21 March 2017. For the Commission The President Jean-Claude JUNCKER (1) OJ L 350, 28.12.1998, p. 58. (2) OJ L 140, 5.6.2009, p. 16.

Title: Rude tenant demanding handicap bathroom Question:There is a tenant on my property who is demanding to have a handicap bathtub installed. She is in a wheelchair. The tenant is living there under a sisters name so she is actually not the person the place was rented to. The property management company is saying we need to do it because she can cause problems legally.. how true is that? The tub would cost thousands and we'd have to do major changes to the bathroom. Side note, the lady is also extremely rude to everyone. Literally cuzes us all out and screams at people. I really want her off my property, she is always a pain to deal with and treats us all badly. What can I do? This is in California by the way. Answer #1: Generally speaking, a landlord does not have the right to refuse an accommodation request for a disability protected by the ADA, so long as the request is reasonable. Here, a request for shower grab bars or handicapped bathtub is likely going to be viewed as a reasonable request. However, it is not clear that the landlord is on the hook for paying for such a modification, particularly where this "tenant" is not even on the lease. Typically, the landlord cannot refuse the tenant from making the modification, but does not necessarily have to pay for the modification - California law only requires that the landlord permit the modification, at the tenant's expense. And the tenant would be on the hook for restoring the property to its original state upon lease termination. See Cal. Civil Code § 54.1. See also http://www.accessiblehousing.org/rights/modifications.asp and https://www.tobenerlaw.com/tenants-with-disabilities/

Exhibit 10.3   COACH INDUSTRIES GROUP, INC. AND CERTAIN OF ITS SUBSIDIARIES MASTER SECURITY AGREEMENT   c/o M&C Corporate Services Limited P.O. Box 309 GT Ugland House South Church Street George Town   Date: September 29, 2004     1. To secure the payment of all Obligations (as hereafter defined), Coach Industries Group, Inc., a Nevada corporation (the “Company”), each of the other undersigned parties (other than Laurus Master Fund, Ltd, “Laurus”)) and each other entity that is required to enter into this Master Security Agreement (each an “Assignor” and, collectively, the “Assignors”) hereby assigns and grants to Laurus a continuing security interest in all of the following property now owned or at any time hereafter acquired by any Assignor, or in which any Assignor now “Collateral”): all cash, cash equivalents, accounts, accounts receivable, deposit accounts (including, without limitation, the Restricted Account (the “Restricted Account”) maintained at North Fork Bank (Account Name: Coach Industries Group, Inc., Account Number: 2704 053 244) referred to in the Restricted Account Agreement), inventory, equipment, goods, vehicles (including without limitation the chasses of vehicles), documents, instruments (including, without limitation, promissory notes), contract rights, general intangibles (including, without limitation, payment intangibles and an absolute right to license on terms no less favorable than those current in effect among our affiliates), chattel paper, supporting obligations, investment property (including, without limitation, all equity interests owned by any Assignor), letter-of-credit rights, trademarks, trademark applications, tradestyles, patents, patent applications, copyrights, copyright applications and other intellectual property in which any Assignor now have or hereafter may acquire any right, title or interest, all proceeds and products thereof (including, without limitation, proceeds of insurance) and all additions, accessions and substitutions thereto or therefore. In the event any Assignor wishes to finance the acquisition in the ordinary course of business of any hereafter acquired equipment and has obtained a commitment from a financing source to finance such equipment from an unrelated third party, Laurus agrees to release or subordinate (in its sole discretion) its security interest on such hereafter acquired equipment so financed by such third party financing source. Except as otherwise defined herein, all capitalized terms used herein shall have the meaning provided such terms in the Securities Purchase Agreement referred to below.   2. The term “Obligations” as used herein shall mean and include all debts, as of the date hereof by and between the Company and Laurus (the “Securities Purchase Agreement”) and (ii) the Related Agreements referred to in the Securities Purchase Agreement (the Securities Purchase Agreement and each Related Agreement, as each may be amended, modified, restated or supplemented from time to time, are collectively referred to herein as the “Documents”), and in connection with any documents, instruments or agreements relating to or executed in connection with the Documents or any documents, instruments or agreements referred to therein or otherwise, and in connection with any other indebtedness, obligations or liabilities of any Assignor to Laurus, whether now existing or hereafter arising, direct or indirect, liquidated or unliquidated, absolute or contingent, due or not due and whether under, pursuant to or evidenced by a note, agreement, guaranty, instrument or otherwise, in each case, irrespective of the genuineness, validity, regularity or enforceability of such Obligations, or of any instrument evidencing any of the Obligations or of any collateral therefor or of the existence or extent of such collateral, and irrespective of the allowability, allowance or disallowance of any or all of the Obligations in any case commenced by or against any Assignor under Title 11, United States Code, including, without limitation, obligations or indebtedness of each Assignor for post-petition interest, fees, costs and charges that would have accrued or been added to the Obligations but for the commencement of such case.   3. Each Assignor hereby jointly and severally represents, warrants and covenants to Laurus that:   Assignor will provide Laurus thirty (30) days’ prior written notice of any change of its respective jurisdiction of organization;   (b) its legal name is as set forth in its respective Certificate of Incorporation or other organizational document (as applicable) as amended through the date hereof and as set forth on Schedule A, and it will provide Laurus thirty (30) days’ prior written notice change in its legal name;   (c) its organizational identification number (if applicable) is as set forth on Schedule A hereto, and it will provide Laurus thirty (30) days’ prior written notice of any change in any of its organizational identification number;   (d) it is the lawful owner of its respective Collateral and it has the sole right to grant a security interest therein and will defend such Collateral against all claims and demands of all persons and entities;   (e) it will keep its respective Collateral free and clear of all attachments, levies, taxes, liens, security interests and encumbrances of every kind and nature (“Encumbrances”), except (the following, “Permitted Encumbrances”): (i) Encumbrances set forth on Schedule B hereto, (ii) Encumbrances securing the Obligations and (iii) any other Encumbrance, to the extent any such Encumbrance referred to in this clause (iii) does not secure indebtedness in excess of a principal amount of $50,000 in the aggregate and such Encumbrance is removed or otherwise released within ten (10) days of the creation thereof;   2 (f) it will, at its and the other Assignors, joint and several cost and expense, keep the Collateral in good state of repair (ordinary wear and tear excepted) and will not waste or destroy the same or any part thereof other than ordinary Assignors’ business;   (g) it will not, without Laurus’ prior written consent, sell, exchange, lease or otherwise dispose of the Collateral, whether by sale, lease or otherwise, except for the sale of inventory in the ordinary course of business and for the disposition or transfer in the ordinary course of business during any fiscal year of obsolete and worn-out equipment or equipment no longer necessary for its ongoing needs, having an aggregate fair market value of not more than $25,000 and only to the extent that:   (i) the proceeds of any such disposition are used to acquire replacement Collateral which is subject to Laurus’ first priority perfected security interest subject to Laurus agreement in Section 1 hereof to release or subordinate its lien on financed equipment,, or are used to repay Obligations or to pay general corporate expenses; and   (ii) following the occurrence of an Event of Default which continues to exist at the time of such disposition, the proceeds of such disposition are remitted to Laurus to be held as cash collateral for the Obligations;   (h) it will insure or cause the Collateral to be insured in Laurus’ name against loss or damage by fire, theft, burglary, pilferage, loss in transit and such other hazards as Laurus shall specify in amounts and under policies by insurers acceptable to Laurus and all premiums thereon shall be paid by such Assignor and certificate of insurance with respect to the applicable insurance policies Assignors, jointly and severally, and shall constitute Obligations;   (i) it will at all reasonable times allow Laurus or Laurus’ representatives free access to and the right of inspection of the Collateral;   (j) such Assignor (jointly and severally with each other Assignor) hereby indemnifies and saves Laurus harmless from all loss, costs, damage, liability and/or expense, including reasonable attorneys’ fees, that Laurus may sustain or incur to enforce payment, performance or fulfillment of any of the Obligations and/or in the enforcement of this Master Security Agreement or in the prosecution or defense of any action or proceeding either against Laurus or any Assignor concerning any matter growing out of or in connection with this Master Security Agreement, and/or any of the Obligations and/or any of the Collateral except to the extent caused by Laurus’ own gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and nonappealable decision); and   3 (k) upon the request of Laurus, will undertake all actions necessary to perfect Laurus’ security interest in each vehicle (including any chasse of any vehicle) owned by any Assignor, to the extent such actions are permitted under applicable law after giving effect to any Permitted Encumbrances.   4. The occurrence of any of the following events or conditions shall constitute an “Event of Default” under this Master Security Agreement:   (a) any covenant, warranty, representation or statement made or furnished to Laurus by the Assignor or on the Assignor’s behalf pursuant to the Documents was breached in any material respect or false in any material respect when made or furnished, as the case may be, and, in the case of a covenant, if subject to cure, shall not be cured for a period of fifteen (15) days;   (b) the loss, theft, substantial damage, destruction, sale or encumbrance to or of any of the Collateral or the making of any levy, seizure or attachment thereof or thereon except to the extent:   (i) such loss is covered by insurance proceeds which are used to replace the item or repay Laurus or deposited with Laurus as cash collateral; or     (b) any Assignor shall become insolvent, cease operations, dissolve, terminate our business existence, make an assignment for the benefit of creditors, suffer the appointment of a receiver, trustee, liquidator or custodian of all or any part of Assignors’ property;   (c) any proceedings under any bankruptcy or insolvency law shall be commenced by or against any Assignor;   (d) the Company shall repudiate, purport to revoke or fail to perform any or all of its obligations under any Note (after passage of applicable cure period, if any); or   (e) an Event of Default shall have occurred under and as defined in any Document.   5. Upon the occurrence of any Event of Default and at any time thereafter, Laurus may declare all Obligations immediately due and payable and Laurus shall have the remedies of a secured party provided in the Uniform Commercial Code as in effect in the State of New York, this Agreement and other applicable law. Upon the occurrence of any Event of Default and at any time thereafter, Laurus will have the right to take possession of the Collateral and to maintain such possession on our premises or to remove the Collateral or any part thereof to such other premises as Laurus may desire, all in accordance with applicable law. Upon Laurus’ request, each of the Assignors shall assemble or cause the Collateral to be assembled and make it available to Laurus at a place designated by Laurus. If any notification of intended disposition of   4 any Collateral is required by law, such notification, if mailed, shall be deemed properly and reasonably given if mailed at least ten (10) days before such disposition, postage prepaid, addressed to any Assignor either at such Assignor’s address shown herein or at any address appearing on Laurus’ records for such Assignor. Any proceeds of any disposition of any of the Collateral shall be applied by Laurus to the payment of all expenses in connection with the sale of the Collateral, including reasonable attorneys’ fees and other legal expenses and disbursements and the reasonable expense of retaking, holding, preparing for sale, selling, and the like, and any balance of such proceeds may be applied by Laurus toward the payment of the Obligations in such order of application as Laurus may elect, and each Assignor shall be liable for any deficiency. For the avoidance of doubt, following the occurrence and during the continuance of an Event of Default, Laurus shall have the immediate right to withdraw any and all monies contained in the Restricted Account or any other deposit accounts in the name of the Assignor and controlled by Laurus and apply same to the repayment of the Obligations (in such order of application as Laurus may elect).   6. If any Assignor defaults in the performance or fulfillment of any of the terms, conditions, promises, covenants, provisions or warranties on such Assignor’s part to be performed or fulfilled under or pursuant to this Master Security Agreement, Laurus may, at its option without waiving its right to enforce this Master Security Agreement according to its terms, immediately or at any time thereafter and without notice to any Assignor, perform or fulfill the same or cause the performance or fulfillment of the same for each Assignor’s joint and several account and at each Assignor’s joint and several cost and expense, and the cost and expense thereof (including reasonable attorneys’ fees) shall be added to the Obligations and shall be payable on demand with interest thereon at the highest rate permitted by law, or, at Laurus’ option, debited by Laurus from the Restricted Account or any other deposit accounts in the name of the Assignor and controlled by Laurus.   7. Each Assignor appoints Laurus, any of Laurus’ officers, employees or any other person or entity whom Laurus may designate as our attorney, with power, (i) after and during the continuance of an Event of Default, to execute such documents in each of our behalf and to supply any omitted information and correct patent errors in any documents executed by any Assignor or on any Assignor’s behalf; (ii) to file financing statements against us covering the Collateral (and, in connection with the filing of any such financing statements, describe the Collateral as “all assets and all personal property, whether now owned and/or hereafter acquired” (or any substantially similar variation thereof)); (iii) after and during the continuance of an Event of Default, to sign our name on public records; and (iv) to do all other things Laurus deem necessary to carry out the intent of this Master Security Agreement. Each Assignor hereby ratifies and approves all acts of the attorney and neither Laurus nor the attorney will be liable for any acts of commission or omission, nor for any error of judgment or mistake of fact or law other than gross jurisdiction in a final and non-appealable decision). This power being coupled with an interest, is irrevocable so long as any Obligations remain unpaid.   8. No delay or failure on Laurus’ part in exercising any right, privilege or option hereunder shall operate as a waiver of such or of any other right, privilege, remedy or option, and no waiver whatever shall be valid unless in writing, signed by Laurus and then only to the extent therein set forth, and no   5 default or of the same default on a future occasion. Laurus’ books and records affecting or continuing Laurus’ security interest in the Collateral.   9. This Master Security Agreement shall be governed by and construed in accordance with the laws of the State of New York and cannot be amended or elections given to Laurus hereunder shall inure to the benefit of Laurus’ successors and assigns. The term “Laurus” as herein used shall include Laurus, any parent of Laurus’, any of Laurus’ subsidiaries and any co-subsidiaries of Laurus’ parent, whether now existing or hereafter created or acquired, and all Agreement shall inure to the benefit of each of the foregoing, and shall bind the representatives, successors and assigns of each Assignor. Laurus and each of Manhattan, the city of New York and (c) waive any objection Laurus or each Assignor may have as to the bringing or maintaining of such action with any such court.   10. It is understood and agreed that any person or entity that desires to become an Assignor hereunder, or is required to execute a counterpart of this Master Security Agreement after the date hereof pursuant to the requirements of any Document, shall become an Assignor hereunder by (x) executing a Joinder Agreement in form and substance satisfactory to Laurus, (y) delivering supplements to such exhibits and annexes to such Documents as Laurus shall reasonably request and (z) taking all actions as specified in this Agreement as would have been taken by such Assignor had it been an original party to this Agreement, in each case with all documents required above to be delivered to Laurus and with all documents and actions required above to be taken to the reasonable satisfaction of Laurus.   11. All notices from Laurus to any Assignor shall be sufficiently given if mailed or delivered to such Assignor’s address set forth below.   12. This Master Security Agreement and the security interests granted by the Assignors hereunder shall terminate (except with respect to indemnification provisions set forth herein which shall terminate in accordance with their terms) upon the provision by Laurus of written confirmation to the Company, either independently or upon the written request of the Company following such repayment or termination, that (x) all indebtedness obligations owed by any Assignor to Laurus has been repaid in full (including, without limitation, all principal, interest, fees, premiums, costs and expenses related to the Note and any other indebtedness outstanding at such time and owed to Laurus) and (y) any and all commitments by Laurus to fund any indebtedness to any Assignor have been terminated in their entirety. Upon such   6 termination, Laurus will, at the Company’s expense, execute and deliver to the Company such documents as the Company shall reasonably request to evidence such termination.   Very truly yours, COACH INDUSTRIES GROUP, INC. By:     Name:     Title:     Address: 12555 Orange Drive, Suite 261 Davie, Florida 33330 SPRINGFIELD COACH BUILDERS, INC. By:     Name:     Title:     Address: c/o Coach Industries Group, Inc. 12555 Orange Drive, Suite 261 Davie, Florida 33330 SPRINGFIELD COACH INDUSTRIES CORPORATION, INC. By:     Name:     Title:     Davie, Florida 33330   7 COMMERCIAL TRANSPORTATION MANUFACTURING CORP. By:     Name:     Title:     Davie, Florida 33330 COACH FINANCIAL SERVICES, INC. By:     Name:     Title:     Davie, Florida 33330   8 ACKNOWLEDGED: By:     Name:     Title       9   SCHEDULE A   Entity    Jurisdiction of Organization    Organization Identification Number   10 SCHEDULE B PERMITTED ENCUMBRANCES   11

Exhibit Number STATE OF FLORIDA Shares ALTERNATIVE ENERGY PARTNERS, INC. AUTHORIZED 50,000,$.0 THIS CERTIFIES THAT IS THE REGISTERED HOLDER OF SHARES OF THE FULLY PAID AND NON-ASSESSABLECAPITAL STOCK OF ALTERNATIVE ENERGY PARTNERS, INC. transferable only on the books of the corporation by the holder hereof in Person or by Attorney upon surrender of this certificate properly endorsed. In witness Whereof, the said Corporation has caused this Certificate to be signed By its duly authorized officers and its Corporate Seal to be hereunto affixed This dayof A.D., . PRESIDENT [SEAL] SECRETARY -1- The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations. TEN COM as tenants in common UNIF GIFT MIN ACT Custodian TEN ENT as tenants by the entireties (Cust) (Minor) JT TEN as joint tenants with the right of Act survivorship and not as tenants (State) in common Additional abbreviations may also be used though not in the above list. For value received, hereby sell, assign and transfer unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE OF ASSIGNEE) shares of the capital stock represented by the within Certificate, and do hereby irrevocably constitute and appoint , Attorney to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises. Dated X THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THIS CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER. THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (Banks, Stockbrokers, Savings and Loan Associations and

EXHIBIT 10.18 September 3, 2015 Mr. David W. McCauley President LSI Graphic Solutions Plus 9260 Pleasantwood Avenue NW North Canton, OH 44720 RE: Separation Agreement and Release Dear Dave: As we discussed, we have agreed that you will retire from full-time employment with LSI and will continue in a consulting role per the terms of this letter agreement (“Agreement”). We will work cooperatively to make a smooth and successful transition for you. This Agreement outlines the terms of our agreement and modification of your existing agreements with LSI: Announcement of Retirement : You will announce at the Executive Team meeting on July 17, 2015 that you are retiring from LSI within the next 90 days and that you will be assisting LSI to make a successful transition to the next President of LSI Graphic Solutions Plus. You may script the reason for your retirement, subject to approval from LSI, and LSI will work with you on a mutually agreeable communication strategy for the internal and external communication about your departure from LSI. Transition Period : You agree to continue working in your current role until a mutually agreeable date in October, 2015, as LSI conducts a search for and installs the next President of LSI Graphic Solutions Plus. During this Transition Period, you must continue functioning in a positive and professional manner and act in the best interest of LSI. After the next President is announced and in place, LSI and you will decide the appropriate date in October, 2015 for your last day of full-time employment with LSI. Consulting Period : Following the last day of your employment, LSI will continue working with you on an as needed basis as a consultant through June 30, 2016. You will be required to complete projects and tasks requested by the new President or CEO, if any, and generally remain available upon reasonable request to assist with the ongoing business needs of LSI. Both parties anticipate that this consulting work will be less than full-time and will be scheduled at a mutually workable time and location. You will work from a home office during this consulting period, unless requested to be on-site at LSI by the new President or the CEO upon reasonable advanced notice. As a consultant, you will not have the authority to bind LSI to any contract or obligation. Compensation : During this Transition Period, LSI will continue to pay you your regular salary and benefits through the last date of your employment. LSI will pay you for all earned and unused paid time off to which you are entitled. Your 2015 STIP award for fiscal year 2015 will be paid in August, 2015. You will be eligible for a pro rata 2016 STIP award from July 1, 2015 through the last day of your employment, and any award earned will be paid in August, 2016. Your 401(k) salary deferral will end with your final paycheck at the end of the Transition Period, and you are ineligible for company contribution into the Deferred Compensation Plan for fiscal year 2016. During this Consulting Period, LSI will pay you at a rate of $28,000 per month payable at the end of each month, with a pro rata amount being paid for the month of October based on the date the consulting period begins. The compensation described in this Section 0 includes payment for all bonuses, commissions, debts, unused vacation pay, and any other severance, salary continuation or other financial obligations due from LSI, including but not limited to the compensation set forth in the June 30, 1997 Employment Agreement. Stock Options : Your awards of stock options and shares of restricted stock shall be governed by LSI’s 2003 Equity Compensation Plan, as Amended and Restated Through January 25, 2006 and LSI’s Amended and Restated 2012 Stock Incentive Plan, as of November 20, 2014, as the case may be. Each of these plans provides generally that when your employment terminates by retirement, your awards shall fully vest and may thereafter be exercised for 90 days. Exhibit A provides a complete and accurate listing of all outstanding and unvested stock options and shares of restricted stock held by you as of the Retirement Date. From the date hereof through the Retirement Date, you shall vest in that portion of the stock options and shares of restricted stock as though you had remained employed with LSI through that date. In addition, effective as of your Retirement Date, all of the awards of stock options and shares of restricted stock identified on Exhibit A shall vest and become immediately exercisable and may thereafter be exercised until 90 days after the Retirement Date, except as follows: with respect to the July 1, 2015 award of performance-based stock options, the option to purchase 10,000 shares shall vest in full in accordance with the goal attainment schedule on Exhibit I of such July 1, 2015 performance-based stock option agreement if and when the performance conditions described therein are achieved. If such performance conditions are not achieved, the July 1, 2015 performance-based stock option to purchase 10,000 shares shall be forfeited. Health Care Coverage : Your health insurance coverage will end upon your last day of employment. Information about your COBRA rights to continue to participate in the Company group health and dental insurance program(s) and your conversion privilege under the group life insurance plan is described in separate documents that will be mailed to you. Management Confidentiality Agreement : You abide by your ongoing obligations set forth in the June 30, 1997 Employment Agreement. Enclosed is a copy of the agreement to remind you of your ongoing legal obligations. Non-Interference : You will not disclose or use for your own benefit, or for the benefit of anyone outside of LSI, any confidential information relating to LSI or any project that you worked on or learned about during your employment with LSI. You will not, directly or indirectly, divert or attempt to divert or take advantage of or attempt to take advantage of any actual or potential business opportunities of LSI (e.g., joint ventures, other business combinations, investment opportunities, potential investors in LSI, and other similar opportunities) which you became aware of during your employment with LSI. You will not make any disparaging comments about LSI or take any action to interfere with its business. Indemnification : You shall be indemnified with respect to any and all matters that arose during your employment with LSI, whether arising from your status as employee, officer, or otherwise, to the maximum extent allowable under, and subject to any conditions or limitations set forth in the company’s Article of Incorporation, Code of Regulations, or applicable law, provided however, that you shall not be indemnified to the extent it is shown that you acted in bad faith, violated the law, or engaged in intentional wrongdoing. These indemnification obligations shall survive the expiration or termination of the Agreement. Compliance : You agree that LSI will have the right to discontinue and recover the consulting payments if you violate the provisions in this letter agreement, in addition to its other legal and equitable remedies. Dave, we are offering this program conditional upon your signing the General Release and Waiver that follows. Please read it carefully and consider it. You already have reviewed the letter agreement with your attorney. GENERAL RELEASE AND WAIVER In return for the items listed above, I, David W. McCauley, hereby waive, release, and hold harmless LSI Industries, LSI Graphic Solutions Plus, Grady McCauley Inc., and their subsidiaries, parents, affiliates, predecessors, owners, directors, officers, employees, agents, consultants, contractors, attorneys and advisors (collectively, “LSI”), from any and all claims, suits or liabilities arising from or by the reason of my employment or termination of employment from LSI. I further agree to refrain from suing LSI with respect to any such matters. Released claims include, without limitation, any and all claims arising under federal, state or local laws, including, without limitation, claims under the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Americans With Disabilities Act, Title VII of the Civil Rights Act of 1964, as amended, the Equal Pay Act, any other federal, state or local law prohibiting employment discrimination or otherwise regulating wages, hours or working conditions, and any and all claims under the common law for breach of express or implied contract, violation of the covenant of good faith and fair dealing, violation of public policy, negligence, slander, defamation, invasion of privacy, false light, breach of fiduciary duty, intentional interference, intentional or negligent infliction of emotional distress, intrusion, loss of consortium, retaliatory or wrongful termination, punitive damages, and claims that I have or may have which may have arisen up to and including the date of this agreement. I further waive the right to receive any monetary damages or personal benefit as a result of any claim that might be filed by me or anyone else on my behalf with the Equal Employment Opportunity Commission and/or the Ohio Civil Rights Commission. I further understand that this agreement does not cover claims which might arise after I sign it and does not waive or release any rights under this separation agreement. You have twenty-one (21) days to consider whether you want to enter into this letter agreement. If you agree with the above, sign this letter in the space provided below and return it to LSI. If you decide to sign the agreement, it will not become effective for seven (7) days. During that seven-day period, you may change your mind and revoke the agreement. If you choose to revoke this agreement, you must notify LSI, no later than seven (7) days after you sign it, by providing written notice to me. The terms of this Agreement are confidential. Sincerely, LSI INDUSTRIES INC. By: /s/ Dennis W. Wells Dennis Wells, CEO ACCEPTANCE Having read and having been given the opportunity to ask questions about its terms, I accept the above letter agreement. AGREED: /s/ David W. McCauley DATE: July 17, 2015 David W. McCauley

EXHIBIT 10.36 EXECUTIVE EMPLOYMENT AGREEMENT BETWEEN: DAVIDsTEA INC., a Canadian corporation, represented herein by Sylvain Toutant, duly authorized by the Board of Directors of DavidsTea Inc., (the “Corporation” or “DTI”); - and - MARC MACDONALD (the “Executive”) WHEREAS the Corporation has employed Executive as its Chief Human Resources Officer since July 28, 2014; WHEREAS the Corporation wishes to continue to employ the Executive on the terms and conditions set forth herein as of March 30, 2015 (the “Effective Date”); AND WHEREAS the Executive wishes to continue to be so employed by the Corporation. NOW THEREFORE for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties agree as follows: ARTICLE 1 INTERPRETATION 1.1.Definitions. For the purposes of this Agreement, the following definitions shall apply unless the context or subject matter is inconsistent therewith: (a)“Agreement” means this Executive Employment Agreement, as amended, supplemented or modified by express written agreement between the Corporation and the Executive from time to time; (b)“Base Salary” has the meaning set forth in Section 3.1; (c)“Basic Payments” means an amount equal to the aggregate of the Executive’s (i) earned but unpaid Base Salary, (ii) unpaid business expense reimbursement, (iii) amount payable for unused vacation days, and (iv) earned but unpaid performance bonus for the year preceding the year during which the termination of the Executive’s employment occurs; (d)“Board” means the board of directors of DTI, as constituted from time to time;       (e)“Business Day” means any day other than a Saturday, Sunday or any other day on which principal commercial banks are not open for business in Montreal, Quebec; (f)“Change in Control” means the occurrence of any of the following events: (i) any person (within the meaning of Section 3(a)(9) of the Exchange Act)), including any group (within the meaning of Rule 13d-5(b) under the Exchange Act), excluding (a) the Corporation, (b) any subsidiary of the Corporation, (c) any trustee or other fiduciary holding securities under an employee benefit plan of the Corporation or of any subsidiary of the Corporation, together with all affiliates and associates (as such terms are used in Rule 12b-2 under the Exchange Act) of such person, directly or indirectly becomes the beneficial owner (within the meaning of Rule 13d-3 under the Exchange Act) of, or acquires control or direction directly or indirectly over, securities of the Corporation representing 50% or more of the total votes eligible to be voted for the election of directors or trustees (“Voting Power”) attached to the Corporation’s then outstanding securities; (ii) within any 12-month period (not including any period prior to the Effective Date), individuals who constitute the Board at the beginning of such period and any new director (other than a director designated by a person who has conducted or threatened a proxy contest, or has entered into an agreement with the Corporation to effect a transaction described in clause (i), (iii) or (iv) of this definition) whose election to the Board or nomination for election was approved by a majority of the directors then still in office who either (a) were directors at the beginning of the period or (b) whose election or nomination for election was previously so approved cease to constitute at least a majority of the Board or the board of directors of any successor to the Corporation; (iii) the consummation of the merger, amalgamation, arrangement or consolidation of the Corporation with any other company; or (iv) the complete liquidation of the Corporation or the sale or disposition by the Corporation of all or substantially all of the Corporation’s assets; provided, however, that notwithstanding clauses (i), (iii) or (iv) of this definition, a Change in Control shall not be deemed to have occurred if immediately following the transaction described in clause (i), (iii) or (iv) of this definition: (A) the holders of voting securities of the Corporation that immediately prior to the consummation of such transaction represented more than 50% of the combined Voting Power including any trustee or other fiduciary holding securities under an employee benefit plan of the Corporation or of any subsidiary of the Corporation in existence prior to the transaction hold (x) securities of the entity resulting from such transaction (the “Surviving Entity”) that represent more than 50% of the combined Voting Power of the then outstanding securities of the Surviving Entity, -2-   or (y) if applicable, securities of the entity that directly or indirectly has beneficial ownership of 100% of the securities eligible to elect directors or trustees of the Surviving Entity (the “Parent Entity”) that represent more than 50% of the combined voting power of the then outstanding securities eligible to vote for the election of directors or trustees of the Parent Entity, and (B) no person (as defined in clause (i) of this definition), including any group (as defined in clause (i) of this definition), excluding any trustee or other fiduciary holding securities under an employee benefit plan of the Corporation or of any subsidiary of the Corporation in existence prior to the prior to the transaction, together with all affiliates and associates (as those terms are defined in clause (i) of this definition), is directly or indirectly the beneficial owner (as defined in clause (i) of this definition) of, or exercises control or direction directly or indirectly over, 50% or more of the voting power of the Parent Entity (or, if there is no Parent Entity, the Surviving Entity) (any such transaction which satisfies all of the criteria specified in clauses (A) and (B) above being referred to as a “Non-Qualifying Transaction” and, following the Non-Qualifying Transaction, references in this definition of “Change in Control” to the “Corporation” shall mean and refer to the Parent Entity (or, if there is no Parent Entity, the Surviving Entity) and, if such entity is a company or a trust, references to the “Board” shall mean and refer to the board of directors or trustees, as applicable, of such entity). (g)“Good Reason” means (i) a materialreduction of the Executive’s title, duties or responsibilities including reporting responsibilities without his express prior written consent, (ii) a material reduction in the Executive’s total compensation, (iii) any requirement by the Corporation that the Executive’s principal office be relocated to a location which is more than 100 kilometers from the Corporation’s current executive head office in Montreal, provided that the Executive has not consented by written agreement to such relocation, or (iv) any other state of fact, act, omission, breach or default, giving rise to a constructive dismissal under the laws of the Province of Quebec; (h)“Person” means an individual, partnership, unincorporated association, organization, syndicate, corporation, trustee, executor, administrator or other legal or personal representative. ARTICLE 2 POSITION And Term 2.1.Term. This Agreement will be effective as of the Effective Date and will terminate as provided in Article 4 of this Agreement.      2.2.Title and Position. -3-   (a) The Corporation shall continue to employ the Executive as its Chief Human Resources Officer.    (b) During the term of his employment with the Corporation, the Executive will also continue to serve as Chief Human Resources Officer of DAVIDsTEA (USA), Inc. (“DT USA”) and, at the request of the Board, as an officer or member of the board of directors of any Affiliate of the Corporation, in each case, without any additional compensation. (c) As Chief Human Resources Officer of each of the Corporation and DT USA, the Executive shall have the powers and authority and perform the duties and functions typically performed by the Chief Human Resources Officer of a business and shall report to and be subject to the direction of the Chief Executive Officer of the Corporation and DT USA. 2.3.Full and Faithful Service. (a) The Executive shall devote his full time and attention and his best efforts to the business and affairs of the Corporation and its subsidiaries, and will ensure that he is not at any time engaged in conduct which would constitute a conflict with the interests of the Corporation or any of its subsidiaries. (b) During his employment with the Corporation, except as contemplated in Subsections 2.2(b) and 2.3(c), the Executive shall not engage in any other employment or gainful occupation, undertake any other business, or be a director, officer or agent of any other company, firm or individual without the express prior written consent of the Board. (c) Notwithstanding the foregoing Section 2.3(b), the Executive may act as a director of, or render services to, charitable or community organizations as may be agreed between the Executive and the Board, to the extent such service is reasonable in time and provided that such activities do not interfere with Executive’s duties hereunder. 2.4.Place of Employment. The Executive’s base for providing his services under this Agreement shall be Montreal, province of Quebec, unless both parties expressly agree otherwise in writing.  Notwithstanding the foregoing, the Executive shall travel from time to time to such locations as may be necessary or desirable in connection with his duties hereunder, including DT USA’s principal business offices currently located in Boston, Massachusetts. 2.5.Work Permit. If a work permit is required for the Executive to enter the territory of the United States for the purposes of discharging his duties as Chief Human Resources Officer of DT USA, such permit shall be obtained by the Executive, with the Corporation’s support.  Pending obtainment of such permit, the Executive shall discharge these duties from his base in Montreal.  If, for any reason, the issuance of such permit is either delayed or cannot be obtained, this will not constitute Cause -4-   for the Corporation to terminate this Agreement.  The Executive has no reason to believe that he will be denied a work permit to enter the territory of the USA. ARTICLE 3 COMPENSATION AND BENEFITS 3.1.Base Salary. The annual base salary (the “Base Salary”) of the Executive shall be CAD$195 000.  The Executive’s Base Salary shall be reviewed annually by the Board (or its human resources committee) following the Executive’s annual performance review and shall be such amount as is established by the Board (or its human resources committee) from time to time.  The Executive’s Base Salary shall be payable by the Corporation to the Executive in arrears on a regular payroll basis. 3.2.Performance Bonus. The Executive shall be eligible for an annual cash performance bonus with a target amount representing 30% of the Executive’s annual Base Salary.  The annual cash performance  bonus at target shall be payable to the Executive in the event that the Board (or its human resources committee) determines, in its sole discretion, that the performance milestones established by the Board (or its human resources committee) near the beginning of each fiscal year have been achieved for such year. The Executive’s annual cash performance bonus may exceed the target amount and be up to 60% of the Executive’s Base Salary in the event that the Board (or its human resources committee) determines, in its sole discretion, that the actual performance has significantly exceeded performance milestones determined by the Board (or its human resources committee).  The Executive’s annual cash performance bonus for each year, if any, will be determined by the Board (or its human resources committee) following the Executive’s annual performance review.  3.3.Long Term Incentives The Executive shall be eligible to participate in the Company’s Long Term Incentive Plan with an annual grant compensation value (not face value) target amount representing approximately 35% of his base salary up to a potential of 50%. The Executive’s annual Long Term Incentive Grant for each year, if any, will be determined by the Board (or its human resources committee). 3.4.Vacation. The Executive shall be entitled to paid vacation in accordance with the Corporation’s reasonable policies and practices (as they may be implemented from time to time) and the timing of vacations shall be determined with a view to the needs of the Corporation and its subsidiaries from time to time.  Accumulated vacation time may not be carried forward except with the prior approval of the Board (or its human resources committee).   3.5.Expense Reimbursement. -5-   The Corporation shall reimburse the Executive for all reasonable expenses incurred by the Executive in the performance of his day-to-day duties under this Agreement.  3.6.Medical, Health and Insurance Benefits. The Executive will be eligible to participate in the employee benefits and insurance programs generally made available to the Corporation’s full time employees, the whole in accordance with the terms and conditions set forth in the programs or plans that the Corporation may institute from time to time. 3.7.Indemnification Agreement; D&O Insurance. Promptly after commencing the Effective Date, DTI and the Executive will enter into an Indemnification Agreement in the form provided to the Executive. The Executive will be covered by the Corporation’s D&O insurance to cover his liability as director and/or officer of the Corporation and its subsidiaries. 3.8.No Other Benefits. The Executive is not entitled to any other benefit or perquisite other than as specifically set out in this Agreement or as agreed to in writing by the Corporation. ARTICLE 4 TERMINATION 4.1.Termination of Employment. The Executive’s employment with the Corporation may be terminated by the Corporation at any time by written notice to the Executive, subject only to the severance entitlements provided in this Agreement. 4.2.Termination by the Corporation for Cause. The Corporation may immediately terminate the employment of the Executive at any time for Cause by written notice to the Executive.  Without limiting the foregoing, any one or more of the following events shall constitute “Cause”: (a) fraud, misappropriation, embezzlement or destruction of the Corporation’s property or other similar behaviour by the Executive; (b) violation by the Executive of applicable securities legislation or stock exchange rules, provided, however, that where such violation is of such a nature that it can be cured, such violation shall not constitute “Cause” if it is cured within 20 days of the Executive becoming aware of its occurrence; -6-   (c) any neglect of duty or misconduct of the Executive in discharging any of the Executive’s duties and responsibilities hereunder that is not cured within 20 days of the Executive becoming aware of its occurrence; (d) any conduct of the Executive which is prejudicial to the business of the Corporation or its subsidiaries; (e) any breach of Executive’s obligations under this Agreement or any breach of any of the Corporation’s or DT USA’s policies that is not cured within 20 days of written notification thereof to the Executive by the Corporation; (f) any failure of or refusal by the Executive to comply with the policies, rules and regulations of the Corporation or its subsidiaries that is not cured by the Executive within 20 days of written notification thereof to the Executive by the Corporation; (g) any breach of any statutory or civil law duty of loyalty to the Corporation or its subsidiaries; (h) conviction of a crime (other than traffic violations and minor misdemeanors) relating to the Executive’s employment or which could cause harm or damage to the Corporation’s or its subsidiaries’ public image, reputation or relations with the authorities; (i) inability of the Executive to perform his duties due to a legal impediment such as an injunction, restraining order or other type of judicial judgment, decree or order entered against the Executive; or (j) any act or omission of the Executive which would in law permit an employer to, without notice or payment in lieu of notice, terminate the employment of an employee. If the Corporation terminates the employment of the Executive for Cause under this Section 4.2, neither the Corporation nor any of its subsidiaries shall be obligated to make any further payments under this Agreement except for the Basic Payments, which shall be paid to the Executive within thirty (30) days of the date of such termination of employment. 4.3.Termination by the Corporation Without Cause. The Corporation may terminate the employment of the Executive at any time without Cause.  In such event, subject to Section 4.9 and Section 7.8 below, and subject to the Corporation receiving from the Executive a resignation from all positions then held, the Corporation shall pay to the Executive, in addition to the Basic Payments, the following payments (the “Severance Payments”) (a) twelve (12) months’ Base Salary, (b) an amount equal to the average annual cash performance bonus paid to the Executive based on the two (2) completed years immediately preceding the date of such termination of employment (provided that for the first year of employment, the amount shall be equal to the target bonus amount), and (c) an amount determined by multiplying the Executive’s target annual cash performance bonus for the year in which the Executive’s employment is terminated, by a fraction, the numerator of which is the number of days -7-   in such year that the Executive was employed by the Corporation and the denominator of which is 365.  The Basic Payments shall be paid within thirty (30) days following the date of such termination of employment and, subject to Sections 4.9 and Section 7.8 below, the Severance Payments shall be paid in twelve (12) equal and consecutive monthly installments over the 12-month period following such termination of employment.  In addition, to the extent permitted by law and the applicable plans, and subject to Section 4.9 and Section 7.8, below, the Corporation shall provide for continued participation in the Corporation’s group insurance plans (other than disability insurance plans) for a period of twelve (12) months following the termination of the Executive’s employment or until the Executive commences employment with another employer, if earlier (together with the Severance Payments, the “Severance”). The Severance paid or provided to the Executive hereunder shall be in lieu of any notice of such termination, and shall satisfy all of the Corporation’s obligations (except with respect to any outstanding equity awards then held by the Executive) arising from the termination of the Executive’s employment.  4.4.Termination by the Executive for Good Reason. In the event that the Executive resigns from his employment with the Corporation in accordance with Section 4.6 within ninety (90) days following the occurrence of an event constituting Good Reason, subject to Section 4.9 and Section 7.8 below, and subject to the Corporation receiving from the Executive a resignation from all positions then held, the Corporation shall be required to pay or provide to the Executive, in addition to the Basic Payments, the Severance.  The Basic Payments shall be paid within thirty (30) days following the date of such termination of employment and, subject to Sections 4.9 and Section 7.8 below, the Severance shall be paid or provided at the same times set forth in Section 4.3 above, which Severance shall satisfy all of the Corporation’s obligations (except with respect to any outstanding equity awards then held by the Executive) arising from the Executive’s resignation of employment.  4.5.No Further Entitlement upon Termination. If the employment of the Executive is terminated under this Article 4, the Executive’s employment with the Corporation shall cease and neither the Corporation nor any of its subsidiaries shall be obligated to make any payments to the Executive, other than as expressly provided for in this Article 4. 4.6.Resignation by Executive. The Executive shall give the Corporation thirty (30) days’ notice of the resignation of the Executive’s employment hereunder and, subject to the following sentence, the Executive’s employment shall terminate on the date specified in the notice.  Upon receipt of the Executive’s notice of resignation, or at any time thereafter, the Corporation shall have the right to waive the notice period, in which event the Executive’s employment shall terminate on the date of such waiver or such other date within the notice period as may be specified by the Corporation.  In the event of a waiver by the Corporation of all or any portion of the notice period, the Executive shall only be entitled to receive his salary for the portion of the notice period up to the date of termination specified in such waiver and continued participation in the Corporation’s group insurance plans, or, to the extent permitted by their terms and the discretion of the Board (or its human resources committee) a reasonable amount in lieu of the Executive’s benefits for such period, and the rest of -8-   the Basic Payments, which amounts shall be paid to the Executive within thirty (30) days of the date of such termination of employment. 4.7.Termination following a Change in Control.  In the event that the Executive’s employment is terminated by the Corporation without Cause in accordance with Section 4.3 or that the Executive resigns from his employment with the Corporation for Good Reason in accordance with Section 4.4, within ninety (90) days following the occurrence of an event constituting Good Reason, provided that, in either case, such termination occurs within the 18-month period following a Change in Control of the Corporation, in lieu of installment payments provided for in Section 4.3 or 4.4, as applicable, the Severance Payments shall be paid in a single lump sum within seventy-five (75) days following the date of such termination of employment, which shall satisfy all of the Corporation’s obligations (except with respect to any outstanding equity awards then held by the Executive and group insurance coverage) arising from such termination of employment.  In addition, all outstanding stock options and other equity awards then held by the Executive will become fully vested and exercisable or payable, as the case may be (provided that any such payment will be made no earlier than the date permitted under Section 409A), and otherwise shall remain subject to the terms and conditions thereof.  4.8.Effect of Termination or Resignation Upon termination of his employment for any reason whatsoever (including for greater certainty, the Executive’s resignation), the Executive shall thereupon be deemed to have immediately resigned any position the Executive may have as an officer, director or employee of the Corporation together with any other office, position or directorship which the Executive may hold, with any of the Corporation’s subsidiaries, including for greater certainty DT USA. In such event, the Executive shall, at the request of the Corporation, forthwith execute any and all documents appropriate to evidence such resignations. The Executive addition to those provided for herein. 4.9.Release and Restrictive Covenants. (a)Any obligation of the Corporation to provide the Executive the Severance or other benefits, including accelerated vesting of stock options and other equity awards, (for the avoidance of doubt, other than the Basic Payments), is conditioned (i) on the Executive signing and his continued compliance with the Restrictive Covenant Agreement (as defined below) in accordance with Article 5 below, (ii) on the Executive signing a release of claims in favor of the Corporation, its subsidiaries, their shareholders and their directors and officers in a form satisfactory to the Corporation (the “Release”) following the termination of the Executive’s employment within a period of time not to exceed 45 days from the date of such termination of employment, and (iii) on the Executive not revoking the Release within the revocation period provided therein following the Executive’s execution of the Release.  Except as otherwise provided in Section 7.8 of this Agreement, any payments to be made in installments pursuant to the terms of this Agreement shall be payable in accordance with the normal payroll practices of the Corporation, with -9-   the first such payment (which shall be retroactive to the day immediately following the date of the Executive’s termination of employment) due and payable as soon as administratively practicable following the date the Release becomes effective, but not later than the date that is 60 days following the date the Executive’s employment terminates.  Notwithstanding the foregoing, if the date the Executive’s employment terminates occurs in one taxable year and the date that is sixty (60) days following such termination date occurs in a second taxable year, to the extent required by Section 409A, such first payment shall not be made prior to the first day of the second taxable year.  For the avoidance of doubt, if the Executive does not execute a Release within the period specified in this Section 4.9, or if the Executive revokes the executed Release within the time period permitted by law, the Executive will not be entitled to any Severance or other benefits (including the accelerated vesting of stock options or other equity awards) set forth in this Article 4 (other than the Basic Payments), any stock options and other equity awards that vested on account of such termination as provided for in this Agreement shall be cancelled with no consideration due to the Executive, and neither the Corporation nor any of its subsidiaries will have any further obligations to the Executive under this Agreement or otherwise. (b)The parties agree that the provisions of Sections 4.3, 4.4 and 4.7 are fair and reasonable and that the amounts payable by the Corporation to the Executive pursuant to Sections 4.3, 4.4 and 4.7 are reasonable estimates of the damages which will be suffered by the Executive in the event of the termination of his employment in the circumstances described therein and shall not be construed as a penalty.  The Executive acknowledges and agrees that the payments pursuant to this Article 4 shall be in full satisfaction of all terms of termination of his employment.  Except as otherwise provided in this Article 4, the Executive shall not be entitled to any further termination payments, notice, pay in lieu of notice, severance pay, damages or any compensation whatsoever. 4.10.Return of Property. Upon the termination of his employment with the Corporation, the Executive shall promptly deliver or cause to be delivered to the Corporation all books, documents (including all copies), money, securities or other property of the Corporation or its subsidiaries which are in the possession, charge, control or custody of the Executive. 4.11.Additional Obligations following Termination of Employment. The Executive and the Corporation (and/or its subsidiaries) shall, mutually, following the termination of the Executive’s employment for any reason whatsoever, upon reasonable notice, and subject to the payment of reasonable expenses, furnish such information and proper assistance to one another as may be reasonably required in connection with any litigation in which the Executive or the Corporation (and/or its subsidiaries) may be or become a party to, other than litigation between the Executive and the Corporation and/or its subsidiaries, and litigation involving the Executive in matters entirely independent from the Corporation’s (and/or its subsidiaries’) affairs. -10-   ARTICLE 5 Restrictive Covenants 5.1.Restrictive Covenants. To the extent permitted by applicable law, it shall be a condition to the Executive’s receipt of any Severance and the acceleration of vesting of stock options and other equity awards hereunder that the Executive execute and comply with the terms of an agreement in the form satisfactory to the Corporation, pursuant to which the Executive (a) shall not disclose confidential information of the Corporation, (b) shall not disparage the Corporation, and (c) for a period of 12 months (18 months, in the case of a termination of employment pursuant to Section 4.7, above) following the Executive’s termination of employment, shall not (i) solicit the employees, customers, and suppliers of the Corporation and (ii) engage in activity competitive with the business of the Corporation, it being understood that the business of the Corporation is the tea beverage specialty retail business (such agreement the “Restrictive Covenant Agreement”). ARTICLE 6 REPRESENTATIONS AND WARRANTIES 6.1.Representations and Warranties. The Executive hereby represents and warrants to the Corporation that he is not subject to any confidentiality or non-competition agreement or any other similar type of restriction that may affect his ability to devote full time and attention to his work at the Corporation. The Executive further represents and warrants that he has not used and will not use or disclose any trade secret or other proprietary right of any previous employer or any other party. In addition, the Executive represents that the Corporation does not owe him unpaid wages or compensation of any kind for services performed prior to the date of this Agreement. The Executive further represents and warrants to the Corporation that the execution and performance of this Agreement will not result in or constitute a default, breach, or violation, or an event that, with notice or lapse of time or both, would be a default, breach, or violation of any understanding, agreement or commitment, written or oral, express or implied, to which the Executive is a party or by which the Executive or the Executive’s property is bound.    The Executive shall defend, indemnify and hold the Corporation and its subsidiaries harmless from any liability, expense or claim (including solicitors’ fees incurred in respect thereof) by any Person in any way arising out of, relating to, or in connection with any incorrectness or breach of the representations and warranties in this Section 6.1.   ARTICLE 7 GENERAL CONTRACT PROVISIONS 7.1.Privacy -11-   The Executive acknowledges and agrees that the Corporation has the right to collect, use and disclose his personal information for purposes relating to his employment with the Corporation, including: (a) ensuring that he is paid for his services to the Corporation and its subsidiaries; (b) administering any benefits to which he is or may become entitled to, including bonuses, medical, dental, disability and life insurance benefits, pension, group RRSP and/or stock options and other equity awards, including the disclosure of his personal information to any insurance company and/or broker or to any entity that manages or administers the Corporation’s benefits on behalf of the Corporation; and (c) compliance with any regulatory reporting and withholding requirements relating to his employment. 7.2.Governing Law. This Agreement and the agreements contemplated herein shall be construed and interpreted in accordance with the laws of the Province of Quebec.  Any dispute concerning the terms of this Agreement and/or the employment relationship between the Corporation and the Executive, including the termination of that relationship, shall be finally resolved by a single arbitrator.  Such arbitration including the selection and arbitration procedures shall be governed by the rules of the Civil Code of Québec and the Civil Code of Procedure of Quebec then in effect.  Unless otherwise agreed to in writing, such arbitration shall he held in the district of Montreal and shall be the exclusive means of resolving any disputes between the parties.  The decision of the arbitrator shall be final and binding upon the parties.  Save and except for cases of abuse of process, disproportionality, bad faith, and the like, the costs of any such arbitration shall be divided and adjudicated equally between the Executive and the Corporation. 7.3.Entire Agreement. This Agreement, together with the Restrictive Covenant Agreement, the Release and the Indemnification Agreement, constitutes the entire agreement between the parties with respect to the matter herein and supersedes all prior agreements relating to the subject matter hereof.  The execution of this Agreement has not been induced by, nor do any of the parties rely upon or regard as material, any representations, promises, agreements or statements whatsoever not incorporated herein and made a part hereof.  This Agreement shall not be amended, altered or qualified except by a memorandum in writing signed by the parties.     7.4.Severability. Wherever possible, each provision of this Agreement and each related document applicable law, but if any word, -12-   phrase, clause, sentence, article or paragraph contained in this Agreement is deemed unenforceable by any court of competent jurisdiction, such word, phrase, clause, sentence, article or paragraph shall be severed from this Agreement and the remaining words, phrases, clauses, sentences, articles and paragraphs of this Agreement shall remain in full force and effect. 7.5.Notice. Any notice required to be given hereunder shall be deemed to have been properly given if delivered personally, by a nationally recognized courier service, or sent by prepaid registered mail or sent via facsimile transmissions as follows:     To the Executive: 7370, De Tilly St.   Montréal Québec   H3R 3E3     To the Corporation: 5430 Ferrier   Mount-Royal, Quebec   H4P IM2   Fax: (514) 739-0200       Attention: Chairman of the Board If delivered personally or by courier service, the notice shall be deemed to have been received on the date of delivery; if sent by registered mail, the notice shall be deemed to have been received on the fourth day of uninterrupted postal service following the date of mailing; or if sent by facsimile, the notice shall be deemed to have been received on the date of transmission, unless, in any such case, such day is not a Business Day, in which case the notice shall be deemed to have been received on the next following Business Day.  Either party may change its address for notice at any time, by giving notice to the other party pursuant to this Section 7.5. 7.6.Successors. This Agreement and all rights of the Executive hereunder shall enure to the benefit of and be enforceable by the Executive and his personal or legal representatives, heirs and executors and shall be binding upon the Corporation and its successors.  This Agreement and the rights and obligations hereunder may, without the further express consent of the Executive, be assigned by the Corporation to any entity which succeeds to all or substantially all of the business, assets or property of the Corporation. 7.7.Taxes. The Executive acknowledges and agrees that all payments, perquisites or benefits under this Agreement shall be subject to withholding of such amounts, if any, relating to tax or other payroll deductions as the Corporation may reasonably determine that it should withhold pursuant to any applicable law or regulation. Nothing in this Agreement shall be construed to obligate the Corporation to compensate the Executive for adverse tax consequences associated with his compensation. -13-   7.8.Section 409A. (a)The Executive and the Corporation agree that this Agreement shall be interpreted to comply with or be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (“Section 409A”) to the extent applicable, and all provisions of this Agreement shall be construed in a manner consistent with the requirements for avoiding taxes or penalties under Section 409A, to the extent applicable. (b)A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits considered “nonqualified deferred compensation” under Section 409A, to the extent applicable, upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Section 409A (after giving effect to the presumptions contained therein) and, for purposes of any such provision of this Agreement, references to a “termination”, “termination of employment” or like terms shall mean “separation from service”.  If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Section 409A(a)(2)(B), to the extent applicable, then with regard to any payment or the provision of any benefit that is considered nonqualified deferred compensation under Section 409A payable on account of a “separation from service”, such payment or benefit shall be made or provided at the date which is the earlier of (a) the expiration of the six-month period measured from the date of such “separation from service”, and (b) the date of the Executive’s death (the “Delay Period”).  Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 7.8(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed on the first Business Day following the expiration of the Delay Period to the Executive in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. (c)With regard to any provision herein that provides for reimbursement of costs and expenses or in-kind benefits, except as permitted by Section 409A, to the extent applicable, (i) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit; (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits, to be provided in any other taxable year; and (iii) such payments shall be made on or before the last day of the Executive’s taxable year following the taxable year in which the expense occurred. (d)For purposes of Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.  -14-   (e)In no event shall the Corporation or any of its affiliates have any liability relating to the failure or alleged failure of any payment or benefit under this Agreement to comply with, or be exempt from, the requirements of Section 409A. 7.9.Counterparts. be an original but all of which together shall constitute one and the same instrument. -15-   IN WITNESS WHEREOF the parties have duly executed this Agreement.   SIGNED BY:   (s) Marc Macdonald   May 26, 2015 MARC MACDONALD   Date       Signed in the presence of:                 (s) Nathalie Rolland   May 26, 2015 Witness   Date             DAVIDsTEA Inc.                 By: (s) Sylvain Toutant   May 26, 2015   Sylvain Toutant   Date   President and CEO       -16-

Exhibit Puget Sound Energy, Inc. SUBSIDIARIES 1. Hydro Energy Development Corporation (HEDC) 10885 N.E. Fourth Street, Suite 1200 Bellevue,

EXHIBIT 10.10 PROMISSORY NOTE January 28, 2014 FOR VALUE RECEIVED, Assured Pharmacy, Inc., a Nevada corporation (the “Corporation”), promises to pay to the order of Pinewood Trading Fund, L.P., or its assigns (the “Shareholder”), the principal sum of Two Hundred Thousand Dollars ($200,000) 1029 East Drive, Beaumont, Texas 77706, or such place as the Shareholder may from time to time designate in writing, payable as hereinafter provided. The unpaid principal balance hereof shall be payable January 28, 2016, subject to early payment as provided herein, by delivery to the Lender a certified or bank cashier’s check for the appropriate amount. The Corporation shall use the proceeds of this note solely to: (1) fund and open a store in Denver, Colorado; and (2) provide funding for stores in Kansas City, Kansas and Kirkland, Washington, to maximize profitability. If payment is not made when due, the outstanding principal and accrued interest of this note shall, at the option of the holder and without notice or demand, mature and become immediately due and payable.The outstanding principal and accrued interest of this note shall automatically mature and become immediately payable in the event the Corporation violates the use of proceeds provided for in this note or becomes the subject of bankruptcy or other insolvency proceedings.The Corporation hereby waives presentment, demand and notice. The unpaid principal balance hereof shall bear interest from the date hereof at a rate equal to 16% per annum.Interest shall be calculated for the actual number of days elapsed, using a daily rate determined by dividing the annual rate by 360, and shall be payable on July 1st and January 1st of each calendar year (each an “Interest Payment Date”), subject to early payment as provided herein.Unless otherwise instructed by the Lender in writing, accrued and unpaid interest shall be paid in duly authorized, validly issued, fully paid and non-assessable shares of the Corporation’s common stock, par value $0.001 per share (the “Common Stock”).The Corporation shall deliver to the Lender on each Interest Payment Date a stock certificate representing a number of fully paid and non-assessable shares of the Common Stock equal to the quotient of (x) the total amount of accrued and unpaid interest to be paid in shares of Common Stock divided by (y) the Repayment Price (as defined below). “Repayment Price” means 90% of the lesser of (i) the average VWAP (as defined below) for the twenty (20) consecutive Trading Days (as defined below) ending on the Trading Day that is immediately prior to the applicable Interest Payment Date or (ii) the average VWAP for the twenty (20) consecutive Trading Days ending on the Trading Day that is immediately prior to the date the applicable the shares of Common Stock are issued and delivered if such delivery is after the Interest Payment Date. Page 1 of 4 “Trading Day” means a day on which the principal Trading Market (as defined below) is open for trading. “Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE AMEX, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, the OTC Bulletin Board or the Pink Sheets LLC (or any successors to any of the foregoing). “VWAP” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if the OTC Bulletin Board is not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC Bulletin Board, (c) if the Common Stock is not then listed or quoted for trading on the OTC Bulletin Board and if prices for the Common Stock are then reported in the “Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Shareholder, and reasonably acceptable to the Corporation, the fees and expenses of which shall be paid by the Corporation. All principal, interest and other amounts unpaid after maturity hereof shall bear interest, payable on demand, computed at a rate equal to 9% per annum plus the rate otherwise payable hereunder.All amounts payable on this note shall be payable in lawful money of the United States of America.This note may be prepaid in full or in part at any time without premium or penalty. As it is the intent of all parties to this note to abide by the interest limitations of any applicable usury law, it is expressly agreed, anything herein to the contrary notwithstanding, that the Lender shall not be allowed or entitled to collect any interest (or any sum which is considered interest by law) which is in excess of any legal rate applicable hereto.Should any amount be collected hereunder which would cause the interest to exceed said lawful rate, such part of said amount in excess of the lawful rate shall automatically be credited to principal, or, if all principal amounts have been paid, shall be refunded to the Corporation.The provisions of this note are hereby modified to the extent necessary to conform with the limitations and provisions of this paragraph. This note is not secured by any existing or future mortgages or security agreements between the Lender and the Corporation. Page 2 of 4 In the event that this note is collected by law or through attorneys at law, or under advice therefrom (whether such attorneys are employees of the Lender or an affiliate of the Lender or are outside counsel), the Corporation and any endorser, guarantor or other person primarily or secondarily liable for payment hereof hereby, severally and jointly agree to pay all costs of collection, including reasonable attorneys’ fees including charges for paralegals and others working under the direction or supervision of the Shareholder’s attorneys, whether or not suit is brought, and whether incurred in connection with collection, trial, appeal, bankruptcy or other creditors’ proceedings or otherwise. This note is governed by the internal laws of the State of New York, except to the extent superseded by United States federal law. The Corporation hereby waives presentment, demand, notice of nonpayment, protest and all other demands and notices in connection with the delivery, acceptance, performance or enforcement of this note. The Corporation hereby consents to the exclusive jurisdiction of any state or federal court situated in New York, New York, and waives any objection based on lack of personal jurisdiction, improper venue or forum non conveniens, with regard to any actions, claims, disputes or proceedings relating to this note, or any document delivered hereunder or in connection herewith, or any transaction arising from or connected to any of the foregoing.The Corporation waives personal service of any and all process, and consents to all such service of process made by mail or by messenger directed to the address specified below.Nothing herein shall affect the Shareholder’s right to serve process in any manner permitted by law, or limit the Shareholder’s right to bring proceedings against the Corporation or its property or assets in the competent courts of any other jurisdiction or jurisdictions. The Corporation hereby waives any and all right to trial by jury in any action or proceeding relating to this note, or any document delivered hereunder or in connection herewith, or any transaction arising from or connected to any of the foregoing.The Corporation represents that this waiver is knowingly, willingly and voluntarily given. If any provision or any portion of any provision contained in this note is held by a court of law to be invalid, illegal, unlawful, void or unenforceable as written in any respect, then it is the intent of all parties hereto that such portion or provision shall be given force to the fullest possible extent that it is legal, valid and enforceable, that the remainder of the note shall be construed as if such illegal, invalid, unlawful, void or unenforceable portion or provision was not contained therein, and the rights, obligations and interests of the Corporation and the Lender under the remainder of this note shall continue in full force and effect. Page 3 of 4 Time is of the essence with regard to the performance of the obligations of the Corporation in this note and each and every term, covenant and condition herein by or applicable to the Corporation. Executed as of the date first written above. ASSURED PHARMACY, INC. By:/s/ Robert DelVecchio Name:Robert DelVecchio Title: CEO Page 4 of 4

Exhibit NEWS RELEASE FOR INFORMATION CONTACT: Glimcher Realty Trust 180 East Broad Street Columbus, Ohio 43215 www.glimcher.com Mark E. Yale Lisa A. Indest Exec. V.P., CFO V.P., Finance and Accounting (614) 887-5610 (614) 887-5844 [email protected] [email protected] FOR

EXHIBIT32.1 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION -OXLEY ACT OF 2002 The undersigned, Robert Hoerr, M.D., President and Director of ENTEROLOGICS, INC. (the “Company”), certifies, under the standards set forth and solely for the purposes of 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2011 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in that Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: November 21, 2011 By: /s/ Robert Hoerr, M.D. Robert Hoerr, M.D. President (Principal Executive Officer) and Director This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): October 21, 2010 PEREGRINE PHARMACEUTICALS, INC. (Exact name of registrant as specified in its charter) Delaware 0-17085 95-3698422 (State of other jurisdiction of incorporation) (Commission File Number) (IRS Employer Identification No.) 14282 Franklin Avenue, Tustin, California 92780 (Address of Principal Executive Offices) Registrant’s telephone number, including area code: (714) 508-6000 Not Applicable (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below): o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425). o Soliciting material pursuant to Rule 14A-12 under the Exchange Act (17 CFR 240.14a-12) o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR.14d-2(b)) o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. (e) Compensatory Arrangements of Certain Officers. On October 21, 2010, at the 2010 Annual Meeting of Stockholders (the “Annual Meeting”) of Peregrine Pharmaceuticals (the “Company”), the Company’s stockholders adopted and approved the Peregrine Pharmaceuticals, Inc. 2010 Stock Incentive Plan and 2010 Employee Stock Purchase Plan, which both had previously been approved by the Compensation Committee of the Company’s Board of Directors (the “Board”) on August 12, 2010, subject to stockholder approval. 2010 Stock Incentive Plan The 2010 Stock Incentive Plan (the “2010 Incentive Plan”) provides for the grant of incentive stock options, nonqualified stock options, restricted stock rights, restricted stock, performance share units, performance shares, performance cash awards, stock appreciation rights, and stock grant awards (collectively, “Awards”).The 2010 Incentive Plan also permits the grant of awards that qualify for the “performance-based compensation” within the meaning of Section162(m) of the U.S. Internal Revenue Code.The Board has the authority to determine the type of Award as well as the amount, terms and conditions of each Award under the 2010 Incentive Plan, subject to the limitations and other provisions of the 2010 Incentive Plan. Persons eligible to receive Awards under the 2010 Incentive Plan include all employees, officers, non-employee directors of, and consultants to, the Company or an affiliate, as determined by the Board.Notwithstanding the foregoing, the Company’s existing Named Executive Officers and existing members of the Board are not eligible to receive any Awards under the 2010 Incentive Plan for a period of two years following the date the 2010 Incentive Plan was adopted by the Committee (or until August 12, 2012). The purpose of the 2010 Incentive Plan is to help the Company: · Attract, retain, motivate and reward officers, employees, directors, consultants and other service providers of the Company; · Provide equitable and competitive compensation opportunities; · Recognize individual contributions and reward achievement of our goals; and · Promote creation of long-term value for stockholders by closely aligning the interests of participants with the interests of stockholders. A total of 3,500,000 shares of the Company’s common stock are authorized for the granting of Awards under the 2010 Incentive Plan.The number of shares available for Awards, as well as the terms of outstanding Awards are subject to adjustment as provided in the 2010 Incentive Plan for stock splits, stock dividends, recapitalizations and other similar events. Awards may be granted under the 2010 Incentive Plan until August 12, 2020 or until all shares available for Awards under the 2010 Incentive Plan have been purchased or acquired. This summary of the 2010 Incentive Plan is qualified in its entirety by reference to the full text of the 2010 Incentive Plan, a copy of which is attached as Exhibit A to the Company’s Definitive Proxy for its 2010 Annual Stockholders Meeting filed with the Securities and Exchange Commission on August 27, 2010 and incorporated herein by this reference.In addition, a more detailed summary of the 2010 Incentive Plan can be found in such Definitive Proxy Statement, which is incorporated herein by this reference. 2010 Employee Stock Purchase Plan The 2010 Employee Stock Purchase Plan (the “2010 ESPP”) allows eligible employees on a voluntary basis to purchase shares of the Company’s common stock directly from the Company.Under the 2010 ESPP, the Company will initially sell shares to participants at a price equal to the lesser of 85% of the fair market value of stock at the (i) beginning of a six-month offering period or (ii) at the end of the six-month offering period.The 2010 ESPP provides for two six-month offering periods; the first offering period will begin on the first trading day on or after each November 1; the second offering period will begin on the first trading day on or after each May 1. 2 Persons eligible to participate in the 2010 ESPP include employees of the Company and its subsidiaries who are customarily employed by the Company or its subsidiaries for more than 20 hours per week for more than five months in a calendar year, who have been employed for at least six months prior to enrolling in the 2010 ESPP and who are employed on the first day of the applicable offering period. The Company’s Board believes that the 2010 ESPP will encourage broad employee stock ownership and align the employees’ economic interests with those of the Company’s stockholders with the hope of enhancing entrepreneurial spirit, which will greatly contribute to the Company’s long-term growth and profitability. A total of 5,000,000 shares are reserved for issuance under the 2010 ESPP and are subject to adjustment as provided in the 2010 ESPP for stock splits, stock dividends, recapitalizations and other similar events. This summary of the 2010 ESPP is qualified in its entirety by reference to the full text of the 2010 ESPP, a copy of which is attached as Exhibit B to the Company’s Definitive Proxy for its 2010 Annual Stockholders Meeting filed with the Securities and Exchange Commission on August 27, 2010 and incorporated herein by this reference.In addition, a more detailed summary of the 2010 ESPP can be found in such Definitive Proxy Statement, which is incorporated herein by this reference. Item 5.07 Submission of Matters to a Vote of Security Holders. The Company held its 2010 Annual Meeting on October 21, 2010.Out of 56,190,285 shares of our Common Stock (as of the record date of August 23, 2010) entitled to vote at the Annual Meeting, there were 44,583,206 shares present in person or represented by proxy, representing 79% of the total outstanding shares of our Common Stock entitled to vote.At the Annual Meeting, the Company’s stockholders voted on and approved each of the following four proposals.The final voting results of each proposal are set forth below. Proposal No. 1:Election of the Board of Directors to serve until the Company’s 2011 Annual Meeting of Stockholders. Directors Votes For Votes Withheld Broker Non-Votes Carlton M. Johnson Steven W. King David H. Pohl Eric S. Swartz Votes For Votes Against Abstain Broker Non-Votes Proposal No. 2: Ratification of the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for fiscal year ending April 30, 2011 - Proposal No. 3: Approvalof the Company’s 2010 Stock Incentive Plan Proposal No. 4: Approval of the Company’s 2010 Employee Stock Purchase Plan 3 Item 8.01 Other Events. On October 21, 2010, the Company issued a press release announcing the results from its Annual Meeting of Stockholders and the appointment of Carlton M. Johnson as chairman of the Board.Mr. Johnson has served as a director of the Company since 1999 and is also the chair of the audit committee. A copy of the press release is attached to this Current Report on Form 8-K as Exhibit 99.1. Item 9.01 Financial Statements and Exhibits (d)Exhibits.The following material is filed as an exhibit to this Current Report on Form 8-K: Exhibit Number Description Press Release issued October 21, 2010 4 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. PEREGRINE PHARMACEUTICALS, INC. Date: October 22, 2010 By:/s/ Paul J. Lytle Paul J. Lytle Chief Financial Officer 5 EXHIBIT INDEX Exhibit Number Description Press Release issued October 21, 2010 6

Exhibit 99.2 D. MEDICAL INDUSTRIES LTD. ADJOURNED ANNUAL GENERAL MEETING OF SHAREHOLDERS FEBRUARY 16, 2011 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoints Efraim Argaman and Amir Loberman, and each ofthem,attorneys or attorney of the undersigned, for and in the name(s) of the undersigned, with power of substitution and revocation in each to vote any and all ordinary shares, par value NIS 0.32 per share, of D. Medical Industries Ltd., or the Company, which the undersigned would be entitled to vote as fully as the undersigned could if personally present at the Annual General Meeting of Shareholders of the Company to be held on Wednesday, February 16, 2011 at 12:00 p.m. (Israel time) at the offices of the Company, 3 HasadnaSt., Tirat Carmel, Israel and at any adjournment or adjournments thereof, and hereby revoking any prior proxies to vote said shares, upon the following item of business more fully described in the notice of and proxy statement for such Adjourned Annual General Meeting (receipt of which is hereby acknowledged): THIS PROXY WILL BE VOTED AS SPECIFIED ON THE REVERSE. IN THE ABSENCE OF SUCH SPECIFICATION, THE SHARES REPRESENTED BY THIS PROXY CARD WILL BE VOTED "FOR" ALL PROPOSALS SET FORTH ON THE REVERSE, EXCEPT FOR PROPOSAL NO. 2.ON ANY OTHER BUSINESS THAT MAY PROPERLY COME BEFORE THE ADJOURNED ANNUAL GENERAL MEETING, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE JUDGMENT OF THE BOARD OF DIRECTORS OF THE COMPANY. (Continued and to be signed on reverse side) ADJOURNED ANNUAL GENERAL MEETING OF SHAREHOLDERS OF D. MEDICAL INDUSTRIES LTD. February 16, 2011 Please sign, date and mail your proxy card in the envelope provided as soon as possible. THIS PROXY MUST BE RECEIVED BY THE COMPANY'S TRANSFER AGENT OR AT THE COMPANY'S OUTSIDE COUNSEL'S OFFICE IN ISRAEL (YORAM L. COHEN, ASHLAGI, ESHEL, 2 WEIZMAN ST., TEL-AVIV, ISRAEL) AT LEAST FORTY-EIGHT (48) HOURS PRIOR TO THE TIME OF THE MEETING TO BE VALIDLY INCLUDED IN THE TALLY OF ORDINARY SHARES VOTED AT THE MEETING. Please detach along perforated line and mail in the envelope provided. THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE PROPOSALS BELOW. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HEREx 1. Elect Mr. Shai Beilis as a class "A" director of the Company, to serve until the third annual general meeting of shareholders to be held after the Annual Meeting of January 11, 2010. o FORo AGAINSTo ABSTAIN Pursuant to the Israeli Companies Law, in order to ensure specific majority requirements we are required to ask you if you are a controlling shareholder of the Company or anyone on its behalf. If no indication is given by you as to whether or not you are a controlling shareholder or anyone on its behalf with respect to proposal 2 and/or you do not provide details regarding your control or action on behalf of a controlling person (if any), your vote with respect to this proposal will be disqualified. Under the Israeli Companies Law, a “controlling person” is a person having the ability to direct the operations of a corporation except an ability resulting only from serving as a director or another office holder of such corporation. 2. Re-elect Ms. Galia Malka as an external director of the Company effective as of the expiration of her current term on February 10, 2011. o FORo AGAINSTo ABSTAIN Are you a controlling person of the Company or anyone on its behalf? YES NO If yes, please provide details: 3(a). Approve that the annual and participation compensation of the Company's external directors be the "minimum amount" as set forth in the second and third schedules, respectively, of the Companies Regulation (Rules with respect to the Compensation and Expenses of an External Director), 2000, determined each year based on the Company's "level" pursuant to the first schedule of such regulations. o FORo AGAINSTo ABSTAIN To change the address on your account, please check the box at right and indicate your new address in the address space above.Please note that changes to the registered name(s) on the account may not be submitted via this method.o Signature of Shareholder Date Signature of Shareholder Date Note: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such.If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such.If signer is a partnership, please sign in partnership name by authorized person.

Exhibit 10.50   FOURTH AMENDMENT AGREEMENT This FOURTH AMENDMENT AGREEMENT (this “Agreement”) is made and entered into as of August 1, 2011, by and among SHENANDOAH TELECOMMUNICATIONS COMPANY, a Virginia corporation (“Borrower”), each of the subsidiaries of Borrower identified as guarantors on the signature pages hereto (individually, a “Guarantor” and, collectively, the “Guarantors”; and together with Borrower, individually a “Loan Party” and, collectively, the “Loan Parties”), COBANK, ACB, as Administrative Agent (“Administrative Agent”), and each of the financial institutions executing this Agreement and identified as a Lender on the signature pages hereto (the “Lenders”). RECITALS WHEREAS, Borrower, the Guarantors and the Lenders have entered into that certain Credit Agreement, dated as of July 30, 2010 (as amended, modified, supplemented, extended or restated from time to time, the “Credit Agreement”); and   WHEREAS, the Lenders have agreed to certain modifications to the Credit Agreement as more fully described herein. NOW, THEREFORE, in consideration of the foregoing and the agreements set forth in this Agreement, each of Borrower, the Guarantors and the Lenders party hereto hereby agrees as follows: SECTION 1.   Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement.   SECTION 2.   Amendment. In reliance on the representations and warranties of Borrower and the Guarantors contained in this Agreement and in connection with Borrower’s request therefor, and subject to the effectiveness of this Agreement as described below, Subsection 4.4 of the Credit Agreement is hereby amended by amending and restating such Subsection 4.4 in its entirety as follows:   4.4           Fixed Charge Coverage Ratio.  Commencing on the Closing Date, Borrower shall maintain at all times, measured at each fiscal quarter end, a Fixed Charge Coverage Ratio greater than the ratio set forth below opposite such date:           Date Covenant Closing Date through June 30, 2011 0.80:1.00 July 1, 2011 through December 31, 2011 0.75:1.00 January 1, 2012 through December 31, 2012 0.80:1.00 January 1, 2013 through December 31, 2013 0.90:1.00 January 1, 2014 and thereafter 1.00:1.00   SECTION 3.   This Agreement shall not constitute a novation of the Credit Agreement or any other Loan Document.  Except as expressly provided in this Agreement, the execution and delivery of this Agreement does not and will not amend, modify or supplement any provision of, or constitute a consent to or a waiver of any noncompliance with the provisions of, the Loan Documents, and the Loan Documents shall remain in full force and effect.   SECTION 4.   Each of the Loan Parties hereby represents and warrants to the Lenders as follows:   (A)  Such Loan Party has the right and power, and has taken all necessary action to authorize it, to execute, deliver and perform this Agreement in accordance with its terms.  This Agreement has been duly executed and delivered by such Loan Party and is a legal, valid and binding obligation of it, enforceable   (B)  The execution, delivery and performance of this Agreement in accordance with its terms do not and will not, by the passage of time, the giving of notice or otherwise,   (1)  require any Governmental Approval or violate any Applicable Law relating to such Loan Party;   (2)  conflict with, result in a breach of or constitute a default under the organizational documents of such Loan Party, any material provision of any indenture, agreement or other instrument to which it is a party or by which it or any of its properties may be bound or any Governmental Approval relating to it; or   (3) result in or require the creation or imposition of any Lien (except as permitted by the Loan Documents) upon or with respect to any property now owned or hereafter acquired by such Loan Party.   (C)      The representations and warranties of such Loan Party set forth in the Loan Documents are true and correct as of the date hereof as if made on the date hereof.           (D)      No Event of Default under the Loan Documents has occurred and is continuing as of this date. SECTION 5.   Borrower hereby confirms and agrees that (a) each Security Document is and shall continue to be in full force and effect, and (b) the obligations secured by each such document include any and all obligations of the Loan Parties to the Secured Parties under the Credit Agreement.   SECTION 6.   Each of the Guarantors hereby confirms and agrees that (a) its guarantee contained in the Credit Agreement and each Security Document to which it is a party is and shall continue to be in full force and effect, and (b) the obligations guaranteed or secured by each such applicable document include any and all obligations of the Loan Parties to the Secured Parties under the Credit Agreement.   SECTION 7.   This Agreement shall be effective only upon receipt by the Administrative Agent of an execution counterpart hereto signed by Borrower, each Guarantor, and each Lender.   SECTION 8.   Borrower agrees to pay to the Administrative Agent, on demand, all reasonable out-of-pocket costs and expenses incurred by the Administrative Agent, including, without limitation, the reasonable fees and expenses of counsel retained by the Administrative Agent, in connection with the negotiation, preparation, execution and delivery of this Agreement and all other instruments and documents contemplated hereby.   SECTION 9.   This Agreement may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original and shall be binding upon all parties and their respective permitted successors and assigns, and all of which taken together shall constitute one and the same agreement.   SECTION 10.   This Agreement shall be governed by and shall be construed and enforced in accordance with all provisions of the Credit Agreement, including the governing law provisions thereof.     [Signature Pages Removed.]    

Exhibit 10(a)(xxiii) Named Executive Officer Salaries                     Name     Amount     William R. Johnson Chairman, President, and Chief Executive Officer     $ 1,250,000       David C. Moran Executive Vice President — President & Chief Executive Officer of Heinz North America     $ 651,000       C. Scott O’Hara Executive Vice President and President and Chief Executive Officer of Heinz Europe     $ 621,000       Arthur B. Winkleblack     $ 625,000      

Exhibit 10.8   SECURITIES PURCHASE AGREEMENT   This SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of August 4, 2014, by and between Blue Sphere Corp., a Nevada corporation, with headquarters located at 35 Asuta St., Even Yehuda 40500, Israel (the “Company”), and Union Capital, LLC., a New York Limited Liability Company, with its address at 338 Crown Street, Brooklyn, NY 11225 (the “Buyer”).   WHEREAS:   (the “1933 Act”);   sell, upon the terms and conditions set forth in this Agreement an 8% convertible note of the Company, in the forms attached hereto as Exhibit A in the aggregate principal amount of $75,000.00 (together with any note(s) issued in such Note. The note (the “Note”) shall be paid for by the Buyer as set forth herein.   in this Agreement, such principal amount of Note as is set forth immediately below its name on the signature pages hereto; and   agree as follows:     the Company such principal amount of Note as is set forth immediately below the Buyer’s name on the signature pages hereto.     Company Initials         name on the signature pages hereto, and (ii) the Company shall deliver such duly executed Note on behalf of the Company, to the Buyer, against delivery of such Purchase Price.   c.           Closing Date. The date and time of the issuance and sale of the Note pursuant to this Agreement (the “Closing Date”) shall be on or about August 4, 2014, or such other mutually agreed upon time. The closing of the Closing Date at such location as may be agreed to by the parties.   2.          Buyer’s Representations and Warranties. The Buyer represents and warrants to the Company as of the date hereof and at Closing that:   a.           Investment Purpose. The Buyer is purchasing the Note and the shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note, such shares of Common Stock being collectively referred to herein as the “Conversion Shares” and, collectively with the Note, the “Securities”) for its own account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from registration under the 1933 Act; provided, however, that by making the representations herein, the Buyer does not agree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act.   Investor”).   c.           Reliance on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions from the Securities.   2     d.           Information. The Buyer, and its advisors, if any, acknowledge receipt and careful review of the Company’s filings and reports with the Securities and Exchange Commission. The Buyer and its advisors, if any, have been, and for so long as the Note remain outstanding will continue to be, furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Securities continue to be, afforded the opportunity to ask questions of the Company. Notwithstanding the foregoing, the Company has not disclosed to the Buyer any disclosure to the Buyer. Neither such inquiries nor any other due diligence investigation conducted by Buyer or any of its advisors or representatives shall modify, amend or affect Buyer’s right to rely on the Company’s representations and warranties contained in Section 3 below. The Buyer understands that its investment in the Securities involves a significant degree of risk. The Buyer is not aware of any facts that may constitute a breach of any of the Company's representations and warranties made herein.   e.           Governmental Review. The Buyer understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Securities.   re-sale of the Securities has not been and is not being registered under the 1933 Act or any applicable state securities laws, and the Securities may not be transferred unless (a) the Securities are sold pursuant to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered to the Company, at the cost of the Buyer, an opinion of counsel that shall be in transactions to the effect that the Securities to be sold or transferred may be sold or transferred pursuant to an exemption from such registration and reasonably acceptable to the Company, (c)  the Securities are sold pursuant to Rule 144; (ii) any sale of such Securities made in reliance on Rule 144 may be   g.           Legends. The Buyer understands that the Note and Conversion Shares have not been registered under the 1933 Act and shall bear a restrictive legend   3     [NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE] HAVE BEEN ACCEPTABLE FORM AND REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION BY THE SECURITIES.”   following a sale thereof pursuant to an effective registration statement covering the resale of such Security, (b) following any sale of such Security pursuant to Rule 144 (assuming the transferor is not an affiliate of the Company), (c) if such Security is eligible to be transferred under Rule 144 without volume or manner of sale restrictions (provided that the Buyer provides the Company with reasonable assurances that such Securities is eligible transfer under Rule 144, which at the option of the Company may include an opinion of Buyer’s counsel), or (d) in connection with a transfer (other than under Rule 144) the Buyer provides the Company with an opinion of counsel, in form, and reasonably acceptable to the Company, to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act. The Buyer agrees to sell all Securities, including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any.   h.           Authorization; Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on   i.            Residency. The Buyer is a resident of the jurisdiction set forth immediately below the Buyer’s name on the signature pages hereto.   represents and warrants to the Buyer that, except as otherwise disclosed in the Company’s public filings and reports with the Securities and Exchange Commission:   a.           Organization and Qualification. The Company and each of its subsidiaries, if any, is a corporation duly organized, validly existing and in leased, used, operated and conducted.   4     corporate power and authority to enter into and perform this Agreement, the Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms hereof and thereof, (ii) the execution and delivery of this Agreement, the Note by the Company and the (including without limitation, the issuance of the Note and the issuance and reservation for issuance of the Conversion Shares issuable upon conversion or exercise thereof) have been duly authorized by the Company’s Board of Directors or its shareholders is required, (iii) this Agreement has been duly executed and c.           Issuance of Shares. The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the Note in accordance with its respective terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not impose personal liability upon the holder thereof.   d.           Acknowledgment of Dilution. The Company understands and acknowledges the potentially dilutive effect to the Common Stock upon the issuance of the Conversion Shares upon conversion of the Note. The Company conversion of the Note in accordance with this Agreement and the Note is absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company.   e.           No Conflicts. The execution, delivery and performance of this Agreement and the Note by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the conflict with or result in a violation of any provision of the Articles of the Company or any of its subsidiaries or by which any property or asset of the Company or any of its subsidiaries is bound or affected (except in the case of paragraphs (ii) and (iii) above for such conflicts, breaches, defaults, not, individually or in the aggregate, have a Material Adverse Effecton the business, properties, assets, liabilities, operations, results of operations, condition (financial or otherwise) or prospects of the Company and its subsidiaries, taken as a whole, or on the transactions contemplated hereby (a “Material Adverse Effect”)). All consents, authorizations, orders, filings and registrations which the Company is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof. The Company is not in violation of the listing requirements of the Over-the-Counter Quotations Bureau (the “OTCQB”) and does not reasonably anticipate that the Common Stock will be delisted by the OTCQB in the foreseeable future, nor are the Company’s securities “chilled” by FINRA. The Company and its subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.   5     f.            Absence of Litigation. There is no action, suit, claim, in their capacity as such, that could have a Material Adverse Effect. Schedule or any of its subsidiaries, without regard to whether it would have a Material Adverse Effect.   g.           Acknowledgment Regarding Buyer’ Purchase of Securities. The Company   h.           No Integrated Offering. Neither the Company, nor any of its   i.            Title to Property. The Company and its subsidiaries have good and of the Company and its subsidiaries, in each case free and Clean of all liens, encumbrances and defects except such as are described in Schedule 3(i) or such as would not have a material adverse effect. Any real property and facilities held under lease by the Company and its subsidiaries are held by them under a material adverse effect.   6     j.            Breach of Representations and Warranties by the Company. If the Company breaches any of the representations or warranties set forth in this Section 3 in any respect, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered an Event of default under the Note.   4.          COVENANTS.   a.           Expenses. At the Closing, the Company shall reimburse Buyer for expenses incurred by them in connection with the negotiation, preparation, execution, delivery and performance of this Agreement and the other agreements to be executed in connection herewith (“Documents”), including, without limitation, reasonable attorneys’ and consultants’ fees and expenses, transfer agent fees, fees for stock quotation services, fees relating to any amendments or modifications of the Documents or any consents or waivers of provisions in the Documents, fees for the preparation of opinions of counsel, escrow fees, and costs of restructuring the transactions contemplated by the Documents. When possible, the Company must pay these fees directly, otherwise the Company must make immediate payment for reimbursement to the Buyer for all fees and expenses immediately upon written notice by the Buyer or the submission of an invoice by the Buyer. Notwithstanding the aforegoing, the Company’s obligation with respect to this transaction is to reimburse Buyer’ expenses shall be $11,250 ($3,750 in legal fees and $7,500 in third party due diligence fees), which shall be deduced from the Note.   b.           Listing. The Company shall promptly secure the listing of the Conversion Shares upon each national securities exchange or automated quotation system, if any, upon which shares of Common Stock are then listed (subject to official notice of issuance) and, so long as the Buyer owns any of the Securities, shall maintain, so long as any other shares of Common Stock shall be so listed, such listing of all Conversion Shares from time to time issuable upon conversion of the Note. The Company will obtain and, so long as the Buyer owns any of the Securities, maintain the listing and trading of its Common Stock on the OTCQB or any equivalent replacement exchange, the Nasdaq National Market Exchange (“NYSE”), or the American Stock Exchange (“AMEX”) and will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority (“FINRA”) and such exchanges, as applicable.   c.           Corporate Existence. So long as the Buyer beneficially owns any Note, the Company shall maintain its corporate existence and shall not sell all or substantially all of the Company’s assets, except in the event of a merger or the surviving or successor entity in such transaction assumes the Company’s connection herewith.   d.           No Integration. The Company shall not make any offers or sales of any security (other than the Securities) under circumstances that would require   7     e.           Breach of Covenants. If the Company breaches any of the covenants set forth in this Section 4, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered an event of default under the Note.     concerning the transactions contemplated by this Agreement shall be brought only in the state courts of New York or in the federal courts located in the state and county of New York. The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Company and Buyer waive trial by jury. The prevailing party shall be entitled to recover from the other party its Agreement by mailing a copy thereof via registered or certified mail or constitute good and sufficient service of process and notice thereof. Nothing   b.           Counterparts; Signatures by Facsimile. This Agreement may be but all of which shall constitute one and the same agreement and shall become other party. This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.   c.           Headings. The headings of this Agreement are for convenience of Agreement.   invalid or unenforceable under any applicable statute or rule of law, then such therewith and shall be deemed modified to conform with such statute or rule of   8     e.           Entire Agreement; Amendments. This Agreement and the instruments   other communications required or permitted hereunder shall be in writing and, prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed most recently by written notice. Any notice or other communication required or or delivery by facsimile, with accurate confirmation generated by the   Blue Sphere Corp. 35 Asuta St, Even Yehuda 40500, Israel Attn: Shlomo Palas, CEO   UNION CAPITAL, LLC 338 Crown Street, Brooklyn, NY 11225, Attn: Yakov Borenstein     obligations hereunder without the prior written consent of the other. Notwithstanding the foregoing, the Buyer may assign its rights hereunder to any person that purchases Securities in a private transaction from the Buyer or to   9       h.           Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.   i.            Survival. The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the   the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.     obligations hereunder will cause irreparable harm to the Buyer by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the required.   10       Blue Sphere Corp.       By:       Shlomo Palas     Chief Executive Officer       UNION CAPITAL, LLC.       By:     Name: Yakov Borenstein   Title: Manager       $75,000.00              Aggregate Purchase Price:       Note 1: $75,000.00 less $3,750 in legal fees and $7,500 in third party fees    11     EXHIBIT A   144 NOTE - $75,000   12    

AMENDED AND RESTATED SCHEDULE A AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT between NEW COVENANT FUNDS and ONE COMPASS ADVISORS Effective as of January 1, 2011 Name of Fund Compensation* New Covenant Growth Fund 0.87% of the average daily net assets of the Fund New Covenant Income Fund 0.65% of the average daily net assets of the Fund New Covenant Balanced Growth Fund None New Covenant Balanced Income Fund None *All fees are computed and paid monthly. ONE COMPASS ADVISORS NEW COVENANT FUNDS By: By: Name: Name: Title: Title:

EXHIBIT 10.35 THIS AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT (the “Amendment”) is made this 29 day of December, 2008 between Gregg Appliances, Inc., an Indiana corporation with a principal place of business at 4151 East 96th Street (the “Company”), and Jerry W. Throgmartin, an individual residing at 4151 E. 96th St. (the WHEREAS, the parties entered into an Employment Agreement dated as of October 19, 2004 (the “Original Employment Agreement”), and an Amendment to Employment Agreement dated as of April 12, 2007 (the “First Amendment”) (the Original Employment Agreement and the First Amendment are hereinafter referred to together as the “Employment Agreement”); and WHEREAS, the parties wish to further amend the Employment Agreement to comply with the requirements of Section 409A(a)(2), (3) and (4) of the Internal Revenue Code of 1986, as amended, and the final regulations of the Treasury and other applicable guidance promulgated thereunder; NOW, THEREFORE, for and in consideration of the premises and the mutual covenants herein contained, the parties hereby further amend the Employment Agreement, effective as of January 1, 2009, as follows: 1. Section 4(b)(i) of the Original Employment Agreement shall be deleted and (i) Subject to the provisions of subparagraph 4(b)(ii) and subparagraph 4(b)(v), if, prior to the expiration of the Term, Executive’s employment is terminated by the Company without Cause, Executive shall be entitled to receive, as “Severance Benefits,” (A) for the remainder of the Term his then current Base Salary, (B) a lump sum stipend equal to 167% of the product of twenty-four (24) times: (1) the monthly COBRA premium that corresponds, as of the date of Executive’s termination of employment, to the health, dental and vision coverage that Executive had in effect under the Company’s health, dental and vision plans immediately prior to his termination of employment, and (2) the monthly premium that corresponds, as of the date of Executive’s termination of employment, to the long-term disability and group term life insurance coverage that Executive had in effect under the Company’s long-term disability and life insurance plans immediately prior to his termination of employment, and (C) for the year in which such termination occurs, a pro-rated bonus for the portion of such year during which Executive was employed by the Company, contingent, however, on the satisfaction of any performance-based conditions relating to such bonus. The stipend referred to in clause (B) will be subject to all applicable withholdings and deductions, and will be paid to Executive on the same payroll date as the first installment of Severance Benefits, and Executive may apply the stipend towards Executive’s purchase of COBRA continuation coverage, continued benefit coverage, or for any other purpose. Notwithstanding the foregoing, if Executive becomes employed by another employer during the time that Severance Benefits are payable to Executive pursuant to this paragraph 4(b), the amount of Severance Benefits to which Executive would be entitled in the absence of such other employment shall be reduced by the amount of any compensation and benefits received or accrued by Executive due to such other employment. Executive shall provide the Company with any evidence of compensation and benefit amounts received or accrued in connection with other employment which the Company shall reasonably request. Executive shall be under no obligation to look for, solicit or accept employment with another employer during the period he is entitled to receive Severance Benefits. 2. Section 4(b)(v) of the Original Employment Agreement shall be deleted in its entirety and replaced with the following: (vi) Such reduction shall be made in such manner that the remaining Severance Benefits provide Executive with the greatest after-tax benefit, as determined by the Company’s accountants. 3. Section 3 of the First Amendment shall be deleted in its entirety and Life Insurance Benefits. In addition to the benefits referred to in the Original Employment Agreement, the Company shall assign to Executive all of the Company’s right, title and interest in and to the life insurance policy on the life of Executive upon his Separation from Service, as defined below, with Executive responsible for payment of all premiums and costs under such policy after such assignment. 4. A new Section 15 shall be added to the Employment Agreement as follows: 15. Section 409A Compliance. (a) Notwithstanding any other provision of this Agreement, if any amount payable to Executive under this Agreement on account of Executive’s “Separation from Service” from the Company constitutes deferred compensation within the meaning of and subject to Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations of the Treasury and applicable guidance of the Internal Revenue Service thereunder (together, “Section 409A”), and Executive is a “Specified Employee” of the Company on the date of his Separation from Service, then payment of such amount shall be delayed until the first business day that is at least six (6) months after the date on which Executive’s Separation from Service occurs. For these purposes, “Separation from Service” means Executive’s “separation from service,” as defined in Section 409A(a)(2)(A)(i) and Treas. Reg. Section 1.409A-1(h), from the Company, and “Specified Employee” has the meaning given to that term in Code Section 409A(a)(2)(B)(i) and Treas. Reg. 1.409A-1(i).   2 Notwithstanding the foregoing, such six month delay of payments shall not apply to any payments or benefits that are not subject to Section 409A, including the following: (a) any severance or other payments that qualify as “short term deferral” payments under Treas. Reg. Section 1.409A-1(b)(4); and (b) any remaining severance or other payments paid after the Executive’s Separation from Service to the extent (i) that the dollar amount of such payments does not exceed two (2) times the lesser of (x) the Executive’s annualized compensation (based on the Executive’s annual rate of pay for the calendar year preceding the calendar year in which the Separation from Service occurs, adjusted to reflect any increase during such calendar year which was expected to continue indefinitely had the Executive’s Separation from Service not occurred) and (y) the maximum amount of compensation that may be taken into account under a in which the Separation from Service occurs, and (ii) such severance or other payments are to be made to the Executive no later than the last day of the second calendar year following the calendar year in which the Separation from Service occurs. For purposes of Section 409A, each payment of severance made on a payroll date and each monthly provision of severance benefits under this Agreement shall be treated as a right to a series of separate payments, as defined in Treas. Reg. Section 1.409A-2(b)(2). (b) With respect to any expense reimbursements or in-kind benefits provided hereunder, including, without limitation, under Section 3(d) or Section 4(b)(i) of the Employment Agreement and paragraph 4 of the First Amendment, which are not otherwise excludible from the Executive’s gross taxable income, to the extent required to comply with Section 409A, no reimbursement of expenses incurred by Executive during any taxable year of Executive shall be made after the last day of the following taxable year, the right to reimbursement of any such expenses or such in-kind benefits shall not be subject to liquidation or exchange for another benefit, and the amount of expenses eligible for affect the expenses eligible for reimbursement or in-kind benefits available in any other taxable year. (c) All payments to Executive pursuant to this Agreement are intended to comply with, or to be exempt from, the requirements of Section 409A. Executive acknowledges that Executive bears the entire risk of any adverse Federal and State tax consequences and penalty taxes in the event any payment pursuant to this Agreement is deemed to be subject to Section 409A and that no representations have been made to Executive relating to the tax treatment of any payment pursuant to this Agreement under Section 409A and the corresponding provisions of any applicable State income taxation laws. 5. Except as amended hereby, the terms and conditions of the Employment Agreement, as amended by the First Amendment, shall continue unchanged and   3 IN WITNESS WHEREOF, the Company and the Executive have executed this Amendment effective as of the date above written.   GREGG APPLIANCES, INC. By:   /s/ Charles Young   Name: Charles Young Title: Chief HR Officer Dated: 12/29/08   EXECUTIVE By:   /s/ Jerry W. Throgmartin   Jerry W. Throgmartin Dated: 12/29/08   4

  Execution Version   FORM OF   INDIVIDUAL EMPLOYMENT AGREEMENT ENTERED INTO, BY AND BETWEEN, ON THE ONE PART VITEL LABORATORIOS, S.A DE C.V. HEREINAFTER REFERRED TO AS “THE COMPANY”, REPRESENTED BY MANUEL COSME ODABACHIAN, AND ON THE OTHER PART, [__], IN HIS OWN RIGHT, HEREINAFTER REFERRED TO AS THE “EMPLOYEE”, ON HIS OWN RIGHT, WITH THE APPEARANCE OF ONCBIOMUNE PHARAMCEUTICALS, INC., HEREINAFTER REFERRED TO AS “GUARANTOR”, REPERESENTED BY ANDREW ALBERT KUCHARCHUK, UNDER THE FOLLOWING RECITALS AND CLAUSES:   R E C I T A LS   I.The Company represents that it:     a) Is a company duly organized in accordance with the laws of the United States of Mexico.         b) It is domiciled at [__], and has the following RFC: [__].         c) Desires to retain the services of an individual with the experience, capacity and ability necessary to hold the position of Chief Operations Officer, which is a position of “trust” with the Company.   II.The Employee represents that:     a) His name is as hereinabove set forth, that he is a male of Mexican nationality, born in Mexico City, that he is born on [__], that he is married, domiciled at [__], has the following RFC: [__], and the following CURP: [__].         b) He is familiar with the work that he is to perform for the Company and has the necessary knowledge and experience to carry out the duties assigned to him as the [__], under the terms of this Agreement.         c)  Conflict of Interests. Employee hereby agrees that all of his decisions and actions with respect of the Company shall be made primarily for the benefit of the Company, and not for Employee’s individual benefit.   To avoid any conflict of interest, Employee agrees:     1. To notify the Company in writing of any corporate or business ties, employment or other circumstance which could originate a conflict of interest, except as it relates to the Excluded Business;         2. To reject any payment or consideration from any third party, in any form, that may affect Employee’s ability to make independent decisions related to the Company;       2     3. Not to make or offer any gifts of any kind to third parties, in exchange for services from the Company, except for customary gifts;         4. Not to perform any activities for personal gain or in favor of third parties which could imply a competing activity except as provided for in Clause Seventeenth; and         5. Conduct Employee’s duties ethically, in compliance with laws and pursuant to the business judgment rule, and in any case in such a way as not to adversely affect the reputation of the Company.   III.The Guarantor represents that:     a) It is a legal entity duly organized and legally existing in accordance with the laws of the State of Nevada, United States of America         b) Andrew Albert Kucharchuk has the necessary authorities to represent it and bind it for the purposes set forth in Clause Sixteenth of this Agreement.   In consideration of the foregoing, the Parties agree to the following:   C L A U S E S   FIRST. - Indefinite Term Agreement. The term of this Agreement is indefinite (the “Term”) and shall begin having effects on the date hereof (the “Effective Date”).   SECOND. - Position and Activities. The Employee agrees to carry out his personal services for the Company as Chief Operations Officer as set forth below, together with such other duties as may be reasonably required from time to time by the Board of Directors of the Company. The Employee and Manuel Cosme Odabachian shall be the employees and officers of the Company with the highest level of authority thereat, being subordinated only and exclusively to the Board of Directors of the Company (and the Board of Directors of Guarantor in the case of deadlock).   The activities that the Employee has to execute while rendering his services consist of Chief Operations Officer, including without limitation, supervising, managing, planning, directing and organizing the activities of the Company and its subsidiaries. The Employee shall be one of the two most senior executive officers of the Company, and all other employees of the Company shall report directly or indirectly to him, except for Manuel Cosme Odabachian, who will hold a position of similar ranking to the Employee.   The Employee will perform his services at the domicile of the Company located at Mexico City, Mexico except for certain travel as reasonably required in the performance of the Employee’s duties under this Agreement.   THIRD. - Work Shift. The Employee shall render his services to the Company during the necessary hours to meet the high level responsibilities assigned to him as per this Agreement, and within a schedule during normal business hours to be self-determined by him at his reasonable discretion but which may not exceed from 40 (forty) hours per week, from Monday to Friday. Employee acknowledges that as part of his responsibilities under this Agreement, some traveling may be required outside of these prescribed business hours.       3   FOURTH. – Salary. As remuneration for his services, the Employee will receive a monthly salary in the amount of US$15,625.00 (Fifteen Thousand Six Hundred and Twenty Five 00/100 Dollars), less applicable payroll deductions.   The Monthly Salary will be paid to the Employee in arrears, half of it every fifteen days. The Parties agree that the salary already includes the payment of the days of rest and legal holidays. The salary shall be paid to Employee in Mexican Pesos, in accordance with the exchange rate published in the Mexican Federal Official Gazette, on the business day prior to the payment date.   FIFTH. – Extralegal Benefits. The Employee shall enjoy the extralegal benefits described in Exhibit “A” hereto.   SIXTH. – Rest for Obligatory Legal Holidays. The Company shall provide the Employee with obligatory holidays, in accordance with the provisions of the Federal Labor Law.   SEVENTH. – Vacations and Vacation Premium. The Employee shall enjoy 15 (fifteen) days of vacation per year. The Company shall pay the Employee a vacation premium equivalent to 25% (twenty-five percent) of the vacation days corresponding to him, in accordance to article 80 of the Federal Labor Law (the “Vacation Premium”).   EIGHTH. – Year End Bonus. The Parties agree that the Company will pay to the Employee an annual Year End Bonus equal to 15 (fifteen) days of salary, no later than December 20 of each year (the “Year End Bonus”).   NINTH. – Reimbursement of expenses. Should the Employee in meeting his obligations, need to travel to other places within or outside the Mexican Republic, and to incur in transportation, lodging and meal expenses, he shall incur them on them on the basis of reasonable expenditures in accordance with the policies that the Company has in place at that time.   TENTH. – Medical Examinations. The Employee agrees to submit himself to periodical medical examination whenever the Company requires so, in accordance with the provisions of Section X of the Article 134 of the Federal Labor Law, in the understanding that the physician who practices such will be designated and   ELEVENTH. – Social Security. The Employee shall be enrolled with the Mexican Social Security Institute in order to receive Mexican Social Security medical benefits. The Company will be authorized to make the necessary discounts from the Employee’s salary in order to cover before the Mexican Institute of Social Security the corresponding fees. Both Parties agree to comply with all matters relative to the Social Security Law and its Regulations.   TWELFTH. – Training. The Employee will be trained by the Company in accordance with the planning and training programs established by the Company.       4   THIRTEENTH. – Member on Third Party’s Board of Directors. The employee shall be able to be appointed as a member of the Board of Directors and/or Board of Managers of any company that does not directly compete with the Company.   FOURTEENTH. – Employee’s Seniority. The Company recognizes to the Employee a seniority as of February 18, 2016, which shall serve exclusively as a reference to determine the rights and obligations that derive from this employment relationship, and in particular to compute the payment set forth in the Clause Fifteenth below.   FIFTEENTH. – Conventional Payment for termination of the Agreement.   If within three years of the Effective Date (a) Employee’s employment with the Company is terminated by the Company without Cause, or (b) Employee terminates his employment with the Company or resigns for Good Reason, Employee will be paid by the Company either (i) the equivalent amount of the corresponding severance payment set forth in the Federal Labor Law for an unjustified dismissal , OR if greater (ii) the equivalent amount of up to three years’ gross salary, depending on the date of termination (the “Severance Payment”). In case of clause (ii), the Severance Payment shall be reduced by an amount equal to the product of (i) a fraction the numerator of which is the number of completed months elapsed after the Effective Date to the date of termination, and the denominator of which is thirty-six (36) (the “Remaining Term”) and such fraction shall be multiplied by (ii) the Severance Payment. The Severance Payment shall be paid in equal monthly installments over the Remaining Term so long as Employee is in compliance with the Non-Compete provisions provided for in Clause SEVENTEENTH below. In addition, Employee shall be obligated to sign a release agreement in such form and content as reasonably approved by the Company prior to payment of the Severance Payment.   Besides the meaning attributed to it in the Federal Labor Law, “Cause” will also mean the:   1. Employee’s conviction of, or plea of “no contest” to, a felony or its equivalent under Mexican law;     2. Employee’s willfully engaging in an act or series of acts of gross misconduct that result in demonstrable and material injury to the Company or the Guarantor; or     3. Employee’s material breach of any provision of this Agreement, which breach has not been cured in all material respects within twenty (20) days after the Company gives notice thereof to Employee.   “Good Reason” means the occurrence of any of the following events without the Employee’s prior written consent, unless within 30 days after the Employee gives written notice of such event, the Company cures any such event:   1. the Company’s material breach of this Agreement;     2. the Company’s appointment/hiring of any employee or officer that is not subordinated to the Employee or Manuel Cosme Odabachian, so long as such person is employed by the Company, or any of its affiliates or subsidiaries;       5   3. a material diminution in the Employee’s responsibilities or authorities, or a material adverse change in his position or title;     4. a material reduction in the Employee’s Salary or benefits, including his Performance Bonus; or     5. relocation of the Employee’s principal place of work by more than 75 kilometers without the Employee’s prior written consent.   Any occurrence of a Good Reason event shall be deemed to be waived by the Employee unless he gives the Company written notice of such event within 90 days after it occurs and he terminates his employment hereunder within one year after such event occurs.   SIXTEENTH.- Guaranty. Guarantor hereby guarantees the correct and complete compliance of the obligations set on the Company as per Clause Fifteenth of this Agreement, and therefore jointly with the Company, obligates to pay to the Employee exclusively the Conventional Payment set forth in it, should the events described therein come to materialize.   This does not create an employment relationship between the Employee and the Guarantor.   SEVENTEENTH.-Non-Compete and Non-Solicitation.   (a)       For a period of five (5) years from the Effective Date, the Employee shall not, nor shall he permit, cause or encourage anyone to, engage directly or indirectly, as an owner, employee, consultant, contractor or otherwise, in any business or enterprise that is engaged in the development, commercialization, sales of the OBMP Products, the OBMP Pipeline Products or the Vitel Products (collectively, the “Restricted Business”) anywhere in the world as well as clinical development and marketing of therapeutic candidates similar to products that are part of the Restricted Business anywhere in the world except for those activities listed on Exhibit “B” (the “Excluded Businesses”); provided, that no owner of less than 5% of the outstanding stock of any publicly-traded corporation will be deemed to be so engaged solely by reason thereof in the Business. For a period of five (5) years from and after the date of this Agreement, the Employee shall not, and shall not permit, cause or encourage anyone to, solicit, recruit, offer employment, hire, employ, engage as a consultant, lure or entice away, or in any other manner persuade or attempt to persuade, any Person who is an employee of any of Guarantor or the Company to leave the employ of Guarantor or the Company. If the final judgment of a court of competent jurisdiction declares that any term or provision of this Clause SEVENTEENTH is invalid or unenforceable, the parties hereto agree that the reduction in the scope, duration, or area of the term or provision, or the deletion of specific words or phrases, or the replacement of any invalid or unenforceable term or provision shall be carried out so as to include a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement will be enforceable as so modified after the expiration of the time within which the judgment may be appealed.       6   (b)       Notwithstanding anything to the contrary in paragraph (a) above, in no event shall the Employee be prohibited from engaging in any business under the following conditions:   Employee shall promptly notify the Company and Guarantor in writing of any business opportunities in ROW with regard to any expansion of any business activity currently conducted by the Employee beyond the Excluded Contracts so long as such business (i) does not interfere with Employee’s duties under this Agreement and (ii) does not compete with any of the products that are part of the Restricted Business anywhere in the world (the “ROW Opportunity”). The Company or Guarantor who is presented with an ROW Opportunity, shall have a period of thirty (30) days in which to decide to participate. In the event the parties to the ROW Opportunity are unable to reach an agreement to consummate the transaction contemplated by the ROW Opportunity within thirty (30) days, the Employee shall be free to pursue the ROW Opportunity without the Company or the Guarantor.   Defined terms in this Clause shall have the meaning attributed to them in Exhibit “B” hereto.   EIGHTEENTH.- Applicable law and jurisdiction. The Parties agree that for any matter not covered by this Agreement, the provisions of the Federal Labor Law shall apply, and in case of any conflict or controversy arising as a consequence of the execution, interpretation or enforcement of this Agreement, they submit to the jurisdiction of the corresponding Labor Conciliation and Arbitration Board   March 10, 2017.   THE EMPLOYEE/ EL EMPLEADO   THE COMPANY/LA COMPAÑÍA             Carlos Fernando Alamán Volnie   Manuel Cosme Odabachian   GUARANTOR   ________________________________   Oncbiomune Pharmaceuticals, Inc. Attorney-in-fact       7   EXHIBIT “A”   EXTRALEGAL BENEFITS OF EMPLOYEE   The Employee shall enjoy the following benefits in additions to the ones set forth in this Agreement:   ● Car Allowance. –Throughout the first 3 years of this Agreement, the Company will pay the Employee the gross amount of US$500.00 (Five hundred 00/100 US Dollars) per month, as a car allowance for the Employee.       The car allowance will be paid to the Employee in Mexican Pesos, taking into accordance the US Dollar exchange rate (USD) published in the Mexican Official Gazette, on the prior business day to the payment date.     ● Health Insurance Allowance. –. On a monthly basis, the Company will reimburse Employee or pay the cost of Employee’s major medical insurance policy covering Employee and his family selected by Employee up to an annual amount of insurance premiums of USD$5,000.00 (the “Health Insurance Allowance”), in the understanding that any amount in excess of such Health Insurance Allowance will not be covered by the Company.       The Health Insurance allowance will be paid to the Employee in Mexican Pesos, taking into accordance the US Dollar exchange rate (USD) published in the Mexican Official Gazette, on the prior business day to the payment date     ● Performance Bonus. Every year the Employee will be given an annual performance objectives for the Company, pursuant to the payment of a bonus (the “Bonus”); the bonus target, will be an amount equal to fifty percent (50%) of his Salary (the “Bonus Target”). The performance objectives will be established by the Guarantor’s Board of Directors and communicated to the Employee in writing as soon as practicable after commencement of every calendar year. The Bonus may be greater or less than the Target Bonus (ranging from a threshold Bonus to a maximum Bonus), based on the level of achievement of the applicable performance objectives.     THE EMPLOYEE/ EL EMPLEADO   THE COMPANY/LA COMPAÑÍA       Carlos Fernando Alamán Volnie   Manuel Cosme Odabachian   GUARANTOR ________________________________       8   EXHIBIT “B”   ACTIVITIES NOT SUBJECT TO NON-COMPETE   The following business activities shall be deemed Excluded Business as provided for in this Agreement so long as such business activity (i) is currently conducted by the Employee pursuant to the terms of any contract or agreement (the “Excluded Contracts”) as in effect as of the Effective Date and for so long as such contract or agreement is in effect, without any amendment to or renewal of such contract or agreement after the Effective Date; (ii) does not interfere with Employee’s duties under this Agreement and (iii) does not compete with any of the products that are part of the Restricted Business anywhere in the world (collectively, the “Excluded Business”):   - Clinical trials & contract research organization (CRO) services in Mexico.     - Regulatory affairs consulting services and third party lobbying for sanitary registrations in Mexico.     - Warehousing and/or hosting of pharmaceutical, biological, over-the-counter (OTC), supplements, medical devices and other health care products in Mexico.     - Distribution of pharmaceutical, biological, OTC, supplements, medical devices and other health care products to the private and/or government segment in Mexico.     - Manufacturing and development of branded generics, cosmetic, medical devices and private labels throughout Mexico.     - Consulting services to international and Mexican companies in the healthcare market.     - Consulting for the sale, license, acquisition for Mexican and/or foreign companies in Mexico.   Within 20 days from the Effective Date, Employee shall provide the Company with a list of the Current Contracts.       9   NEW DEFINED TERMS   “OBMP Products” shall mean the following:   (a) Proscavax® Prostate Cancer;   (b) OBMP Pipeline; and   (c) OBMP vaccine technology, OBMP cancer technologies for the treatment of prostate, ovarian and various other types of cancer and any other technology for medical treatment, drug or medical treatment owned by OBMP or by any OBMP related Person or that use or are based on the technology included in the OBMP IP Rights, the OBMP Licensed IP Rights, the OBMP Owned Rights or the OBMP Registered IP Rights.   “OBMP Pipeline” shall mean the following:   (a) Ovcavax® Ovarian Cancer;   (b) PA-OBC – Breast Cancer;   (c) PGT-OBM – Renal Cancer; and   (d) Any other product under development, developed or to be developed by OBMP and/or by Dr. Jonathan F. Head in collaboration, under contract or under any other type of business relationship with OBMP or with any OBMP related Person.   “Vitel Products” shall mean the following:   (a) Any other product under development, developed or to be developed by Vitel that use or are based on any Vitel IP Rights, Vitel Licensed IP Rights, the Vitel Owned IP Rights and the Vitel Registered IP Rights, or under contract or under any other type of business relationship involving a Material Contract, the Vitel IP Rights, the Vitel Licensed IP Rights, the Vitel Owned IP Rights and the Vitel Registered IP Rights.   “ROW” shall mean all the countries and territories in the world.          

##### Document Number: 1 File Name: form10q.htm Type: 10-Q Description: QUARTERLY REPORT FOR THE PERIOD ENDING 9-30-08 ##### UNITED STATES SECURITIES

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 12b-25 NOTIFICATION OF LATE FILING (Check One): o Form 10-K o Form 20-F oForm 11-K þForm 10-Q oForm 10-D o Form N-SAR o Form N-CSR For Period Ended: September 30, 2011 o Transition Report on Form 10-K o Transition Report on Form 20-F o Transition Report on Form 11-K o Transition Report on Form 10-Q o Transition Report on Form N-SAR For the Transition Period Ended: Read Instruction (on back page) Before Preparing Form. Please Print or Type. Nothing in this form shall be construed to imply that the Commission has verified any information contained herein. If the notification relates to a portion of the filing checked above, identify the Item(s) to which the notification relates: Not applicable PART I — REGISTRANT INFORMATION GLOBAL GOLD CORPORATION Full Name of Registrant Former Name if Applicable 555 Theodore Fremd Avenue Address of Principal Executive Office ( Street and Number) Rye, NY 10580 City, State and Zip Code PART II — RULES 12b-25(b) AND (c) If the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate) þ (a) The reasons described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense; þ (b) The subject annual report, semi-annual report, transition report on Form 10-K, Form 20-F, Form 11-K or Form N-SAR or Form N-CSR, or portion thereof, will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report or transition report on Form 10-Q or subject distribution report on Form 10-D, or portion thereof, will be filed on or before the fifth calendar day following the prescribed due date; and (c) The accountant’s statement or other exhibit required by Rule 12b-25(c) has been attached if applicable. PART III — NARRATIVE State below in reasonable detail the reasons why Forms 10-K, 20-F, 11-K, 10-Q, 10-D, N-SAR, N-CSR, or the transition report or portion thereof, could not be filed within the prescribed time period. Global Gold Corporation (the “Company”) is unable to file its quarterly report on Form 10-Q for the period ended September 30, 2011 within the prescribed period. The compilation, dissemination and review of the information required to properly be presented in Form 10-Q has imposed time constraints on the Company and its independent accountants that have rendered timely filing of the Form 10-Q impracticable without undue hardship and expense to the Company. At this time, the Company expects to file Form 10-Q no later than the fifth calendar day following the prescribed due date, as permitted by Rule 12b-25. PART IV — OTHER INFORMATION Name and telephone number of person to contact in regard to this notification Van Z. Krikorian 925-0020 (Name) (Area Code) (Telephone Number) Have all other periodic reports required under Section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed? If the answer is no, identify report(s). þ Yes o No Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof? o Yes þ No If so, attach an explanation of the anticipated change, both narratively and quantitatively, and, if appropriate, state the reasons why a reasonable estimate of the results cannot be made. GLOBAL GOLD CORPORATION (Name of Registrant as Specified in Charter) has caused this notification to be signed on its behalf by the undersigned thereunto duly authorized. Date: November 14, 2011 By: /s/Van Z. Krikorian Van Z. Krikorian Chairman and Chief Executive Officer INSTRUCTION: The form may be signed by an executive officer of the registrant or by any other duly authorized representative. The name and title of the person signing the form shall be typed or printed beneath the signature. If the statement is signed on behalf of the registrant by an authorized representative (other than an executive officer), evidence of the representative’s authority to sign on behalf of the registrant shall be filed with the form. ATTENTION Intentional misstatements or omissions of fact constitute Federal Criminal Violations (See 18 U.S.C. 1001).

    Exhibit 10   August 9, 2010 PARKWAY PROPERTIES LP AMENDMENT TO EXHIBIT A OF THE AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP   Exhibit A of the Amended and Restated Agreement of Limited Partnership of Parkway Properties LP, is hereby amended in its entirety to read as follows: Partner Contribution Partnership Interest Parkway Properties, Inc. (the "Company") $9,900 plus those properties contributed subsequent to the Effective Date Limited Partnership Interest consisting of 21,921,506 Common Limited Partnership Units1 Lane N. Meltzer 47.5% General Partnership Interest in and to the 111 Capitol Building Limited Partnership to Parkway Jackson LLC (a limited liability company which is wholly owned by the Limited Partnership) Limited Partnership Interest consisting of 1318 Class A Common Limited Partnership Units Parkway Properties General Partners, Inc. $100 plus those properties contributed subsequent to the Effective Date General Partnership Interest consisting of 110,858 Class A Common General Partnership Units $106,917,6042 4,374,896 units of Series D Cumulative Redeemable Preferred Partnership Interests                                                                                                                         ______________________                                                                                                                         1Adjusted from time to time to take into account redemptions and issuances of stock by the Company and the corresponding unit issuances and redemptions by the Partnership.                                                                                                                         2Amount represents gross proceeds, including accrued dividends, before underwriting discount and other offering expenses.   A.                SERIES D CUMULATIVE REDEEMABLE PREFERRED LIMITED PARTNERSHIP INTERESTS The following is a description of the preferences, conversion and other rights, voting powers, restrictions, limitations as to distribution, qualifications and terms and conditions of redemption of the Series D Cumulative Redeemable Preferred Limited Partnership Interests of the Limited Partnership: 1.                  Designation and Amount.             The designation of Series D Preferred Limited Partnership Interests shall be 8.00% Series D Cumulative Redeemable Preferred Limited Partnership Interests. The number of units of Series D Preferred Limited Partnership Interests to be authorized shall be 4,374,896. 2.                  Distribution Provisions. (a)               Subject to the rights of series of Preferred Limited Partnership Interests which may from time to time come into existence, holders of Series D Preferred Limited Partnership Interests shall be entitled to receive, when and as declared by the General Partner, out of funds legally available for the payment of distributions, cumulative preferential cash distributions at the rate of 8.00% per annum of the Liquidation Preference (as hereinafter defined) per unit (equivalent to a fixed amount of $2.00 per unit).  Such distributions shall be cumulative from the date of original issue and shall be payable quarterly in arrears on or before the 15th day of each of January, April, July and October or, if not a business day, the next succeeding business day (each, a "Distribution Payment Date").  The first distribution, which will be due on October 15, 2010, shall be for a full quarter in the amount of $0.50 per share.  Any distribution payable on Series D Preferred Limited Partnership Interests for any partial distribution period will be computed on the basis of a 360-day year consisting of twelve 30-day months.  Distributions will be payable to holders of record as they appear in the records of the Partnership at the close of business on the last business day of March, June, September and December, respectively or on such date designated by the General Partner of the Partnership for the payment of distributions that is not more than 30 nor less than 10 days prior to such Distribution Payment Date (each, a "Distribution Record Date"). (b)               No distributions on units of Series D Preferred Limited Partnership Interests shall be declared by the General Partner or be paid or set apart for payment by the Partnership, at any time when the terms and provisions of any agreement to which the Partnership is a party, including any agreement relating to its indebtedness, that prohibits such declaration, payment or setting apart for payment or provides that such declaration, payment or setting apart for payment would constitute a breach thereof or a default thereunder, or if such declaration or payment shall be restricted or prohibited by law. (c)                Notwithstanding the foregoing, distributions on the units of Series D Preferred Limited Partnership Interests will accrue whether or not the Partnership has earnings, whether or not there are funds legally available for the payment of such distributions and whether or not such distributions are declared.  No interest, or sum of money in lieu of interest, shall be payable in respect of any distribution payment or payments on Series D Preferred Limited Partnership Interests which may be in arrears. 2 (d)               Capital gains shall be allocated to the holders of the Series D Preferred Limited Partnership Interests in the same proportion that the total distributions paid or made available to the holders of the Series D Preferred Limited Partnership Interests for the Fiscal Year bears to the total distributions paid or made available for the Fiscal Year to holders of all classes of Partnership Interests. (e)                If any units of Series D Preferred Limited Partnership Interests are outstanding, no full distributions (other than in units of Common Partnership Interests or other capital stock ranking junior to Series D Preferred Limited Partnership Interests as to distributions and upon liquidation) shall be declared or paid or set apart for payment on any units of series of Preferred Limited Partnership Interests of the Partnership ranking, as to distributions, on a parity with or junior to the Series D Preferred Limited Partnership Interests for any period unless full cumulative distributions have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for such payments on units of Series D Preferred Limited Partnership Interests for all past distribution periods and the then current distribution period.  When distributions are not paid in full (or a sum sufficient for such full payment is not so set apart) upon the units of Series D Preferred Limited Partnership Interests and the units of any other series of Preferred Limited Partnership Interests ranking on a parity as to distributions with units of Series D Preferred Limited Partnership Interests, all distributions declared upon units of Series D Preferred Limited Partnership Interests and any other series of Preferred Limited Partnership Interests ranking on a parity as to distributions with Series D Preferred Limited Partnership Interests shall be declared pro rata so that the amount of distributions declared per unit on Series D Preferred Limited Partnership Interests and such other series of Preferred Limited Partnership Interests shall in all cases bear to each other the same ratio that accrued distributions per unit on Series D Preferred Limited Partnership Interests and such other series of Preferred Limited Partnership Interests bear to each other. (f)                Unless full cumulative distributions on units of Series D Preferred Limited Partnership Interests have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past distribution periods and the then current distribution period, no distributions (other than in units of Common Partnership Interests or other partnership interests ranking junior to Series D Preferred Limited Partnership Interests as to distributions and upon liquidation) shall be declared or paid or set aside for payment nor shall any other distribution be declared or made upon the Common Partnership Interests or any other partnership interests of the Partnership ranking junior to or on a parity with the Series D Preferred Limited Partnership Interests as to distributions or upon liquidation, nor shall any units of Common Partnership Interests or any other units of partnership interests of the Partnership ranking junior to or on a parity with the Series D Preferred Limited Partnership Interests as to distributions or upon liquidation be redeemed, purchased or otherwise acquired for any consideration (or any monies be paid to or made available for a sinking fund for the redemption of any such partnership interests) by the Partnership or any affiliate or any person acting on behalf of the Partnership or any of its affiliates (except by conversion into or exchange for other partnership interests of the Partnership ranking junior to Series D Preferred Limited Partnership Interests as to distributions and amounts upon liquidation or redemptions for the purpose of preserving the Company's status as a REIT). 3 (g)               Any distribution payment made on units of the Series D Preferred Limited Partnership Interests shall first be credited against the earliest accrued but unpaid distribution due with respect to units of Series D Preferred Limited Partnership Interests which remains payable. (h)               For the sole purpose of determining whether any distribution made on units of Series D Preferred Limited Partnership Interests is permitted under Delaware Law, amounts that would be needed, if the Partnership were dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of partners whose preferential rights on dissolution are superior to those receiving the distribution shall not be added to the Partnership's total liabilities. 3.                  Liquidation Rights. (a)               Subject to the rights of any series of Preferred Limited Partnership Interests which by its terms expressly ranks senior to the Series D Preferred Limited Partnership Interests in respect of the right to receive payment of the distribution of assets upon liquidation of the Partnership, which may from time to time come into existence, upon any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Partnership, then, before any distribution or payment shall be made to the holders of any units of Common Partnership Interests or any other class or series of partnership Partnership Interests in the distribution of assets upon any liquidation, dissolution or winding up of the affairs of the Partnership, the holders of units of the Series D Preferred Limited Partnership Interests shall be entitled to receive out of assets of the Partnership legally available for distribution to stockholders, liquidation distributions in the amount of the liquidation preference of $25.00 per unit, plus an amount equal to all distributions accrued and unpaid thereon (the "Liquidation Preference").  Holders of Series D Preferred Limited Partnership Interests will be entitled to written notice of any event triggering the right to receive such Liquidation Preference.  After payment of the full amount of the liquidating distributions to which they are entitled, the holders of units of Series D Preferred Limited Partnership Interests will have no right or claim to any of the remaining assets of the Partnership. In the event that, upon any such voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Partnership, the available assets of the Partnership are insufficient to pay the amount of the liquidation distributions on all outstanding units of Series D Preferred Limited Partnership Interests and the corresponding amounts payable on all units of other classes or series of partnership interests of the Partnership ranking on a parity with Series D Preferred Limited Partnership Interests in the distribution of assets upon any liquidation, dissolution or winding up of the affairs of the Partnership ("Parity Units"), then the holders of units of Series D Preferred Limited Partnership Interests and Parity Units shall share ratably in any such distribution of assets in proportion to the full liquidating distributions to which they would otherwise be respectively entitled. 4 (b)               A consolidation or merger of the Partnership with or into any other entity or entities, or a sale, lease, conveyance or disposition of all or substantially all of the assets of the Partnership or the effectuation by the Partnership of a transaction or series of related transactions in which more than 50% of the voting power of the Partnership is disposed of, shall not be deemed to be a liquidation, dissolution or winding up of the affairs of the Partnership within the meaning of this Section A.3. 4.                  Redemption. (a)               The Partnership, at its option, upon not less than 30 nor more than 60 days written notice, may redeem outstanding units of Series D Preferred Limited Partnership Interests, in whole or in part, at any time or from time to time, for cash at a redemption price of $25.00 per unit, plus an amount equal to all distributions accrued and unpaid thereon to the date fixed for redemption, without interest.  Holders of units of Series D Preferred Limited Partnership Interests to be redeemed shall surrender such units of Series D Preferred Limited Partnership Interests at the place designated in such notice and shall be entitled to the redemption price and any accrued and unpaid distributions payable upon such redemption following such surrender.  If fewer than all of the outstanding units of Series D Preferred Limited Partnership Interests are to be redeemed, the number of units to be redeemed will be determined by the Partnership and such units may be redeemed pro rata from the holders of record of such units in proportion to the number of such units held by such holders (with adjustments to avoid redemption of fractional units) or by lot in a manner determined by the Partnership. (b)               Unless full cumulative distributions on all units of Series D Preferred Limited Partnership Interests and Parity Units shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past distribution periods and the then current distribution period, no units of Series D Preferred Limited Partnership Interests or Parity Units shall be redeemed unless all outstanding units of Series D Preferred Limited Partnership Interests and Parity Units are simultaneously redeemed; provided, however, that the foregoing shall not prevent redemption in accordance with Article V of the Charter of the Company or the purchase or acquisition of units of Series D Preferred Limited Partnership Interests or Parity Units pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding units of Series D Preferred Limited Partnership Interests or Parity Units, as the case may be.  Furthermore, unless full cumulative distributions on all outstanding units of Series D Preferred Limited Partnership Interests and Parity Units have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past distribution periods and the then current distribution period, the Partnership shall not purchase or otherwise acquire directly or indirectly any units of Series D Preferred Limited Partnership Interests or Parity Units (except by conversion into or exchange for units of partnership interests of the Partnership ranking junior to Series D Preferred Limited Partnership Interests and Parity Units as to distributions and upon liquidation). 5 (c)                Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each holder of record of units of Series D Preferred Limited Partnership Interests at the address shown on the books of the Partnership.  Each notice shall state:  (i) the redemption date; (ii) the number of units of Series D Preferred Limited Partnership Interests to be redeemed; (iii) the redemption price per unit; (iv) the place or places where certificates for units of Series D Preferred Limited Partnership Interests are to be surrendered for payment of the redemption price; and (v) that distributions on units of Series D Preferred Limited Partnership Interests will cease to accrue on such redemption date.  If fewer than all units of Series D Preferred Limited Partnership Interests are to be redeemed, the notice mailed to each such holder thereof shall also specify the number of units of Series D Preferred Limited Partnership Interests to be redeemed from each such holder.  If notice of redemption of any units of Series D Preferred Limited Partnership Interests has been given and if the funds necessary for such redemption have been set aside by the Partnership in trust for the benefit of the holders of units of Series D Preferred Limited Partnership Interests so called for redemption, then from and after the redemption date, distributions will cease to accrue on such units of Series D Preferred Limited Partnership Interests, such units of Series D Preferred Limited Partnership Interests shall no longer be deemed outstanding and all rights of the holders of such units will terminate, except the right to receive the redemption price. (d)               The holders of units of Series D Preferred Limited Partnership Interests at the close of business on a Distribution Record Date will be entitled to receive the distribution payable with respect to such units of Series D Preferred Limited Partnership Interests on the corresponding Distribution Payment Date notwithstanding the redemption thereof between such Distribution Record Date and the corresponding Distribution Payment Date or the Partnership's default in the payment of the distribution due.  Except as provided above, the Partnership will make no payment or allowance for unpaid distributions, whether or not in arrears, on units of Series D Preferred Limited Partnership Interests which have been called for redemption. (e)                Series D Preferred Limited Partnership Interests has no stated maturity and will not be subject to any sinking fund or mandatory redemption, except as provided in Article V of the Charter of the Company. 5.                  Voting Rights. (a)               Except as indicated in this Section A.5(a), or except as otherwise from time to time required by applicable law, the holders of units of Series D Preferred Limited Partnership Interests will have no voting rights. 6 (b)               So long as any units of Series D Preferred Limited Partnership Interests remain outstanding, the Partnership will not without the affirmative vote or consent of the holders of at least two-thirds of the units of the Series D Preferred Limited Partnership Interests outstanding at the time, given in person or by proxy, either in writing or at a meeting (voting separately as a class), (a) authorize or create, or increase the authorized or issued amount of, any class or series of partnership interests ranking senior to the Series D Preferred Limited Partnership Interests with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized partnership interests of the Partnership into such units, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such units; or (b) amend, alter or repeal the provisions of the Partnership's Amended and Restated Agreement of Limited Partnership, whether by merger, consolidation or otherwise (an "Event"), so as to materially and adversely affect any right, preference, privilege or voting power of the Series D Preferred Limited Partnership Interests or the holders thereof; provided, however, with respect to the occurrence of any Event set forth in (b) above, so long as the Series D Preferred Limited Partnership Interests remains outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event the Partnership may not be the surviving entity, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of the Series D Preferred Limited Partnership Interests and provided further that: (i) any increase in the amount of the authorized Preferred Limited Partnership Interests or the creation or issuance of any series of Preferred Limited Partnership Interests, or (ii) any increase in the amount of authorized units of such series (including the Series D Preferred Limited Partnership Interests), in each case ranking on a parity with or junior to the Series D Preferred Limited Partnership Interests with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers. (c)                Except as provided above and as required by law, the holders of Series D Preferred Limited Partnership Interests are not entitled to vote on any merger or consolidation involving the Partnership, on any unit exchange or on a sale of all or substantially all of the assets of the Partnership. 6.                  Conversion.             The units of Series D Preferred Limited Partnership Interests are not convertible into or exchangeable for any other property or securities of the Partnership. 7.                  Ranking.             In respect of the right to the payment of distributions and the distribution of assets in the event of any liquidation, dissolution or winding up of the affairs of the Partnership, the Series D Preferred Limited Partnership Interests shall rank: (i) senior to the Partnership's Common Partnership Interests and to any other class or series of partnership interests of the Partnership other than any class or series referred to in clause (ii), and (ii) junior to any class or series of partnership interests of the Partnership ranking senior to the Series D Preferred Limited Partnership Interests as to the payment of distributions and the distribution of assets in the event of any liquidation, dissolution or winding up of the Partnership.  For avoidance of doubt, debt securities of the Partnership which are convertible into or exchangeable for units of partnership interests of the Partnership shall not constitute a class or series of partnership interests of the Partnership. 7 Dated the 9th day of August, 2010.                                                                                                                                                                 PARKWAY PROPERTIES GENERAL                                                                                                                                                                 PARTNERS, INC.                                                                                                                                                                 By /s/ Richard G. Hickson IV                                                                                                                                                                                        Name: Richard G. Hickson IV                                                                                                                                                                 Title: EVP and Chief Financial Officer                                                                                                                                                                 By:/s/ Mandy M. Pope                                                                                                                                                                                        Name: Mandy M. Pope                                                                                                                                                                 Title: Executive Vice President,                                                                                                                                                                 Chief Accounting Officer and Secretary 8

DELAWARE GROUP® EQUITY FUNDS V Delaware Dividend Income Fund (the “Fund”) Supplement to the Fund’s Class A, Class B, Class C, Class R, and Institutional Class Summary Prospectus dated March 28, 2014 On Nov. 20, 2013, the Board of Trustees of Delaware Group Equity Funds V approved an increase in the exposure limitations on the Fund’s ability to invest in emerging markets securities. These changes will be effective May 27, 2014 (the “Effective Date”). Until the Effective Date, the following information replaces the section entitled, “What are the Fund’s principal investment strategies?” What are the Fund's principal investment strategies? The Fund invests primarily in income-generating securities (debt and equity), which may include equity securities of large, well-established companies, and debt securities, including high yield, high-risk corporate bonds, investment grade fixed income securities, and U.S. government securities. Under normal circumstances, at least 50% of the Fund's total assets will be invested in income-generating equity securities. In making investments in income-generating equity securities, the Fund may invest an unlimited portion of its total assets in convertible securities without regard to credit quality. While debt securities may comprise up to 50% of the Fund's total assets, no more than 45% of the Fund's total assets will be invested in high yield, high-risk debt securities. No more than 25% of the Fund's total assets will be invested in any one industry sector nor, as to 75% of the Fund's total assets, will more than 5% be invested in securities of any one issuer. The Fund may invest up to 30% of its total assets in foreign equity and debt securities. The Fund will not, however, invest more than 5% of its total assets in securities of issuers principally located or principally operating in markets of emerging countries. Within the percentage guidelines noted above, the Manager will determine the proportion of the Fund's assets that will be allocated to income-generating equity securities and equity equivalents and to debt securities, based on its analysis of economic and market conditions and its assessment of the income and potential for appreciation that can be achieved from investments in such asset classes. It is expected that the proportion of the Fund's total assets invested in income-generating equity securities and equity equivalent securities will vary from 50% to 100% of the Fund's total assets. The proportion of the Fund's total assets in debt securities will correspondingly vary from 0% to 50% of the Fund's total assets. The Fund may use a wide range of derivative instruments, typically including options, futures contracts, options on futures contracts, and credit default swaps. The Fund will use derivatives for both hedging and nonhedging purposes. For example, the Fund may invest in: futures and options to manage duration and for defensive purposes, such as to protect gains or hedge against potential losses in the portfolio without actually selling a security, or to stay fully invested; forward foreign currency contracts to manage foreign currency exposure; and credit default swaps to hedge against bond defaults, to manage credit exposure, or to enhance total return. Investments in the Fund are not and will not be deposits with or liabilities of Macquarie Bank Limited ABN 46 and its holding companies, including their subsidiaries or related companies (the "Macquarie Group"), and are subject to investment risk, including possible delays in repayment and loss of income and capital invested. No Macquarie Group company guarantees or will guarantee the performance of the Fund, the repayment of capital from the Fund, or any particular rate of return. Please keep this Supplement for future reference. This Supplement is dated April 2, 2014.

EXHIBIT 10.2     LIMITED CONTINUING GUARANTY This LIMITED CONTINUING GUARANTY (this “Guaranty”) is made by GENERAL FINANCE CORPORATION, a Delaware corporation (“Guarantor”) to and for the benefit of WELLS FARGO BANK, NATIONAL ASSOCIATION (with its participants, successors and assigns, “Wells Fargo”) as of June 10, 2014.   Recitals   Reference is made to the following:   A.   Wells Fargo, SOUTHERN FRAC, LLC, a Texas limited liability company (the “Company”), Guarantor, and GFN MANUFACTURING CORPORATION, a Delaware corporation (“GFN Mfg”) have entered into that certain Credit and Security Agreement, dated as of October 1, 2012, as amended by that certain First Amendment to Credit and Security Agreement, dated as of February 22, 2013, as amended by that certain Second Amendment to Credit and Security Agreement, dated as of June 26, 2013, and as amended by that certain Third Amendment to Credit and Security Agreement, dated as of September 5, 2013 (as  amended, modified, extended, restated or supplemented from time to time, the “Credit Agreement”).   B.   The Obligations (as defined in the Credit Agreement) are secured by Accounts (as defined in the Credit Agreement), including one or more Accounts owing from Account Debtors (as defined in the Credit Agreement) that are majority owned, directly or indirectly by Guarantor or Affiliates of Guarantor (the “Guarantor Affiliate Accounts”).   C.   Borrower has requested that Wells Fargo amend certain provisions of the Credit Agreement, as more fully set forth in that certain Fourth Amendment to Credit and Security Agreement, dated as of the date hereof (the “Fourth Amendment”) to allow for the increased eligibility of the Guarantor Affiliate Accounts.   D.   Subject to the terms, conditions and limitations set forth in the Fourth Amendment, Wells Fargo is willing to amend certain provisions of the Credit Agreement as set forth in the Fourth Amendment, provided that, the Guarantor makes this Guaranty and in full reliance upon the guaranty herein provided to Wells Fargo.   AGREEMENTS   1.           GUARANTY.  In consideration of the foregoing and other good and valuable consideration, Guarantor hereby unconditionally guarantees and promises to pay to Wells Fargo, or order, on demand in lawful money of the United States of America and in immediately available funds, any and all Indebtedness.  The term “Indebtedness” means any amounts outstanding owing to the Company pursuant to the Guarantor Affiliate Accounts to the extent the aggregate amount of all such Guarantor Affiliate Accounts shall exceed $1,500,000.00.  This Guaranty is a guaranty of payment and not collection.       1   2.           SUCCESSIVE TRANSACTIONS; REVOCATION; OBLIGATION UNDER OTHER GUARANTIES.  This is a continuing guaranty and all rights, powers and remedies hereunder shall apply to all past, present and future Indebtedness, including that arising under successive transactions which shall either continue the Indebtedness, increase or decrease it, or from time to time create new Indebtedness after all or any prior Indebtedness has been satisfied, and notwithstanding the death, incapacity, dissolution, liquidation or bankruptcy of Company, Guarantor, or any Account Debtor or any other event or proceeding affecting either Company or Guarantor.  This Guaranty is irrevocable and shall not be subject to termination by Guarantor until all commitments under the Credit Agreement shall have been terminated and the outstanding balance of Indebtedness, calculated in accordance with this Guaranty shall be less than $1,500,000.  In furtherance of the foregoing, Guarantor promises to pay on demand based on the amount of Guarantor Affiliate Accounts owing as of the date of demand, which demand may be made one or more times following the occurrence of an Event of Default (as defined in the Credit Agreement).  Wells Fargo may allocate amounts paid by Guarantor among the Guarantor Affiliate Accounts in such manner as it may elect as long as credit is given dollar-for-dollar.  Guarantor agrees that the amount of all Guarantor Affiliate Accounts will be calculated without giving effect to any defenses, disputes or rights of offset that Account Debtors may assert (whether or not valid), and that credit for payments made by Guarantor may be allocated to setoff or disputed accounts in the election of Wells Fargo.  The obligations of Guarantor under this Guaranty shall be in addition to any obligations of Guarantor under any other guaranties of any liabilities or obligations of Company or other persons that may be given to Wells Fargo at any time, unless the other guaranties are expressly modified or revoked in writing; and neither this Guaranty nor any amounts paid hereunder shall, unless expressly provided for in this Guaranty, affect, limit or invalidate any such other guaranties. 3.           OBLIGATIONS JOINT AND SEVERAL; SEPARATE ACTIONS; WAIVER OF STATUTE OF LIMITATIONS; REINSTATEMENT OF LIABILITY.  The obligations of Guarantor under this Guaranty are joint and several and independent of the obligations of Company, and a separate action or actions may be brought and prosecuted against Guarantor, whether the action is brought against Company or other persons, or whether Company or other persons are joined in any such action or actions.  Guarantor acknowledges that this Guaranty is absolute and unconditional, that there are no conditions precedent to the effectiveness of this Guaranty, and that this Guaranty is in full force and effect and binding on Guarantor as of the date written below, regardless of whether Wells Fargo obtains collateral or any guaranties from others or takes any other action contemplated by Guarantor.  Guarantor waives the benefit of any statute of limitations affecting the enforcement or Guarantor’s liability under this Guaranty, and Guarantor agrees that any payment of any Indebtedness or other act which shall toll any applicable statute of limitations shall similarly toll the statute of limitations applicable to Guarantor's liability under this Guaranty.  The liability of Guarantor hereunder shall be reinstated and revived and the rights of Wells Fargo shall continue if and to the extent for any reason any amount at any time paid on account of any Indebtedness guaranteed hereby is rescinded or must otherwise be restored by Wells Fargo, whether as a result of any proceedings in bankruptcy or reorganization or otherwise, all as though such amount had not been paid.  The determination as to whether any amount so paid must be rescinded or restored shall be made by Wells Fargo in its sole discretion; provided however, that if Wells Fargo chooses to contest any such matter at the request of Guarantor, Guarantor agrees to indemnify and hold Wells Fargo harmless from and against all costs and expenses, including reasonable attorneys' fees, expended or incurred by Wells Fargo in connection therewith, including without limitation, in any litigation with respect thereto. 4.           AUTHORIZATIONS TO WELLS FARGO.  Guarantor authorizes Wells Fargo either before or after revocation hereof, without notice to or demand on Guarantor, and without affecting Guarantor's liability hereunder, from time to time to: (a) alter, compromise, renew, extend, accelerate or otherwise change the time for payment of, or otherwise change the terms of the Indebtedness or any portion thereof, including increase or decrease of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the Indebtedness or any portion thereof, and exchange, enforce, waive, subordinate or release any such security; (c) apply such security and direct the order or manner of sale thereof, including without limitation, a non-judicial sale permitted by the terms of the controlling security agreement, mortgage or deed of trust, as Wells Fargo in its discretion may determine; (d) release or substitute any one or more of the endorsers or any other guarantors of the Indebtedness, or any portion thereof, or any other party thereto; and (e) apply payments received by Wells Fargo from Company to any portion of the Indebtedness, in such order as Wells Fargo shall determine in its sole discretion, whether or not such Indebtedness is covered by this Guaranty, and Guarantor hereby waives any provision of law regarding application of payments which specifies otherwise.  Wells Fargo may without notice assign this Guaranty in whole or in part.  Upon Wells Fargo's request, Guarantor agrees to provide to Wells Fargo copies of Guarantor's financial statements.       2   5.           REPRESENTATIONS AND WARRANTIES.  Guarantor represents and warrants to Wells Fargo that: (a) this Guaranty is executed at Company's request; (b) Guarantor shall not, without Wells Fargo's prior written consent, sell, lease, assign, encumber, hypothecate, transfer or otherwise dispose of all or a substantial or material part of Guarantor's assets other than in the ordinary course of Guarantor's business; (c) Wells Fargo has made no representation to Guarantor as to the creditworthiness of Company; and (d) Guarantor has established adequate means of obtaining from Company on a continuing basis financial and other information pertaining to Company's financial condition.  Guarantor agrees to keep adequately informed of any facts, events or circumstances which might in any way affect Guarantor's liability under this Guaranty, and Guarantor further agrees that Wells Fargo shall have no obligation to disclose to Guarantor any information or material about Company which is acquired by Wells Fargo in any manner. 6.           GUARANTOR'S WAIVERS. (a)           Guarantor waives any right to require Wells Fargo to: (i) proceed against Company or any other person; (ii) marshal assets or proceed against or exhaust any security granted by Company or any other person; (iii) give notice of the terms, time and place of any public or private sale or other disposition of personal property security granted by Company or any other person; (iv) take any other action or pursue any other remedy in Wells Fargo's power; or (v) make any presentment or demand for performance, or give any notice of nonperformance, protest, notice of protest or notice of dishonor hereunder or in connection with any obligations or evidences of indebtedness held by Wells Fargo as security for or which constitute in whole or in part the Indebtedness guaranteed hereunder, or in connection with the creation of new or additional Indebtedness. (b)           Guarantor waives any defense to its obligations hereunder based upon or arising by reason of: (i) any disability or other defense of Company or any other person; (ii) the cessation or limitation from any cause whatsoever, other than payment in full, of the Indebtedness or the indebtedness of any other person; (iii) any lack of authority of any officer, director, partner, agent or any other person acting or purporting to act on behalf of Company, if it is a corporation, partnership or other type of entity, or any defect in the formation of Company; (iv) the application by Company of the proceeds of any Indebtedness for purposes other than the purposes represented by Company to, or intended or understood by, Wells Fargo or Guarantor; (v) any act or omission by Wells Fargo which directly or indirectly results in or aids the discharge of Company or any portion of the Indebtedness by operation of law or otherwise, or which in any way impairs or suspends any rights or remedies of Wells Fargo against Company; (vi) any impairment of the value of any interest in any security for the Indebtedness or any portion thereof, including without limitation, the failure to obtain or maintain perfection or recordation of any interest in any such security, the release of any such security without substitution, and/or the failure to preserve the value of, or to comply with applicable law in disposing of, any such security; (vii) any modification of the Indebtedness, in any form whatsoever, including any modification made after revocation hereof to any Indebtedness incurred prior to such revocation, and including without limitation the renewal, extension, acceleration or other change in time for payment of, or other change in the terms of, the Indebtedness or any portion thereof, including increase or decrease of the rate of interest thereon; or (viii) any requirement that Wells Fargo give any notice of acceptance of this Guaranty.  Until all Indebtedness has been paid in full, Guarantor shall have no right of subrogation, and Guarantor waives any right to enforce any remedy which Wells Fargo now has or may hereafter have against Company or any other person, and waives any benefit of, or any right to participate in, any security now or hereafter held by Wells Fargo.  Guarantor further waives all rights and defenses Guarantor may have arising out of (A) any election of remedies by Wells Fargo, even though that election of remedies, such as a non-judicial foreclosure with respect to any security for any portion of the Indebtedness, destroys Guarantor's rights of subrogation or Guarantor's rights to proceed against Company for reimbursement, or (B) any loss of rights Guarantor may suffer by reason of any rights, powers or remedies of Company in connection with any anti-deficiency laws or any other laws limiting, qualifying or discharging Company's Indebtedness, whether by operation of law or otherwise, including any rights Guarantor may have to a fair market value hearing to determine the size of a deficiency following any foreclosure sale or other disposition of any real property security for any portion of the Indebtedness.       3   7.           WELLS FARGO'S RIGHTS WITH RESPECT TO GUARANTOR'S PROPERTY IN ITS POSSESSION.  In addition to all liens upon and rights of setoff against the monies, securities or other property of Guarantor given to Wells Fargo by law, Wells Fargo shall have a lien upon and a right of setoff against all monies, securities and other property of Guarantor now or hereafter in the possession of or on deposit with Wells Fargo, whether held in a general or special account or deposit or for safekeeping or otherwise, and every such lien and right of setoff may be exercised without demand upon or notice to Guarantor.  No lien or right of setoff shall be deemed to have been waived by any act or conduct on the part of Wells Fargo, or by any neglect to exercise such right of setoff or to enforce such lien, or by any delay in so doing, and every right of setoff and lien shall continue in full force and effect until such right of setoff or lien is specifically waived or released by Wells Fargo in writing. 8.           SUBORDINATION.  Any indebtedness of Company now or hereafter held by Guarantor is hereby subordinated to the Indebtedness.  Such indebtedness of Company to Guarantor is assigned to Wells Fargo as security for this Guaranty and the Indebtedness and, if Wells Fargo requests, shall be collected and received by Guarantor as trustee for Wells Fargo and paid over to Wells Fargo on account of the Indebtedness but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty.  Any notes or other instruments now or hereafter evidencing such indebtedness of Company to Guarantor shall be marked with a legend that indicates that the notes or other instruments are subject to this Guaranty and, if Wells Fargo so requests, such notes and instruments shall be delivered to Wells Fargo. Wells Fargo is hereby authorized in the name of Guarantor from time to time to file financing statements and continuation statements and execute such other documents and take such other action as Wells Fargo deems necessary or appropriate to perfect, preserve and enforce its rights hereunder. 9.           REMEDIES; NO WAIVER.  All rights, powers and remedies of Wells Fargo hereunder are cumulative.  No delay, failure or discontinuance of Wells Fargo in exercising any right, power or remedy hereunder shall affect or operate as a waiver of such right, power or remedy; nor shall any single or partial exercise of any such right, power or remedy preclude, waive or otherwise affect or remedy.  Any waiver, permit, consent or approval of any kind by Wells Fargo of any breach of this Guaranty, or any such waiver of any provisions or conditions hereof, must be in writing and shall be effective only to the extent set forth in writing. 10.           COSTS, EXPENSES AND ATTORNEYS' FEES.  Guarantor shall pay to Wells Fargo immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys' fees (to include outside counsel fees and all allocated costs of Wells Fargo’s in-house counsel), expended or incurred by Wells Fargo in connection with the enforcement of any of Wells Fargo's rights, powers or remedies and/or the collection of any amounts which become due to Wells Fargo under this Guaranty, and the prosecution or defense of any action in any way related to this Guaranty, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Wells Fargo or any other person) relating to Guarantor or any other person or entity.  All of the foregoing shall be paid by Guarantor with interest from the date of demand until paid in full at a rate per annum equal to the greater of ten percent (10%) or Wells Fargo’s Prime Rate in       4   11.           SUCCESSORS; ASSIGNMENT.  This Guaranty shall be binding upon and inure to the benefit of the heirs, executors, administrators, legal representatives, successors and assigns of the parties; provided however, that Guarantor may not assign or transfer any of its interests or rights hereunder without Wells Fargo's prior written consent.  Guarantor acknowledges that Wells Fargo has the right to sell, assign, transfer, negotiate or grant participations in all or any part of, or any interest in, the Indebtedness and any obligations with respect thereto, including this Guaranty.  In connection therewith, Wells Fargo may disclose all documents and information which Wells Fargo now has or hereafter acquires relating to Guarantor and/or this Guaranty, whether furnished by Company, Guarantor or otherwise.  Guarantor further agrees that Wells Fargo may disclose such documents and information to Company. 12.           AMENDMENT.  This Guaranty may be amended or modified only in writing signed by Wells Fargo and Guarantor. 13.           APPLICATION OF SINGULAR AND PLURAL.  In all cases where there is more than one Company named in this instrument, then the term “Company” shall be deemed to have been used in the plural where context and construction so require; and when this Guaranty is executed by more than one Guarantor, the word "Guarantor" shall mean all or any one or more of them as the context requires. 14.           UNDERSTANDING WITH RESPECT TO WAIVERS; SEVERABILITY OF PROVISIONS.  Guarantor warrants and agrees that each of the waivers set forth herein is made with Guarantor's full knowledge of its significance and consequences, and that under the circumstances, the waivers are reasonable and not contrary to public policy or law.  If any waiver or other provision of this Guaranty shall be held to be prohibited by or invalid under applicable public policy or law, such waiver or other provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such waiver or other provision or any remaining provisions of this Guaranty. 15.           GOVERNING LAW.  This Guaranty shall be governed by and construed in accordance with the laws of the State of Texas. 16.             WAIVER OF JURY TRIAL. GUARANTOR IRREVOCABLY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF, BASED ON OR PERTAINING TO THIS GUARANTY.     5   IN WITNESS WHEREOF, the undersigned Guarantor has executed this Guaranty as of June 10, 2014.           General Finance Corporation       By:   /s/ Christopher A. Wilson   Name:  Christopher A. Wilson   Title         [Signature Page to Limited Continuing Guaranty (General Finance Corporation)]  

PART II AND III Preliminary Offering Circular dated August , 2017 An Offering Statement pursuant to Regulation A relating to these securities has been filed with the Securities and Exchange Commission.

  Exhibit 10.1 SECOND AMENDMENT TO INVESTORS’ RIGHTS AGREEMENT      This Second Amendment to Investors’ Rights Agreement (this “Second Amendment”) is made and entered into as of December 20, 2006, among SIRION HOLDINGS, INC. (f/k/a Tenby Pharma Inc.), a Delaware corporation (the “Company”), and the investors signatory hereto (each such investor is a “Investor” and all such investors are, collectively, the “Investors”). All capitalized terms set forth in this Second Amendment but not otherwise defined herein shall have the meaning ascribed thereto in the Original Agreement.      WHEREAS, the Company and the Investors have previously entered into that certain Investors’ Rights Agreement dated September 13, 2006, as amended by that certain First Amendment to Investors’ Rights Agreement dated as of November 15, 2006 (collectively as amended, the “Original Agreement”);      WHEREAS, the Company and the Investors desire to amend certain provisions of the Original Agreement to provide for an additional extension of the required time period within which the Company is required to comply with the requirements of Section 2 of the Original Agreement. adequacy of which are hereby acknowledged, the Company and the Investors agree as follows:      1. New Definitions. Section 1 of the Original Agreement is hereby amended by adding the following new definitions thereto (where the same would appear in alphabetical order), to wit:       “Commission” means the U.S. Securities and Exchange Commission, and any successor federal agency or commission that is delegated administrative authority with respect to the federal securities laws, and the staff thereof.”       “Securities Act” means the Securities Act of 1933, as amended.”      2. Definition of “Filing Date”. The term “Filing Date” as defined in Section 1 of the Original Agreement is hereby amended by deleting the current definition in its entirety and substituting the following therefor, to wit: “Filing Date” means, (a) with respect to the initial Registration Statement required to be filed pursuant to Section 2, the earlier of (i) January 31, 2007, and (ii) the date that is the tenth (10th) day following the closing by the Company of a private offering of equity and/or debt securities pursuant to a financing transaction that results in gross proceeds to the Company of at least $5,000,000, and (b) with respect to any additional Registration Statements that may be required pursuant to Section 3, the 30th day following the date on which the Company receives a valid request for registration pursuant to Section 3.”          3. No Other Changes. Except as expressly amended hereby, the Original affirmed by the parties.      4. Counterparts. This Second Amendment may be executed in counterparts, each of which shall constitute an original and all of which together shall constitute one and the same instrument. Any party hereto may execute this Second Amendment by signing any one counterpart. A facsimile copy (including telephonic, portable digital format or other) of this Second Amendment and any signature(s) hereon shall be considered for all purposes as an original. [Remainder of page intentionally left blank. Signature pages follow.] 2        IN WITNESS WHEREOF, the parties have executed this Investors’ Rights                   SIRION HOLDINGS, INC.         (f/k/a Tenby Pharma Inc.)                       By:   /s/ Barry Butler                Name: Barry Butler       Address for Notice: 3110 Cherry Palm Drive, Suite 340 Tampa, Florida 33619 Facsimile No.: (813) 496-7328 Telephone No.: (813) 496-7325 Attn: Barry Butler Hill, Ward and Henderson, P.A. 101 East Kennedy Boulevard, Suite 3700 Tampa, Florida 33602 Facsimile No.: (813) 221-2900 Telephone No.: (813) 222-8705 Attn: Reid Haney, Esq. [Remainder of page intentionally left blank. Signature pages for the Investors follow.]                       NORTH SOUND LEGACY INSTITUTIONAL FUND LLC                       By:   North Sound Capital LLC; Manager                       By:   /s/ Andrew B. David               Name: Andrew B. David             Title: General Counsel     Address for Notice: 20 Horseneck Lane Greenwich, Connecticut 06830 Facsimile No.: (203) 340-5701 Telephone No.: (203) 340-5784 Attn: Andrew B. David, Esq. Proskauer Rose LLP 1585 Broadway Facsimile No.: (212) 969-2900 Telephone No.: (212) 969-3000 Attn: Adam J. Kansler, Esq. Signature pages of other Investors to follow.]                       NORTH SOUND LEGACY INTERNATIONAL LTD.                       By:   North Sound Capital LLC; Investment Advisor                                       Title: General Counsel     Address for Notice: 20 Horseneck Lane Greenwich, Connecticut 06830 Proskauer Rose LLP 1585 Broadway                       AVALON VENTURES VI, L.P.                       By:   Avalon Ventures GP, LLC             its General Partner                       By:   /s/ Kevin J. Kinsella               Name: Kevin J. Kinsella             Title: Managing Member     Address for Notice: c/o Sytera II, Inc. 888 Prospect Street, Suite 320 Facsimile No.: (858) 348-2183 Telephone No.: Attn:                       AVALON VENTURES VI GP FUND, LLC                             its General Partner                                       Title: Managing Member     Address for Notice: Telephone No.: Attn:                       AVALON VENTURES VII, L.P.                       By:   Avalon Ventures VII GP, LLC             its General Partner                                       Title: Managing Member     Address for Notice: Telephone No.: Attn:                   /s/ Barry Butler   Barry Butler     Address for Notice: c/o Tenby Pharma Inc. Tampa, FL 33619 Attn: Barry Butler Tampa, FL 33602                   /s/ Roger Vogel   Roger Vogel     Address for Notice: Tampa, FL 33619 Attn: Roger Vogel                       WIDDER FAMILY LIMITED PARTNERSHIP                       By:   /s/ Kenneth J. Widder                Name: Kenneth J. Widder, M.D.             Title: Partner     Address for Notice: Telephone No.: Attn: Kenneth J. Widder, M.D.                       THE LICHTER FAMILY TRUST                       By:   /s/ Jay Lichter                Name: Jay Lichter, Ph.D.             Title: Trustee     Address for Notice: Telephone No.: Attn: Jay Lichter, Ph.D.                       PHARMABIO DEVELOPMENT INC.              (D/B/A NOVAQUEST)                       By:   /s/ Kerry E. Zook                Name: Kerry E. Zook             Title: Vice President     Address for Notice: 4709 Creekstone Drive Riverbirch Building, Suite 200 Durham, NC 27703 Facsimile No.: (919) 998-2090 Telephone No.: (919) 998-2000 Attn: President  

Exhibit 10.3 ESCROW DEPOSIT AGREEMENT ESCROW DEPOSIT AGREEMENT (this “Agreement”) dated June 11, 2007, by and between EGPI FIRECREEK, INC., a Nevada corporation (the “Company” or “EGPI”), having an address at 6564 Smoke Tree Lane, Scottsdale, Arizona 85253 and GERSTEN SAVAGE LLP (the “Escrow Agent”), having an office at 600 Lexington Avenue, 9th Floor, New York, New York 10022.   WITNESSETH: WHEREAS, on June 11, 2007 (the “Closing Date”), the Company issued to Dutchess Private Equities Fund, Ltd. (“Dutchess”) a Debenture to evidence a loan in the principal amount of $2,000,000 (the “Debenture”); WHEREAS, the Company has requested that all proceeds of the loan accepted by the Company pursuant to the issuance of the Debenture minus any fees due, be deposited with the Escrow Agent (the “Funds”); WHEREAS, the Company desires to establish an escrow account with the Escrow Agent into which the Funds from the sale of the Debenture shall be deposited and Escrow Agent is willing to accept said payment of money in accordance with the terms hereinafter set forth; WHEREAS, the Company and Dutchess acknowledge that they have not stated to any individual or entity that the Escrow Agent’s duties will include anything other than those duties stated in this Agreement; and In consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby 1. Delivery of Escrow Funds. (a) The Company and Dutchess hereby agree that all Funds from Dutchess be transferred to the Escrow Agent pursuant to the wire instructions attached hereto as Exhibit A.  The wire transfer of the Funds shall be deposited into an interest-bearing escrow account (the “Escrow Account”). (b) The Funds deposited into the Escrow Account are referred to as the “Escrow Funds” as of the Closing Date and any amounts remaining in the Escrow Account subsequent to the Closing Date are referred to as the “Remaining Escrow Funds.” (c) The Escrow Agent shall have no duty or responsibility to enforce the collection or demand payment of any Escrow Funds deposited into the Escrow Account.  Further, the Escrow Agent shall have no duty or responsibility to compel collection of the Escrow Funds from Dutchess. 2. Release of Escrow Funds.  The Escrow Funds shall be released by the Escrow Agent in accordance with the following: (a) In the event the Escrow Agent has received a release notice (the “Release Notice”) from the Company by 3:00 P.M. (local New York City time) on the Closing Date, in form and substance satisfactory to Escrow Agent, the Escrow Agent shall, unless otherwise so instructed, release $5,000.00 of the Escrow Funds to the Escrow Agent pursuant to its wire instructions attached hereto as Exhibit B. 1 (b) In the event the Escrow Agent has received the Release Notice from the Company by 3:00 P.M. (local New York City time) on the Closing Date, in form and substance satisfactory to Escrow Agent, the Escrow Agent shall, unless otherwise so instructed, release $75,000 of the Escrow Funds to the Company pursuant to its wire instructions attached hereto as Exhibit C. (c) The Remaining Escrow Funds, or $[1,820,000], shall be released by the Escrow Agent pursuant to one or more Release Notices received from the Company and agreed to in writing by Dutchess (“Confirmation”), by 3:00 PM (local New York City time), on any date that all or a portion of the Remaining Escrow Funds are to be released (“Subsequent Closing Dates”). A form of Release Notice is attached hereto as Exhibit D. (d) In the event the Escrow Agent receives written notice from Dutchess that the Company is in default under the Debenture (“Notice of Default”), all Remaining Escrow Funds in the Escrow Account shall be immediately transferred to Dutchess. Upon receipt of the Notice of Default, the Remaining Escrow Funds shall be transferred by the Escrow Agent in accordance with the instructions contained in the Notice of Default.  It shall not be the Escrow Agent’s duty, and the Escrow Agent shall have no obligation whatsoever, to verify any Event of Default pursuant to the Debenture. Further, the Company and Dutchess agree that the Escrow Agent may rely on any Notice of Default sent from Dutchess. (e) Dutchess shall be entitled to receive all interest paid on the Escrow Account (“Interest”).  At the end of each month, the Escrow Agent shall automatically transfer the funds paid as Interest in the Escrow Account directly to Dutchess pursuant to the wire instructions attached hereto as Exhibit E. (f) The Escrow Agent shall not be required to pay any uncollected funds or any funds which are not available for withdrawal. 3. Acceptance by Escrow Agent.  The Escrow Agent hereby accepts and agrees to perform its obligations hereunder, provided that: (a) The Escrow Agent may act in reliance upon any signature believed by it to be genuine, and may assume that any person who has been designated by the Company and Dutchess to give any written instructions, notice or receipt, or make any statements in connection with the provisions hereof has been duly authorized to do so.  Escrow Agent shall have no duty to make inquiry as to the genuineness, accuracy or validity of any statements or instructions or any signatures on statements or instructions.  The names and true signatures of each individual authorized to act singly on behalf of the Company and Dutchess are stated in Schedule I, which is attached hereto and made a part hereof. (b) The Escrow Agent shall not be liable for any mistake of fact or error of judgment or law, or for any acts or omissions of any kind, unless caused by its willful misconduct or gross negligence. (c) The Company and Dutchess, each jointly and severally, agree to indemnify and hold the Escrow Agent harmless from and against any and all claims, losses, costs, liabilities, damages, suits, demands, judgments or expenses (including but not limited to reasonable attorney’s fees) claimed against or incurred by Escrow Agent arising out of or related, directly or indirectly, to this Escrow Agreement or any acts or omissions hereunder. (d) In the event that the Escrow Agent shall be uncertain as to its duties or rights hereunder, the Escrow Agent shall be entitled to (i) refrain from taking any action other than to keep safely the Escrow Funds, if any, or Remaining Escrow Funds until it shall be directed otherwise by a court of competent jurisdiction, or (ii) deliver the Escrow Funds, if any, or Remaining Escrow Funds to a court of competent jurisdiction. 2 (e) The Escrow Agent shall have no duty, responsibility or obligation to interpret or enforce the terms of any agreement and shall have no obligation to verify or confirm an event of default under the Debenture or any other agreement between the Company and Dutchess, other than Escrow Agent’s obligations hereunder, and the Escrow Agent shall not be required to make a request that any monies be delivered to the Escrow Account, it being agreed that the sole duties and responsibilities of the Escrow Agent shall be to the extent not prohibited by applicable law (i) to accept wire transfer delivered to the Escrow Agent for the Escrow Account and deposit such wire transfer into the interest bearing Escrow Account, and (ii) to disburse or refrain from disbursing the Escrow Funds, if any, or Remaining Escrow Funds as stated above. 4. Resignation and Termination of the Escrow Agent.  The Escrow Agent may resign at any time by giving thirty (30) days’ prior written notice of such resignation to the Company and Dutchess.  Upon providing such notice, the Escrow Agent shall have no further obligation hereunder except to hold the Escrow Funds, if any, or the Remaining Escrow Funds which it received until the end of such 30-day period.  In such event, the Escrow Agent shall not take any action until the Company and Dutchess have designated a banking corporation, trust company, attorney or other person as successor.  Upon receipt of such written designation signed by the Company and Dutchess, the Escrow Agent shall promptly deliver the Escrow Funds, if any, or the Remaining Escrow Funds to such successor and shall thereafter have no further obligations hereunder.  If such instructions are not received within thirty (30) days following the effective date of such resignation, then the Escrow Agent may deposit the Escrow Funds, if any, or the Remaining Escrow Funds held by it pursuant to this Agreement with a clerk of a court of competent jurisdiction pending the appointment of a successor.  In either case provided for in this paragraph, the Escrow Agent shall be relieved of all further obligations and released from all liability thereafter arising with respect to the Escrow Funds, if any, or the Remaining Escrow Funds. 5. Termination.  The Company and Dutchess may terminate the appointment of the Escrow Agent hereunder upon written notice specifying the date upon which such termination shall take effect, which date shall be at least thirty (30) days from the date of such notice.  In the event of such termination, the Company shall, within thirty (30) days of such notice, appoint a successor escrow agent and the Escrow Agent shall, upon receipt of written instructions signed by the Company and Dutchess turn over to such successor escrow agent all of the Escrow Funds, if any, or the Remaining Escrow Funds; provided, however, that if the Company and Dutchess fail to appoint a successor escrow agent within such 30-day period, such termination notice shall be null and void and the Escrow Agent shall continue to be bound by all of the provisions hereof.  Upon receipt of the Escrow Funds, if any, or the Remaining Escrow Funds the successor escrow agent shall become the escrow agent hereunder and shall be bound by all of the provisions hereof and Escrow Agent shall be relieved of all further obligations and released from all liability thereafter arising with respect to the Escrow Funds, if any, or the Remaining Escrow Funds and under this Agreement. 6. Investment.  All Funds received by the Escrow Agent shall be invested only in an interest bearing bank accounts. 7. Expenses and Fees.  The Escrow Agent’s fee shall be $5,000 which shall be paid upon receipt of the Funds.  The Company shall be obligated to reimburse Escrow Agent for all costs and expenses incurred in connection with this Agreement, including reasonable attorneys’ fees.  No modification, cancellation, termination or rescission of this Agreement or the resignation or termination of the Escrow Agent shall affect the right of Escrow Agent to retain the amount of any fee which has been paid prior to the effective date of any such modification, cancellation, termination, resignation or rescission.  To the extent the Escrow Agent has incurred any such expenses prior to any closing, the Escrow Agent shall advise the Company and the Company shall direct all such amounts to be paid directly at any such closing. 8. Notices.  All notices, requests, demands and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given if sent by hand-delivery, by facsimile (followed by first-class mail), by nationally recognized overnight courier service or by prepaid registered or certified mail, return receipt requested, to the addresses set forth below: 3 EGPI Firecreek, Inc. 6564 Smoke Tree Lane Scottsdale, AZ 85253 Attention:  Chairman of the Board and Chief Financial Officer Facsimile No.:  (480) 443-1403 If to Escrow Agent: Gersten Savage LLP 600 Lexington Avenue Attention:  Peter J. Gennuso, Esq. Facsimile No.:  (212) 813-9768 If to Dutchess: Dutchess Private Equities Fund, II, LP 50 Commonwealth Ave, Suite 2 Boston, MA 02116 Attention:  Douglas Leighton Facsimile No.:  (617) 249-0947 9. General. (a) with the laws of the State of New York applicable to agreements made and to be entirely performed within such State, without regard to choice of law principles. (b) This Agreement sets forth the entire agreement and understanding of the parties with respect to the matters contained herein and supersedes all prior agreements, arrangements and understandings relating thereto. (c) All of the terms and conditions of this Agreement shall be binding upon, and inure to the benefit of and be enforceable by, the parties hereto, as well as their respective successors and assigns. (d) This Agreement may be amended, modified, superseded or canceled, and any of the terms or conditions hereof may be waived, only by a written instrument executed by each party hereto or, in the case of a waiver, by the party waiving compliance.  The failure of any party at any time or times to require performances of any provision hereof shall in no manner affect its right at a later time to enforce the same.  No waiver of any party of any condition, or of the breach of any term contained in this Agreement, whether by conduct or otherwise, in any one or more instances shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of the breach of any other term of this Agreement.  No party may assign any rights, duties or obligations hereunder unless all other parties have given their prior written consent. (e) If any provision included in this Agreement proves to be invalid or unenforceable, it shall not affect the validity of the remaining provisions. (f) This Agreement may be executed in several counterparts or by separate instruments and all of such counterparts and instruments shall constitute one agreement, binding on all of the parties hereto. 10. Form of Signature.  The parties hereto agree to accept a facsimile transmission copy of their respective actual signatures as evidence of their actual signatures to this Agreement; provided, however, that each party who produces a facsimile signature agrees, by the express terms hereof, to place, promptly after transmission of his or her signature by fax, a true and correct original copy of his or her signature in overnight mail to the address of the other party.   EGPI FIRECREEK, INC.   By: /s/ Dennis Alexander   Dennis Alexander   Chairman and Chief Financial Officer       DUTCHESS PRIVATE EQUITIES FUND, LTD.   By: /s/ Douglas H. Leighton   Douglas H. Leighton   Director     GERSTEN SAVAGE LLP   By: /s/ Arthur Marcus   Arthur Marcus   Partner   Schedule I The Escrow Agent is authorized to accept instructions signed or believed by the Escrow Agent to be signed by any one of the following on behalf of EGPI FIRECREEK, INC. and DUTCHESS PRIVATE EQUITIES FUND, LTD. Name True Signature Dennis Alexander, CFO and Chairman of EGPI Firecreek, Inc. _____________________________________ Douglas H. Leighton, Managing Member of Dutchess Private Equities Fund, Ltd.   EXHIBIT A ESCROW ACCOUNT WIRE INSTRUCTIONS EXHIBIT B ESCROW AGENT WIRE INSTRUCTIONS EXHIBIT C EGPI FIRECREEK, INC. WIRE INSTRUCTIONS Wiring Instructions: EXHIBIT D FORM OF RELEASE NOTICE Pursuant to that certain Escrow Deposit Agreement by and between EGPI Firecreek, Inc. (the “Company”), Dutchess Private Equities Fund, Ltd. (“Dutchess”) and Gersten Savage LLP (“Escrow Agent”), dated June 11, 2007, the Company and Dutchess are providing herewith a Release Notice to the Escrow Agent to make the following transfer of the Remaining Escrow Funds (as defined in the Escrow Deposit Agreement) from the Escrow Account (as defined in the Escrow Deposit Agreement): Amount of Transfer:         $__________________ Recipient of Funds:         __________________________________ The undersigned has executed this Release Notice as of the __ day of 200_.       Dennis Alexander             Douglas H. Leighton   Director EXHIBIT E

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM N-CSRS Investment Company Act file number:811-06103 Investors Cash Trust (Exact Name of Registrant as Specified in Charter) 345 Park Avenue New York, NY 10154-0004 (Address of Principal Executive Offices) (Zip Code) Registrant’s Telephone Number, including Area Code: (212) 250-3220 Paul Schubert 60 Wall Street New York, NY 10005 (Name and Address of Agent for Service) Date of fiscal year end: 3/31 Date of reporting period: 9/30/2012 ITEM 1. REPORT TO STOCKHOLDERS Central Cash Management Fund Semiannual Report to Shareholders September 30, 2012 Contents 4 Portfolio Summary 5 Investment Portfolio 10 Statement of Assets and Liabilities 11 Statement of Operations 12 Statement of Changes in Net Assets 13 Financial Highlights 14 Notes to Financial Statements 18 Information About Your Fund's Expenses 20 Investment Management Agreement Approval 24 Summary of Management Fee Evaluation by Independent Fee Consultant 28 Account Management Resources 30 Privacy Statement This report must be preceded or accompanied by an offering circular. To obtain the fund's private offering memorandum, refer to the Account Management Resources information provided in the back of this booklet. We advise you to consider the fund's objectives, risks, charges and expenses carefully before investing. The offering circular contains this and other important information about the fund. Please read the fund's private offering memorandum carefully before you invest. An investment in this fund is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or by any other government agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the fund. The share price of money market funds can fall below the $1.00 share price. You should not rely on or expect the Advisor to enter into support agreements or take other actions to maintain the fund's $1.00 share price. The credit quality of the fund's holdings can change rapidly in certain markets, and the default of a single holding could have an adverse impact on the fund's share price. The fund's share price can also be negatively affected during periods of high redemption pressures and/or illiquid markets. The actions of a few large investors of the fund may have a significant adverse effect on the share price of the fund. See the prospectus for specific details regarding the fund's risk profile. DWS Investments is part of Deutsche Bank's Asset Management division and, within the U.S., represents the retail asset management activities of Deutsche Bank AG, Deutsche Bank Trust Company Americas, Deutsche Investment Management Americas Inc. and DWS Trust Company. NOT FDIC/NCUA INSURED NO BANK GUARANTEE MAY LOSE VALUE NOT A DEPOSIT NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY Portfolio Summary (Unaudited) Investment Portfolio as of September 30, 2012 (Unaudited) Principal Amount ($) Value ($) Commercial Paper 5.9% Issued at Discount** Straight-A Funding LLC: 144A, 0.18%, 10/4/2012 144A, 0.18%, 10/10/2012 144A, 0.18%, 11/7/2012 Total Commercial Paper (Cost $64,994,175) Government & Agency Obligations 56.3% U.S. Government Sponsored Agencies 51.7% Federal Farm Credit Bank, 0.15%, 2/15/2013 Federal Home Loan Bank: 0.07%**, 10/1/2012 0.12%**, 10/1/2012 0.114%**, 10/17/2012 0.136%**, 10/9/2012 0.15%, 10/23/2012 0.17%, 1/23/2013 0.17%, 2/11/2013 0.17%*, 11/8/2013 0.17%*, 11/15/2013 0.18%, 11/21/2012 0.19%, 2/27/2013 0.19%*, 7/25/2013 0.19%*, 7/26/2013 0.195%*, 11/4/2013 0.2%, 11/19/2012 0.21%, 1/8/2013 0.25%, 3/28/2013 0.32%*, 5/17/2013 0.33%*, 4/5/2013 0.33%*, 4/12/2013 0.36%, 5/16/2013 0.5%, 8/28/2013 Federal Home Loan Mortgage Corp.: 0.054%**, 10/2/2012 0.09%**, 10/4/2012 0.119%**, 1/8/2013 0.122%**, 10/15/2012 0.124%**, 10/16/2012 0.127%**, 11/14/2012 0.133%**, 10/16/2012 0.15%**, 6/12/2013 0.167%*, 9/13/2013 0.169%**, 5/29/2013 1.375%, 1/9/2013 3.5%, 5/29/2013 Federal National Mortgage Association: 0.094%**, 10/15/2012 0.129%**, 2/19/2013 0.139%**, 12/17/2012 0.139%**, 1/2/2013 0.149%**, 2/6/2013 0.159%**, 3/4/2013 0.169%**, 3/20/2013 0.19%**, 10/1/2012 0.75%, 2/26/2013 4.375%, 3/15/2013 U.S. Treasury Obligations 4.6% U.S. Treasury Notes: 1.375%, 10/15/2012 1.375%, 1/15/2013 1.375%, 3/15/2013 3.375%, 11/30/2012 Total Government & Agency Obligations (Cost $619,742,329) Repurchase Agreements 36.7% BNP Paribas, 0.25%, dated 9/28/2012, to be repurchased at $40,000,833 on 10/1/2012 (a) Citigroup Global Markets, Inc., 0.21%, dated 9/27/2012, to be repurchased at $50,002,042 on 10/4/2012 (b) Citigroup Global Markets, Inc., 0.22%, dated 9/28/2012, to be repurchased at $35,000,642 on 10/1/2012 (c) JPMorgan Securities, Inc., 0.25%, dated 9/28/2012, to be repurchased at $30,000,625 on 10/1/2012 (d) Merrill Lynch & Co., Inc., 0.15%, dated 9/28/2012, to be repurchased at $33,767,709 on 10/1/2012 (e) Merrill Lynch & Co., Inc., 0.17%, dated 9/28/2012, to be repurchased at $56,000,793 on 10/1/2012 (f) Merrill Lynch & Co., Inc., 0.2%, dated 9/28/2012, to be repurchased at $64,001,067 on 10/1/2012 (g) The Goldman Sachs & Co., 0.19%, dated 9/28/2012, to be repurchased at $70,001,108 on 10/1/2012 (h) The Toronto-Dominion Bank, 0.19%, dated 9/25/2012, to be repurchased at $25,000,924 on 10/2/2012 (i) Total Repurchase Agreements (Cost $403,767,287) % of Net Assets Value ($) Total Investment Portfolio (Cost $1,088,503,791)† Other Assets and Liabilities, Net Net Assets † The cost for federal income tax purposes was $1,088,503,791. * Floating rate securities' yields vary with a designated market index or market rate, such as the coupon-equivalent of the U.S. Treasury Bill rate. These securities are shown at their current rate as of September 30, 2012. ** Annualized yield at time of purchase; not a coupon rate. (a) Collateralized by $36,525,430 Government National Mortgage Association, 5.0%, maturing on 6/20/2041 with a value of $40,800,001. (b) Collateralized by $45,542,978 Government National Mortgage Association, 5.5%, with various maturity dates of 7/20/2038-4/15/2040 with a value of $51,000,000. (c) Collateralized by: Principal Amount ($) Security Rate (%) Maturity Date Collateral Value ($) U.S. Treasury Inflation Indexed Note 7/15/2022 U.S. Treasury Note 5/15/2015 Total Collateral Value (d) Collateralized by: Principal Amount ($) Security Rate (%) Maturity Date Collateral Value ($) Federal Home Loan Mortgage Corp. — Principal Only Zero Coupon 10/15/2033- 8/15/2036 Federal National Mortgage Association — Interest Only 2.0-5.5 6/25/2013- 10/25/2040 Total Collateral Value (e) Collateralized by $34,380,100 U.S. Treasury Note, 1.0%, maturing on 6/30/2019 with a value of $34,464,182. (f) Collateralized by: Principal Amount ($) Security Rate (%) Maturity Date Collateral Value ($) U.S. Treasury Inflation Indexed Note 7/15/2013 U.S. Treasury Note 6/30/2019 Total Collateral Value (g) Collateralized by: Principal Amount ($) Security Rate (%) Maturity Date Collateral Value ($) Federal Home Loan Mortgage Corp. — Interest Only 3.0-6.0 2/15/2023- 1/15/2042 Federal National Mortgage Association — Interest Only 2.5-6.5 7/25/2022- 8/25/2041 Total Collateral Value (h) Collateralized by $64,526,877 Federal Home Loan Mortgage Corp., 4.0%, with various maturity dates of 12/1/2040-11/1/2041 with a value of $71,400,001. (i) Collateralized by: Principal Amount ($) Security Rate (%) Maturity Date Collateral Value ($) Federal National Mortgage Association 11/20/2014 U.S. Treasury Bond 5/15/2041 U.S. Treasury Notes 0.375-2.875 1/31/2013- 6/30/2019 U.S. Treasury STRIPS Zero Coupon 11/15/2040 Total Collateral Value 144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. Interest Only: Interest Only (IO) bonds represent the "interest only" portion of payments on a pool of underlying mortgages or mortgage-backed securities. IO securities are subject to prepayment risk of the pool of underlying mortgages. Principal Only: Principal Only (PO) bonds represent the "principal only" portion of payments on a pool of underlying mortgages or mortgage-backed securities. STRIPS: Separate Trading of Registered Interest and Principal Securities Fair Value Measurements Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. Securities held by the Fund are reflected as Level 2 because the securities are valued at amortized cost (which approximates fair value) and, accordingly, the inputs used to determine value are not quoted prices in an active market. The following is a summary of the inputs used as of September 30, 2012 in valuing the Fund's investments. For information on the Fund's policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to Financial Statements. Assets Level 1 Level 2 Level 3 Total Investments in Securities (j) $

Name: Commission Regulation (EEC) No 2252/80 of 28 August 1980 amending Regulation (EEC) No 2600/79 on storage contracts for table wine, grape must and concentrated grape must Type: Regulation Date Published: nan No L 227/ 10 Official Journal of the European Communities 29. 8 . 80 COMMISSION REGULATION (EEC) No 2252/80 of 28 August 1980 amending Regulation (EEC) No 2600/79 on storage contracts for table wine, grape must and concentrated grape must 1 . Article 1 0 (3) is replaced by the following : *3 . The intervention agency may, on the basis of the information referred to in paragraphs 1 and 2, decide to terminate the contract prematurely in respect of the quantity of product in respect of which the change in quality has occurred. The intervention agency may, for this purpose, order a verification of the said information to be carried out'. 2. Article 1 1 is replaced by the following : 'Article 11 The level of storage aid for products, applicable throughout the Community, shall be payable at the following standard rates per hectolitre per day : THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Economic Community, Having regard to Council Regulation (EEC) No 337/79 of 5 February 1979 on the common organiza ­ tion of the market in wine ( 1 ), as last amended by Regulation (EEC) No 1 990/80 (2), and in particular Articles 7 (7), 8 (3), 9 (5), 12, (4) and 65 thereof, Whereas Commission Regulation (EEC) No 2600/79 (3) laid down detailed rules governing storage contracts for table wine, grape must and concentrated grape must ; Whereas the option available under Article 10 (3) of that Regulation to the intervention agency to termi ­ nate a storage contract prematurely, following an appreciable deterioration in the quality of the product, is liable to be costly where such deterioration concerns only some of the quantity under contract ; whereas it is necessary therefore to specify that the said option relates solely to the quantity of product which has suffered a deterioration in quality ; Whereas the amounts of aid fixed in Article 1 1 of Regulation (EEC) No 2600/79 no longer cover the technical costs of storage and interest charges ; whereas it therefore appears appropriate to adjust them in line with the rise in costs ; Whereas it is appropriate , in order to take better account of technical reality, to extend to grape must the option of cancelling long-term storage contracts currently provided for only in the case of concentrated must necessary for enriching wine harvests ; Whereas the measures provided for in this Regulation are in accordance with the opinion of the Manage ­ ment Committee for Wine , (a) for table wines of types R I, R II, R III and A I and for table wines which stand in close economic relation to those types of table wine : 0.0103 ECU ; (b) for table wines of types A II and A III and for table wines which stand in close economic rela ­ tion to those types of table wines : 0-0151 ECU ; (c) for musts with a density of less than 1 -24 at 20 °C : ” which were obtained from vine varieties other than Sylvaner, Mà ¼ller-Thurgau or Riesling : 0.0123 ECU, ” which were obtained from the Sylvaner, Mà ¼ller-Thurgau or Riesling vine varieties : 0.0181 ECU ; (d) for concentrated grape musts with a density of not less than 1 -24 at 20 ° C : ” obtained by concentration of the musts referred to in the first indent of (c) : 0.0410 ECU ; ” obtained by concentration of the musts referred to in the second indent of (c) : 0 0453 ECU.' HAS ADOPTED THIS REGULATION : Article 1 Regulation (EEC) No 2600/79 is hereby amended as follows : ( 1 ) OJ No L 54, 5 . 3 . 1979, p. 1 . (2 ) OJ No L 195, 29 . 7 . 1980 , p. 6 . P) OJ No L 297, 24 . 11 . 1979, p . 15 . 29 . 8 . 80 Official Journal of the European Communities No L 227/ 11 3 . Article 1 2 is replaced by the following : 'Article 12 At the beginning of every wine-growing year, the option of cancelling long-term storage contracts in respect of grape must and concentrated grape must may be made available .' Article 2 This Regulation shall enter into force on the day of its publication in the Official Journal of the European Communities. However, Article 1 (2) shall apply only with effect from 16 December 1980 . This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 28 August 1980 . For the Commission Finn GUNDELACH Vice-President

REAFFIRMATION OF VALIDITY GUARANTY   REAFFIRMATION OF VALIDITY GUARANTY, dated as of June 24, 2011, made by David J. Fremed (the “Guarantor”) in favor of Panta Distribution, LLC (“Panta”), in respect of the Validity Guaranty, as defined below.   RECITALS   WHEREAS, Zoo Publishing, Inc., a New Jersey corporation (the “Company”) is party to that certain Factoring and Security Agreement, dated as of September 9, 2011 (as amended, supplemented or otherwise modified, the “Factoring Agreement”), by and between the Company and Working Capital Solutions, Inc.   WHEREAS, pursuant to the Factoring Agreement, the Guarantor made that certain Validity Guaranty, dated as of September 9, 2011 (the “Validity Guaranty”), in favor of Working Capital Solutions, Inc.   WHEREAS, pursuant to that certain Limited Recourse Assignment, dated the date hereof, by Working Capital Solutions, Inc. to Panta (the “Limited Recourse Assignment”), Working Capital Solutions, Inc. assigned the Factoring Agreement and Validity Guaranty to Panta.   WHEREAS, immediately after the assignment of the Factoring Agreement and Validity Guaranty pursuant to the Limited Recourse Assignment, the Company and Panta amended and restated the Factoring Agreement as set forth in that certain Amended and Restated Factoring, Security and Purchase Order Financing Agreement, dated as of the date hereof, by and between the Company and Panta (the “Amended and Restated Factoring Agreement”).   WHEREAS, the Guarantor wishes to reaffirm that the provisions of the Validity Guaranty shall remain in full force and effect upon the effectiveness of the Amended and Restated Factoring Agreement and as otherwise provided herein;   WHEREAS, the Guarantor wishes to reaffirm the Validity Guaranty in favor of Panta.   NOW, THEREFORE, the Guarantor agrees as follows:   1.           The Guarantor hereby acknowledges receipt of the Amended and Restated Factoring Agreement and consents to the terms and execution thereof;   2.           The Guarantor hereby reaffirms all obligations to Panta pursuant to the terms of the Validity Guaranty and acknowledges that the guarantee contained in the Validity Guaranty is continuing and in full force and effect in favor of Panta.   3.           The Guarantor acknowledges that Panta may amend, restate, extend, renew or otherwise modify the Amended and Restated Factoring Agreement and any indebtedness or agreement of the Company, or enter into any agreement or extend additional or other credit accommodations, without notifying or obtaining the consent of the Guarantor and without impairing the liability of the Guarantor under the Validity Guaranty.   GUARANTOR:   /s/ David J. Fremed David J. Fremed, as an individual Guarantor      

INSURED COPY 033-75-87 - 02 INVESTMENT COMPANY BOND GREAT AMERICAN INSURANCE COMPANY (A Stock Insurance Company, Herein Called the Underwriter) DECLARATIONS Bond No. 033-75-87 - 02 Item 1. Name of Insured (herein called Insured): Stone Ridge Trust Principal Address: 405 Lexington Avenue, 55th Floor New York, NY 10174 Item 2. Bond Period from 12:01 a.m.02/01/2014 to 12:01 a.m. 02/01/2015 the effective date of the termination or cancellation of this bond, standard time at the Principal Address as to each of said dates. Item 3.

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENTREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (date of earliest event reported): August 3, 2007 DENNY’S CORPORATION (Exact name of registrant as specified in its charter) Delaware 0-18051 13-3487402 (State or other jurisdiction of Commission File No. (I.R.S. Employer Incorporation or organization Identification No.) 203 East Main Street Spartanburg, South Carolina 29319-0001 (Address of principal executive offices) (Zip Code) (864) 597-8000 (Registrant’s telephone number, including area code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions: [

Exhibit 10.5 REAFFIRMATION, RATIFICATION AND AMENDMENT AGREEMENT June 23, 2006 Laurus Master Fund, Ltd. c/o Laurus Capital Management, LLC 825 Third Avenue Ladies and Gentlemen:   Reference is made to the (a) Security Agreement, dated as of October 8, 2004 among HESPERIA HOLDING, INC., a Nevada corporation (the “Company”), HESPERIA TRUSS, INC., a California corporation (“Hesperia Truss”), and PAHRUMP VALLEY TRUSS, INC., a Nevada corporation (“PVTI”) (the Company, Hesperia Truss and PVTI are collectively referred to herein as the “Companies”) and Laurus Master Fund, Ltd., a Cayman Islands company (“Laurus”) (as amended, modified or supplemented from time to time, the “Existing Security Agreement”), and (b) Stock Pledge Agreement dated as of October 8, 2004 made by the Company, and Laurus (as amended, modified or supplemented from time to time, the “Existing Stock Pledge Agreement”) (the Existing Security Agreement and the Existing Stock Pledge Agreement, collectively, the “Existing Security Documents”). Capitalized terms used but not defined herein shall have the meanings given them in the Existing Security Agreement.   WHEREAS, the Companies no longer require the use of the revolving credit aspect of the credit facility contemplated by the Existing Security Agreement and have requested that Laurus convert all outstanding Loans, which total $805,537 on the date hereof, into the term loan on the terms set forth in the New Laurus Term Note (below) and Laurus desires to make such accommodation to the Companies; and   WHEREAS, the Companies have authorized the issuance to Laurus of an amended and restated secured term note in the aggregate principal amount of (eight hundred five thousand five hundred thirty-seven) Dollars ($805,537) in the form of Exhibit A hereto (as amended, modified and/or supplemented from time to time, the “New Laurus Term Note”) which New Laurus Term Note shall amend and restate in their entirety and be given in substitution of and not in satisfaction of each of the Revolving Note and the Minimum Borrowing Note (as each term is defined in the Existing Security Agreement); and WHEREAS the parties hereto, being all of the parties signatory to the Existing Security Agreement, desire to terminate certain provisions of the Existing Security Agreement;     :           NOW THEREFORE, in consideration of the foregoing premises and for other good and 1.            New Laurus Term Note. On the date hereof, (a) the Companies shall, on a joint and several basis, issue to Laurus the New Laurus Term Note (the form terms and provisions of which is attached and incorporated herein as Exhibit A) in substitution and not in satisfaction of each of the Revolving Note and the Minimum Borrowing Note, (b) Laurus shall return to the Company each of Revolving Note and the Minimum Borrowing Note, marked “cancelled”. 2.            To induce Laurus to provide additional financial accommodations to each of the Company, Hesperia Truss and PVTI contemplated by the New Laurus Term Note, each of the Company, Hesperia Truss and PVTI hereby jointly and severally:   (a) represents and warrants to Laurus that it has reviewed and approved the terms and provisions of each of the New Laurus Term Note and the documents, instruments and agreements entered into in connection therewith;   (b) acknowledge ratifies and confirms in all respects that the Loans outstanding on the date hereof total $805,537;   (c) acknowledges, ratifies and confirms in all respects that all indebtedness incurred by, and all other obligations and liabilities of, each of the Company, Hesperia Truss and PVTI to Laurus under the New Laurus Term Note constitute (i) “Obligations” under, and as defined in the Existing Security Agreement, and (ii) “Indebtedness” under, and as defined in, the Existing Stock Pledge Agreement;   (d) acknowledges, ratifies and confirms that the New Laurus Term Note shall be deemed to be included in the definition of “Documents” under, and as defined in, each of the Existing Security Agreement and the Existing Stock Pledge Agreement;   (e) acknowledges, ratifies and confirms that all of the terms, conditions, representations and covenants contained in the Existing Security Documents, unless as otherwise stated in Schedule 2.1 attached hereto, are in full force and effect and shall remain in full force and effect after giving effect to the execution and effectiveness of the New Laurus Term Note;   (f) represents and warrants that no offsets, counterclaims or defenses exist as of the date hereof with respect to any of the undersigned’s obligations under any Existing Security Documents; and   (g) acknowledges, ratifies and confirms the grant by each of the Company, Hesperia Truss and PVTI to Laurus of a security interest in the assets of (including the equity interests owned by) each of the Company, Hesperia Truss and PVTI, respectively, as more specifically set forth in the Existing Security Documents.     2.           Termination of Certain Provisions of the Existing Security Agreement. The parties hereto, being all of the parties signatory to the Existing Security Agreement, hereby agree that effective as of the date hereof, (a) Sections 2, 4, 5, 8, 17 of the Existing Security Agreement are hereby deleted and without further force or effect; (b) the following definitions in Annex A to the Existing Security Agreement Shall be deleted in their entirety; “Accounts Availability”, “Available Minimum Borrowing”, “Capital Availability Amount”, “Eligible Accounts”, “Fixed Conversion Price”, “Minimum Borrowing Amount”, “Minimum Borrowing Notes”, “Receivables Purchase”, “Revolving Loans”, “Revolving Note” and (c) Exhibit A to the Existing Security Agreement entitled “Borrowing Base Certificate” is hereby deleted in its entirety. 3.           The definition of “Notes” in Annex A is hereby deleted in its entirety and the following inserted in its stead: “Notes” means the Amended and Restated Secured Term Note dated June __, 2006, made by the Company and each Eligible Subsidiary in favor of Laurus as the same may be amended, modified and supplemented from time to time.” 4.            This letter agreement shall be governed by and construed in accordance with the laws of the State of New York.   [the remainder of this page is intentionally left blank]     Very truly yours, HESPERIA HOLDING INC.   By: /s/ William Nalls                                       Name: William Nalls Address: 9780 E Avenue Hesperia, CA 92345     HESPERIA TRUSS, INC.   Name: William Nalls Hesperia, CA 92345   PAHRUMP VALLEY TRUSS INC.   Name: William Nalls Address: c/o 9780 E Avenue Hesperia, CA 92345   Acknowledged and Agreed to by: By: _/s/ David Grim_____________ Name: David Grim Title: Director

Exhibit PARTICIPATION AGREEMENT This Participation Agreement (this “Agreement”) is entered into effective as of the 30th day of September, 2008 (the “Effective Date”) by and between UNITED MORTGAGE TRUST, a real estate trust organized under the laws of the State of Maryland with an address of1702 N. Collins Blvd., Suite 100, Richardson, TX 75080, as lender, agent and assignor (“UMT”), and

Name: Commission Regulation (EEC) No 1224/83 of 6 May 1983 amending for the second time Regulation (EEC) No 997/81 laying down detailed rules for the description and presentation of wines and grape musts Type: Regulation Date Published: nan 21 . 5 . 83 Official Journal of the European Communities No L 134/ 1 I (Acts whose publication is obligatory) COMMISSION REGULATION (EEC) No 1224/83 of 6 May 1983 amending for the second time Regulation (EEC) No 997/81 laying down detailed rules for the description and presentation of wines and grape musts Regulation (EEC) No 338/79 of 5 February 1979 laying down special provisions relating to quality wines produced in specified regions (6), as last amended by Regulation (EEC) No 2145/82 (7); whereas the detailed rules should be adjusted accordingly : Whereas the sale of Greek quality wines psr the description of which includes the predicate 'oÎ ¹ÃŽ ½ÃŽ ¿Ã ‚ Ï †Ã Ï ƒÃŽ ¹ÃŽ ºÃ ŒÃ ‚ Î ³ÃŽ »Ã Î ºÃ Ã ‚' has encountered special difficulties in recent years ; whereas it would seem appropriate to extend the transitional period for three years ; THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Economic Community, Having regard to Council Regulation (EEC) No 337/79 of 5 February 1979 on the common organi ­ zation of the market in wine (*), as last amended by Regulation (EEC) No 3082/82 (2), and in particular Articles 54 (5) and 65 thereof, Whereas Commission Regulation (EEC) No 997/81 (3), as amended by Regulation (EEC) No 2628/81 ( 4), lays down detailed rules for the description of wines and grape musts ; whereas experience of the application of this Regulation has shown that a number of amendments should be made thereto ; Whereas , to provide the consumer with better infor ­ mation on the origin of wines made from a mixture of grapes or by the coupage of products originating in several Member States, the height of the lettering to be used for the words 'blend of wines from various countries of the European Communities' should be specified ; whereas the same should apply to similar terms laid down for table wines which have been manufactured in a Member State other than that where the grapes were harvested ; whereas appropriate provisions on the maximum height of the lettering should also be adopted to ensure that no confusion can arise between certain table wines entitled to a geographical ascription and quality wines psr ; Whereas, to prevent the consumer from being misled by the claims of superior quality made for certain wines imported into the Community and subject to less stringent labelling requirements, without thereby discriminating between such wines and those of Community origin in the matter of their description, the special climatic conditions in which the imported wines were produced should be taken into consideration and, consequently, the terms 'spà ¤tgelesen' and 'ausgelesen' should not be permitted to figure on the labelling of such imported wines, even if the terms in question are the translation of terms used in accordance with the provisions of the non-member country of origin ; Whereas , in the interest of consumers , it should be specified that the actual or total alcoholic strength stated on the labelling is that determined by analysis ; whereas, for the sake of simplicity, however, it should be possible for the figure expressing this alcoholic strength to be rounded off within certain limits ; whereas the rules governing the indication of density in the description of grape musts and concentrated grape musts should be adjusted in the light of the methods recently introduced into the Community rules ; Whereas , to ensure control and protection of table wines qualifying for description as 'Landwein', 'vin de pays', 'vino tipico', 'ovoÎ ¼ÃŽ ±Ã ƒÃŽ ¹ÃŽ ± Î ºÃŽ ±Ã „ÃŽ ¬ 7tap&8oar|' or Whereas Regulation (EEC) No 3578/ 81 ( 5) added the terms 'appellation d'origine vin d6limit6 de quality supà ©rieure' and 'Eiswein' to those listed in Council 0) OJ No L 54, 5 . 3 . 1979, p. 1 . O OJ No L 326, 23. 11 . 1982, p. 1 . O OJ No L 106, 16 . 4 . 1981 , p. 1 . (4) OJ No L 258 , 11 . 9 . 1981 , p. 10 . C) OJ No L 359, 15 . 12 . 1981 , p. 6 . ( ¢) OJ No L 54, 5 . 3 . 1979, p. 48 . O OJ No L 227, 3 . 8 . 1982 , p. 10 . No L 134/2 Official Journal of the European Communities 21 . 5 . 83 confusion with the mandatory information, it should be stipulated that only some of the optional parti ­ culars may appear on the same part of the label as the mandatory information and that other optional parti ­ culars should appear on a separate part of the label or on an additional label ; whereas it is in the interest of the consumer that such particulars should relate only to verifiable facts ; Whereas transitional provisions should be adopted to make it possible to sell products described and presented in accordance with Community rules the validity of which has expired ; Whereas the lists in Annexes II, III and IV should be supplemented or amended in several places in accordance with the requests of certain non-member countries and within the framework of the general rules laid down by Regulation (EEC) No 355/79 ; Whereas this opportunity should be taken to correct the wording of certain provisions of Regulation (EEC) No 997/81 ; Whereas the measures provided for in this Regulation are in accordance with the opinion of the Management Committee for Wine, oivos T0JUK05 and to provide accurate information for the authorities in the Member States responsible for ensuring the observance of Community or national provisions in the wine sector, producer Member States should forward to the Commission all relevant information on the designation of such wines ; whereas the Commission should publish lists of such table wines ; whereas, in the case of quality wines psr, the forwarding of information to the Commission and the publication of lists are governed by Article 3 (2) of Commission Regulation (EEC) No 2247/ 73 (*); whereas, to prevent the lists of quality wines psr published by the Commission being lengthened unnecessarily by the names of geographical units which are smaller than the Member State and are rarely or never used, the rules in force should be amended so that the names of such geographical units need no longer be communicated to the Commission ; Whereas Austria and Yugoslavia have requested permission to export to the Community wines bearing the name of a vine variety under the derogations which may be allowed for the description of imported wines pursuant to Article 32 (2) of Council Regu ­ lation (EEC) No 355/79 of 5 February 1979 laying down general rules for the description and pres ­ entation of wines and grape musts (2), as last amended by Regulation (EEC) No 3685/81 (}); Whereas, in the interest of the consumer, the use of the term Vivace' should be permitted to describe certain Italian wines which, although containing carbon dioxide, do not meet the definition of 'sparkline wine' or 'semi-sparkling wine'; Whereas, given the importance of the terms 'dry 'medium dry', 'medium sweet' and 'sweet' in providing the consumer with information on the nature of wine, provision should be made so that these terms can also be used in the Danish language ; whereas provision should also be made so that certain Italian quality wines psr described as 'dry' may be marketed even where the residual sugar content of such wines exceeds thfe maximum fixed in accordance with this Regulation ; HAS ADOPTED THIS REGULATION : Article 1 Regulation (EEC) No 997/ 81 is hereby amended as follows : 1 . The second subparagraph of Article 1 (2) is replaced by the following : 'However, the optional information referred to in Article 2 (3) (i) of the said Regulation, namely, the terms "Landwein", "vin de pays", "vino tipico", "ovo|xaaia Kaxd nap&8oar|" and "oivog Tomicd^", shall be grouped together with the mandatory information referred to in the first subparagraph of paragraph 1 .' 2.The following Article la is added : tide la The terms referred to in Article 2 ( 1 ) (d) (ii) and (iii) of Regulation (EEC) No 355/79 shall be indicated on the labels in lettering at least half as high as that used to indicate "table wine" and in no case less than three millimetres high. 2 . When, pursuant to Article 54 (2) or (3) of Regulation (EEC) No 337/79 , the label of a table wine contains a geographical ascription but not Whereas experience has shown that the marketing of wines should be facilitated by granting a wider freedom of choice as regards the mentioning of certain optional particulars ; whereas, to avoid any (') OJ No L 230, 18 . 8 . 1973, p. 12 . O OJ No L 54, 5 . 3 . 1979, p. 99. O OJ No L 369, 24. 12 . 1981 , p . 1 . 21 . 5 . 83 Official Journal of the European Communities No L 134/3 the words "Landwein", "vin de pays", "vino tipico", "ovoÎ ¼ÃŽ ±Ã ƒÃŽ ¹ÃŽ ± Î ºÃŽ ±Ã „ÃŽ ¬ ÏÎ ±Ã ÃŽ ¬ÃŽ ´ÃŽ ¿Ã ƒÃŽ ·" or "oÎ ¹ÃŽ ½ÃŽ ¿Ã ‚ Ï „ÃŽ ¿ÃÃŽ ¹ÃŽ ºÃ ŒÃ ‚", the geographical ascription shall be indicated in lettering of the same type and size . The lettering may not be higher than that used to indicate "table wine".' 3 . Article 2 is amended as follows : (a) the second indent of the first subparagraph of paragraph 1 is replaced by the following : ' ” "appellation d'origine contrà ´là ©e", "appellation contrà ´là ©e" and "appellation d'origine vin dà ©limità © de qualità © supà ©rieure",' (f) The fourth subparagraph of paragraph 3 is deleted . (g) The second subparagraph of paragraph 4 is replaced by the following : 'On the labels of imported wines no expression concerning superior quality as referred to in the first subparagraph may be translated into German by any of the following terms : "Qualitatswein mit Pradikat", "Kabinett", "Spatlese", "Auslese", "Beerenauslese", "Trockenbeerenauslese", "Eiswein", "spà ¤tgelesen" or "ausgelesen".' 4 . Article 4 is amended as follows : (a) The following is added to the third subpara ­ graph of paragraph 1 : 'The provisions of this subparagraph shall apply without prejudice to paragraph 3 .' (b) Paragraph 2 is replaced by the following : '2 . Without prejudice to paragraph 3, the name or business name of a person or group of persons as referred to in paragraph 1 may include the proper name of the firm of such persons or an expression describing the wine ­ growing or wine-making activities of that firm.' (c) Paragraph 3 is replaced by the following : '3 . The name or business name of a person or group of persons as referred to in paragraph 1 , as it appears on the label, may not include the following terms : (b) the second subparagraph of paragraph 1 is replaced by the following : 'The traditionally used specific terms "appellation d'origine contrà ´là ©e", "appellation contrà ´là ©e", "appellation d'origine vin dà ©limità © de qualite supà ©rieure", "denominazione di origine controllata", "denominazione di origine controllata e garantita", "ovo µÃŽ ±Ã ƒÃŽ ¹ÃŽ ± ÏpoÎ µÃŽ »ÃŽ µÃ Ã ƒÃŽ µÃ ‰Ã ‚ Î µÃŽ »ÃŽ µYXo µÃŽ ­vÎ ·" and "ovoÎ ¼ÃŽ ±Ã ƒÃŽ ¹ÃŽ ± ÏÏ ÃŽ ¿ÃŽ µÃŽ »ÃŽ µÃ Ã ƒÃŽ µÃ ‰Ã ‚ Î ±ÃŽ ½Ã ‰Ã „ÃŽ ­Ã ÃŽ ±Ã ‚ 7toi6rr|Tog" shall appear on the label directly below the name of the specified region. However, when the label of a French quality wine psr bearing the term "appellation contrà ´là ©e" or that of a Greek quality wine psr shows the name of a vineyard, a vine variety or a brand name, the name of the specified region shall be repeated between "appellation" and "contrà ´là ©e" or after "ovoÎ ¼ÃŽ ±Ã ƒÃŽ ¹ÃŽ ± 7tpOEX £()aea)5", in lettering of the same type, size and colouring.' (c) Paragraph 2 is replaced by the following : '2 . The terms "Kabinett", "Spatlese", "Auslese", "Beerenauslese", "Trockenbeeren ­ auslese" and "Eiswein" shall appear in lettering of the same type and height as the name of the specified region or, where appro ­ priate, of the geographical unit smaller than the specified region.' (d) In the first subparagraph, under (a), of paragraph 3 , 'Eiswein' is deleted . (e) The third subparagraph of paragraph 3 is replaced by the following : ” "Weingut", "Weingutsbesitzer", ” "viticulteur", "proprià ©taire rà ©coltant", ” "viticoltore", "fattoria", "tenuta", "podere", "cascina", "azienda agricola", "contadino", ” estate , ” "Î ±ÃŽ ¼ÃÃŽ µÃŽ »ÃŽ ¿Ã Ï ÃŽ ³Ã ŒÃ ‚-Î ¿ÃŽ ¹ÃŽ ½ÃŽ ¿ÃÃŽ ¿ÃŽ ¹Ã ŒÃ ‚", or other similar terms referring to an agri ­ cultural holding, unless the product concerned was made exclusively from grapes harvested in vineyards belonging to the holding or person described by one of these terms and that the wine-making was carried out at such holding. The terms referred to in the first subpara ­ graph may be used in the plural in the business name of a group of vineyard holdings or of a group of persons as aforesaid . For the purposes of the first subparagraph, no account shall be taken of the addition of concentrated grape must designed to increase 'Furthermore, until 31 August 1984 at the latest, the term "Î ¿ÃŽ ¯ÃŽ ½ÃŽ ¿Ã ‚ Ï †Ã Ï ƒÃŽ ¹ÃŽ ºÃ ŒÃ ‚ Î ³ÃŽ »Ã Î ºÃ Ã ‚" may be used for Greek quality wines psr entitled to the description "Î £ÃŽ ¬ÃŽ ¼ÃŽ ¿Ã ‚", "Î œÃŽ ¿Ã ƒÃ ‡ÃŽ ¬Ã „ÃŽ ¿Ã ‚ Î Î ±Ã „Ï Ã ŽÃŽ ½", "Î œÃŽ ¿Ã ƒÃ ‡ÃŽ ¬Ã „ÃŽ ¿Ã ‚ Î ¡ÃŽ ¯ÃŽ ¿Ã Î Î ±Ã „Ï Ã ŽÃŽ ½", "Î œÃŽ ¿Ã ƒÃ ‡ÃŽ ¬Ã „ÃŽ ¿Ã ‚ Î šÃŽ µÃ †ÃŽ ±ÃŽ »ÃŽ »ÃŽ ·ÃŽ ½ÃŽ ¯ÃŽ ±Ã ‚", "Î œÃŽ ¿Ã ƒÃ ‡ÃŽ ¬Ã „ÃŽ ¿Ã ‚ Î ¡Ã ŒÃŽ ´ÃŽ ¿Ã ", "Î œÃŽ ¿Ã ƒÃ ‡ÃŽ ¬Ã „ÃŽ ¿Ã ‚ Î ›ÃŽ ®ÃŽ ¼ÃŽ ½ÃŽ ¿Ã ", "Î £ÃŽ ·Ã „ÃŽ µÃŽ ¯ÃŽ ±", "Î £ÃŽ ±ÃŽ ½Ã „ÃŽ ¿Ã ÃŽ ¯ÃŽ ½ÃŽ ·" and "Î ”ÃŽ ±Ã †ÃŽ ½ÃŽ ­Ã ‚'7 No L 134/4 Official Journal of the European Communities 21 . 5 . 83 the natural alcoholic strength of the product concerned.' 5 . Article 8 is replaced by the following : !Article 8 1 . The information regarding actual alcoholic strength referred to in Articles 2 (2) (f), 12 (2) (g), 22 ( 1 ) (b), 27 (2) (d), 28 (2) (f) and 29 ( 1 ) (b) of Regulation (EEC) No 355/79 shall be given as a unit or half-unit percentage of volume. The actual alcoholic strength indicated may not be higher than the strength determined by analysis . It may be lower than that strength by 0,7 % vol at the most. The figure expressing the actual alcoholic strength shall be followed by the symbol "% vol" and may be preceded by the terms "alcoholic strength" or "actual alcohol". 4 . The density of the grape musts, concentrated or otherwise, as referred to in Articles 22 ( 1 ) (b) and 29 ( 1 ) (b) of Regulation (EEC) No 355/79 shall be shown : (a) in the case of grape musts, by use of the word "density", followed by the corresponding figure ; producer Member States may, however, during a transitional period ending on 31 August 1986, provide in respect of grape must put into circulation in their territory that the density be expressed in Oechsle degrees ; (b) in the case of concentrated grape musts and rectified concentrated grape musts, by use of the terms "refractive index" followed by the corresponding figure . 5 . The density shown on the label may not exceed the density as determined by analysis of the product concerned.' 6 . Article 10 ( 1 ) is replaced by the following : * 1 . Each producer Member State shall forward to the Commission in respect of the table wines described as "Landwein", "vin de pays", "vino tipico", "ovojiaoia Kaxd itapdSoar)" or "oivog T07tuc6$" in accordance with Article 2 (3) (i) of Regulation (EEC) No 355/79 : ” as soon as possible after it is drawn up, a list of the names of the geographical units smaller than the Member State referred to in Article 4 ( 1 ) of Regulation (EEC) No 355/79 which may be used and the provisions governing the use of the said designations and names, ” any amendments subsequently made to the list and provisions referred to in the preceding indent. The Commission shall publish in the Official Journal ofthe European Communities the names of the geographical units communicated to it under the first subparagraph.' 7 . Article 12 is amended as follows : (a) Paragraph 1 (c) is replaced by the following : '(c) the United States of America on or after 1 January 1983 to be described by reference to the name of the relevant State, supplemented if appropriate by the name of the country or viticultural area as referred to below, even if : ” only 75 % of the wine concerned is obtained from grapes harvested in a State as listed in point VIII of Annex II, or in a single county whose name 2. The information regarding total alcoholic strength as referred to in the provisions mentioned in paragraph 1 shall be given : ” either by inserting after the indication of actual alcoholic strength shown in accordance with paragraph 1 the figure representing the potential alcoholic strength preceded by the symbol " + " and followed by the symbol "% vol", ” or by the use of the words "total alcoholic strength" followed in order by the figure representing the actual alcoholic strength indicated in accordance with paragraph 1 , the symbol " + ", the figure representing the potential alcoholic strength and the symbol "% vol". The potential alcoholic strength shall be indicated as a unit or tenth-unit percentage of volume. The potential alcoholic strength indicated may not be higher than the strength determined by analysis . It may be lower than that strength by 0,2 % vol at the most. 3 . Member States may allow the terms mentioned in the third subparagraph of paragraph 1 and at the second indent of paragraph 2 in their official language(s) to be given in an abbreviated form or replaced by terms the use of which is traditional and customary in their territory. 21 . 5 . 83 Official Journal of the European Communities No L 134/5 (b) Paragraph 6 is replaced by the following : '6 . Pursuant to Articles 2 (2) (h), 12 (2) (k), 27 (2) (i) and 28 (2) (k) of Regulation (EEC) No 355/79 the following terms may be used as appropriate : ” "demi-sec", "halbtrocken", "abboccato", "medium dry", "halvtà ¸r", "Î ·ÃŽ ¼ÃŽ ¯ÃŽ ¾ÃŽ ·Ã ÃŽ ¿Ã ‚", ” "moelleux", "lieblich", "amabile", "medium", "medium sweet", "halvsà ¸d", "Î ·ÃŽ ¼ÃŽ ¯ÃŽ ³ÃŽ »Ã Î ºÃŽ ¿Ã ‚", ” "doux", "sà ¼ss3", "dolce", "sweet", "sod", "Î ³ÃŽ »Ã Î ºÃ Ã ‚". The terms "sec", "trocken", "secco", "asciutto", "dry", "tor" and " £np6<;" may only be used if the wine concerned has a residual sugar content of : ” four grams per litre maximum, or ” nine grams per litre maximum where the level of the total acidity in grams per litre expressed as tartaric acid does not fall more than two grams per litre below the residual sugar content, or ” 10 grams per litre maximum in the case of quality wines psr entitled to the appellation "Frascati", for a transitional period ending on 31 August 1985 .' it bears, provided the wine is obtained entirely from grapes harvested in the territory of the United States of America, or ” only 85 % of the wine concerned is obtained from grapes harvested in the "viticultural area" as laid down by United States regulations, provided the wine is obtained entirely from grapes harvested in the State or States on whose territory that viticultural area is situated.' (b) Paragraph 2 (b) is replaced by the following : '(b) ” South Africa, ” Australia, ” Austria, ” Israel, ” New Zealand, ” Yugoslavia, ” Hungary, if described by the term "minà ¶segi bor" and not described by another term denoting superior quality as listed in point 4 of Annex I, to bear the name of a vine variety listed in Annex IV, even if only 85 % of the wine concerned is obtained from grapes of the named variety provided this variety determines the character of the wine concerned;' (c) Paragraph 3 (a) is replaced by the following : '(a) ” South Africa, ” Australia, ” Austria, ” Israel , ” Hungary, if described by the term "minà ¶segi bor" and not described by another term denoting superior quality as listed in point 4 of Annex I , to bear an indication of the harvest year, even if only 85 % of the wine concerned is obtained from grapes harvested in the year indicated ;' 8 . Article 13 is amended as follows : (a) The following is added to paragraphs 1 (c) (i) and 3 (c): ' ” vivace'. 9 . Article 16 is replaced by the following : 'Article 16 1 . No information regarding : ” the history of the wine concerned, of the bottler's firm or of a firm belonging to a natural or legal person or group of persons involved in the distribution, ” the natural or technical wine-growing conditions in which the wine originated, ” the ageing of the wine, as referred to in Articles 2 (3) (h), 12 (2) (t), 27 (2) (f) and 28 (2) (p) of Regulation (EEC) No 355/79, may appear on the same part of the label as that on which the mandatory information appears . Such information shall be given either : ” on a part of the label that is clearly separated from the part bearing the mandatory infor ­ mation, or ” on one or more additional labels or on a pendant label . The information referred to in the first subpara ­ graph must be verifiable. No L 134/6 Official Journal of the European Communities 21 . 5 . 83 ” "velho" in the case of imported wine originating in Portugal bearing one of the geographical ascriptions set out in point XIII of Annex II, provided that the Portuguese provisions regarding the use of that term are observed, ” "staro vino" in the case of imported wines originating in Yugoslavia and bearing one of the geographical ascriptions set out in point XVIII of Annex II, provided that the Yugoslav provisions regarding the use of that term are observed . The terms referred to in (b) and (c) of the first subparagraph may not be translated . The terms referred to in (b) of the first subparagraph may, however, be translated into German by "Hugelwein" in the case of quality wines psr originating in the province of Bolzano.' 10 . The following subparagraph is added to Article 22(1 ): 'Wines and grape musts , described and presented in accordance with provisions of Regulation (EEC) No 355/79 and of this Regulation in force when they are put into circulation and applicable up to a fixed time limit, may, after the time limit expires , be held for sale and put into circulation and exported until stocks are exhausted.' 11 . The Annexes are amended in accordance with the Annex to this Regulation. 2 . Notwithstanding paragraph 1 , the following information may appear on the same part of the label as that on which the mandatory information appears : (a) short statements such as "established in . . or "wine growers, from father to son, since . . regarding the history of the wine concerned, of the bottler's firm or of a firm belonging to a natural or legal person or group of persons involved in the distribution ; (b) the terms "vino di colle" and "vino di collina", when these are used to describe an Italian table wine or quality wine psr in accordance with the Italian provisions governing their use ; (c) the following information regarding the wine's ageing : ” "vin vieux" in the case of French quality wines psr, provided that the French provisions regarding the use of that term are observed, ” "vecchio" or "invecchiato" in the case of Italian quality wines psr, provided that the Italian provisions regarding the use of these terms are observed, ” "ic&6a" or "cave" in the case of Greek table wines , provided that the Greek provisions regarding the use of those terms are observed, ” "vin vieux" in the case of imported wines originating in Morocco and bearing one of the geographical ascriptions set out in point XII of Annex II, provided that the Moroccan provisions regarding the use of that term are observed, ” in the case of imported wines originating in the United States of America, an indication in the English language of the number of years of ageing in casks or in bottles, Article 2 This Regulation shall enter into force on the third day following its publication in the Official Journal of the European Communities. Article 1 (3) (e) and ( 10) shall apply with effect from 1 September 1981 . This Regulation shall be binding in its entirety and directly applicable in all Member States . Done at Brussels, 6 May 1983 . For the Commission Poul DALSAGER Member ofthe Commission 21 . 5 . 83 Official Journal of the European Communities No L 134/7 ANNEX 1 . Annex I is hereby amended as follows : (a) Point 6 PORTUGAL is replaced by the following : / '6. PORTUGAL ” regià £o demarcada ” denominaà §Ãƒ £o de origem ” vinho de qualidade ” superior ” extra ” reserva ” garrafeira'; (b) The third indent under point 7 ROMANIA is replaced by the following : ' ” vinuri di calitate superiora cu denomire de origine si trepte de calitate (vsoc) ” cules la maturitate deplinÄ ƒ (cmd) ” cules tà ®rzui (ct) ” cules la maturitate de à ®nnobilare (cmi) ” cules selectionat (cs) ” cules la à ®nnobilarea boabelor (cib)'; (c) Point 9 TUNISIA is replaced by the following : '9 . TUNISIA ” appellation d'origine contrà ´là ©e ” vin dfelimit6 de qualità © supà ©rieure (vdqs) ” vin supà ©rieur ” qualità © exceptionnelle ” cà ©page tardif (for wine made from the Carignan vine varieties) ” grand era ” grand vin ” premier cru ” cuv6e rà ©servà ©e'; (d) Point 10 YUGOSLAVIA is replaced by the following : ' 10 . YUGOSLAVIA ” "kvalitetno vino sa geografskim poreklom" or "kakovostno vino z geografskim poreklom" or "kvalitetno vino so geografsko poteklo" ” "vrhunsko" or "Ä uveno vino sa goegrafskim poreklom" or "vrhunsko vino z geografskim poreklom" or "vrvno vino so geogravsko poteklo" ” "kontrolisano poreklo" or "kontrolirano poreklo" or "kontrolirano poteklo" ” "sluà ¾beno kontrolisano poreklo" or "sluà ¾beno kontrolirano poreklo" or "sluà ¾beno kontrolirano poteklo" ” "sopstvena berba" or "lastna trgatev" or "sopstvena berba" ” "berba u punoj zrelosti (probirna berba)" or "trgatev v polni zrelosti (izbor)" or "berba vo polna zrelost" ” "kasna berba" or "pozna trgatev" or "docna berba" ” "probirna berba bobica" or "jagodni izbor" or "probirna berba na zrna" ” "berba suvih bobica" or "suhi jagodni izbor" or "berba na suvi zrna" ” "originalnost zakonom zaSti6ena" (e) The following point 16 is added : ' 16 . TURKEY ” vin de qualit6\ No L 134/8 Official Journal of the European Communities 21 . 5 . 83 2 . In Annex II, Chapter I SOUTH AFRICA is replaced by the following : 'I. SOUTH AFRICA Wines bearing one of the following names of the wine-growing region or sub-region of origin : 1 . Wine-growing region Kusstreek (Coastal Region): sub-regions : ” Durbanville ” Constantia 2 . Wine-growing region Stellenbosch : sub-region : ” Simonsberg-Stellenbosch 3 . Wine-growing region Paarl : sub-region : ” Franschhoek 4. Wine-growing region Swartland : sub-regions : ” Riebeeckberg ” Groenkloof 5 . Wine-growing region Tulbagh 6 . Wine-growing region Breà «riviervallei (Brede River Valley) 7 . Wine-growing region Worcester : sub-regions : ” Aan-de-Doorns ” Slanghoek ” Nuy ” Goudini ” Scherpenheuvel 8 . Wine-growing region Robertson : sub-regions : ” Eilandia ” Bonnievale ” Hoopsrivier ” Boesmansrivier ” Le Chasseur ” Agterkliphoogte ” McGregor ” Vinkrivier ” Goree ” Riverside 9. Wine-growing region Swellendam 10 . Wine-growing region Olifantsrivier (Olifants River): sub-region : ” Spruitdrift 1 1 . Wine-growing region Klein Karoo 12. Wine-growing region Benede Oranje 13 . Wine-growing region Piketberg (Piquetberg) 14 . Wine-growing region Overberg : sub-region : ” Walker Bay 15 . Wine-growing region Douglas 16 . Wine-growing region Cederberg'. 21 . 5 . 83 Official Journal of the European Communities No L 134/9 3 . In Annex II , the following is added to Chapter VIII UNITED STATES OF AMERICA under B : (a) in point 1.1 : ' ” Santa Maria Valley ” San Pasqual Valley ” Guenoc Valley ” McDowell Valley ” Chalone ” Cienega Valley ” Paicines ” Salano County Green Valley ” Suisun Valley' and the footnote '( l)' after 'Shenandoah Valley'; (b) after point 4 : '4.1 . Viticultural areas : ” Isle of St George ” Laramie Creek'; (c) after point 6 : '7 . Michigan 7.1 . Viticultural area : Fennville 7.2 . Viticultural area : Leelanau Peninsula 8 . Pennsylvania 8.1 . Lancaster Valley 9. Virginia 9.1 . Viticultural areas : ” Rocky Knob ” Shenandoah Valley 10 . West Virginia ” Shenandoah Valley'. 4 . In Annex II , Chapter X HUNGARY is amended as follows : (a) The names of the following geographical units shall be deleted : ” from point 3 : ' ” Liptà ³d ” Helesfa ” Kà ©thely ” from point 4 : ' ” Demjà ©n ” Bà ¼kkalja ” Kerecsend ” Maklà ¡r ” Tà ¼rje ” Ozora ” Zalaszentgrà ³t' ” Novaj ” Gyà ¶ngyà ¶spata ” Gyà ¶ngyà ¶starjà ¡n ” Szà ¼csi'; (b) The names of the following geographical units are added to : ” Csillaghegy ” Naphegy ” Kerek-hegy ” Templom-domb ” Csongrà ¡d ” Galambos' ” Tà ¶rà ¶kkà ºt ” Vadaskert ” Pusztatorony' ” point 1 : ' ” Mà ¡riavà ¡ros ” Kà ‘kà ºt ” Feketehalom ” à –regszà ‘là ‘ ” Szarvaskà ºt ” Frankdà ±là ‘ ” point 2 : ' ” Apà ¡thegy ” Sà ¡torhegy' ” point 3 : ' ” Csillagv6lgy ” Ordà ¶gvà ¶lgy ” Kakasdomb ” point 4 : ” à šrerdà ‘ ». No L 134/ 10 Official Journal of the European Communities 21 . 5 . 83 5 . In point 2.3 of Chapter XIV ROMANIA of Annex II, 'Mà gera Odobestilor' is replaced by 'MÄ ƒgura Odobestilor'. 6 . In Annex II, Chapter XVI TUNISIA is replaced by the following : 'XVI. TUNISIA 1 . Wines entitled to the descriptions "appellation d'origine contrà ´là ©e", "vin dà ©limità © de qualità © supà ©rieure" and/or "vin supà ©rieur", bearing one of the following names denoting the wine-growing region or sub-region of origin : 1.1 . Wine-growing region Mornag : sub-regions : ” Le Noble de Mornag ” Domaine de Charmettes ” Mornag Village ” C6teaux de Carthage ” Haut Mornag ” Coteaux de Mornag ” Sidi Saad ” Domaine d'Ouzra ” Chateau de Mornag 1.2 . Wine-growing region Sidi Salem : sub-regions : ” Domaine Nepheris ” Coteaux de Khanguet ” Khanguet Village ” Chateau Khanguet 1.3 . Wine-growing region Kelibia 1.4 . Wine-growing region Beja : sub-regions : ” Coteaux de Thibar ” Domaine de Thibar ” Clos de Thibar 1.5 . Wine-growing region Bizerte : sub-regions : ” Chateau Fà ©riani ” Domaine Karim ” Coteaux d'Utique ” C6teaux de Mateur ” Coteaux de Bizerte 1.6 . Wine-growing region Jendouba : sub-region : Coteaux de Tabarka 1.7 . Wine-growing region Nabeul : sub-regions : ” Cap Bon ” Sidi Rais ” Coteaux de Hammamet 1.8 . Wine-growing region T6bourba : sub-regions : ” Coteaux de T6bourba ” Coteaux de Schuiggui ” Domaine de Lansarine ” Tà ©bourba Village 2 . Wines entitled to the description "vin delimit6 de qualità © supà ©rieure", originating in and bearing the name of the Mornag wine-growing region'. 21 . 5 . 83 Official Journal of the European Communities No L 134/ 11 7. In Annex II, Chapter XVII TURKEY is replaced by the following : 'XVII. TURKEY 1 . Wines bearing one of the following geographical ascriptions referring to geo ­ graphical units in Thrace and in Marmara : ” Gà ¼zel Marmara ” Barbaros ” Trakya (Tà ¼rkiye) ” HosbaÄ Ÿ ” Gà ¼zbaÄ Ÿ ” Aslihan Doruk ” Dimitrakopulo ” Doluca ” Villa Doluca ” Hethiter ” Buzluca ” Kircasalih ” Yenimà ¶y ” Kirklareli ” Avsa Island 2 . Wines bearing one of the following geographical ascriptions referring to geo ­ graphical units on the Aegean Sea : ” Ismir ” Efes Gà ¼nesi 3 . Wines bearing one of the following geographical ascriptions referring to geo ­ graphical units in Central Anatolia : ” Cubuk ” NarbaÄ Ÿ ” KalebaÄ Ÿ ” à œrgà ¼p ” Sungurlu ” Tokat ” Hitit ” Kà ¶pà ¼ren Sarap ” Yakut ” Lai ” Cankaya ” Kazova Valley ” Kalecik ” Kirikkale ” Kirikkale -Sungurlu ” Nevsehir ” Coke ” Avcilar 4 . Wines bearing one of the following ascriptions referring to geographical units in south and south-east Anatolia : ” Gà ¼zelbÄ ƒg ” BuzbaÄ Ÿ ” ElaziÄ Ÿ'. 8 . In Annex II, Chapter XVIII YUGOSLAVIA is replaced by the following : 'XVIII . YUGOSLAVIA 1 . Wines originating in the Socialist Republic of Bosnia and Herzegovina and bearing one of the following names of the wine-growing region or sub-region of origin : 1.1 . Wine-growing region Herzà ©govine : sub-regions : ” Srednja Neretva i Trebià ¡njica ” Rama 1.2 . Wine-growing region Severna Bosna 2 . Wines originating in the Socialist Republic of Montenegro and bearing the following name of the wine-growing region of origin : Wine-growing region Crna Gora 3 . Wines originating in the Socialist Republic of Croatia and bearing one of the following names of the wine-growing region or sub-region of origin : 3.1 . Wine-growing region Kontinentalna hrvatska : sub-regions : ” Zagorsko-Medjimurski ” Prigorje ” Pleà ¡ivica ” Pokuplje ” Moslavina ” Bilogorsko-Podravski ” Srednje Slavonski ” Posavina ” Podunavlje No L 134/ 12 Official Journal of the European Communities 21 . 5 . 83 3.2 . Wine-growing region Primorska hrvatska : sub-regions : ” Istra ” Hrvatsko primorje i Kvarnerski otoci ” Sjeverna Dalmacija ” Dalmatinska Zagora ” Srednja i juà ¾na dalmacija (obalno otoÄ ni deo) 4 . Wines originating in the Socialist Republic of Macedonia and bearing one of the following names of the wine-growing region or sub-region of origin : 4.1 . Wine-growing region PÄ inja-Osogovo : sub-regions : ” Kumanovo ” Kratovo ” KoÄ anski ” PijaneÄ ko 4.2 . Wine-growing region Povardarje : sub-regions : ” Skopje ” Titov Veles ” OvÄ e Pole ” Strumica-Radovià ¡te ” Gevgelija Valandovo ” Tikves with or without the word "Krater" 4.3 . Wine-growing region Pelagonija-Polog : sub-regions : ” Prilep ” Bitola ” Prespa ” Ohrid ” KiÄ evo ” Tetovo 5 . Wines originating in the Socialist Republic of Slovenia and bearing one of the following names of the wine-growing region or sub-region of origin : 5.1 . Wine-growing region Podravski : sub-regions : ” Mariborski okolià ¡ ” Radgonsko-Kapelske gorice ” Ljutomersko-Ormoà ¡ke gorice ” Haloze z obrobnim pogorjem ” Srednje Slovenske gorice ” Prekmurske gorice 5.2 . Wine-growing region Posavski : sub-regions : ” à marsko-Virà ¡tanjski ” Bizeljsko-Sremà ¡ki ” Dolenjski ” Belokranjski 5.3 . Wine-growing region Primorski : sub-regions : ” Brià ¡ki ” Vipavski ” Kraà ¡ki ” Koprski 21 . 5 . 83 Official Journal of the European Communities No L 134/ 13 6. Wines originating in the Socialist Republic of Serbia and bearing one of the following names of the wine-growing region or sub-region of origin : 6.1 . Wine-growing region Timok : sub-regions : ” Krajina ” Knjaà ¾evac 6.2 . Wine-growing region Nià ¡ava Juà ¾na Morava : sub-regions : ” Aleksinac ” Toplica ” Nià ¡ ” Nià ¡ava ” Leskovac ” Vranje 6.3 . Wine-growing region Zapadna Morava : sub-regions : ” Ä ŒaÄ ak ” Kruà ¡evac 6.4 . Wine-growing region Sumadija Velika Morava : sub-regions : ” Mlava ” Jagodina ” Beograd ” Oplenac \ 6.5 . Wine-growing region Pocerina-Podgora 7 . Wines originating in the autonomous socialist region of Woiwodina and bearing one of the following names of the wine-growing region or sub-region of origin : 7.1 . Wine-growing region Srem : sub-region : ” Fruà ¡ka Gora 7.2 . Wine-growing region Banat : sub-regions : ” Vrà ¡ac ” Bela Crkva-Deliblato ” Peà ¡Ã„ ara 7.3. Wine-growing region Subotià ¡ka peScara : sub-regions : ” Ä Œoka-Potisje ” PaliÄ ‡-Horgoà ¡ 8 . Wines described as "Kosovsko vino" originating in the autonomous socialist region of Kosovo and bearing one of the following names of the wine-growing region or sub-region of origin : 8.1 . Wine-growing region Kosovo : sub-regions : ” Istok ” Pe6 ” Djakovica ” Malià ¡evo ” Orahovac ” Prizren ” Suva Reka'. No L 134/ 14 Official Journal of the European Communities 21 . 5 . 83 9. In Annex II, Chapter XX CZECHOSLOVAKIA is replaced by the following : 'XX. CZECHOSLOVAKIA Wines bearing one of the following names of the wine-growing region of origin : ” Pezinok , ” Nitra ” Bratislava-Raca'. 10 . In Annex IV, Chapter I SOUTH AFRICA is replaced by the following : 'List of varieties accepted in the Community Accepted synonyms I. SOUTH AFRICA Bukettraube Cabernet franc Cabernet sauvignon Chenel Chenin blanc Steen Cinsaut Clairette blanche Colombar Colombard Chardonnay Gamay Gewurztraminer Grenache Red Grenache, Rooi Grenache Kerner Merlot Muscadel Muskadel Muscat d'Alexandrie Hanepoot Palomino Pinotage Pinot noir Sauvignon blanc S6millon Greengrape Shiraz Sylvaner \ Tinta Barocca Ugni blanc Trebbiano Weià Ÿer Riesling Rhine Riesling, Riesling' Weldra Zinfandel 11 . In Annex IV, Chapter III AUSTRALIA, 'Gewurztraminer' is deleted from the right-hand column. 12 . In Annex IV, Chapter X ROMANIA is amended as follows : (a) 'Grauer Mà ¶nch', as a synonym of 'Rulanda, Rulà ¤nder', and 'Mavrud', as a synonym of 'Negru virtos', shall be added in the right-hand column ; (b) 'Negro virtos' in the left-hand column shall be deleted ; (c) In the left-hand column, 'Rossetraminer' shall be replaced by 'Rosetraminer'. 21 . 5 . 83 Official Journal of the European Communities No L 134/15 13 . In Annex IV, Chapter XIII YUGOSLAVIA is replaced by the following : 'List of varieties accepted in the Community Accepted synonyms XIII . YUGOSLAVIA Bagrina Banatski Rizling, Kreaca Bena Bogdanuà ¡a Burgundac beli, beli pino Burgundac sivi , Rulandec Buvijeova ranka, Ranina, à asla Buvije Dobrogostina Ezerjo Grenaà ¡ beli, Belan Grk Debit Kevedinka Krkoà ¡ija Kujundjuà ¡a Malvazija Muà ¡kat Ottonel Zlatni muskat Plemenka à ½lahtina Pinela Poà ¡ip Rebula Talijanski Rizling, Laski Rizling Rizling beli Rizvanac Rumeni Muà ¡kat Rumeni Plavec Semijon Sovinjon Smederevka à ipon Pimo à ¡ardone Traminac beli Crveni Traminac Diseci Traminac Zeleni Silvanec à ½ilavka Ranfol à ½upljanka Neoplanta Tamnjanika bela Rkaciteli Ugni blanc Medna Braghina Zackelweià Ÿ Pinot blanc, Pinot bianco, Weià Ÿer Bur ­ gunder, Beli Burgunder Pinot gris, Rulà ¤nder, Pinot grigio, Grau ­ burgunder Bouvie Chasselas Tausendgut Grenache blanc Crvena ruà ¾ica, Crvena dinka Istarska malvazija, Malvasia, Malvasija dubrovaCka Mirisavka, Muà ¡kat ottonel, Muscat ottonel Golden muscat Chasslas, Gutedel , à ½lahtnina, à asla bela, Ranka Grasevina, Welschriesling Rajnski Rizling, Renski Rizling, Riesling renano, Rheinriesling, Riesling Rizvaner, Mà ¼ller-Thurgau Muskat beli, Gelber Muscateller Semillon Sauvignon, Weià Ÿsauvignon Belina Moslavac, Furmint Pinot Chardonnay, Chardonnay Weisser Traminer, Traminec RdeÄ i Traminac, Roter Traminer Mirisavi Traminac, Gewà ¼rztraminer, Tra ­ miner aromatico Silvanac, Grà ¼ner Silvaner No L 134/ 16 Official Journal of the European Communities 21 . 5 . 83 List of varieties accepted in the Community Accepted synonyms XIII . YUGOSLAVIA (cont 'd) Zlatarica DobriÄ iÄ ‡ BabiÄ ‹ Trbljan, Ku6 Vugava Saperavi Alicant Bouche Barbera Blatina Burgundac crni Game Frankovka Kabernet frank Kabernet sovinjon Kadarka Skadarka Kratoà ¡ija Teran Refoà ¡k Lasina Merlo Muà ¡kat Hamburg Muà ¡kat Krokan NinÄ uà ¡a Okatac Plavac Prokupac Portugizac plavi Plavka Stanuà ¡ina ^ Sentlorenka Trnjak Vranac Veltlinac zeleni à ½ametna crnina Kavcina RdeÄ a kraljevina Zelen Ohridsko crno Plovdina Game bojadiser à ½upski bojadiser Krajinski bojadiser Jagodinka Kladovka bela Alicante ” bouche Modri pino, Blauer Burgunder, Blaubur ­ gunder, Pinot noir, Blauer Spatburgunder, Spatburgunder, Modri Burgundec Game crni, Gamay Modra frankinja, Blaufrà ¤nkisch Cabernet franc Cabernet Sauvignon Lelekuà ¡a Merlot Muscat Hamburg, Muskat Hamburg Glavinuà ¡a Plavac mali , Plavec mali Prokupec, Rskavac, KameniÄ arka Portugalka, Portugizac modri, Blauer Portugieser Plavina Sentlovrenka, Saint Laurent Vranec Vetlinec, Grà ¼ner Veltliner à ½ametovka, Blauer Kolner à ½ametna Ä rnina, KavÄ ina Kraljevina Gamay tantiner' 21 . 5 . 83 Official Journal of the European Communities No L 134/ 17 14 . In Annex IV, Chapter XVI CZECHOSLOVAKIA shall be replaced by the following : 'List of varieties accepted in the Community Accepted synonyms XVI. CZECHOSLOVAKIA Limbaà ¡skà ½ silvà ¡n Svatopeterskà ½ rizling Pezinskà © zà ¡meckà © Rizling vlaà ¡skà ½ Rulandskà © Nietranskà © knieà ¾a bile Nietranskà © knieà ¾a Ä ervenà © Frankovka Riesling rà ½nskà ½ Gewà ¼rztraminer' 15 . The following chapter shall be added to Annex IV : 'List of varieties accepted in the Community Accepted synonyms XVII. TURKEY Papaskarasi Okà ¼zgà ¶zà ¼-Bogazkere Kalecik karasi Horoz karasi Pinot Noire Gamay Cinsaut Grenache Alicante Bouschet Cabernet-Sauvignon Carignan Adakarasi Calkarasi Hasandede Sungurlu Narince Misket Emir Semillon Clarette Sylvaner Riesling Dà ¶kà ¼lgen Hasandede'

SECURITIES AND EXCHANGE COMMISSION Washington, D.C.20549 FORM 6-K Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 15May 2014 
LLOYDS BANKING GROUP plc 
(Translation of registrant's name into English) 5th Floor 25 Gresham Street London EC2V 7HN United Kingdom (Address of principal executive offices) Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. Form 20-FX Form 40-F Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes No X If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- Index to Exhibits  15 May 2014 ANNUAL GENERAL MEETING OF LLOYDS BANKING GROUP PLC Following the annual general meeting held today at the Edinburgh International Conference Centre in Scotland, Lloyds Banking Group plc announces that all the resolutions put to shareholders were passed by the requisite majorities. Resolution 21 being passed by a majority of at least 66% as over 50% of the total shares were represented at the annual general meeting. Resolutions 22 to 27 (inclusive) were passed as special resolutions. The results of the polls are as follows: Resolution Votes For % of Votes Cast Votes Against % of Votes Cast Total Votes Validly Cast Total Votes as a % of the Relevant Shares in Issue Votes Withheld 1 Receive the report and accounts 70.61% 2 Election of Mr J Colombás 70.64% 3 Election of Mr D D J John 70.64% 4 Re-election of Lord Blackwell 70.65% 5 Re-election of Mr M G Culmer 70.65% 6 Re-election of Ms C J Fairbairn 70.41% 7 Re-election of Ms A M Frew 70.65% 8 Re-election of Mr A Horta-Osório 70.65% 9 Re-election of Mr N L Luff 70.64% 10 Re-election of Mr D L Roberts This resolution was withdrawn. 11 Re-election of Mr A Watson 70.65% 12 Re-election of Ms S V Weller 70.65% 13 Re-appointment of the auditors 70.38% 14 Authority to set the remuneration of the auditors 70.65% 15 Authority to make political donations or to incur political expenditure 70.64% 16 Directors' authority to allot shares 69.95% 17 Directors' authority to allot Regulatory Capital Convertible Instruments 68.92% 18 Authority to introduce a Scrip Dividend Programme 70.65% 19 Approval of the Directors' Remuneration Policy 69.02% 20 Approval of Directors' Remuneration Implementation Report 70.31% 21 Approval of Directors' Remuneration Policy - variable component for Code Staff 70.60% 22 Amendments to the articles of association 70.63% 23 Limited disapplication of pre-emption rights (ordinary shares) 70.32% 24 Limited disapplication of pre-emption rights (Regulatory Capital Convertible Instruments) 69.28% 25 Authority to purchase own ordinary shares 70.65% 26 Authority to purchase own preference shares 70.60% 27 Notice period for general meetings 70.65% 28 Approval of the Related Party and Class 1 Transaction 45.41% On 13 May 2014 there were 71,373,735,357 relevant shares in issue. 271 shareholders or persons representing shareholders attended the meeting. Shareholders are entitled to one vote per share. Votes withheld are not votes and, therefore, have not been counted in the calculation of the proportion of votes for and against a resolution. In accordance with the UK Listing Authority's Listing Rules, copies of the resolutions will be submitted to the National Storage Mechanism and will shortly be available for inspection at www.morningstar.co.uk/uk/nsm Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. LLOYDS BANKING GROUP plc (Registrant) By: Charles King Name:Charles King Title:Investor Relations Director Date:15May2014

Exhibit 10.3   THE CHUBB CORPORATION LONG-TERM STOCK INCENTIVE PLAN (2004)   Performance Share Award Agreement   This PERFORMANCE SHARE AWARD AGREEMENT, dated as of                      , 2006, is by and between The Chubb Corporation (the “Corporation”) and [               ] (the “Participant”), pursuant to The Chubb Corporation Long-Term Stock Incentive Plan (2004) (the “Plan”). Capitalized terms that are not defined herein shall have the same meanings given to such terms in the Plan. If any provision of this Agreement conflicts with any provision of the Plan (as either may be interpreted from time to time by the Committee), the Plan shall control.   WHEREAS, pursuant to the provisions of the Plan, the Committee has authorized the grant to the Participant of Performance Shares in accordance with the terms and conditions of this Agreement; and   WHEREAS, the Participant and the Corporation desire to enter into this Agreement to evidence and confirm the grant of such Performance Shares on the terms and   NOW THEREFORE, the Participant and the Corporation agree as follows:   1.             Grant of Performance Shares.  Pursuant to the provisions of the Plan, the Corporation on the date set forth above (the “Grant Date”) has granted and hereby evidences the grant to the Participant, subject to the terms and conditions set forth herein and in the Plan, of an Award of [               ] Performance Shares (the “Award”).   2.             Payment of Earned Performance Shares.   (a)           Settlement of Performance Shares.  Subject to the provisions of this Section 2, Section 4 and Section 5, the Payment Value of each Performance Share covered by the Award which the Committee determines, in writing, to be earned pursuant to Section 3 shall be paid by the Corporation on a date (the “vesting date”) as soon as administratively practicable after (but no later than 2½ months after the calendar year end coincident with) the end of the Performance Cycle described in Section 3(a). Payments hereunder shall be made in cash, shares of Stock, or a combination thereof, as determined by the Committee in its sole discretion. Notwithstanding the aforementioned, the vesting date shall be the last day of the Performance Cycle if (i) the Participant experiences a Qualifying Termination of Employment on or after December 31, 2006 or (ii) the Committee determines, in its discretion, pursuant to Section 4(b), that the Participant will not forfeit his or her rights to Performance Shares upon his or her termination of employment for other reasons; in either case, provided the Committee determines, in writing, that Performance Shares are to be awarded hereunder.     (b)           Voluntary Deferral.  Notwithstanding the provisions of Section 2(a), the Participant may elect, by election filed with the Corporation under its Key Employee Deferred Compensation Plan (2005) (or any successor plan or program) (the “Deferred Compensation Plan”), and on a form acceptable to the Committee, not later than June 30, 2008 and subject to such terms and conditions as the Committee may specify, to have any payment that may become due in respect of Performance Shares covered by the Award deferred until such later time as shall be specified in such election (or, if applicable, the date determined pursuant to Section 2(c)).   (c)           Mandatory Deferral of Payment of Earned Performance Shares.  Notwithstanding anything contained in Section 2(a) or 2(b) to the contrary (unless the payment date elected pursuant to Section 2(b) is later than the payment date specified herein, in which case Section 2(b) shall control), if the Corporation’s Ending Average Value is less than the Corporation’s Beginning Average Value (as such terms are defined in Section 3(c)), no settlement shall be made in respect of any Performance Shares earned in accordance with Section 3 until the earlier of (i) the first date on or before March 10, 2010 on which the average of the averages of the highest and lowest sales prices of the Stock reported for consolidated trading of issues listed on the New York Stock Exchange for the 15 trading days prior to such date exceeds the Beginning Average Value and (ii) March 10, 2011. Once either of the conditions described in the immediately preceding sentence has been satisfied, settlement shall occur as soon as practicable thereafter (in the case of condition (i), not later than March 15, 2010, and in the case of condition (ii) not later than April 9, 2011) in cash, shares of Stock or a combination thereof, as determined by the Committee in its sole discretion. If the Participant experiences a Qualified Termination of Employment on or after December 31, 2006, or if the Committee determines, in its discretion pursuant to Section 4(b), that the Participant will not forfeit his or her rights to Performance Shares upon his or her termination of employment for other reasons, settlement shall not occur until March 10, 2011.   3.             Vesting Criteria Applicable to Performance Shares.   (a)           Performance Cycle.  The Performance Cycle for this Award shall commence on May 1, 2006, and shall end on December 31, 2008.   (b)           Performance Goal.  The Performance Goal for the Performance Cycle is the total return per share of Stock to the Corporation’s shareholders, inclusive of dividends paid (regardless of whether paid in cash or property, which dividends shall be deemed reinvested in Stock), during the Performance Cycle in comparison to the total return per share of stock, inclusive of dividends paid (regardless of whether paid in cash or property, which dividends shall be deemed reinvested in stock), achieved by the companies (i) which are in the Standard & Poors 500 Index (the “S&P 500”) on the date the Performance Cycle begins and (ii) which continue to file public reports pursuant to the Act for the entirety of the Performance Cycle (such companies, the “Comparison Companies”). For the avoidance of doubt, a company included in the S&P 500 on the date the Performance Cycle commences that is not   2   included in the S&P 500 at the conclusion of the Performance Cycle will be a Comparison Company as long as it files public reports pursuant to the Act for the entire Performance Cycle (and any company first included in the S&P 500 after the start of the Performance Cycle would not be a Comparison Company).   (c)           Comparison of Total Shareholder Return.  Except as provided in Section 5, the Performance Shares covered by the Award shall be deemed earned based on where the Corporation’s total shareholder return during the Performance Cycle ranks in relation to the total shareholder returns of the Comparison Companies during such period. For purposes of calculating the total shareholder return of the Corporation and the Comparison Companies during the Performance Cycle, the value of each such company’s stock at the beginning and end of the Performance Cycle shall be established based on the average of the averages of the high and low trading prices of the applicable stock on the principal exchange on which the stock trades for the 15 trading days occurring immediately prior to the beginning or end of the Performance Cycle, as the case may be. Such averages for each such company (including the Corporation) shall be referred to herein as the “Beginning Average Value” and the “Ending Average Value.” As soon as practicable after the completion of the Performance Cycle, the total shareholder returns of the Comparison Companies will be calculated and ranked from highest to lowest. The Corporation’s total shareholder return will then be ranked in terms of which percentile it would have placed in among the Comparison Companies. In calculating the total shareholder return with respect to either the Corporation or any of the Comparison Companies, the Committee shall make or shall cause to be made such appropriate adjustments to the calculation of total shareholder return for such entity (including, without limitation, adjusting the Beginning Average Value) as shall be necessary or appropriate to avoid an artificial increase or decrease in such return as a result of a stock split (including a reverse stock split), recapitalization or other similar event affecting the capital structure of such entity that does not involve the issuance of the entity’s securities in exchange for money, property or other consideration.   (d)           Percentage of Performance Shares Earned.  The extent to which Performance Shares shall become earned on the vesting date described in Section 2(a) shall be determined according to the following schedule:   Relative Performance Level Percentile   Percent of Performance Shares Earned   85th or higher   200 % 50th   100 % 25th   50 % Under 25th   0 %   To the extent that the Corporation’s total shareholder return ranks in a percentile between the 25th and the 50th percentile, or between the 50th and the 85th percentile, of comparative performance, then the number of Performance Shares earned on the vesting   3   date shall be determined by multiplying the relative percentile of comparative performance achieved by the Corporation by two (e.g., if the Corporation’s total shareholder return would have placed in the 40th percentile, then 80% of the Performance Shares covered by the Award become earned on the vesting date; if the Corporation’s total shareholder return would have placed in the 75th percentile, then 150% of the Performance Shares covered by the Award become earned on the vesting date).   4.             Termination of Employment.  Except as provided in this Section 4 or in Section 5, the Participant shall not have any right to any payment hereunder unless the Participant is employed by the Corporation or a Subsidiary on the date the Performance Shares subject to this Award are settled pursuant to Section 2(a) (or would have been settled without regard to any other provision of Section 2).   (a)           Qualifying Termination of Employment.  If the Participant’s employment terminates by reason of a Qualifying Termination of Employment on or after December 31, 2006, the Participant shall be entitled to receive the same Payment Values (without pro-ration) in respect of the Performance Shares covered by the Award as would have been payable, and at the same time and subject to the same conditions, had his or her employment continued until the end of the Performance Cycle.   (b)           Termination for any Other Reason.  Unless otherwise determined by the Committee, if the Participant’s employment is terminated prior to the date on which the Performance Shares subject to this Award are settled pursuant to of Section 2) for any reason other than a Qualifying Termination of Employment occurring on or after December 31, 2006, all of the Participant’s rights to Performance Shares covered by the Award shall be immediately forfeited and canceled without further action by the Corporation or the Participant as of the date of such termination of employment. Notwithstanding the preceding sentence, the Participant’s Performance Shares shall be immediately forfeited and cancelled without further action by the Corporation or the Participant upon the Participant’s termination of employment for Cause. For purposes of the Award, the term “Retirement” shall mean a termination of the Participant’s employment other than for Cause at or after the Participant’s normal retirement age or earliest retirement date, in each case as specified in the Corporation’s Pension Plan. Accordingly, all of the Participant’s Performance Shares shall be forfeited and cancelled without further action by the Corporation or the Participant as of the date a Participant is terminated for Cause, whether prior to, on, or after the Participant’s normal retirement age or earliest retirement date, in each case as specified in the Corporation’s Pension Plan.   (c)           Transfers between the Corporation and Subsidiaries; Leaves, Other Absences and Suspension.  Transfer from the Corporation to a Subsidiary, from a Subsidiary to the Corporation, or from one Subsidiary to another shall not be considered a termination of employment. Any question regarding whether a Participant’s employment has terminated in connection with a leave of absence or other absence from   4   active employment shall be determined by the Committee, in its sole discretion, taking into account the provisions of applicable law and the Corporation’s generally applicable employment policies and practices. The Committee may also suspend the operation of the termination of employment provisions of this Agreement for such period and upon such terms and conditions as it may deem necessary or appropriate to further the interests of the Corporation.   (d)           Termination Pursuant to a Change in Control.  Notwithstanding the provisions of Section 4(b), if the Participant’s employment is involuntarily terminated other than for Cause or if the Participant terminates employment due to death or Disability, in all such cases on or after the date the Corporation’s shareholders approve a Change in Control pursuant to subsections (iii) or (iv) of such definition but prior to the consummation of such Change in Control, the Participant shall be treated as having continued employment through, and terminated employment immediately after, such Change in Control.   5.             Change in Control.  Notwithstanding anything in Section 2 or 3 to the contrary, in the event a Change in Control occurs, Performance Shares covered by the Award not previously forfeited pursuant to Section 4 shall be treated in accordance with Section 9 of the Plan, in which case the Performance Shares covered by the Award shall become earned and payable as provided in Sections 9(a)(ii) and 9(a)(iii) of the Plan or, if applicable, be honored, assumed or substituted for in accordance with Section 9(b) of the Plan. Notwithstanding the foregoing, if the Performance Shares shall become earned and payable as provided in Sections 9(a)(ii) and 9(a)(iii) of the Plan, but the accelerated payment of the Performance Shares would subject the Participant to taxation under Section 409A of the Code, then the payment due to the Participant shall not be made until the earliest permissible payment date (including, but not limited to, the vesting date) that would not subject the Participant to taxation under Section 409A of the Code.   6.             Adjustment in Capitalization.  In the event that the Committee shall determine that any stock dividend, stock split, share combination, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination, exchange of shares, warrants or rights offering to purchase Stock at a price substantially below fair market value, or other similar corporate event affects the Stock such that an adjustment is required in order to preserve, or to prevent the enlargement of, the benefits or potential benefits intended to be made available under this Award, then the Committee shall, in its sole discretion, and in such manner as the Committee may deem equitable, adjust any or all of the number and kind of Performance Shares subject to this Award and/or, if deemed appropriate, make provision for a cash payment to the person holding this Award, provided, however, that, unless the Committee determines otherwise, the number of Performance Shares subject to this Award shall always be a whole number.   7.             Restrictions on Transfer.  Performance Shares may not be sold, assigned, hypothecated, pledged or otherwise transferred or encumbered in any manner except (i) by will or the laws of descent and distribution or (ii) to a “Permitted   5   Transferee”(as defined in Section 11(b) of the Plan) with the permission of, and subject to such conditions as may be imposed by, the Committee.   8.             No Rights as a Shareholder.  Until shares of Stock are issued, if at all, in satisfaction of the Corporation’s obligations under this Award, in the time and manner specified in Section 2 or 5, the Participant shall have no rights as a shareholder.   9.             Notice.  Any notice given hereunder to the Corporation shall be addressed to The Chubb Corporation, Attention Secretary, 15 Mountain View Road, P.O. Box 1615, Warren, New Jersey 07061-1615, and any notice given hereunder to the Participant shall be addressed to the Participant at the Participant’s address as shown on the records of the Corporation.   10.           Restrictive Covenants.  As a condition to the receipt of the Award made hereby, the Participant agrees to be bound by the terms and conditions hereof and of the Plan, including the following restrictive covenants:   (a)           Non-Disclosure. The Participant shall not, without prior written authorization from the Committee, disclose to anyone outside the Corporation, or use (other than in the Corporation’s or any of the Subsidiaries’ business), any confidential information or material relating to the business of the Corporation or any of the Subsidiaries that is acquired by the Participant either during or after employment with the Corporation or any of the Subsidiaries.   (b)           Non-Solicitation. Unless the Participant has received prior written authorization from the Committee, the Participant shall not during his or her employment or service with the Corporation or any of the Subsidiaries and for a period of one (1) year following any termination of such employment or service relationship (the “Restricted Period”):   (I)            DIRECTLY OR INDIRECTLY, EMPLOY, SOLICIT, PERSUADE, ENCOURAGE OR INDUCE ANY INDIVIDUAL EMPLOYED BY THE CORPORATION OR ANY OF THE SUBSIDIARIES TO BECOME EMPLOYED BY OR ASSOCIATED WITH ANY PERSON OR ENTITY OTHER THAN THE CORPORATION OR ANY OF THE SUBSIDIARIES; OR   (II)           DIRECTLY OR INDIRECTLY, SOLICIT BUSINESS ON BEHALF OF A COMPETITIVE BUSINESS FROM ANY CUSTOMER WITH WHOM THE PARTICIPANT HAS HAD, OR EMPLOYEES REPORTING TO THE PARTICIPANT HAVE HAD, PERSONAL CONTACT OR DEALINGS WITH ON BEHALF OF THE CORPORATION OR ANY OF THE SUBSIDIARIES DURING THE ONE (1) YEAR PERIOD PRECEDING THE RESTRICTED PERIOD.   (c)           Non-Competition. Unless the Participant has received prior written authorization from the Committee, the Participant shall not, whether during his or her employment or service with the Corporation or any of the Subsidiaries or during the Restricted Period, directly or indirectly compete with the business of the Corporation or any of the Subsidiaries by becoming an officer, agent, employee, consultant, partner or director of a Competitive Business, or otherwise render services to or assist or hold an   6   interest (except as a less than one (1) percent shareholder of a public company) in any Competitive Business.   “Customer” shall mean a person or entity to which the Corporation or any of the Subsidiaries is at the time providing services.   “Competitive Business” shall mean any person or entity (including any joint venture, partnership, firm, corporation or limited liability company) that engages, directly or indirectly, in the property and casualty insurance business, including, but not limited to, commercial insurance, personal insurance, specialty insurance, surety, excess and surplus lines and/or reinsurance, and/or any other business which is a significant business of, the Corporation and the Subsidiaries as of the date of the Participant’s termination of employment or service with the Corporation or any of the Subsidiaries; provided however, that a business set forth above shall not be considered a “Competitive Business” in the event that, as of the date of the Participant’s termination of employment or service with the Corporation or any of the Subsidiaries, such business is no longer a business of the Corporation or any of the Subsidiaries.   (d)           Inventions.  A Participant shall disclose promptly and assign to the Corporation all right, title, and interest in any invention or idea, patentable or not, made or conceived by the Participant during employment by the Corporation or any of the Subsidiaries, relating in any manner to the actual or anticipated business, research or development work of the Corporation or any of the Subsidiaries and shall do anything reasonably necessary to enable the Corporation or any of the Subsidiaries to secure a patent, copyright or any other intellectual property rights where appropriate in the United States and in foreign countries.   (e)           Relief with Respect to Violations of Covenants.  Failure to comply with the provisions of this Section 10 at any point before payment in respect of earned Performance Shares covered by the Award is made pursuant to the provisions of Section 2 or 5 shall cause all Performance Shares covered by the Award to be cancelled and rescinded without any payment therefor. For the avoidance of doubt, following a failure to comply with this Section 10, payments in respect of any portion of the Performance Shares covered by the Award that have been deferred under the Deferred Compensation Plan in accordance with Section 2 hereof shall be forfeited, and accordingly the Participant shall have no further right to receive any such payment(s). In the event that all or any portion of the Performance Shares covered by this Award shall have been settled in accordance with the terms of this Agreement within twelve (12) months of the date on which any breach by the Participant of any of the provisions of this Section 10 shall have first occurred, the Committee may require that the Participant repay (with interest or appreciation (if any), as applicable, determined up to the date payment is made), and the Participant shall promptly repay, to the Corporation the value of any cash or property (including the Fair Market Value of any Stock) conveyed to the Participant within such period in respect of such Performance Shares. Additionally, the Participant agrees that the Corporation shall be entitled to an injunction, restraining order or such other equitable relief restraining the Participant from committing any violation of the   7   covenants or obligations contained in this Section 10. These rescission rights and injunctive remedies are cumulative and are in addition to any other rights and remedies the Corporation may have at law or in equity. The Participant acknowledges and agrees that the covenants and obligations in this Section 10 relate to special, unique and extraordinary matters and that a violation or threatened violation of any of the terms of such covenants or obligations will cause the Corporation and the Subsidiaries irreparable injury for which adequate remedies are not available at law.   (f)            Reformation.  The Participant agrees that the provisions of this Section 10 are necessary and reasonable to protect the Corporation in the conduct of its business. If any restriction contained in this Section 10 shall be deemed to be invalid, illegal or unenforceable by reason of the extent, duration or geographical scope hereof, or otherwise, then the court making such determination shall have the right to reduce such extent, duration, geographical scope or other provisions hereof, and in its reduced form such restriction shall then be enforceable in the manner contemplated hereby.   11.           Withholding.  The Corporation shall have the right to deduct from all amounts paid to the Participant in cash in respect of Performance Shares covered by the Award any amount of taxes required by law to be withheld as may be necessary in the opinion of the Corporation to satisfy tax withholding required under the laws of any country, state, province, city or other jurisdiction. In the case of any payments of Performance Shares covered by the Award in the form of Stock, at the Committee’s discretion, the Participant shall be required to either pay to the Corporation the amount of any taxes required to be withheld with respect to such Stock or, in lieu thereof, the Corporation shall have the right to retain (or the Participant may be offered the opportunity to elect to tender) the number of shares of Stock whose Fair Market Value equals such amount required to be withheld.   12.           Committee Discretion; Delegation.  Notwithstanding anything contained in this Agreement to the contrary, the Committee may take any action that is authorized under the terms of the Plan that is not contrary to the express terms hereof, including permitting the Participant to receive (upon such terms and conditions as the Committee shall determine) all or a portion of the Performance Shares covered by the Award, up to the maximum amount that would have been payable, despite the termination of the Participant’s employment prior to the settlement date specified pursuant to Section 2(a). Nothing in this Agreement shall limit or in any way restrict the power of the Committee, consistent with the terms of the Plan, to delegate any of the powers reserved to it hereunder to such person or persons as it shall designate from time to time.   13.           No Right to Continued Employment.  Neither the execution and delivery hereof nor the granting of the Award shall constitute or be evidence of any agreement or understanding, express or implied, on the part of the Corporation or any of the Subsidiaries to employ or continue the employment of the Participant for any period.   8   14.           Governing Law.  The Award and the legal relations between the parties shall be governed by and construed in accordance with the laws of the State of New Jersey (without reference to the principles of conflicts of law).   15.           Signature in Counterpart.  This Agreement may be signed in signature thereto and hereto were upon the same instrument.   16.           Binding Effect; Benefits.  This Agreement shall be binding upon and inure to the benefit of the Corporation and the Participant and their respective successors and permitted assigns. Nothing in this Agreement, express or implied, is intended or shall be construed to give any person other than the Corporation or the Participant or their respective successors or assigns any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained herein.   17.           Amendment.  This Agreement may not be altered, modified or amended except by a written instrument signed by the Corporation and the Participant.   18.           Sections and Other Headings.  The section and other headings   IN WITNESS WHEREOF, the Corporation, by its duly authorized officer, and the Participant have executed this Agreement in duplicate as of the day and year first above written.     THE CHUBB CORPORATION   By:           Secretary       By:           Participant   9

Decision on urgent procedure The next item is the vote on the use of the urgent procedure for the proposal for a Council regulation establishing a multi-annual recovery plan for bluefin tuna in the Eastern Atlantic and Mediterranean. Madam President, ladies and gentlemen, the request for application of the urgent procedure put before us this morning, in implementation of Rule 134 of the Rules of Procedure, was submitted to us by the Council last week and relates, as you said, to the proposal for a Council regulation establishing a multi-annual recovery plan for bluefin tuna in the Eastern Atlantic and Mediterranean. The aim of this proposal is to implement the new recovery plan, as recommended for these areas by the International Commission for the Conservation of Atlantic Tunas at its meeting last November. As the Council pointed out in its request for application of the urgent procedure, this regulation needs to come into force before the start of the main fishing season on 15 April, which means that the obligatory consultation of this Parliament needs to be carried out in this plenary session so as to pave the way for a political agreement within the Council in the coming weeks. In view of this, and of the fact that the European Union needs to meet its international commitments and to do its part in the crucial efforts to deal with the acute crisis in bluefin tuna stocks, the European Parliament's Committee on Fisheries has unanimously approved this request for application of the urgent procedure. I therefore encourage you to confirm this approval in this morning's vote. (PT) Madam President, just a brief point of order about the agenda for this week. Wednesday 11 March is the European Day for the Victims of Terrorism. This day was proposed in the first place by Parliament in a vote that took place on 11 March 2004. We were then debating an assessment of the area of freedom, security and justice. It was the day of the tragic attacks in Madrid. It was originally proposed for 11 September but, given the tragedy that occurred on that day, Parliament voted for it to be on 11 March. Several days later, on 25 March if my memory serves me correctly, the European Council adopted this date as European Day for the Victims of Terrorism. Yet now, we have a plenary sitting tomorrow - 11 March - and I see from the agenda that there is not even a memorial of any kind. I would like to know if something of this sort is planned for this week's part-session. Mr Ribeiro e Castro, it is my understanding that the President will make a statement tomorrow at the opening of the plenary about the day you refer to and the special circumstances. This will play a part in that regard.

Exhibit 10.1 COMMITMENT INCREASE AGREEMENT AND AMENDMENT TO CREDIT DOCUMENTS (AMENDMENT NO. 1 TO CREDIT AGREEMENT AND AMENDMENT NO. 1 TO SECURITY AGREEMENT) This Commitment Increase Agreement and Amendment to Credit Documents (this “Agreement”) dated as of December 17, 2013 (the “Effective Date”) is among Steel Energy Ltd., a Delaware corporation (the “Borrower”), the Lenders (as defined below), and Wells Fargo Bank, National Association, as administrative agent (in such capacity, the “Administrative Agent”), as issuing lender (in such capacity, the “Issuing Lender”) and as swing line lender (in such capacity, the “Swing Line Lender”). INTRODUCTION A.The Borrower, the lenders party thereto from time to time (the “Lenders”), the Administrative Agent, the Issuing Lender and the Swing Line Lender are parties to that certain Credit Agreement dated as of July 3, 2013 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”). B.Pursuant to Section 2.15 of the Credit Agreement, the Borrower has the right, subject to the terms and conditions thereof, to increase the aggregate Term Commitments by allowing one or more Lenders to increase their respective Term Commitments. C.The Borrower has given notice to the Administrative Agent and the Lenders of its intention, pursuant to such Section 2.15 of the Credit Agreement, to increase the aggregate Term Commitments by $25,000,000. D.The Borrower intends to consummate the acquisition contemplated by that certain Asset Purchase Agreement dated as of October 29, 2013 between Black Hawk Energy Services, Inc., a New Mexico corporation (“Black Hawk”), as seller, the shareholders of Black Hawk party thereto and Black Hawk Acquisition, Inc., a Delaware corporation (“Acquisition”), as purchaser (the “Purchase Agreement”), of substantially all of the assets of Black Hawk for a purchase price of approximately $60,000,000 (the “Black Hawk Acquisition”). E.The Borrower, the Subsidiaries of the Borrower party thereto, and the Administrative Agent are parties to that certain Pledge and Security Agreement dated as of July 3, 2013 (as amended, restated, supplemented or otherwise modified from time to time, the “Security Agreement”). F.The Borrower has requested that the Lenders agree to amend certain provisions of the Credit Agreement and the Security Agreement pursuant to the terms and conditions hereof. THEREFORE, in consideration of the premises and the mutual covenants, representations and warranties contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: Section 1.Defined Terms; Other Definitional Provisions.As used in this Agreement, each of the terms defined in the opening paragraph and the Recitals above shall have the meanings assigned to such terms therein.Each term defined in the Credit Agreement and used herein without definition shall have the meaning assigned to such term in the Credit Agreement, unless expressly provided to the contrary. Article, Section, Schedule, and Exhibit references are to Articles and Sections of and Schedules and Exhibits to this Agreement, unless otherwise specified.The words “hereof”, “herein”, and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.The term “including” means “including, without limitation”.Paragraph headings have been inserted in this Agreement as a matter of convenience for reference only and it is agreed that such paragraph headings are not a part of this Agreement and shall not be used in the interpretation of any provision of this Agreement. Section 2.Increase of Term Commitments; Making of Term Advances; Reduction of Term Commitments; Repayment of Term Advances. (a)Pursuant to Section 2.15 of the Credit Agreement, the aggregate Term Commitments are hereby increased from $0.00 to $25,000,000.00.The Term Commitments of each Increasing Lender, as increased by this Agreement, are set forth on Schedule 1 attached hereto. (b)Pursuant to Section 2.1(b) of the Credit Agreement, each Increasing Lender with a Term Commitment severally agrees, on the terms and conditions set forth in this Agreement and the Credit Agreement, to make to the Borrower on the Effective Date, a Term Advance in an amount not to exceed such Lender’s Term Commitment as increased by this Agreement. (c)Pursuant to Section 2.1(c)(ii) of the Credit Agreement, on the making of such Term Advances on the Effective Date, each such Increasing Lender’s Term Commitment, as increased by this Agreement, shall be reduced to zero. (d)The Term Advances made on the Effective Date shall be repaid in accordance with Section 2.5(b) of the Credit Agreement, as amended hereby. Section 3.Amendments to Credit Agreement. (a)Section 1.1 of the Credit Agreement is hereby amended by adding the following new defined terms in their appropriate alphabetical order: “Andrews, Texas Property” means the property described as the 4.56 acre tract in Lot 31, Business Park West, Andrews, Texas. “First Amendment Effective Date” means December 17, 2013. (b)Section 2.5(b) of the Credit Agreement is hereby restated in its entirety as follows: (b)Term Advances.The Borrower shall pay to Administrative Agent for the ratable benefit of each Term Lender the aggregate outstanding principal amount of the Term Advances as follows:(i) quarterly installments equal to $3,303,571.43 and due and payable on March 31, June 30, September 30, and December 31 of each year commencing on March 31, 2014, and (ii) a final installment of the remaining, unpaid principal balance of the Term Advances due and payable on the Term Maturity Date. (c)Section 2.15(a)(iii) of the Credit Agreement is hereby restated in its entirety as follows:“(iii) the aggregate of (A) all such Commitment Increases since the First Amendment Effective Date shall not exceed $25,000,000 and (B) all such Commitment Increases involving an increase in the aggregate Revolving Commitments since the First Amendment Effective Date shall not exceed $12,500,000”. (d)Section 5.11(b) of the Credit Agreement is hereby restated in its entirety as follows: (b) within 60 days (or such longer period as the Administrative Agent may determine in its sole discretion) after the purchase of any such new Certificated Equipment by the Borrower or any Subsidiary after the Closing Date or after any such Certificated Equipment ceases to be subject to a Lien securing purchase money indebtedness or Capital Leases, a certificate of title for such equipment naming a Credit Party as the owner and naming the Administrative Agent as the holder of the first lien thereon. - 2 - (e)Section 6.17 of the Credit Agreement is hereby amended by replacing clause (b) with the following and adding a new clause (c) immediately thereafter: (b) $20,000,000 in the aggregate during the fiscal year ending December 31, 2014 and (c) $17,500,000 in the aggregate during each fiscal year thereafter; (f)Article 6 of the Credit Agreement is hereby amended by adding the following as a new Section 6.25: Section 6.25Andrews, Texas Property.Until such time as the Borrower has, or has caused its Subsidiary to, deliver a fully executed Mortgage covering the Andrews, Texas Property, the Borrower shall not, nor shall it permit its Subsidiaries to, hold, store or otherwise maintain equipment or inventory with an aggregate value in excess of $1,000,000 that is intended to constitute Collateral on such Property. Section 4.Amendment to Security Agreement.Section 2.1(a) of the Security Agreement is hereby amended by replacing clause (a) of the definition of “Excluded Collateral” with the following: (a)any Property purchased or leased pursuant to purchase money indebtedness or Capital Leases, respectively (and proceeds thereof, including insurance proceeds), of any Grantor that is now or hereafter subject to a Lien securing such purchase money indebtedness or Capital Leases to the extent (and only to the extent) that (i) the Debt associated with such Lien is permitted under Section 6.1 of the Credit Agreement, and (ii) the documents evidencing such purchase money indebtedness or Capital Leases prohibit or restrict the granting of a Lien in such Property; provided, however, to the extent that either of the prohibitions in clause (i) and (ii) above is ineffective or subsequently rendered ineffective under Sections 9-406, 9-407, 9-408 or 9-409 of the UCC or under any other Legal Requirement or is otherwise no longer in effect, then such Property and proceeds thereof shall cease to be “Excluded Collateral” and shall automatically be subject to the Lien and security interests granted hereby and to the terms and provisions of this Security Agreement as“Collateral”; provided further, that any proceeds received by any Grantor from the sale, transfer or other disposition of such Excluded Collateral shall constitute Collateral unless any Property constituting such proceeds are themselves subject to the exclusions set forth above or otherwise constitute Excluded Collateral; and Section 5.Representations and Warranties.Each Credit Party represents and warrants that: (a) after giving effect to this Agreement, the representations and warranties contained in Article 4 of the Credit Agreement, as amended hereby, and the representations and warranties contained in the other Credit Documents are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the Effective Date as if made on as and as of such date, except that any representation and warranty which by its terms is made as of a specified date is true and correct only as of such specified date; (b) after giving effect to this Agreement, no Default has occurred and is continuing; (c) the execution, delivery and performance of this Agreement are within the corporate, partnership, or limited liability company power, as applicable, and authority of such Credit Party and have been duly authorized by appropriate governing action and proceedings; (d) this Agreement constitutes the legal, valid, and binding obligation of such Credit Party enforceable in accordance with its terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the rights of creditors generally and general principles of equity; (e) there are no governmental or other third party consents, licenses and approvals required in connection with the execution, delivery, performance, validity and enforceability of this Agreement; and (f) the Liens under the Security Documents are valid and subsisting and secure the Secured Obligations. - 3 - Section 6.Conditions to Effectiveness.This Agreement shall become effective on the Effective Date and enforceable against the parties hereto upon the satisfaction of the following conditions precedent: (a)Documentation.The Administrative Agent shall have received the following, duly executed by all the parties thereto: (1)this Agreement, duly executed by the Borrower, each Guarantor, the Administrative Agent, the Issuing Lender, the Swing Line Lender and each Lender; (2)Term Notes from the Borrower made payable to each Increasing Lender in the amount of such Increasing Lender’s new Term Commitment, after giving effect to the increase effected hereby, plus such Increasing Lender’s outstanding Term Advances; (3)an officer’s certificate from the Borrower certifying such Person’s (A) officers’ incumbency, (B) authorizing resolutions, (C) organizational documents, with respect to this Agreement and the other Credit Documents and (D) the Equity Issuance Proceeds or capital contributions from the Equity Contribution (as defined below) will be used to fund a portion of the purchase price of the Black Hawk Acquisition; (4)certificates of good standing or equivalent for the Borrower in each jurisdiction in which each such Person is organized or qualified to do business, which certificate shall be (A) dated a date not earlier than 30 days prior to Effective Date or (B) otherwise effective on the Effective Date; (5)a legal opinion of Olshan Frome Wolosky LLP, New York counsel to the Credit Parties, in form and substance reasonably acceptable to the Administrative Agent; (6)a certificate of an authorized officer of the Borrower certifying (A)both before and after giving effect to the increase of the Term Commitments pursuant to this Agreement (the “Commitment Increase”), no Default has occurred and is continuing, (B)all representations and warranties contained in Article 4 of the Credit Agreement are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the Effective Date, except that any representation and warranty which by its terms is made as of a specified date is true and correct only as of such specified date, and (C) the pro forma compliance with the covenants in Sections 6.20 and 6.21 of the Credit Agreement, after giving effect to the Commitment Increase and the funding of the Term Advances in connection therewith; (7)a compliance certificate in form acceptable to the Administrative Agent and executed by the chief executive officer or chief financial officer of the Borrower, reflecting (i) the Borrower’s pro forma compliance with the financial covenant in Section 6.21 of the Credit Agreement and (ii) a pro forma Leverage Ratio of no greater than 0.25 less than the maximum ratio set forth under Section 6.20 of the Credit Agreement as of the fiscal quarter ended September 30, 2013, assuming that such financial covenants applied as of such fiscal quarter end and after giving pro forma effect to the Black Hawk Acquisition; - 4 - (8)a copy of the Purchase Agreement, together with all exhibits and schedules thereto, certified as of the Effective Date by an authorized officer of the Borrower (A) as being true and correct copies of such documents, (B) as being in full force and effect, and (C) that no material term or condition thereof shall have been amended, modified or waived after the execution thereof without the prior written consent of the Administrative Agent; (9)“pay-off” letters (or such other evidence) in form and substance satisfactory to the Administrative Agent with respect to all Debt of Black Hawk secured by Liens on the assets to be acquired pursuant to the Black Hawk Acquisition, together with evidence satisfactory to the Administrative Agent that all Liens securing such Debt have been or concurrently with the making of the initial Advance under the Credit Agreement after giving effect to the Commitment Increase are being released; (10)a fully executed Mortgage covering the property located at 8510 Oil Avenue, Williston, North Dakota, together with (x) a flood determination certificate issued by the appropriate Governmental Authority or third party indicating whether such property is designated as a “flood hazard area” and (y) if such property is designated to be in a “flood hazard area”, evidence of flood insurance on such property obtained by the applicable Credit Party in such total amount as required by Regulation H of the Federal Reserve Board, and all official rulings and interpretations thereunder or thereof, and otherwise in compliance with the National Flood Insurance Program as set forth in the Flood Disaster Protection Act of 1973; (11)lien waivers or subordination agreements in form and substance reasonably satisfactory to the Administrative Agent covering each of the leased real properties acquired pursuant to the Black Hawk Acquisition to the extent required by Section 6.18 of the Credit Agreement; and (12)original certificates of title to all Certificated Equipment to be acquired pursuant to the Black Hawk Acquisition (other than Certificated Equipment with an OLV less than $50,000 individually and $500,000 in the aggregate for all Certificated Equipment of the Credit Parties and to be acquired pursuant to the Black Hawk Acquisition) that is not subject to a Lien securing purchase money indebtedness or Capital Leases, and such other documents, agreements or instruments required in order to evidence the Administrative Agent’s first priority lien on such certificates of title. (b)Notices of Borrowing.The Administrative Agent shall have received a Notice of Borrowing from the Borrower, with appropriate insertions and executed by an authorized officer of the Borrower. (c)Liquidity.On the Effective Date after giving pro forma effect to the Black Hawk Acquisition, Liquidity shall be greater than or equal to $5,000,000. (d)Consummation of the Black Hawk Acquisition.The Administrative Agent shall have had the opportunity to review and shall be satisfied with the terms of the Purchase Agreement, including all disclosure schedules and exhibits thereto, and the Administrative Agent shall have received evidence satisfactory to the Administrative Agent confirming that (i) all of the transactions contemplated by the Purchase Agreement shall have been consummated and no condition under the Purchase Agreement remains unsatisfied (except for payment of the purchase price and any condition that remains unsatisfied to the extent not materially adverse to the interest of the Lenders) and (ii) the Black Hawk Acquisition shall have occurred on or before the Effective Date. - 5 - (e)Equity Contribution.The Borrower shall have received Equity Issuance Proceeds or capital contributions from its equity holders in an amount no less than $30,000,000 (the “Equity Contribution”). (f)Payment of Fees.The Borrower shall have paid (i) to the Administrative Agent the fees described in that certain Engagement Letter dated November 1, 2013 between the Borrower and the Wells Fargo Securities, LLC and (ii) all other costs and expenses which have been invoiced and are payable pursuant to Section 9.1 of the Credit Agreement. Section 7.Acknowledgments and Agreements. (a)Each Credit Party acknowledges that on the date hereof all outstanding Secured Obligations are payable in accordance with their terms and each Credit Party waives any defense, offset, counterclaim or recoupment with respect thereto.Except as expressly set forth herein, the Administrative Agent, the Issuing Lender, the Swing Line Lender and the Lenders hereby expressly reserve all of their rights, remedies, and claims under the Credit Documents.Except as expressly set forth herein, nothing in this Agreement shall constitute a waiver or relinquishment of (i) any Default or Event of Default under any of the Credit Documents, (ii) any of the agreements, terms or conditions contained in any of the Credit Documents, (iii) any rights or remedies of the Administrative Agent, the Issuing Lender, the Swing Line Lender or any Lender with respect to the Credit Documents, or (iv) the rights of the Administrative Agent, the Issuing Lender, the Swing Line Lender or any Lender to collect the full amounts owing to them under the Credit Documents. (b)The Borrower, each Guarantor, Administrative Agent, Issuing Lender, Swing Line Lender and each Lender does hereby adopt, ratify, and confirm the Credit Agreement, as amended hereby, and acknowledges and agrees that the Credit Agreement, as amended hereby, is and remains in full force and effect, and the Borrower and the Guarantors acknowledge and agree that their respective liabilities and obligations under the Credit Agreement, as amended hereby, and the Guaranty, are not impaired in any respect by this Agreement. (c)The Borrower, each Guarantor and the Administrative Agent does hereby adopt, ratify, and confirm the Security Agreement, as amended hereby, and acknowledges and agrees that the Security Agreement, as amended hereby, is and remains in full force and effect, and the Borrower and the Guarantors acknowledge and agree that their respective liabilities and obligations under the Security Agreement, as amended hereby. (d)From and after the Effective Date, all references to the Credit Agreement, the Security Agreement and the Credit Documents shall mean the Credit Agreement, the Security Agreement and such Credit Documents as amended by this Agreement. (e)This Agreement is a Credit Document for the purposes of the provisions of the other Credit Documents.Without limiting the foregoing, any breach of representations, warranties, and covenants under this Agreement shall be a Default or Event of Default, as applicable, under the Credit Agreement. Section 8.Reaffirmation of the Guaranty.Each Guarantor hereby ratifies, confirms, acknowledges and agrees that its obligations under the Guaranty are in full force and effect and that such Guarantor continues to unconditionally and irrevocably guarantee the full and punctual payment, when due, whether at stated maturity or earlier by acceleration or otherwise, of all of the Guaranteed Obligations (as defined in the Guaranty), as such Guaranteed Obligations may have been amended by this Agreement, and its execution and delivery of this Agreement does not indicate or establish an approval or consent requirement by such Guarantor under the Guaranty in connection with the execution and delivery of amendments, consents or waivers to the Credit Agreement or any of the other Credit Documents. - 6 - Section 9.Counterparts.This Agreement may be signed in any number of counterparts, each of which shall be an original and all of which, taken together, constitute a single instrument.This Agreement may be executed by facsimile or other electronic signature and all such signatures shall be effective as originals. Section 10.Successors and Assigns.This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted pursuant to the Credit Agreement. Section 11.Invalidity.In the event that any one or more of the provisions contained in this Agreement shall for any reason be held invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement. Section 12.Governing Law.This Agreement shall be deemed a contract under, and shall be governed by, and construed and enforced in accordance with, the laws of the State of New York without regard to conflicts of laws principles (other than Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York). Section 13.Entire Agreement. THIS AGREEMENT, THE CREDIT AGREEMENT AS AMENDED BY THIS AGREEMENT, THE SECURITY AGREEMENT AS AMENDED BY THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND SUPERSEDE ALL PRIOR UNDERSTANDINGS AND AGREEMENTS, WHETHER WRITTEN OR ORAL, RELATING TO THE TRANSACTIONS PROVIDED FOR HEREIN AND THEREIN.ADDITIONALLY, THIS AGREEMENT AND THE CREDIT DOCUMENTS MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES. IN EXECUTING THIS AGREEMENT, EACH CREDIT PARTY HEREBY WARRANTS AND REPRESENTS IT IS NOT RELYING ON ANY STATEMENT OR REPRESENTATION OTHER THAN THOSE IN THIS AGREEMENT AND IS RELYING UPON ITS OWN JUDGMENT AND ADVICE OF ITS ATTORNEYS. [The remainder of this page has been left blank intentionally.] - 7 - EXECUTED to be effective as of the date first above written. BORROWER: STEEL ENERGY LTD. By: Name: Title: Signature Page to Commitment Increase Agreement and Amendment to Credit Documents (Steel Energy Ltd.) GUARANTORS: SUN WELL SERVICE, INC. By: Name: Title: ROGUE PRESSURE SERVICES LTD. By: Name: Title: BLACK HAWK ACQUISITION, INC. By: Name: Title: Signature Page to Commitment Increase Agreement and Amendment to Credit Documents (Steel Energy Ltd.) ADMINISTRATIVE AGENT/LENDERS: WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent, Issuing Lender, Swing Line Lender, a Revolving Lender, a Term Lender and an Increasing Lender By: Name: Title: Signature Page to Commitment Increase Agreement and Amendment to Credit Documents (Steel Energy Ltd.) RBS CITIZENS, N.A., as a Revolving Lender, a Term Lender and an Increasing Lender By: Name: Title: Signature Page to Commitment Increase Agreement and Amendment to Credit Documents (Steel Energy Ltd.) COMERICA BANK, as a Revolving Lender, a Term Lender and an Increasing Lender By: Name: Title: Signature Page to Commitment Increase Agreement and Amendment to Credit Documents (Steel Energy Ltd.) SCHEDULE 1 Increased Term Commitments Lender Increased Term Commitment Wells Fargo Bank, National Association RBS Citizens, N.A. Comerica Bank Total:

Converted by SEC Publisher, created by BCL Technologies Inc., for SEC Filing As filed with the Securities and Exchange Commission on November 13, 2008 Registration Statement No. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 CAE INC. (Exact name of registrant as specified in its charter) Canada Not Applicable (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 8585 Côte-de-Liesse Saint-Laurent, Québec Canada, H4T 1G6 (514) 341-6780 (Address and telephone number of Registrant’s principal executive offices) CAE INC. EMPLOYEE STOCK OPTION PLAN (Full title of the Plans) CT Corporation System 111 8 th Avenue, 13 th Floor New York, New York, 10011 (212) 894-8700 (Name, address and telephone number, including area code, of agent for service) Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (check one). x Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company (do not check if a smaller reporting company) CALCULATION OF REGISTRATION FEE Title of Amount Proposed Maximum Proposed Maximum Amount of Securities to be to be Offering Price Per Aggregate Registration Registered Registered(1) Share (2 ) Offering Price(2) Fee Common Shares, no par value 2,000,000 U.S.$ 5.29 U.S.$ 10,580,000 U.S.$ 416.00 (1) Pursuant to Rule 416 under the Securities Act of 1933, as amended (the “Securities Act”), this Registration Statement covers, in addition to the number of Common Shares stated above, such additional Common Shares to be offered or issued to prevent dilution as a result of future stock dividends or stock splits. (2) Estimated pursuant to paragraphs (c) and (h) of Rule 457 under the Securities Act solely for the purpose of calculating the registration fee, based upon the average of the high and low prices for the Registrant’s Common Shares quoted on the New York Stock Exchange on November 11, 2008. EXPLANATORY NOTE This Registration Statement on Form S-8 (this "Registration Statement") is filed by CAE Inc. (the “Registrant”) relating to the issuance of up to 2,000,000 common shares, without par value, in the capital of the Registrant (the “Common Shares”), deliverable upon exercise of stock options granted under the CAE Inc. Employee Stock Option Plan (the "Plan"), and are in addition to the Common Shares registered on the Registrant’s Registration Statement on Form S-8 filed on July 26, 2002 (Registration No. 333-97185) (the "Prior Registration Statement"). This Registration Statement relates to securities of the same class as those to which the Prior Registration Statement relates, and is submitted in accordance with General Instruction E to Form S-8 regarding Registration of Additional Securities. Pursuant to Instruction E of Form S-8, the contents of the Prior Registration Statement is incorporated herein by reference and made part of this Registration Statement, except as amended hereby. PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS ITEM 1. Plan Information. * ITEM 2. Registrant Information and Employee Annual Information. * * Information required by Part I to be contained in the Section 10(a) prospectus is omitted from this Registration Statement in accordance with Rule 428 under the Securities Act of 1933 and the “Note” to Part I of Form S-8. PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 6. Indemnification of Directors and Officers. Under the Canada Business Corporations Act (the “CBCA”), a corporation may indemnify a director or officer of the corporation or a person who acts or acted at the corporation’s request as a director or officer of a body corporate of which the corporation is or was a shareholder or creditor against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him or her in respect of any civil, criminal or administrative action or proceeding to which he or she is made a party by reason of being or having been a director or officer of that corporation or body corporate, if (a) he or she acted honestly and in good faith with a view to the best interests of the corporation, and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he or she had reasonable grounds for believing that his or her conduct was lawful. Where that action is by or on behalf of the corporation or that body corporate, the approval of the court is also required. In accordance with the CBCA, the By-laws of the Registrant provide that the Registrant shall indemnify a director or officer of the Registrant, a former director or officer of the Registrant or a person who acts or acted at the Registrant’s request, as a director or officer of another corporation of which the Registrant is or was a stockholder or creditor, and the heirs and legal representatives of such a person to the extent permitted under the CBCA. A policy of directors’ and officers’ liability insurance is maintained by the Registrant which insures directors and officers of the Registrant for losses as a result of claims based upon their acts or omissions as directors and officers, including liabilities under the Securities Act of 1933, and also reimburses the Registrant for payments made pursuant to the indemnity provisions under the CBCA. The Registrant has entered into indemnity agreements with each of its board members. ITEM 8. Exhibits. Unless otherwise indicated below as being incorporated by reference to another filing of the Registrant with the Commission, each of the following exhibits is filed herewith: Exhibit No. Exhibit Description * Registrant’s Articles of Amalgamation (incorporated by reference to Exhibit 4.1 of the Registrant's Registration Statement on Form S-8 as filed on July 26, 2002, File No. 333-97185). Registrant’s By-laws Registrant's Amended and Restated Shareholder Rights Plan Agreement dated June 21, 2006. CAE Inc. Employee Stock Option Plan (as Amended and Restated) Opinion of Stikeman Elliot as to the Legality of the Common Shares. Consent of Stikeman Elliot (contained in Exhibit 5.1). Consent of PricewaterhouseCoopers LLP, Montreal, Quebec. Power of Attorney (contained on signature page hereto). *Incorporated by reference SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Montreal, Province of Quebec, Country of Canada, on this 13 th day of November, 2008. CAE INC. By: /s/ Robert E. Brown Name: Robert E. Brown Title: President and Chief Executive Officer POWERS OF ATTORNEY Each person whose signature appears below constitutes and appoints each of Robert E. Brown and Hartland J. A. Paterson his or her true and lawful attorney-in-fact and agent, each acting alone, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any or all Amendments (including post-effective Amendments) to this Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, each acting alone, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, each acting alone, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed by or on behalf of the following persons in the capacities and on the dates indicated: Signature Title Date /s/ Brian E. Barents Director November 13, 2008 Brian E. Barents /s/ Robert E. Brown President and Chief Executive Officer November 13, 2008 Robert E. Brown and Director (Principal Executive Officer) /s/ John A. (Ian) Craig Director November 13, 2008 John A. (Ian) Craig /s/ H. Garfield Emerson Director November 13, 2008 H. Garfield Emerson, Q.C. /s/ Anthony S. Fell Director November 13, 2008 Anthony S. Fell /s/ Paul Gagné Director November 13, 2008 Paul Gagné /s/ James F. Hankinson Director November 13, 2008 James F. Hankinson /s/ E. Randolph (Randy) Jayne II Director November 13, 2008 E. Randolph (Randy) Jayne II /s/ Robert Lacroix Director November 13, 2008 Robert Lacroix /s/ Katharine B. Stevenson Director November 13, 2008 Katharine B. Stevenson /s/ Lawrence N. Stevenson Director November 13, 2008 Lawrence N. Stevenson Signature Title Date /s/ Lynton R. Wilson Chairman of the Board of Directors November 13, 2008 Lynton R. Wilson /s/ Antoine Auclair Vice President and Corporate November 13, 2008 Antoine Auclair Controller (Principal Accounting Officer) /s/ Alain Raquepas Vice President, Finance and Chief November 13, 2008 Alain Raquepas Financial Officer (Principal Financial Officer) AUTHORIZED REPRESENTATIVE Pursuant to the requirements of Section 6(a) of the Securities Act of 1933, as amended, the Authorized Representative has duly caused this Registration Statement to be signed on its behalf by the undersigned, solely in its capacity as the duly authorized representative of CAE Inc. in the United States, in the City of Montreal, Province of Quebec, Country of Canada, on this 13 th day of November, 2008. CAE (US) INC. (Authorized U.S. Representative) By: /s/ Hartland Peterson Name: Hartland Paterson Title: Secretary

EXHIBIT 10.28 Freddie Mac Loan Numbers: 708653197   708654282   708653111   708653812   708653170   708653154   708653162   708653138 and 708653103     Freddie Mac Deal Number: 160601 Freddie Mac Rollup Number: 504199536 CREDIT AGREEMENT BY AND BETWEEN SIR Ashley Oaks, LLC, SIR Buda Ranch, LLC, SIR Deer Valley, LLC, SIR Carrington Park, LLC, SIR Carrington Place, LLC, SIR Carrington Champion, LLC, SIR Audubon Park, LLC, SIR Oak Crossing, LLC, AND SIR Steiner Ranch Apartments, LLC, individually and collectively as Borrower AND PNC Bank, National Association, as Lender July 29, 2016 TABLE OF CONTENTS           Page 1. DEFINITIONS 1   1.1   Definitions 1   1.2   Construction 10       1.2.1 Number; Inclusion 11       1.2.2 Determination 11       1.2.3 Lender's Discretion and Consent; References to Lender's           Requirements 11       1.2.4 Documents Taken as a Whole 11       1.2.5 Headings 11       1.2.6 Implied References to this Agreement 11       1.2.7 Persons 11       1.2.8 From, To, and Through 12       1.2.9 Conflicts with Other Loan Documents 12   1.3   Accounting Principles 12 2. REVOLVING LOAN FACILITY 12   2.1   Revolving Loan 12       2.1.1 Revolving Loan 12       2.1.2 Loan Requests and Funding 12       2.1.3 Recalculations 13       2.1.4  Sublimits 14   2.2   Term 14   2.3   Option to Extend 14       2.3.1 First Option to Extend 14       2.3.2 Second Option to Extend 15   2.4   Contraction and Expansion Options 16       2.4.1 Borrower's Election of Contraction Option 16       2.4.2 Lender's Election of Contraction Option 17       2.4.3 Expansion Option 17   2.5   Fees 17       2.5.1 Fees and Costs Due on the Closing Date 17       2.5.2 Unused Commitment Fee 18       2.5.3 Seasoning Fee 18       2.5.4 Base Rate Termination Fee, Fixed Rate Termination Fee           and Release Termination Fee 18       2.5.5 Addition Fee 20       2.5.6 Expansion Fee 20       2.5.7 Extension Fee 20   2.6   Borrower's Right to Terminate the Agreement 20 3. COLLATERAL POOL, ADDITION AND RELEASE, VALUATIONS     VALUATIONS AND AND MATERIAL ADVERSE CHANGE 20   3.1    Addition of a Collateral Pool Property 20               i   TABLE OF CONTENTS (continued)           Page       3.1.1 Procedure for Proposing a Mortgaged Property Addition           to the Collateral Pool 21       3.1.2 Approval of the Addition of the Mortgaged Property           to the Collateral Pool 21   3.2   Release of a Collateral Pool Property 23   3.3   Release of Collateral Pool Property Followed by a Securitized Loan 23       3.3.1 Securitized Loan 23       3.3.2 Procedure for Making a Securitized Loan 24   3.4   Valuations 25       3.4.1 Timing and Procedure of Valuation 25       3.4.2 Valuations that Disclose a Decrease in Market Value           and/or Net Operating Income 25       3.4.3 Valuations that Disclose an Increase in Market Value           26   3.5   Material Adverse Change to Borrower, Guarantor or a         Collateral Pool Property 26 4. INTEREST, COSTS AND CHARGES 26   4.1   Interest Rate 26   4.2   Interest Rate Determinations 27       4.2.1 Prime Rate, Base Rate, and Fixed Rate Determination 27       4.2.2 Prime Rate, Base Rate, and Margin Quotations 27       4.2.3 Net Spread 27   4.3   Interest Periods 28       4.3.1 Interest Period to End on a Business Day 28       4.3.2 No Interest Periods Beyond the Expiration Date 28       4.3.3 Renewals 28       4.3.4 Interest After Default 29       4.3.5 Late Charge 29       4.3.6 Non-Compliance with Sublimits 30   4.4   Illegality; Increased Costs 30       4.4.1 Illegality; Increased Costs 30       4.4.2 Lender's Rights 30 5. PAYMENTS 31   5.1   Repayment of Loan 31   5.2   Payments 31   5.3   Payment Dates 31   5.4   Prepayments 32       5.4.1 Voluntary Prepayments 32       5.4.2 Sublimit Violations (Mandatory Prepayment or           Collateral Addition) 32   5.5   Payment of Balance Without Termination 33   ii   TABLE OF CONTENTS (continued)                 Page   5.6   Payment of Additional Compensation in Certain Circumstances 33       5.6.1 Increased Costs Resulting from Taxes, Etc. 33       5.6.2 Termination 34   5.7   Indemnity 34 6. CONDITIONS OF LENDING 34       6.1.1 Delivery of Loan Documents 35       6.1.2 Validity of Representations 35       6.1.3 Valid Security Instrument 35       6.1.4 No Default 35       6.1.5 Officer's Certificate 35       6.1.6 Opinion of Counsel 36       6.1.7 Legal Details 36       6.1.8 Payment of Fees 36       6.1.9 Other Conditions 36 7. REPRESENTATIONS AND WARRANTIES 36   7.1   Representations and Warranties 36       7.1.1 Authority 36       7.1.2 Binding Obligations 37       7.1.3 Formation and Organizational Documents 37       7.1.4 No Violation 37       7.1.5 Reserved 37       7.1.6 Financial Condition 37       7.1.7 No Material Adverse Change 38       7.1.8 Reserved 38       7.1.9 Reserved 38       7.1.10 Enforceability 38       7.1.11 Reserved 38       7.1.12 Solvency 38       7.1.13 No Pending Proceedings or Judgments 38       7.1.14 Authorized Officer/Authorized Representative 38       7.1.15 Other Loan Documents 39   7.2   Updates 39   7.3   39 8. COVENANTS 39   8.1   Organization and Dissolution 39   8.2   Affiliate Transactions 40   8.3   Assumption 40   8.4   Further Assurances 40   8.5   Proceedings and Judgments 41   8.6   Compliance with Lender Requirements 41   8.7   Correction of Defects 41   iii   TABLE OF CONTENTS (continued)     Page   8.8   Notice of Material Adverse Change 41   8.9   Annual Evaluation 42   8.10   Compliance with Guaranty 42 9. DEFAULT 43   9.1 Events of Default 43       9.1.1 Payments Under Loan Documents 43       9.1.2 Breach of Representation or Warranty 43       9.1.3 Breach of Covenant 43       9.1.4 Event of Default under the Other Loan Documents 44       9.1.5 Final Judgments or Orders 44       9.1.6 Notice of Lean or Assessment 44       9.1.7 Insolvency 44       9.1.8 Cessation of Business 44       9.1.9 Lien Priority 44       9.1.10 Bankruptcy and Other Proceedings 45       9.1.11 Material Adverse Change 45       9.1.12 Aggregate DSCR/LTV Ratio 45       9.1.13 Guarantor Default 45   9.2   Consequences of Event of Default 45       9.2.1 Acceleration of Loan 45       9.2.2 Remedies Cumulative 46       9.2.3 Notice of Sale 46 10. MISCELLANEOUS 46   10.1   Reserved 46   10.2   Successors and Assign 46   10.3   Modifications, Amendments, or Waivers 46   10.4   Forbearance 46   10.5   Remedies Cumulative 47   10.6   Reimbursement and Indemnification of Lender and         Servicer by Borrower; Taxes 47   10.7   Holidays 48   10.8   Notices 48   10.9   Severability 49   10.10   Governing Law; Consent to Jurisdiction and Venue 49   10.11   Prior Understanding 50   10.12   Duration; Survival 50   10.13   Exceptions 50   10.14   Servicing 50   10.15   Reserved 51   10.16   Authority to File Notices 51   10.17   51   10.18   Advertising 51   iv   TABLE OF CONTENTS (continued)     Page   10.19   Time of Essence 51   10.20   Counterparts 51   10.21   NOTICE OF FINAL AGREEMENT 51   v   CREDIT AGREEMENT THIS CREDIT AGREEMENT (“Agreement”) is dated as of July 29, 2016 and is made by and between SIR Ashley Oaks, LLC, a Delaware limited liability company, SIR Buda Ranch, LLC, a Delaware limited liability company, SIR Deer Valley, LLC, a Delaware limited liability company, SIR Carrington Park, LLC, a Delaware limited liability company, SIR Carrington Place, LLC, a Delaware limited liability company, SIR Carrington Champion, LLC, a Delaware limited liability company, SIR Audubon Park, LLC, a Delaware limited liability company, SIR Oak Crossing, LLC, a Delaware limited liability company, SIR Steiner Ranch Apartments, LLC, a Delaware limited liability company, each having an address of c/o Steadfast Companies, 18100 Von Karman Avenue, Suite 500, Irvine, CA 92612 (individually and collectively the “Borrower”) and PNC Bank, National Association, a national banking association, having an address of 26901 Agoura Road, Suite 200, Calabasas Hills, CA 91301 (together, with its successors and/or assigns, “Lender”). RECITALS WHEREAS, Borrower desires to obtain a revolving credit facility (the “Facility”) from Lender in an amount up to, but not exceeding $235,124,750, subject to increase to an amount up to, but not exceeding, $350,000,000 as provided herein; WHEREAS, Borrower has offered to grant Lender a security interest in certain real property and other assets owned by Borrower as security for Borrower’s repayment of such Facility; and WHEREAS, Lender is willing to make the above described Facility available to Borrower secured by an interest in such real property and other assets owned by Borrower. and agreements hereinafter set forth and intending to be legally bound hereby, 1.    DEFINITIONS. 1.1    Definitions. The following capitalized terms shall have the meanings set forth below. Certain other capitalized terms used only in specific sections of this Agreement are defined in such sections. To the extent not otherwise defined herein, capitalized terms shall have the meanings as set forth in the applicable Loan Agreement, the Fixed Rate Note, or the Revolving Credit Note, as applicable. “Accrued Interest” shall have the meaning as set forth in Section 5.4.1.1. “Addition Fee” shall have the meaning as set forth in Section 2.5.6. Credit Agreement     “Advisor” shall mean Steadfast Income Advisor, LLC, a Delaware limited liability company. “Affiliate” or “Affiliates” shall mean (i) any other Person which, directly or indirectly, is in Control of, is under the Control of, or is under common Control with, such Person; or (ii) any other Person who is a director or officer of (A) such Person, (B) any subsidiary of such Person, or (C) any Person described in clause (i) of this definition; provided, however, that no publicly held corporation other than Guarantor shall be considered an Affiliate for any purpose. “Aggregate DSCR” shall mean, at the time of Lender’s determination, the then prevailing computation of the aggregate Net Operating Income of each Collateral Pool Property divided by the then prevailing computation of Aggregate Stressed Debt Service. “Aggregate Stressed Debt Service” shall mean, for the purposes of this Agreement, the sum of (i) interest due on the Fixed Rate Note (including any default interest), (ii) the interest due on the Revolving Credit Note (including any default interest), (subject to a floor of 1.25% for the LIBOR Index Rate or any other index then being used by Lender to determine the interest rate of the Revolving Credit Note pursuant to this Agreement), and (iii) an amount equal to 0.01 of the then outstanding principal amount of such Revolving Credit Note, but exclusive of any voluntary or mandatory principal prepayments allowed or required hereunder. Aggregate Stressed Debt Service shall be annualized at the time of Lender’s determination and calculated as set forth herein, notwithstanding the duration of any Interest Period. “Agreement” shall mean this Credit Agreement, as the same may be amended, modified, increased or supplemented from time to time, including all exhibits and schedules attached hereto. “Allocated Loan Amount” shall mean for a Collateral Pool Property the maximum debt amount determined by Freddie Mac taking into account the Sublimits. For purposes of determining the Addition Fee for an addition of a Mortgaged Property as a Collateral Pool Property, the Allocated Loan Amount shall be calculated based on such Mortgaged Property’s “as is” Net Operating Income and Valuation at the time of such Mortgaged Property’s addition to the Collateral Pool. For purposes of determining the Seasoning Fee, Base Rate Termination Fee and Release Termination Fee, the Allocated Loan Amount shall be calculated based on such Collateral Pool Property’s “as is” Net Operating Income and Valuation on or about the most recent anniversary of the Closing Date. “Anniversary Date” shall have the meaning as set forth in Section 3.4.1. Credit Agreement   Page 2 “Authorized Officer” shall mean those individuals, designated by written Notice to Lender from Borrower, authorized to execute Notices, reports and other documents on behalf of Borrower required hereunder; provided, further, that the individuals so designated as the Authorized Officers of Borrower shall be the sole representatives of Borrower for the purpose of giving or receiving any Notices permitted or required by this Agreement. Borrower may amend such list of individuals from time to time by giving written Notice of such amendment to Lender. “Base Rate” shall mean the LIBOR Index Rate (truncated to the 5th decimal place, if necessary) plus the applicable Margin. Interest accruing at the Base Rate shall be calculated monthly in the manner provided in this Agreement based on the aggregate principal balance of the Base Rate Borrowing Tranches outstanding during the applicable Month, and such interest shall be paid in arrears, as provided herein. The LIBOR Index Rate plus the applicable Margin with respect to each Base Rate Borrowing Tranche shall remain fixed throughout the applicable Interest Period and shall then be recalculated as of each renewal of such Base Rate Borrowing Tranche in accordance with Section 4.3.3. The Margin with respect to each Base Rate Borrowing Tranche shall be determined and redetermined from time to time in accordance with Section 4.3.3. “Base Rate Borrowing Tranche” shall mean a Borrowing Tranche which accrues interest at the Base Rate. “Base Rate Termination Fee” shall have the meaning as set forth in Section 2.5.4.1. “Borrower” shall mean each Single Asset Entity defined as “Borrower” in the Recitals together with any Proposed Borrower that becomes a party to this Agreement pursuant to the terms and conditions of Section 3.1.2.2, but excluding any entity that is released pursuant to the terms of Sections 2.6, 3.2 or 3.3 from all obligations other than environmental indemnifications under Sections 6.12 and 10.02 of the applicable Loan Agreement. “Borrower’s Knowledge” shall mean the knowledge of: (i) any officer or employee of Borrower, (ii) any officer of Sponsor or Guarantor, (iii) any officer of any holder of the membership or other equity interest in Borrower, and/or (iv) any officer of any Affiliate that manages or operates any Collateral Pool Property. “Borrowing Date” shall mean, with respect to any Borrowing Tranche, the date of borrowing or renewal, as the case may be, which shall be a Business Day or, in the case of a renewal which would otherwise fall on a day other than a Business Day, the first Business Day thereafter. Credit Agreement   Page 3 “Borrowing Tranche” shall mean each advance outstanding at any one time at the (i) Base Rate hereunder having a particular Interest Period and the (ii) Fixed Rate, and all advances at the Prime Rate. Two (2) or more Borrowing Tranches accruing interest at a Base Rate may be combined to form a single Borrowing Tranche (i) with the same Interest Period without a payment of any penalty or fee in the event such 2 or more Borrowing Tranches mature and are renewed at the same time with the same Interest Period, or (ii) in the event 2 or more Borrowing Tranches mature at different times, with payment of the applicable Accrued Interest if 1 or more Borrowing Tranches are advanced or prepaid and at the request of the Borrower then combined with 1 or more other Borrowing Tranches with the same Interest Period. For all purposes hereunder, the 1 time advance at the Fixed Rate shall be deemed a single Borrowing Tranche, and all Prime Rate fundings permitted or required hereunder shall be aggregated and deemed a single Borrowing Tranche. “Closing Date” shall mean the first date on which both of the following requirements are met: (i) this Agreement has been fully executed, and (ii) the first advance is made by Lender pursuant to this Agreement. The closing shall take place on the Closing Date at such time and place as the parties agree. “Collateral” shall mean the Collateral Pool Property, and the UCC Collateral of a Borrower on which first priority liens and security interests have been granted for the benefit of Lender to secure the Loan and all other obligations of Borrower under the Loan Documents. “Collateral Pool” shall mean each and every Collateral Pool Property. “Collateral Pool Property” shall mean each Mortgaged Property as set forth in Schedule 1.1(A). Schedule 1.1(A) shall be deemed amended each time a Mortgaged Property is added as a Collateral Pool Property or released as a Collateral Pool Property in accordance with the terms of this Agreement. “Collateral Pool Property Documents” shall mean the Lender’s then current versions of the Loan Agreements, Security Instruments, guaranties, indemnities, O&M Programs, and any other documents now or in the future executed (or in the case of a UCC financing statement authorized) by Borrower, any Guarantor or any Affiliate of Borrower or Guarantor in connection with the Loan or the Collateral, as such documents may be amended from time to time. The Collateral Pool Property Documents shall include, but not be limited to, those documents set forth in Schedule 1.1(B). To the extent a Borrower or Proposed Borrower shall execute a Loan Agreement or Security Instrument after the date hereof, such documents will include any previously negotiated changes approved by Lender to the extent determined to be applicable by Lender in its reasonable discretion. “Commitment Fee” shall have the meaning as set forth in Section 2.5.1. Credit Agreement   Page 4 “Contraction Option Date” shall mean each date the Loan is decreased pursuant to Section 2.4.1 or Section 2.4.2. “Event of Default” shall mean any of the events described in Section 9.1 or otherwise referred to herein as an “Event of Default”. “Expansion Amount” shall have the meaning as set forth in Section 2.4.3. “Expansion Fee” shall have the meaning as set forth in Section 2.5.6. “Expansion Option Date” shall mean each date that the Loan is increased pursuant to Section 2.4.3 “Expiration Date” shall mean the earlier to occur of (i) the Maturity Date, or (ii) the date specified by Borrower as the expiration date under Section 2.6. “Extension Fee” shall have the meaning as set forth in Section 2.5.7. “Extension Option Date” shall mean the date the Scheduled Maturity Date is extended pursuant to Section 2.3.1 or the date the First Extended Maturity Date is extended pursuant to Section 2.3.2. “Facility” shall have the meaning as set forth in the Recitals of this Agreement. “First Extended Maturity Date” shall mean August 1, 2022. “First Option to Extend” shall have the meaning as set forth in Section 2.3.1. “Fixed Rate” means the annual interest rate established by Lender and agreed upon by Borrower as set forth in the Fixed Rate Note. “Fixed Rate Borrowing Tranche” shall mean, to the extent requested by Borrower, a single advance in an amount not greater than 50% of the Loan as of the Closing Date to be disbursed on the Closing Date and which accrues interest at the Fixed Rate. “Fixed Rate Note” shall mean, solely to the extent Borrower requests a Fixed Rate Borrowing Tranche, the Multifamily Note (Fixed Rate) of Borrower in the face amount of the Fixed Rate Borrowing Tranche, together with all amendments, modifications, increases, extensions, renewals, replacements or supplements. “Fixed Rate Termination Fee” shall have the meaning as set forth in Section 2.5.4.2. “Freddie Mac” shall mean the Federal Home Loan Mortgage Corporation. Credit Agreement   Page 5 “GAAP” shall mean generally accepted accounting principles as are in effect from time to time, subject to the provisions of Section 1.3 and applied on a consistent basis both as to classification of items and amounts. “Guarantor” shall mean individually and collectively (i) Steadfast Income REIT, Inc. and (ii) any entity or individual who becomes a Guarantor pursuant to the terms of this Agreement or the other Loan Documents. “Guaranty” shall mean that certain Guaranty of even date herewith executed by Steadfast Income REIT, Inc. in connection with the Loan, together with all amendments, modifications, supplements or replacements thereto. “Guide” shall have the meaning as set forth in Section 8.9. “Increased Cost Amount” shall have the meaning as set forth in Section 5.6.1. “Indebtedness” shall mean at any time and from time to time the (i) principal amount of the Revolving Credit Note and Fixed Rate Note then outstanding, (ii) any interest owed pursuant to the Revolving Note and Fixed Rate Note , and (iii) any other fees, costs or amounts due under the Revolving Credit Note, the Fixed Rate Note, this Agreement, or any other Loan Document. “Initial Market Value” shall mean the Market Value of any Mortgaged Property as determined by Lender based on Lender’s then current underwriting policies as of the date the same is included in the Collateral Pool pursuant to the provisions hereof. The Initial Market Value of each Collateral Pool Property is shown at Schedule 1.1(A). The Lender shall update Schedule 1.1(A) or otherwise confirm Initial Market Value in writing as of the date a Mortgaged Property is included as a Collateral Pool Property pursuant to the provisions hereof; provided however, that with respect to a Mortgaged Property acquired or developed within 12 months prior to the date such Mortgaged Property is added as a Collateral Pool Property, the Initial Market Value shall not exceed the lesser of (i) appraised value or (ii) the sum of (a) the purchase price paid by Borrower for such Mortgaged Property, (b) the capital expenditures paid by Borrower for such Mortgaged Property during such 12 month period, (c) the acquisition costs (not to exceed 3% of the purchase price paid by Borrower in connection with the purchase of such Mortgaged Property) and (d) any escrows held by or on behalf of Lender on account of capital expenditures as determined by Lender (i.e. replacement reserves or repair escrows) for such Mortgaged Property; provided, further, that Lender may agree, in its sole discretion, to a Borrower’s written request to limit Lender’s recovery from a Collateral Pool Property to a certain dollar amount due to recording tax considerations in a particular Property Jurisdiction (which limitation shall be memorialized in the applicable Security Instrument), in which event the Market Value for such Collateral Pool Property shall never exceed such limited recovery amount. Credit Agreement   Page 6 “Interest Period” shall have the meaning as set forth in Section 4.3. “Law” shall mean any law (including common law), constitution, statute, treaty, regulation, rule, ordinance, final issued opinion, binding release, ruling, order, injunction, writ, or decree of any Official Body. “Lender” shall mean at any time and from time to time, the entity that is the holder of the Revolving Credit Note and Fixed Rate Note. PNC Bank, National Association, a national banking association, the initial Lender, intends to sell the Revolving Credit Note and Fixed Rate Note to Freddie Mac and assign all of its interests in this Agreement and the other Loan Documents to Freddie Mac subsequent to the Closing Date, provided each Collateral Pool Property serves as Collateral for the Loan as of the date of said assignment. “LIBOR” shall have the meaning as set forth in the Revolving Credit Note. “LIBOR Index” shall have the meaning as set forth in the Revolving Credit Note. “LIBOR Index Page” shall have the meaning as set forth in the Revolving Credit Note. “LIBOR Index Rate” shall have the meaning as set forth in the Revolving Credit Note. “Liquidity” shall have the meaning as set forth in the Guaranty. “Loan” shall mean $235,124,750 as of the Closing Date, subject to increase as provided in Section 2.4.3 hereof and contraction as provided in Sections 2.4.1 and 2.4.2 hereof. “Loan Agreement” shall mean each Multifamily Loan and Security Agreement executed by a Borrower, as same may be amended, modified, increased or supplemented from time to time, including all riders, exhibits and schedules attached thereto. “Loan Documents” shall mean individually and collectively this Agreement, the Revolving Credit Note, the Fixed Rate Note, the Guaranty, the Collateral Pool Property Documents and any other instruments, certificates or documents executed by Borrower or any Affiliate of Borrower now or hereafter delivered hereunder or thereunder or in connection herewith or therewith, as the same may be supplemented or amended from time to time in accordance herewith or therewith. “Loan Request” shall have the meaning as set forth in Section 2.1.2. Credit Agreement   Page 7 “LTV Ratio” shall mean the product, expressed as a percentage, determined by dividing the Outstanding Borrowing Tranches by the aggregate of the then current Market Values of the Collateral Pool Properties exclusive of any voluntary or mandatory principal prepayments allowed or required hereunder. “Margin” shall mean with respect to a Base Rate Borrowing Tranche, the sum of the Net Spread and the Servicing Spread. “Market Value” shall mean as to an individual Collateral Pool Property, the Initial Market Value of such property, in each case as such value may be subsequently increased or decreased in accordance with the terms and conditions of this Agreement. “Material Adverse Change” shall mean any set of circumstances or events which, in Lender’s reasonable discretion, would have or is then reasonably expected to have a material adverse effect on (i) the validity or enforceability of this Agreement or the other Loan Documents Taken as a Whole, (ii) the ability of Borrower Taken as a Whole to duly perform the Obligations, (iii) the ability of Lender to enforce its legal remedies pursuant to this Agreement or the other Loan Documents Taken as a Whole, including, without limitation, by realizing upon any Collateral or any guaranty, (iv) the financial condition of Borrower Taken as a Whole or any Guarantor, or (v) the financial performance or Market Value of any Collateral Pool Property. “Maturity Date” shall mean the earlier of (i) the Scheduled Maturity Date, as the same may be extended to the First Extended Maturity Date and the Second Extended Maturity Date, as applicable or (ii) the date on which the unpaid principal balance of the Loan becomes due and payable by acceleration or otherwise pursuant to this Agreement or any Loan Document or the exercise by Lender of any right or remedy under this Agreement or any Loan Document to accelerate the stated Maturity Date. “Maximum Facility Available” shall mean, at the time of determination, the maximum amount which Borrower may borrow under this Agreement without violating the Sublimits set forth in Section 2.1.4. “Maximum LTV Ratio” shall mean 72.5% “Minimum Expansion Amount” shall have the meaning as set forth in Section 2.4.3. “Minimum Net Worth” shall have the meaning as set forth in the Guaranty. “Month” shall mean the appropriate calendar month. “Monthly Payment Statement” shall have the meaning as set forth in Section 5.3. Credit Agreement   Page 8 “Mortgaged Property” shall have the meaning as set forth in the Loan Agreement consisting of conventional multifamily real property owned by Borrower or Proposed Borrower, as applicable. Each Mortgaged Property shall be acceptable to Lender in its sole discretion, fully constructed and shall have received all final certificates of occupancy. “Net Operating Income” shall mean an annualized dollar amount, as determined by Lender in its sole discretion in accordance with Lender’s then applicable underwriting standards, which is equal to all income from the operations of each Collateral Pool Property that is available for repayment of debt and return of equity after deducting for economic vacancy and all expenses (including an allowance for a property management fee) (exclusive of debt service on account of the Loan). Net Operating Income shall be calculated by Lender for each individual Collateral Pool Property as of the Closing Date and thereafter on or about the date of each Valuation performed in accordance with Section 3.4, in accordance with Lender’s then current methodology, consistently applied, excluding from such calculation expenses from depreciation, amortization, interest expenses, non-recurring items and capital expenses, but including in such calculation an assumed capital expense reserve in an amount consistent with Lender’s then current requirements for such capital reserves. “Net Spread” shall have the meaning as set forth in Section 4.2.3 with respect to a Base Rate Borrowing Tranche hereunder. “Notice” shall have the meaning as set forth in Section 10.8. “Obligation”, “Obligations”, “obligation”, or “obligations” shall mean the Indebtedness and any other obligation or liability of Borrower to Lender, connection with this Agreement, the Revolving Credit Note, the Fixed Rate Note “Official Body” shall mean any national, federal, state, local or other government or political subdivision or any agency, authority, bureau, commission, department or instrumentality of either, or any court, tribunal, grand jury or arbitrator, in each case whether foreign or domestic, to the extent having jurisdiction over a Collateral Pool Property, Borrower, Guarantor, the Loan or the Lender as the case may be. “Outstanding Borrowing Tranches” shall mean the sum of all Borrowing Tranches outstanding at any one time. “Payment Date” shall have the meaning as set forth in Section 5.3. Credit Agreement   Page 9 “Permitted Exceptions” shall mean those title exceptions approved by Lender on Lender’s title insurance policy accepted by Lender on the Closing Date and thereafter as permitted and approved pursuant to Sections 3.1.2.2 and 3.3.2 or as otherwise approved by Lender. “Potential Default” shall mean any event or condition which, with the passage of time, the giving of notice, or a determination by Lender, or any combination of the foregoing, would constitute an Event of Default. “Prepayment Premium” shall mean the prepayment premium calculated in accordance with the Fixed Rate Note. “Prepayment Premium Period” shall have the meaning as set forth in the Fixed Rate Note. “Prime Rate” shall mean the rate of interest per annum established on the first day of each Month during the term hereof and published in The Wall Street Journal as the prime rate, or any comparable publication reasonably selected by Lender in the event The Wall Street Journal no longer publishes the prime rate, plus the applicable Margin. “Prime Rate Borrowing Tranche” shall mean all advances hereunder which accrue interest at the Prime Rate. Notwithstanding anything to the contrary contained herein, no Prime Rate Borrowing Tranches will be permitted hereunder except as may be required pursuant to Sections 4.3.2 or 4.4.2. “Proceeding” shall have the meaning as set forth in Section 8.5. “Proposed Borrower” shall mean a Single Asset Entity that is an Affiliate of Borrower and is the owner of one or more Mortgaged Properties which have been proposed to be included in the Collateral Pool, pursuant to the terms hereof. “Reaffirmation Date” shall have the meaning as set forth in Section 7.2. “Release Termination Fee” shall have the meaning as set forth in Section 2.5.4.3. “Renewal Date” shall have the meaning as set forth in Section 4.3.3. “Renewal Request” shall have the meaning as set forth in Section 4.3.3. “Required Financial Statements” shall have the meaning as set forth in Section 8.9. Credit Agreement   Page 10 “Revolving Credit Note” shall mean the Multifamily Note (Floating Rate) of Borrower, in the face amount of the Loan, which evidences the Loan, together with all amendments, modifications, increases, extensions, renewals, replacements, or supplements. “Scheduled Maturity Date” shall mean August 1, 2021. “Seasoning Fee” shall have the meaning as set forth in Section 2.5.3. “Second Extended Maturity Date” shall mean August 1, 2023. “Second Option to Extend” shall have the meaning as set forth in Section 2.3.2. “Securitized Loan” shall have the meaning as set forth in Section 3.3.1. “Securitized Loan Collateral” shall have the meaning as set forth in Section 3.3.1. “Securitized Product” shall mean Freddie Mac’s then current product for financing a performing loan that is intended to be securitized in a securitization where the most subordinate debt component of such securitization is sold to a party unrelated to Freddie Mac. “Seismic Report Fee” shall mean a non-refundable fee equal to Lender’s and Servicer’s reasonable out-of-pocket costs and expenses incurred in obtaining a seismic report with respect to any real property for which Lender, in its reasonable discretion, deems such report necessary. “Servicer” shall mean PNC Bank, National Association, a national banking association, Freddie Mac or any subsequent independent contractor appointed by Lender, at Lender’s sole cost and expense, to administer the Loan and the Loan Documents or otherwise perform certain functions in connection therewith under the terms of a Servicing Agreement and/or Guide. “Servicing Agreement” shall mean the Guide as modified by any agreement between Lender and an independent contractor pursuant to which Lender appoints said independent contractor as Servicer under this Agreement, the Revolving Credit Note, the Fixed Rate Note, and the other Loan Documents. “Servicing Spread” shall mean (0.0005) times the outstanding Base Rate Borrowing Tranches. “Sponsor” shall mean collectively (i) Steadfast Income REIT, Inc., a Maryland corporation, and (ii) any entity or individual which becomes a sponsor. Credit Agreement   Page 11 “Sponsor Liquidity Event” shall mean a liquidation of the Sponsor which shall include a sale or merger of the Sponsor into another entity or the Sponsor’s public issuance of common stock, convertible debt, equity or other similar securities or a merger of the Sponsor’s Advisor into the Sponsor, dissolution or winding up of Sponsor or Borrower or any plan of liquidation related to the Sponsor or Borrower adopted directly or indirectly by Sponsor’s board of directors (each an “Event”) of which any Event must be approved by Lender prior to the occurrence of such Event. “Sublimits” shall have the meaning as set forth in Section 2.1.4. “Taken as a Whole” means the Borrower collectively as a group, or this Agreement and the other Loan Documents, collectively as a group. “Termination Fee” means singularly and collectively, as the context may require, the Base Rate Termination Fee, Fixed Rate Termination Fee and Release Termination Fee. “Underwriting Materials” shall mean all materials required by Lender pursuant to Lender’s then current loan underwriting requirements including, without limitation, a current appraisal acceptable to Lender for a Mortgaged Property to be added to the Collateral Pool. “Unused Commitment Fee” shall have the meaning as set forth in Section 2.5.2. “Valuation” shall have the meaning as set forth in Section 3.4.1. “Valuation Letter” shall have the meaning as set forth in Section 3.4.1. 1.2    Construction. Documents. 1.2.1    Number; Inclusion. References to the plural include the singular, the plural, the part and the whole; “or” has the inclusive meaning represented by the phrase “and/or”, and “including” has the meaning represented by the phrase “including without limitation”. 1.2.2    Determination. References to “determination” of or by Lender shall be deemed to include good-faith estimates by Lender (in the case of quantitative determinations) and good-faith beliefs by Lender (in the case of qualitative determinations) and such determinations shall be conclusive absent manifest error. Credit Agreement   Page 12 1.2.3    Lender’s Discretion and Consent; References to Lender’s Requirements. Whenever Lender is granted the right herein to act in its sole discretion or to grant or withhold consent, such right shall be exercised in good faith, and whenever a reference is made to “Lender’s then current requirements”, “Lender’s then current programs” or the like, such reference shall be deemed to mean such requirements, programs and the like as are then standard in the secondary multifamily mortgage industry, as such standards are generally reflected in the then current version of the Guide. 1.2.4    Documents Taken as a Whole. The words “hereof,” “herein,” “hereunder,” “hereto” and similar terms in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document as a whole and not to any particular provision of this Agreement or such other Loan Document. 1.2.5    Headings. The section and other headings contained in this Agreement or such other Loan Document and the Table of Contents preceding this Agreement or such other Loan Document are for reference purposes only and shall not control or affect the construction of this Agreement or such other Loan Documents or the interpretation thereof in any respect. 1.2.6    Implied References to this Agreement. Article, section, subsection, clause, exhibit and schedule references are to this Agreement unless otherwise specified, and exhibits and schedules attached hereto are incorporated herein by this reference. 1.2.7    Persons. Reference to any Person includes such Person’s successors and assigns (but only if such successors and assigns are permitted by this Agreement or such other Loan Document, as the case may be), and reference to a Person in a particular capacity excludes such Person in any other capacity. 1.2.8    From, To and Through. Relative to the determination of any period of time, “from” means “from and including”, “to” means “to but excluding”, and “through” means “through and including”. Credit Agreement   Page 13 1.2.9    Conflicts with Other Loan Documents. In the event of any conflict between the terms and provisions of this Agreement and any other Loan Document, the terms and provisions of this Agreement shall prevail. 1.3    Accounting Principles. Except as otherwise provided in this Agreement, all computations and determinations as to accounting or financial matters and all financial statements to be delivered pursuant to this Agreement shall be made and prepared in accordance with GAAP (including principles of consolidation where appropriate) or, at the request of Borrower and consented to by Lender, cash accounting principles recognized and consistently applied at that time by the accounting industry. In the event of any change after the date hereof in GAAP, and if such change would result in the inability to determine compliance with any financial covenants set forth herein, then the parties hereto agree to endeavor, in good faith, to agree upon an amendment to this Agreement that would adjust such financial covenants in a manner that would not affect the substance thereof, but would allow compliance therewith to be determined in accordance with Borrower’s financial statements at that time. 2.    REVOLVING LOAN FACILITY. 2.1    Revolving Loan. 2.1.1    Revolving Loan. Subject to the terms of this Agreement from time to time prior to the Maturity Date, Lender shall make revolving advances in an amount not to exceed the amount of the Loan. All advances pursuant to this Agreement, the Revolving Credit Note and the Fixed Rate Note constitute a single indebtedness, and all of the Collateral is security for the Obligations. Credit Agreement   Page 14 2.1.2    Loan Requests and Funding. Subject to the terms and conditions set forth herein, on the Closing Date, Borrower may request a Fixed Rate Borrowing Tranche, and Borrower may from time to time request a Base Rate Borrowing Tranche in each case by delivering Notice to Servicer in the form attached hereto as Schedule 2.1.2 (“Loan Request”). Borrower may at any one time submit 1 or more Loan Requests for a Base Rate Borrowing Tranche, which shall not be less than $10,000,000 or such lesser amount as determined by Lender in its sole discretion; provided, however, that the amount of the proposed Base Rate Borrowing Tranche may be in an amount not less than $1,000,000 if at the time of the Loan Request the difference between the Maximum Facility Available and the outstanding Base Rate Borrowing Tranches is less than $10,000,000. Notwithstanding anything to the contrary contained herein, (i) no Prime Rate Borrowing Tranches will be permitted hereunder except as may be required pursuant to Sections 4.3.2 or 4.4, and (ii) Borrower is permitted a maximum of 10 Borrowing Tranches outstanding at any one time, except in connection with Borrower’s cure of a Sublimits violation pursuant to Section 5.4.2. Subject to the terms and conditions set forth herein, Borrower may from time to time request an increase to an existing Base Rate Borrowing Tranche by delivering to Servicer a Loan Request. Any request of an increase to an existing Base Rate Borrowing Tranche shall be in an amount not less than $1,000,000. Provided all conditions set forth in this Agreement and the other Loan Documents are satisfied, the Lender shall fund the amount requested in the Loan Request to Borrower on the Borrowing Date relating to a Base Rate Borrowing Tranche and the Closing Date for the Fixed Rate Borrowing Tranche. The Borrowing Date relating to a Base Rate Borrowing Tranche, shall be the Business Day set forth in the Loan Request, provided that Lender received Notice from Servicer not less than 30 days prior to the proposed Borrowing Date. Borrower may revoke any pending but unfunded Loan Request provided that Borrower reimburses Lender and Servicer for any reasonable costs and expenses (including Attorneys’ Fees and Costs) incurred in connection with such Loan Request. Lender shall fund the amounts requested in any Loan Request relating to a Base Rate Borrowing Tranche by 3:00 p.m. Eastern Time on the Borrowing Date. In addition to the foregoing, while an Event of Default or Potential Event of Default exists, Lender may refuse to make any further Base Rate Borrowing Tranches available to Borrower. Credit Agreement   Page 15 2.1.3    Recalculations. 2.1.3.1    Aggregate Stressed Debt Service and LTV Ratio shall each be recalculated (i) as of each Loan Request, (ii) as of each Renewal Request, or deemed renewal under Section 4.3.3, (iii) on or about the date of each Valuation performed in accordance with Section 3.4.1, (iv) as of each addition or release of a Collateral Pool Property to or from the Collateral Pool, (v) as of each repayment of any principal portion of the Outstanding Borrowing Tranches, (vi) as of the exercise of the First Extension Option (if applicable), or the Second Extension Option (if applicable), (vii) as of the Expansion Option Date, and (viii) upon the occurrence of any Material Adverse Change. Each recalculation of Aggregate Stressed Debt Service and the LTV Ratio shall be based on Lender’s then current underwriting policies, consistently applied. 2.1.3.2    In the event of: (i) an addition of a Mortgaged Property to the Collateral Pool, Lender shall add the Net Operating Income of the Mortgaged Property to be added to the Collateral Pool to the most recent determination of Net Operating income for the existing Collateral Pool; (ii) a release of a Collateral Pool Property from the Collateral Pool, Lender shall subtract the Net Operating Income of the Collateral Pool Property released from the Collateral Pool from the most recent determination of the Net Operating Income for the Collateral Pool; or (iii) a substitution of a Collateral Pool Property in the Collateral Pool, Lender shall (x) add the Net Operating Income of the Mortgaged Property to be added to in the Collateral Pool to the most recent determination of Net Operating Income for the existing Collateral Pool and (y) subtract the Net Operating Income of the Collateral Pool Property released from the Collateral Pool from the most recent determination of Net Operating Income for the Collateral Pool. 2.1.4    Sublimits. Notwithstanding anything to the contrary set forth herein, Borrower may borrow hereunder only to the extent that after giving effect to such borrowing (collectively, the “Sublimits”): 2.1.4.1    the LTV Ratio shall not exceed the Maximum LTV Ratio; 2.1.4.2    the Aggregate DSCR shall not be less than 1.45:1.00; 2.1.4.3    the number of Borrowing Tranches outstanding shall not exceed 10, unless an Expansion has occurred, in which event the number of Base Rate Borrowing Tranches shall not exceed 15 if the Loan has been increased to $300,000,000 and shall not exceed 20 if the Loan has been increased to $350,000,000; Credit Agreement   Page 16 2.1.4.4    the aggregate amount of the Outstanding Borrowing Tranches shall not exceed the Loan. In the event either of the Sublimits set forth in Section 2.1.4.1 or Section 2.1.4.2 above are not satisfied at any time prior to the Expiration Date, Lender shall provide Borrower with Notice in the form attached hereto as Schedule 2.1.4, and Borrower shall comply with the provisions of Section 5.4.2. 2.2    Term. The term of the Loan shall commence on the Closing Date and shall terminate on the Expiration Date. The entire Indebtedness shall be due and payable on the Expiration Date. 2.3    Option to Extend. 2.3.1    First Option to Extend. Borrower shall have the option to extend the Scheduled Maturity Date to the First Extended Maturity Date (“First Option to Extend”), upon satisfaction of each of the following conditions precedent in Lender’s discretion: (i)    Borrower shall provide written Notice to Lender at least 60 days, but no more than 90 days, prior to the Scheduled Maturity Date, which Notice shall be supplemented by such additional information as Lender may reasonably require to determine, in its sole discretion, whether the conditions set forth in this Section 2.3.1 have been satisfied; (ii)    Borrower shall pay on or prior to the Scheduled Maturity Date (a) all amounts due and owing pursuant to the Fixed Rate Note, if any; provided however, any unpaid principal may be converted to a Base Rate Borrowing Tranche if Borrower complies with all of the terms and provisions of this Agreement for obtaining a Base Rate Borrowing Tranche, (b) the Extension Fee to Lender together with the Notice delivered pursuant to clause (i) above (provided, that if Borrower elects to terminate the First Extension Option prior to the Scheduled Maturity Date for any reason, Lender shall reimburse Borrower for the Extension Fee) and (c) all of Lender’s and Servicer’s reasonable costs and expenses (including, without limitation, Attorneys’ Fees and Costs) incurred in connection with the requested extension; (iii)    Borrower shall provide to Lender all documents in connection with the requested extension as Lender shall require, in its reasonable discretion; (iv)    no Potential Default or Event of Default shall have occurred and then be continuing under this Agreement or any of the Loan Documents; Credit Agreement   Page 17 (v)    Borrower shall be in compliance with the Sublimits; and (vi)    The representations and warranties set forth in Section 7 shall be true and correct as of the date of Borrower’s Notice to Lender requesting the extension and as of the effective date of the extension of the Scheduled Maturity Date. If Borrower elects to exercise the First Option to Extend, then the Net Spread applicable for any Borrowing Tranche (including the converted Fixed Rate Borrowing Tranche) shall be redetermined by Lender in its sole discretion in accordance with Section 4.2.3 hereof. Lender and Borrower shall evidence the First Extended Maturity Date and applicable Net Spread pursuant to this Section 2.3.1 by executing a confirmation substantially in the form attached hereto as Schedule 2.3. If Borrower does not exercise the First Option to Extend, the entire Indebtedness shall be payable on the Scheduled Maturity Date. 2.3.2    Second Option to Extend. Borrower shall have the option to extend the First Extended Maturity Date to the Second Extended Maturity Date (“Second Option to Extend”), upon satisfaction of more than 90 days, prior to the First Extended Maturity Date, which Notice shall be supplemented by such additional information as Lender may reasonably require to determine, in its sole discretion, whether the conditions set forth in this Section 2.3.2 have been satisfied; (ii)    Borrower shall pay (a) the Extension Fee to Lender together with the Notice delivered pursuant to clause (i) above (provided, that if Borrower elects to terminate the Second Extension Option prior to the First Extended Maturity Date for any reason, Lender shall reimburse Borrower for the Extension Fee) and (b) all of Lender’s and Servicer’s reasonable costs and expenses (including, without limitation, Attorneys’ Fees and Costs) incurred in connection with the requested extension on or prior to the First Extended Maturity Date; Credit Agreement   Page 18 extension and as of the effective date of the extension of the First Extended Maturity Date. If Borrower elects to exercise the Second Option to Extend, then the Net Spread applicable for any Borrowing Tranche shall be redetermined by Lender in its sole discretion in accordance with Section 4.2.3 hereof. Lender and Borrower shall evidence the Second Extended Maturity Date and applicable Net Spread pursuant to this Section 2.3.2 by executing a confirmation substantially in the form attached hereto as Schedule 2.3. If Borrower does not exercise the Second Option to Extend, the entire Indebtedness shall be payable on the First Extended Maturity Date. 2.4    Contraction and Expansion Options. 2.4.1    Borrower’s Election of Contraction Option. Borrower shall have the right to decrease the Loan as described below; provided such decrease is a result of either Borrower’s (i) sale of a Collateral Pool Property to a third party as reasonably determined by Lender; (ii) refinancing of a Collateral Pool Property in connection with a Securitized Loan pursuant to the provisions of Section 3.3; or (iii) release of a Collateral Pool Property pursuant to Section 3.2, but not sold to a third party or refinanced in connection with a Securitized Loan. Borrower shall exercise such right by (a) delivering to Lender 60 days prior written Notice of its intent to decrease the Loan, which Notice shall be accompanied by payment of all reasonable costs and expenses that Lender and Servicer incur in connection with such decrease, including, but not limited to, Attorneys’ Fees and Costs, and (b) by executing and where appropriate acknowledging (A) amendments to the Loan Documents, in form and substance reasonably acceptable to Lender, as Lender deems reasonably necessary to evidence the decrease in the Loan, and (B) any other amendments or agreements deemed reasonably necessary by Lender. All amendments referred to in clause (b)(A) of the preceding sentence shall be prepared by Lender’s counsel and delivered to Borrower within a reasonable time of Borrower’s Notice to Lender under clause (a) of the preceding sentence. Upon Borrower’s compliance with all of the provisions of items (a) and (b) above, the Loan shall be decreased by an amount equal to the Allocated Loan Amount of the released Collateral Pool Property in the event of a third party sale decreased by the amount of the Securitized Loan in the event of a refinance pursuant to the provisions of Section 3.3 or decreased by an amount equal to the Allocated Loan Amount of the released Collateral Pool Property not sold to a third party or refinanced in connection with a Securitized Product. Once Borrower has elected to decrease the Loan as provided herein, any unexercised expansion of the Loan as set forth in Section 2.4.3 shall be deemed null and void and of no further force and effect. Credit Agreement   Page 19 2.4.2    Lender’s Election of Contraction Option. In the event a Collateral Pool Property is released pursuant to Section 3.2 and not refinanced or acquisition financed, as applicable, by a Securitized Product, Lender, in its sole discretion may, within 120 days of such release, reduce the Loan as to any future Base Rate Borrowing Tranches by the Allocated Loan Amount, and Borrower shall pay the Termination Fee. 2.4.3    Expansion Option. Prior to the twelve (12) months immediately preceding the Scheduled Maturity Date, Borrower shall have the right to increase the Loan as described below, up to a maximum of $350,000,000 provided that (i) neither a Potential Default or Event of Default under this Agreement shall have occurred and then be continuing at the time of such increase, and (ii) the representations and warranties of Section 7 are true and correct at the time of such increase and (iii) Guarantor complies with the Minimum Net Worth and Liquidity requirements set forth in Section 8.10 at the time of such increase. Borrower shall exercise such right by (a) delivering to Lender 60 days prior written Notice of its intent to increase the Loan, which Notice shall be accompanied by (1) the Expansion Fee, and (2) payment of all reasonable costs and expenses that Lender and Servicer incur in connection with such increase, including, but not limited to, Attorneys’ Fees and Costs, and (b) executing and where appropriate acknowledging (1) amendments to the Loan Documents, in form and substance reasonably acceptable to Lender, as Lender deems reasonably necessary to evidence the increase in the Loan and to increase the amount of coverage under Lender’s existing title insurance policies, and (2) any other amendments or agreements deemed reasonably necessary by Lender. All amendments referred to in clause (b)(1) of the preceding sentence shall be prepared by Lender’s counsel and delivered to Borrower within a reasonable period of time following Borrower’s Notice to Lender under clause (a) of the preceding sentence. Upon Borrower’s compliance with all of the provisions in this Section, the Loan (as to any future Base Rate Borrowing Tranches) shall be increased to the amount selected by Borrower (the “Expansion Amount”). The minimum amount of each increase in the Loan requested by Borrower pursuant to this Section shall be $25,000,000 (“Minimum Expansion Amount”). Subject to the provisions of Section 2.4.1 and this Section 2.4.3, the Borrower shall have an unlimited number of expansion options, but in no event shall the number of requested increases by Borrower exceed 2 within any 12 month period. Credit Agreement   Page 20 2.5    Fees. 2.5.1    Fees and Costs Due on the Closing Date. Borrower shall pay on the Closing Date, as further consideration for Lender’s cost in underwriting the Loan, (i) a non-refundable transaction fee, payable to Freddie Mac, equal to the amount of 0.0005 times the amount of the Loan, (ii) a non-refundable transaction fee, payable to Servicer, equal to the amount of 0.0020 times the amount of the Loan (collectively, (i) and (ii), the “Commitment Fee”), (iii) the Addition Fee (to the extent not previously paid) and Seismic Report Fee (to the extent applicable) for each Mortgaged Property to be included as part of the Collateral Pool, and (iv) all reasonable out-of-pocket costs, expenses and disbursements (including fees and expenses of counsel for Lender and Servicer), incurred by Lender and Servicer in connection with the negotiation and execution of this Agreement and other instruments and documents 2.5.2    Unused Commitment Fee. Accruing from the Closing Date until the Maturity Date, Borrower shall pay to Lender, as consideration for Lender’s commitment hereunder, a nonrefundable unused commitment fee (the “Unused Commitment Fee”) equal to 0.0020 per annum (computed on the basis of a year of 360 days and actual days elapsed) on the average daily difference between the amount of (i) the outstanding principal balance of the Loan and (ii) the Loan. All Unused Commitment Fees shall be payable monthly in arrears on each Payment Date and shall be set forth on the applicable Monthly Payment Statement. Unused Commitment Fee payments which cover less than 1 month shall be prorated based on the actual number of days elapsed. Any accrued but unpaid Unused Commitment Fees shall also be due and payable on the Expiration Date. Credit Agreement   Page 21 2.5.3    Seasoning Fee. If a Collateral Pool Property remains in the Collateral Pool for 3 years and upon each subsequent 1 year anniversary date thereafter until the Expiration Date (the “Seasoning Period”) Borrower shall pay to Lender an annual seasoning fee for each such Collateral Pool Property in an amount equal to the product of 0.0050 times the applicable Collateral Pool Property’s Allocated Loan Amount (the “Seasoning Fee”). On each Payment Date during the applicable Seasoning Period, 1/12th of the applicable Seasoning Fee shall be paid in arrears on each Payment Date beginning with the Payment Date immediately after the applicable anniversary date and shall be set forth on the applicable Monthly Payment Statement. Any Seasoning Fee payments which cover less than 1 month shall be prorated based on the actual number of days elapsed. The applicable Seasoning Fee shall continue to be due and payable until the date on which Lender is required to deliver its release of the applicable Collateral Pool Property pursuant to Sections 3.2 or 3.3 as applicable. After such date, any remaining portion of any such annual Seasoning Fee that would have been due after the date of such release will not be due. Any accrued but unpaid Seasoning Fees shall also be due and payable on the Expiration Date. 2.5.4    Base Rate Termination Fee, Fixed Rate Termination Fee and Release Termination Fee. 2.5.4.1    In the event any Collateral Pool Property is released pursuant to Section 2.6 or Section 3.2 and not refinanced or acquisition financed by the Borrower or a third party purchaser, as applicable, by a Securitized Product, then Borrower shall pay a termination fee (the “Base Rate Termination Fee”) relating to any applicable Base Rate Borrowing Tranche under either (but not both) Section 2.5.4.1.1 or Section 2.5.4.1.2 below, as applicable. 2.5.4.1.1    In the event of a prepayment of all or any portion of any Base Rate Borrowing Tranche, the product of the Allocated Loan Amount attributable to such Collateral Pool Property multiplied by (i) 4% if the Collateral Pool Property is released prior to the 1st anniversary of the Closing Date, (ii) 3% if the Collateral Pool Property is released prior to the 2nd anniversary of the Closing Date, (iii) 2% if the Collateral Pool Property is released prior to the 3rd anniversary of the Closing Date or (iv) 1% on or after the 3rd anniversary of the Closing Date. Credit Agreement   Page 22 2.5.4.1.2    In the event of a prepayment of all of the Base Rate Borrowing Tranches pursuant to Section 2.6, the product of the (i) Loan (less (x) any decrease as a result of Borrower’s election of the Contraction Option or (y) provided Borrower has not previously elected any Contraction Option as a result of such releases, the aggregate amount of the financing of the previously released Collateral Pool Properties that are refinanced or financed by the Borrower or a third party purchaser by a Securitized Product, as applicable, the “Calculated Loan Amount”) times (ii) (a) 4% if the termination occurs prior to the 1st anniversary of the Closing Date, (b) 3% if the termination occurs prior to the 2nd anniversary of the Closing Date, (c) 2% if the termination occurs prior to the 3rd anniversary of the Closing Date or (d) 1% on or after the 3rd anniversary of the Closing Date. Provided, however in the event the Borrower’s prepayment of all of the Base Rate Tranches pursuant to Section 2.6 is the result of a Sponsor Liquidity Event, then Borrower shall pay a fee equal to 2% of the Loan if the Sponsor Liquidity Event occurs during the period from the Closing Date until the 2nd anniversary date of the Closing Date or one percent (1.0%) of the Loan thereafter. 2.5.4.1.3    No Base Rate Termination Fee will be owed in the event Lender or its successors is not offering the Securitized Product. Borrower, in the event a Collateral Pool Property is released pursuant to Section 3.2, will have the option, in its sole discretion (subject to compliance with the terms of Section 2.4.1) to reduce the Loan by the stated principal amount of the Securitized Loan for the Collateral Pool Property refinanced through the Securitized Product. 2.5.4.2    In the event any Collateral Pool Property is released pursuant to Section 2.6 or Section 3.2 then Borrower shall pay a termination fee (the “Fixed Rate Termination Fee”) relating to any applicable Fixed Rate Borrowing Tranche as more fully set forth below. 2.5.4.2.1    In the event of a prepayment of all or any portion of any Fixed Rate Borrowing Tranche as a result of (i) a sale of a Collateral Pool Property, either (a) the applicable Prepayment Premium calculated in accordance with the Fixed Rate Note, if the third party purchaser does not finance the acquisition by a Securitized Product, or (b) the applicable Prepayment Premium calculated in accordance with the Fixed Rate Note minus 1% of the outstanding principal balance of the prepaid amount of the Fixed Rate Borrowing Tranche, if the third party purchaser finances the acquisition by a Securitized Product or (ii) a release of a Collateral Pool Property (other than by a sale) either (a) the applicable Prepayment Premium calculated in accordance with the Fixed Rate Note, if the Collateral Pool Property is released without the use of a Securitized Product, or (b) the applicable Prepayment Premium calculated in accordance with the Fixed Rate Note less 1% of the outstanding principal balance of the prepaid amount of the Fixed Rate Borrowing Tranche, if refinanced by a Securitized Product. Credit Agreement   Page 23 2.5.4.3    In the event a Collateral Pool Property is released pursuant to Borrower or a third party purchaser, as applicable, by a Securitized Product and (ii) no prepayment occurs, then Borrower shall pay a termination fee (“Release Termination Fee”), calculated as follows: the product of the Allocated Loan Amount attributable to such Collateral Pool Property multiplied by (i) 4% if the Collateral Pool Property is released prior to the 1st anniversary of the Closing Date, (ii) 3% if the Collateral Pool Property is released prior to the 2nd anniversary of the Closing Date, (iii) 2% if the Collateral Pool Property is released prior to the 3rd anniversary of the Closing Date or (iv) 1% on or after the 3rd anniversary of the Closing Date. 2.5.5    Addition Fee. For each Mortgaged Property added to the Collateral Pool pursuant to Section 3.1 of this Agreement, Borrower shall upon Lender’s approval of the addition of a Mortgaged Property to the Collateral Pool pay to: (a) Servicer a non-refundable addition fee equal to the amount of 0.0020 times the Allocated Loan Amount for such Mortgaged Property; (b) Lender a non-refundable addition fee equal to the amount of 0.0010 times the Allocated Loan Amount for such Mortgaged Property (collectively, the “Addition Fee”). 2.5.6    Expansion Fee. Upon each Expansion Option Date, Borrower shall pay to (a) Servicer an expansion fee equal to 0.0020 times the Expansion Amount, and (b) Lender a non-refundable expansion fee equal to the amount of 0.0005 times the Expansion Amount (collectively, the “Expansion Fee”). 2.5.7    Extension Fee. If Borrower elects to exercise (i) its First Option to Extend and/or (ii) its Second Option to Extend, Borrower shall, in each instance, pay to Servicer an extension fee equal to $50,000 (the “Extension Fee”). Credit Agreement   Page 24 2.6    Borrower’s Right to Terminate the Agreement. At any time during the term of the Loan, Borrower shall have the right to terminate this Agreement in full and the parties’ obligations under the Loan Documents, provided that Borrower (i) delivers to Lender 30 days advance written Notice of its revocable election to terminate this Agreement specifying the Expiration Date, (ii) repays all Indebtedness with respect to, the Loan in full and (iii) performs all other Obligations under this Agreement, the Revolving Credit Note, the Fixed Rate Note and the other Loan Documents, including, but not limited to, Borrower’s obligations to pay the Termination Fee. Notwithstanding anything herein to the contrary, a Sponsor Liquidity Event shall be deemed an election by Borrower to terminate this Agreement except as otherwise permitted pursuant to Section 8.3. Upon Borrower’s compliance with the terms and provisions in this Section 2.6, Lender shall release the Liens granted hereunder and release and discharge Borrower from any and all Obligations under the other Loan Documents except as to environmental indemnifications under Sections 6.12 and 10.02 of the applicable Loan Agreement on the Expiration Date. Without limiting any other provision contained herein, in the event Borrower shall revoke any such request to terminate its Obligations under this Agreement in full and the parties’ obligations under the Loan Documents, Borrower shall pay all costs and expenses incurred by Lender and Servicer in connection with such revocation, including, without limitation, Attorneys’ Fees and Costs. Credit Agreement   Page 25 3. COLLATERAL POOL, ADDITION AND RELEASE, VALUATIONS AND MATERIAL ADVERSE CHANGE. 3.1    Addition of a Collateral Pool Property. 3.1.1    Procedure for Proposing a Mortgaged Property Addition to the Collateral Pool. Borrower or Proposed Borrower, as the case may be, may propose to add one (1) or more Mortgaged Properties to the Collateral Pool by delivering to Lender (i) a written proposal for addition of each such proposed Mortgaged Property, (ii) the Addition Fee as and when required pursuant to Section 2.5.5, (iii) a Seismic Report Fee, if applicable, and (iv) the Underwriting Materials with respect to the Mortgaged Property and the Proposed Borrower, if applicable, provided that, (a) Borrower shall utilize its best efforts to aggregate such submission(s) relating to one or more Mortgaged Properties to cause such submission(s) to constitute no more than 3 proposals being submitted to Lender in any 1 Month. Upon Lender’s receipt of all fees required hereunder and all Underwriting Materials, Lender shall notify Borrower (or Proposed Borrower, as applicable) of the same. The determination of whether Borrower or Proposed Borrower has provided Lender with all Underwriting Materials shall be in Lender’s discretion. Borrower (or Proposed Borrower, as applicable) shall pay all reasonable costs and expenses that Lender and Servicer incur in connection with any such proposal to add a Mortgaged Property to the Collateral Pool, including, but not limited to, Attorneys’ Fees and Costs and any reasonable costs and expenses incurred with respect to third party reports, whether or not Lender approves the Mortgaged Property for addition hereunder. Borrower (or Proposed Borrower, as applicable) or its Affiliates shall be permitted to engage and pay directly the third-party consultants to be retained for the required property condition reports and environmental reports provided that (i) Lender and Servicer approve in advance and in writing each such consultant and the scope of each such report, and (ii) each such report states that it is made for the benefit, use and reliance of Lender and Servicer, as well as Borrower (or Proposed Borrower, as applicable) and/or its Affiliate. Notwithstanding the foregoing, only a Mortgaged Property presented by Borrower (or Proposed Borrower, as applicable) to Servicer for underwriting and approval pursuant to this Agreement will be eligible for addition to the Collateral Pool. Credit Agreement   Page 26 3.1.2    Approval of the Addition of the Mortgaged Property to the Collateral Pool. 3.1.2.1    With respect to any Mortgaged Property that Borrower (or Proposed Borrower, as applicable), proposes for addition to the Collateral Pool, Lender shall, within 20 days of the date on which Lender notifies Borrower (or Proposed Borrower, as applicable) that it has received all fees then required hereunder and all Underwriting Materials, use its best efforts to accept or reject in writing the proposed Mortgaged Property on the basis of whether such Mortgaged Property meets Lender’s then current requirements for addition to the Collateral Pool, as determined by Lender in its sole discretion. In the event that Lender accepts the Mortgaged Property for addition to the Collateral Pool, Lender shall provide or cause Servicer to provide Borrower (or Proposed Borrower, as applicable) with a written approval letter (which letter shall include Lender’s determination of the Initial Market Value of such Mortgaged Property, the Net Operating Income of such Mortgaged Property and the initial Allocated Loan Amount). If Borrower (or Proposed Borrower, as applicable) elects in its sole discretion to accept the terms thereof, Borrower (or Proposed Borrower, as applicable) shall execute the approval letter and add such Mortgaged Property to the Collateral Pool within 20 days of the date of the issuance of the approval letter, subject to Borrower’s (or Proposed Borrower’s as applicable compliance with the terms and provisions of Section 3.1.2.2. Notwithstanding anything contained herein to the contrary, no Mortgaged Property shall be submitted for addition to the Collateral Pool unless the value of such Mortgaged Property, as determined by Lender, in its sole discretion, is equal to or greater than $10,000,000 prior to and after the addition of such Mortgaged Property. The failure of Lender to respond to Borrower’s (or Proposed Borrower’s, as applicable) request within such 20 day period shall be deemed a rejection by Lender of the proposal to add the Mortgaged Property to the Collateral Pool. If Lender provide(s) the reason(s) for such rejection, Borrower (or Proposed Borrower, as applicable) shall have 45 days to satisfy the objections of Lender to such proposed Mortgaged Property (Lender, in its sole discretion, may require that Borrower (or Proposed Borrower, as applicable) provide within such 45 day period necessary updates of any or all of the Underwriting Materials). If Borrower (or Proposed Borrower, as applicable) does not satisfy Lender’s objections, then such proposal shall be deemed terminated (unless Lender, in its sole discretion shall agree to extend such 45 day period). Any such termination shall not prevent Borrower (or Proposed Borrower, as applicable) from subsequently resubmitting a Mortgaged Property (together with all fees then required hereunder and the Underwriting Materials) for addition to the Collateral Pool, provided however, that Borrower or Proposed Borrower may not resubmit the same Mortgaged Property for addition to the Collateral Pool more often than 1 time in any 12 month period unless otherwise permitted by Lender. Credit Agreement   Page 27 3.1.2.2    If the Mortgaged Property is accepted for addition to the Collateral Pool, such Mortgaged Property shall be added to the Collateral Pool, provided that, at the time of such addition to the Collateral Pool (i) no Event of Default or Potential Default shall exist and then be continuing, (ii) reserved, (iii) Borrower (or Proposed Borrower, as applicable) has paid the fees and expenses required hereunder including, but not limited to, Attorneys’ Fees and Costs and the Addition Fee, (iv) Borrower (and Proposed Borrower, as applicable) has submitted the following to Lender: (a) executed Collateral Pool Property Documents requested by Lender, (b) any modifications or amendments to the existing Loan Documents as required by Lender, (c) copies of all filing receipts and acknowledgements issued by any governmental authority evidencing any recordation or filing necessary to perfect Lender’s Lien on the Mortgaged Property or other evidence satisfactory to Lender of such recordation and filing of the applicable Security Instrument, (d) evidence satisfactory to Lender that, subject to the Permitted Exceptions, (1) in the case of personal property, the Lien constitutes a first priority security interest in favor of Lender and, (2) in the case of real property, the Security Instrument constitutes a valid and perfected first priority Lien in favor of Lender (such evidence to be in the form of a title insurance policy acceptable to Lender in both form and substance), (e) such consents to the transaction by Guarantor as requested by Lender or Servicer in form and substance acceptable to the requesting party, (f) opinions of counsel acceptable to Lender including but not limited to an enforceability opinion with respect to Virginia law for any addition to the Collateral Pool (provided, however, any Virginia law opinion shall only be required after the Closing Date if material or substantive modifications are made to the Loan Documents as determined by Lender in its reasonable discretion), and (g) such other certificates and documentation as required by Lender or Servicer and (v) in the case of a Proposed Borrower, such Proposed Borrower shall also execute (a) a joinder agreement relating to the Loan Documents, and (b) an allonge(s) to the Revolving Credit Note and Fixed Rate Note. If Borrower (or Proposed Borrower, as applicable) fails to perform any of the acts, where applicable, or to submit any of the documents or information listed under (i), (ii), (iii), (iv), and (v) above together with any and all updates to the Underwriting Materials reasonably requested by Lender within 20 days of the date of Lender’s acceptance, Lender may at its option reject the Mortgaged Property and terminate such proposal. In the event that Borrower (or Proposed Borrower, as applicable) performs all of the acts and submits all of the documents and evidence listed in (i), (ii), (iii), (iv), and (v) and accepts the terms of any approval letter issued or caused to be issued by Lender and not withdrawn (such withdrawal to be permitted only as a result of material changes or circumstances to the Mortgaged Property, Borrower, Guarantor, the Loan or the existence of a Material Adverse Change), the Mortgaged Property shall be added to the Collateral Pool. Credit Agreement   Page 28 3.2    Release of a Collateral Pool Property. Lender shall, upon 30 days advance written Notice, release the Liens with respect to a Collateral Pool Property, provided, however, such Collateral Pool Property is not the last remaining Collateral Pool Property (unless Borrower complies with the penultimate sentence in this Section 3.2), provided that (i) Borrower shall pay Lender (a) the applicable Termination Fee, if applicable and (b) all costs and expenses that Lender or Servicer incur in connection with such release, including, but not limited to, Attorneys’ Fees and Costs and all other amounts due to Lender hereunder in connection with such release, including, without limitation, Accrued Interest and unpaid interest, if applicable, (ii) at the time of the request for such release, no Event of Default or Potential Default shall exist, (iii) after giving effect to such release, no Event of Default or Potential Default shall exist, (iv) reserved, and (v) Borrower shall be in compliance with the Sublimits, provided, however, that if such release would otherwise cause Borrower to be in non-compliance with the Sublimits set forth in Section 2.1.4, Borrower shall have the opportunity to cure the same prior to or simultaneously with such release by complying with the terms and provisions of Section 5.4.2. Upon the release of a Lien on a Collateral Pool Property, if the Borrower of such Collateral Pool Property owns no other Collateral Pool Property, such Borrower shall be released from its obligations under this Agreement and the other Loan Documents except as to environmental indemnifications pursuant to Sections 6.12 and 10.02 of the applicable Loan Agreement. Notwithstanding the foregoing, under no circumstances may Borrower receive a release of the Security Instrument with respect to the last remaining Collateral Pool Property prior to the Maturity Date, unless Borrower has elected to terminate this Agreement pursuant to Section 2.6. Borrower may revoke a pending request to release a Collateral Pool Property at any time; provided that Borrower pays all of Lender’s reasonable costs and expenses with respect to such release request, including, without limitation, Attorneys’ Fees and Costs; provided, further, that Borrower shall be entitled to reimbursement of any Termination Fee, if any, paid to Lender in connection with such request to release a Collateral Pool Property. Credit Agreement   Page 29 3.3    Release of Collateral Pool Property Followed by a Securitized Loan. 3.3.1    Securitized Loan. Borrower may request that Lender cause Servicer to make a Securitized Loan (the “Securitized Loan”) to be secured by a Collateral Pool Property designated by Borrower (the “Securitized Loan Collateral”) to be simultaneously released from the Collateral Pool and encumbered in favor of Servicer as security for Borrower’s obligations under the Securitized Loan, which request shall be made in accordance with the provisions of Section 3.3.2. The Securitized Loan shall be made in accordance with the terms and conditions of a Securitized Product. Notwithstanding the foregoing, under no circumstances may Borrower receive a release of the Security Instrument with respect to the last remaining Collateral Pool Property prior to the Maturity Date, unless Borrower has elected to terminate this Agreement under Section 2.6. Servicer shall be permitted to collect from Borrower (and Borrower shall pay to Servicer) a commitment fee for such Securitized Loan, as reasonably determined by Servicer based on then-current market commitment fees. 3.3.2    Procedure for Making a Securitized Loan. Borrower may request that Lender cause Servicer to make a Securitized Loan to Borrower, which request (i) shall be in writing, which writing shall specify (a) each Collateral Pool Property that will constitute the Securitized Loan Collateral, (b) the requested original principal amount of the Securitized Loan, which amount shall be greater than or equal to $10,000,000, (c) the related reduction in the Maximum Facility Available, (d) whether Borrower has selected Lender’s then current early rate lock or standard delivery option, and (e) any payment or prepayment of a Borrowing Tranche, and (ii) shall be accompanied by (a) any fees then due and owing under the Securitized Product for each Collateral Pool Property proposed by Borrower to be subject to the Securitized Loan, and (b) the Underwriting Materials. Following receipt of all of the items specified in (i) and (ii) of the previous sentence, Lender shall use its best efforts to consent to Borrower’s request within 45 days of such Notice, provided that (i) at the time of such request no Event of Default or Potential Default exists, (ii) the Securitized Loan shall be made in accordance with, and subject to, the terms and conditions of a Securitized Product, (iii) after giving effect to such release, no Event of Default or Potential Default shall exist, (iv) the representations and warranties of Section 7 shall be true and correct as of the date of Borrower’s request for such Securitized Loan and on the date that such Securitized Loan is funded by Lender, (v) Borrower will be in compliance with all provisions hereof, including the Sublimits set forth in Section 2.1.4, further provided that if any release occasioned by a Securitized Loan would otherwise cause Borrower to be in non-compliance with the Sublimits, Borrower shall have the opportunity to cure the same, prior to or simultaneously with the release and the consummation of the Securitized Loan in accordance with the provisions of Section Credit Agreement   Page 30 5.4.2, (vi) Borrower shall provide evidence to Lender of title insurance in form and substance acceptable to Lender and in the face amount of the Securitized Loan, (vii) the proposed Borrower under the Securitized Loan shall execute and deliver such documents as Lender, in its discretion, may request in order to evidence the making of the Securitized Loan and in order to grant Lender a first priority Lien on the real and personal property constituting the Securitized Loan Collateral subject, in each case, to any Permitted Exceptions, and (viii) Borrower shall pay Lender any fees then due and owing under the Securitized Product. Thereafter, Servicer shall use commercially reasonable efforts to consummate the Securitized Loan within 30 days after its consent to Borrower’s request thereof. Notwithstanding the foregoing, in the event that Borrower selects Lender’s then current early rate lock delivery option, Lender shall use its best efforts, subject to Borrower’s timely compliance with Lender’s requests, to lock the interest rate for the requested Securitized Loan within 7 Business Days of Borrower’s Notice hereunder. Any Securitized Loan granted pursuant to the foregoing provisions shall not reduce the Loan hereunder unless Borrower elects to reduce the Loan pursuant to Section 2.4.1. Simultaneously with the closing of the Securitized Loan, Lender shall release the Lien granted hereunder on the Collateral and the related Borrower (provided, such Borrower owns no other Collateral Pool Properties) except as to environmental Agreement. Notwithstanding the foregoing, at any time prior to the release and consummation of the Securitized Loan, Borrower may by written Notice revoke its request for a release and a Securitized Loan pursuant to this Section 3.3.2; provided, however, that Borrower shall reimburse Lender and Servicer respectively, for Lender’s and Servicer’s costs and expenses, including breakage costs and Attorneys’ Fees and Costs and any other fees due under this Agreement, that Lender or Servicer incur in connection with such proposed release and Securitized Loan financing prior to Borrower’s revocation. Credit Agreement   Page 31 3.4    Valuations. 3.4.1    Timing and Procedure of Valuation. In addition to any other provisions requiring a valuation hereunder, Lender will perform, in accordance with its then current underwriting policies, practices and procedures consistently applied, a valuation (the “Valuation”) to determine the then (i) Market Value and (ii) Net Operating Income of each Collateral Pool Property, which Valuation will be performed (a) on the first date such Collateral Pool Property is added to the Collateral Pool, and (b) on or about August 1st annually thereafter (“Anniversary Date”). In connection with the Valuation, Borrower shall deliver to Servicer by no later than June 1st, a current rent roll (which will be no more than 30 days old) and trailing 12 month operating statement dated no later than the last day of April with respect to each Collateral Pool Property, each trailing 12 month operating statement certified by an Authorized Officer. In the event that a 12 month trailing operating statement is not available for a Collateral Pool Property because of when Borrower purchased such Collateral Pool Property, the Borrower must deliver to the Servicer no later than June 1st a current rent roll (which will be no more than 30 days old) and no less than a 6 month trailing operating statement certified by an Authorized Officer in which event Lender may, in Lender’s sole discretion, annualize such operating statements for the purpose of determining the Market Value and/or Net Operating Income of such Collateral Pool Property. Lender may request that Borrower deliver additional current rent rolls (which shall be no more than 30 days old) more frequently than annually, and Borrower shall deliver to Servicer such additional current rent rolls, each certified by an Authorized Officer. Lender may elect, in its sole and absolute discretion, to use any such additional current rent rolls for Valuation purposes but Lender has no obligation to do so. Without limiting the foregoing, each such rent roll and operating statement will be in such form and contain such detail as Lender may reasonably require and Lender may require that any such rent rolls and operating statements be verified by an independent party acceptable to Lender if Lender in its reasonable discretion believes the information contained therein is inaccurate or misleading. Lender will then notify the Borrower in writing (the “Valuation Letter”) of the Net Operating Income and Market Value for each Collateral Pool Property. 3.4.2    Valuations that Disclose a Decrease in Market Value and/or Net Operating Income. If any Valuation discloses that the Market Value and/or Net Operating Income of the Collateral Pool has decreased below the then current values or calculations thereof, the Maximum Facility Available may be adjusted in accordance with the provisions of Section 2.1.4 and in the event such decrease in Market Value or Net Operating Income shall cause Borrower to be in non-compliance with the Sublimits set forth in Sections 2.1.4.1 or 2.1.4.2, Borrower shall comply with the provisions of Section 5.4.2. Credit Agreement   Page 32 3.4.3    Valuations that Disclose an Increase in Market Value and/or Net Operating Income. the Collateral Pool has increased above the then current values thereof, the Maximum Facility Available may be adjusted, if necessary, in accordance with the provisions of Section 2.4.1, and Borrower shall be entitled to borrow and reborrow hereunder, subject to the Sublimits, up to the remaining amount of the Loan in accordance with the terms of this Agreement. 3.5    Material Adverse Change to Borrower, Guarantor or a Collateral Pool Property. If a Material Adverse Change occurs, Borrower shall promptly notify Lender in writing as soon as Borrower has notice thereof. If Lender shall receive Notice of a Material Adverse Change in accordance with the preceding sentence, or otherwise becomes aware of a Material Adverse Change, which Material Adverse Change affects a Collateral Pool Property or Borrower, Lender may (and Borrower shall have the right to request) promptly conduct a Valuation of the affected Collateral Pool Property pursuant to Section 3.4. Until such time as such Valuation is completed, the Collateral Pool Property which experienced the Material Adverse Change, or which is owned by a Borrower that experienced a Material Adverse Change, shall be deemed, for the purposes of determining whether any new borrowing request satisfies the Sublimits, to have a Market Value and Net Operating Income reasonably determined and quantified by Lender upon the information then available to Lender. Lender shall promptly provide Borrower with written Notice of the results of such Valuation. If the results of such Valuation disclose that the Market Value of the affected Collateral Pool Property has decreased, then the Market Value shall thereafter be deemed to be the amount shown in such Valuation. In the event that such Valuation hereunder shall cause Borrower to be in non-compliance with the Sublimits set forth in Sections 2.1.4.1 or 2.1.4.2, Borrower shall comply with the provisions of Section 5.4.2. If Lender shall receive Notice of a Material Adverse Change from Borrower hereunder, or otherwise becomes aware of a Material Adverse Change, Borrower shall promptly provide any information or documents reasonably requested by Lender, including, but not limited to, (a) with respect to a Material Adverse Change which affects Borrower or Guarantor, financial Adverse Change or (b) with respect to a Material Adverse Change which affects the enforceability of this Agreement or the other Loan Documents Taken as a Whole, replacement documents in form and substance acceptable to Lender in its discretion, together with a legal opinion regarding the enforceability of such replacement documents, acceptable to Lender in its discretion. Credit Agreement   Page 33 4.    INTEREST, COSTS AND CHARGES 4.1    Interest Rate. The interest rate for each Borrowing Tranche shall be the Base Rate, Fixed Rate or, if required pursuant to Sections 4.3.2 or 4.4 hereof, the Prime Rate. Interest rates under this Agreement, the Revolving Credit Note and the Fixed Rate Note shall be computed on the basis of a year of 360 days and actual days elapsed. 4.2    Interest Rate Determinations. 4.2.1    Prime Rate, Base Rate, and Fixed Rate Determination. 4.2.1.1    Prime Rate. The initial Prime Rate applicable to any Prime Rate Borrowing Tranche required under Sections 4.3.2 or 4.4 shall equal the Prime Rate as of the Borrowing Date or Renewal Date, as applicable. The Prime Rate shall thereafter fluctuate in accordance with any changes to the Prime Rate as published from time to time during the term of the Prime Rate Borrowing Tranche. 4.2.1.2    Base Rate. The Base Rate applicable to any Base Rate Borrowing Tranche hereunder shall, subject to the provisions set forth below, equal the Base Rate calculated as of the date of the Loan Request and set forth in the Loan Request. In the event that the Base Rate, calculated as of the Borrowing Date, is more than 0.0025 higher or lower than the Base Rate set forth in the Loan Request, the Base Rate applicable to such Loan Request shall instead be the Base Rate calculated as of the Borrowing Date. Thereafter, (i) the portion of the Base Rate attributable to the LIBOR Index Rate (or such alternative index as may be selected by Lender in accordance with the provisions of Section 4.4) for any Base Rate Borrowing Tranche shall be redetermined as of each renewal of such Borrowing Tranche pursuant to Section 4.3.3 and (ii) the Margin for all Borrowing Tranches then outstanding shall be redetermined as of each determination and redetermination of the Net Spread. As determined and redetermined pursuant to this Agreement, the same Margin shall apply to all Borrowing Tranches then outstanding. The portion of the Margin attributable to the Net Spread shall be determined based on the Aggregate DSCR in accordance with the table set forth in Schedule 4.2.3. The Aggregate DSCR and Net Operating Income shall each be redetermined in accordance with the definitions thereof, as applicable. 4.2.1.3    Fixed Rate. The Fixed Rate applicable to the Fixed Rate Borrowing Tranche shall be determined pursuant to Borrower’s selection of Lender’s then current rate lock or standard delivery option. Credit Agreement   Page 34 4.2.2    Prime Rate, Base Rate and Margin Quotations. Borrower may call Servicer on or before the date on which a Loan Request is to be delivered or prior to the end of an Interest Period, to receive both a calculation of the resulting Aggregate DSCR for a proposed Prime Rate (if required pursuant to Sections 4.3.2 or 4.4) or Base Rate Borrowing Tranche and an indication of the rates then in effect, including the Margin, but both parties acknowledge that such projection shall not be binding on Lender or Borrower, nor shall such projection affect the rate of interest which thereafter is actually in effect when such interest rate election is made. 4.2.3    Net Spread. The net spread (the “Net Spread”) applicable for any Base Rate Borrowing Tranche shall be as set forth in Schedule 4.2.3. With respect to the exercising of the First Option to Extend or Second Option to Extend, the Net Spread applicable for any Base Rate Borrowing Tranche during such extended term shall be determined by Lender in its sole discretion and communicated to Borrower (provided, that Lender will communicate indicative (but not final) Net Spreads for such extension period to Borrower at least 2 Business Days prior to the Scheduled Maturity Date, First Extended Maturity Date or Second Extended Maturity Date, as applicable). With respect to the exercising of an Expansion Option, the Net Spread applicable for any Base Rate Borrowing Tranche for such expanded amount of the Loan shall be determined by Lender in its sole discretion and communicated to Borrower (provided, that Lender will communicate indicative (but not final) Net Spreads for such expansion to Borrower at least 2 Business Days prior to the Expansion Option Date), and the final Net Spread for such expanded amount of the Loan shall be blended together with the Net Spread then in effect as determined by Lender. Lender and Borrower shall evidence any new or blended applicable Net Spread pursuant to this Section 4.2.3, by executing a confirmation substantially in the form attached hereto as Schedule 2.3. 4.3    Interest Periods. Upon each Loan Request for a new Base Rate Borrowing Tranche, and upon each Renewal Request applicable to a Base Rate Borrowing Tranche, Borrower shall notify Lender of the period (the “Interest Period”) which may only be a 1 month (having original durations to maturity of approximately 30 days) or 3 month (having original durations to maturity of approximately 90 days) for which the LIBOR Index Rate shall be determined. 4.3.1    Interest Period to End on a Business Day. If the last day of any Interest Period is not a Business Day, the Interest Period shall be deemed to mature on the Business Day immediately following such date. Credit Agreement   Page 35 4.3.2    No Interest Periods Beyond the Expiration Date. Borrower shall not select or renew an Interest Period for any Base Rate Borrowing Tranche that would end after the Expiration Date. If at the time of any such selection or renewal the period of time remaining prior to the Expiration Date is less than 30 days then such Borrowing Tranche shall bear interest at the Prime Rate. No Prime Rate Borrowing Tranche may remain outstanding in excess of 30 days at any one time. 4.3.3    Renewals. For purposes of calculating interest due under the applicable Base Rate Borrowing Tranche, the first day of the new Interest Period shall be the first Business Day immediately following the last day of the preceding Interest Period (“Renewal Date”). For each Base Rate Borrowing Tranche, if no new Interest Period is specified within 2 Business Days prior to the last day of such Interest Period, by delivery to Lender of a fully completed, authorized and executed request therefor (a “Renewal Request”) in the form attached hereto as Schedule 4.3.3, the Base Rate Borrowing Tranche shall be renewed for an Interest Period of 1 month at the Base Rate that would be applicable to a Base Rate Borrowing Tranche disbursed on the applicable Renewal Date having a 1 month Interest Period. Notwithstanding anything contained herein to the contrary, (i) no Base Rate Borrowing Tranche may be renewed with a principal amount of less than $1,000,000 and (ii) in the event the Borrower fails to comply with the Sublimits set forth with Section 2.1.4.1 or Section 2.1.4.2, Borrower may renew or consolidate (but not increase the outstanding principal amount of) any Base Rate Borrowing Tranche(s) then outstanding, all in accordance with the provisions of this Section 4.3.3, provided that, as of the date of such renewal or consolidation (a) no Event of Default or Potential Default, other than Borrower’s failure to comply with Sections 2.1.4.1 or 2.1.4.2, shall then exist, (b) Borrower’s failure to comply with Sections 2.1.4.1 or 2.1.4.2 shall have been for a period of less than 90 days, and (c) Borrower is otherwise in full compliance with all other terms and conditions of the Loan Documents, including the provisions of Section 4.3.6. Borrower must comply with Sections 2.1.4.1 or 2.1.4.2 pursuant to the provisions of Section 5.4.2.1. Credit Agreement   Page 36 4.3.4    Interest After Default. So long as (i) any payment under this Agreement remains past due for 30 days or more, or (ii) any other Event of Default has occurred and is continuing, interest on the Loan shall accrue on the unpaid principal balance from the earlier of the due date of the first unpaid installment or the occurrence of such other Event of Default at the Default Rate (as defined in the Revolving Credit Note and Fixed Rate Note). If the unpaid principal balance and all accrued interest on the Loan are not paid in full on the Expiration Date, the unpaid principal balance and all accrued interest on the Loan shall thereafter bear interest at the Default Rate. Borrower acknowledges that (a) its failure to make timely payments will cause Lender to incur additional expenses in servicing and processing the Loan, (b) during the time that any installment is delinquent for more than 30 days, Lender will incur additional costs and expenses arising from its loss of the use of the money due and from the adverse impact on Lender’s ability to meet its other obligations and to take advantage of other investment opportunities, and (c) it is extremely difficult and impractical to determine those additional costs and expenses. Borrower also acknowledges that, during the time that any installment is delinquent for more than 30 days or any other Event of Default has occurred and is continuing, Lender’s risk of nonpayment will be materially increased and Lender is entitled to be compensated for such increased risk. Borrower agrees that the increase in the rate of interest set forth in the Revolving Credit Note and Fixed Rate Note represents a fair and reasonable estimate, taking into account all circumstances existing on the date of this Agreement, of the additional costs and expenses Lender will incur by reason of Borrower’s delinquent payment and the additional compensation Lender is entitled to receive for the increased risks of nonpayment associated with a delinquent loan. Credit Agreement   Page 37 4.3.5    Late Charge. If any amount payable under this Agreement, the Revolving Credit Note, Fixed Rate Note or any other Loan Document, other than (i) the outstanding amount of the Revolving Credit Note or Fixed Rate Note payable on the Expiration Date or (ii) the then outstanding amount of the Loan payable upon acceleration of the Revolving Credit Note or Fixed Rate Note, is not received by Lender as provided in the Revolving Credit Note or Fixed Rate Note, as applicable, Borrower shall pay to Lender, immediately and without demand by Lender, a late charge as specified in the Revolving Credit Note or Fixed Rate Note. Borrower acknowledges that its failure to make timely payments will cause Lender to incur additional expenses in servicing and processing the Loan, and that it is extremely difficult and impractical to determine those additional expenses. Borrower agrees that the late charge payable specified in the Revolving Credit Note or Fixed Rate Note represents a fair and reasonable estimate, taking into account all circumstances existing on the date of this Agreement, of the additional expenses Lender will incur by reason of such late payment. The late charge is payable in addition to, and not in lieu of, any interest payable at the Default Rate specified in the Revolving Credit Note or Fixed Rate Note. 4.3.6    Non-Compliance With Sublimits. If Borrower is unable to cause compliance with the Sublimits pursuant to Sections 2.1.4.1 or 2.1.4.2, within 15 days following Notice thereof from Servicer or Lender of Borrower’s non-compliance with such Sublimits, then, for so long as Borrower fails to comply with such Sublimits, (i) the Net Spread applicable to all Base Rate Borrowing Tranches then outstanding (and thereafter renewed) shall automatically increase to 0.01 over the highest Net Spread shown on Schedule 4.2.3 (as such Net Spreads are adjusted by Lender pursuant to Section 4.2.3), further increased, if at all, in accordance with Schedule 4.2.3, as a result of the duration of such Base Rate Borrowing Tranche(s) Interest Period and (ii) the interest rate applicable to all Fixed Rate Borrowing Tranches shall automatically increase by 0.0l; provided, however, such increase shall not constitute a cure of an Event of Default under Section 9.1.12. Credit Agreement   Page 38 4.4    Illegality; Increased Costs. 4.4.1    Illegality; Increased Costs. At any time at which Lender shall have reasonably determined that (i) adequate and reasonable means do not exist for ascertaining the applicable LIBOR Index Rate, (ii) a contingency has occurred which materially and adversely affects the London interbank market, (iii) the making, maintenance or funding of any Borrowing Tranche bearing interest in part at the LIBOR Index Rate has been made unlawful by Lender’s compliance in good faith with any Law or any interpretation or application thereof by any Official Body or with any request or directive of any such Official Body (whether or not having the force of Law, but other than as a result of any misconduct by Lender), (iv) the Base Rate (as determined with reference to the LIBOR Index Rate) will not adequately and fairly reflect the cost to Lender of the establishment or maintaining of any such Borrowing Tranche, or (v) after making all reasonable efforts, deposits of the relevant amount in Dollars for the relevant Interest Period for a Borrowing Tranche are not available to Lender in the London interbank market, then Lender shall have the rights specified in Section 4.4.2. 4.4.2    Lender’s Rights. In the case of the events specified in Section 4.4.1 above, Lender shall promptly notify Borrower thereof. Upon the date as shall be specified in such Notice, the obligation of Lender to make advances under any Borrowing Tranche(s) at the Base Rate shall be suspended until Lender shall have later notified Borrower of Lender’s reasonable determination that the circumstances set forth in Section 4.4.1 no longer exist. If at any time Lender notifies Borrower that it has made a determination under Section 4.4.1, then with respect to any Loan Request previously submitted but not yet funded, and with respect to any Borrowing Tranche on which an Interest Period shall thereafter expire, each such new or renewal Borrowing Tranche(s) shall thereafter bear interest at the Prime Rate, in each case subject to Section 4.4.1. Lender agrees to exercise its rights under Section 4.4.1 in a manner that is non-discriminating to Borrower and only if Lender is also exercising its rights thereunder with respect to other borrowers similarly situated. 5.    PAYMENTS 5.1    Repayment of Loan. The obligation of Borrower to repay the aggregate unpaid principal amount of the Loan together with interest thereon, shall be evidenced by the Revolving Credit Note and Fixed Rate Note payable to the order of Lender. Credit Agreement   Page 39 5.2    Payments. All payments and prepayments to be made in respect of principal, interest, fees or other amounts due from Borrower hereunder shall be due and payable on the date when due without presentment, demand, protest, or notice of any kind, including, but not limited to, notice of Lender’s intent to accelerate Borrower’s Obligations under the Loan Documents and notice of such acceleration, all of which (unless expressly provided in the Loan Documents) are hereby waived by Borrower to the maximum extent permitted by applicable law, and without set-off, counterclaim or other deduction of any nature, and Lender’s right to action therefor shall immediately accrue. Such payments shall be made to Lender in immediately available funds when due. Lender’s Monthly Payment Statement shall, in the absence of manifest error, be conclusive as to the amount of principal of and interest on the Loan and other amounts owing under this Agreement, provided that Borrower may challenge the accuracy of any Monthly Payment Statement within 6 months from the date of receipt of such Monthly Payment Statement. 5.3    Payment Dates. Subject to the provisions of Section 5.4, interest on the Loan shall be payable in arrears and shall be due, together with all other amounts set forth on the applicable Monthly Payment Statement, prior to 12:00 p.m. Eastern Time on the 1st day of any calendar month during the term hereof (“Payment Date”) and shall be paid by wire transfer of immediately available funds to an account specified by Servicer and, simultaneously with such wire transfer. Lender shall (or shall cause Servicer to) deliver to Borrower an invoice (“Monthly Payment Statement”) detailing the interest and principal (if applicable), Unused Commitment Fees and other fees due and payable. Except in the case of a prepayment under Section 5.4, Lender shall deliver the Monthly Payment Statement detailing charges due for the current calendar month via fax or by other electronic transmittal at least 5 Business Days prior to the first day of the succeeding calendar month. In the instance of a renewal of an Interest Period pursuant to Section 4.3.3, interest on such renewed Base Rate Borrowing Tranche shall be due and payable on the next Payment Date, subject to any adjustments in interest rates, as if the Interest Period had not expired and then been renewed. Interest on prepayments under Section 5.4 shall be due on the date such prepayment is due. Interest on the principal amount of the Loan or other monetary Obligation shall be due and payable on demand after such principal amount or other monetary Obligation becomes due and payable (whether on the stated maturity date, upon acceleration or otherwise). Credit Agreement   Page 40 5.4    Prepayments. 5.4.1    Voluntary Prepayments. Borrower shall have the right, at its option, from time to time to prepay the Loan in whole or part at any time, but no prepayment may be less than $1,000,000 plus accrued interest thereon. Whenever Borrower desires to prepay any part of the Loan, Borrower shall provide a prepayment Notice to Lender by 12:00 p.m. Eastern Time at least 10 Business Days prior to the date of the proposed prepayment setting forth the following information: (i) the amount to be prepaid; (ii) the estimated date on which the proposed prepayment is to be made; and (iii) a statement indicating the application of the prepayment to a particular Borrowing Tranche(s). The principal amount of the Borrowing Tranche(s) for which a prepayment Notice is given, together with Accrued Interest, shall be due and payable by 12:00 p.m. Eastern Time on the date on which the proposed prepayment is to be made. Lender shall, upon receipt of Borrower’s Notice, prepare and deliver to Borrower the same day via facsimile or other electronic transmittal a statement of interest due with respect to such prepayment, provided that in the event Borrower’s prepayment Notice is not received by Lender prior to 12:00 p.m. Eastern Time, Lender shall not be obligated to prepare and deliver such statement of interest until the Business Day following Lender’s receipt of such Notice. 5.4.1.1    Prepayment of a Base Rate Borrowing Tranche. Unless Borrower for any reason (i) repays a Prime Rate Borrowing Tranche permitted hereunder or (ii) repays all or a part of a Base Rate Borrowing Tranche upon the expiration of such Base Rate Borrowing Tranche’s Interest Period, any prepayment under Section 5.4 shall be accompanied by a payment of the Accrued Interest. The Accrued Interest for any Base Rate Borrowing Tranche shall be an amount equal to the interest, applicable to the particular Base Rate Borrowing Tranche being prepaid, which would have otherwise accrued over the remainder of the applicable Interest Period (“Accrued Interest”). In addition, upon Lender’s exercise of any right of acceleration under this Agreement, the Revolving Credit Note, or any other Loan Document following an Event of Default, Borrower shall pay to Lender the Accrued Interest on all Base Rate Borrowing Tranches at the time of acceleration, and all other sums and fees payable to Lender hereunder. 5.4.1.2    Prepayment of a Fixed Rate Borrowing Tranche. Except as otherwise provided in Section 2.5.4 or any other provision of this Agreement, any prepayment pursuant to Section 5.4.1, of a Fixed Rate Borrowing Tranche shall be accompanied by the Prepayment Premium. Credit Agreement   Page 41 5.4.2    Sublimit Violations (Mandatory Prepayment or Collateral Addition). 5.4.2.1    Upon Borrower’s receipt of Notice that it is not in compliance with the Sublimits, Borrower must either (i) within 90 days of the Notice of Borrower’s non-compliance with the Sublimits, add a Mortgaged Property in form, substance, value and in a manner all acceptable to Lender, in its sole discretion, in accordance with Section 3.1, or (ii) within 45 days of the Notice of Borrower’s non-compliance with the Sublimits, prepay the Loan in such amount as is necessary to cause compliance with the Sublimits. Borrower shall provide Notice to Lender and Servicer, within 20 days of Servicer’s or Lender’s Notice to Borrower of Borrower’s non-compliance with the Sublimits, of Borrower’s election to proceed under clause (i) or clause (ii) of the first sentence. If Borrower provides notice of its election to pledge multifamily real property, Borrower may also cure any Sublimit non-compliance by providing evidence satisfactory to Lender, within 60 days of the Notice of Borrower’s non-compliance with the Sublimits, that circumstances with respect to the Collateral Pool have changed such that Borrower is no longer in non-compliance with the Sublimits. Lender shall deliver to Borrower as soon as practicable, but in any event 2 Business Days after such Notice of Borrower’s election to prepay the Loan a statement of the principal and interest due with respect to any required prepayment. Any prepayment of the Loan in accordance with the provisions of this Section 5.4.2.1 shall be applied, as directed by Borrower, to a particular Borrowing Tranche or Borrowing Tranches under the Revolving Credit Note until the Revolving Credit Note has been repaid in full or, in the absence of any specific direction from Borrower, as selected by Lender in its sole discretion. 5.4.2.2    Casualty; Condemnation. In the event of a casualty or condemnation affecting any Collateral Pool Property, any award and/or proceeds payable with respect to such casualty or condemnation and applied to Borrower’s Obligations in accordance with the provisions of the applicable Loan Agreement shall be applied without any prepayment fee or other penalty (but any Accrued Interest shall be paid), and this Agreement, and the parties’ obligations under the Loan Documents, shall be terminated, at Borrower’s election in accordance with Section 2.6. Credit Agreement   Page 42 5.5    Payment of Balance Without Termination. Prior to the Maturity Date, Borrower shall have the right to pay the balance of the Loan, subject in each instance to the provisions of Section 5.4, all without any release of any Lien, and subsequently reborrow hereunder and the Revolving Credit Note, provided that Borrower is at such time, and thereafter remains, in compliance with the provisions of this Agreement, including, without limitation, the obligation to be in compliance with the Sublimits and the obligations to pay all fees due and payable hereunder. Under no circumstances shall Borrower be entitled to any additional advances or re-advances under the Revolving Credit Note on or after the Maturity Date. In no event will Borrower be permitted to request a Fixed Rate Borrowing Tranche after the Closing Date or re-borrow under the Fixed Rate Note. 5.6    Payment of Additional Compensation in Certain Circumstances. 5.6.1    Increased Costs Resulting from Taxes, Etc. If any change in any Law, guideline or interpretation or application thereof by any Official Body charged with the interpretation or administration thereof or compliance with any written request or directive of any Official Body (other than as a result of any misconduct by Lender) which is applicable to Lender: (i)    subjects Lender to any tax or adversely changes the basis of taxation with respect to this Agreement, the Revolving Credit Note, the Fixed Rate Note, the Loan or payments by Borrower of any principal, interest, fees, or other amounts due from Borrower hereunder, or under the Revolving Credit Note or under the Fixed Rate Note (except for taxes on the overall net income of Lender); or (ii)    imposes upon Lender any condition or denies Lender any right, the result of which is to increase the cost to, reduce the income receivable by, or impose any expense (including breakage costs) upon Lender with respect to this Agreement, the Revolving Credit Note, the Fixed Rate Note or the making, maintenance or funding of any Borrowing Tranche by an amount which Lender in its discretion deems to be material; then, Lender shall from time to time notify Borrower of the amount determined (using any averaging and attribution methods employed in good faith) by Lender to be necessary to compensate Lender for such increase in cost (“Increased Cost Amount”). Such Notice shall set forth in reasonable detail the basis for such Increased Cost Amount. The Increased Cost Amount shall be due and payable by Borrower to Lender 30 days after such Notice is given. Credit Agreement   Page 43 5.6.2    Termination. Upon the occurrence of any event described in Section 5.6.1, Borrower, in lieu of paying the Increased Cost Amount within the time period set forth in Section 5.6.1, may terminate this Agreement in accordance with the provisions of Section 2.6, provided that the Borrower shall not be obligated to pay the Termination Fee. 5.7    Indemnity. Borrower shall jointly and severally indemnify Lender and Servicer against all losses, claims, damages, liabilities and expenses, including Attorneys’ Fees and Costs ( individually and collectively, “Loss”) which may be imposed or incurred by Lender and/or Servicer directly or indirectly arising out of, or in any way relating to, or a result of any of the following: (i) attempt by Borrower to revoke (expressly, by later inconsistent notices or otherwise) in whole or part any Loan Request under Section 2.1.2, any request to release a Mortgaged Property under Section 3.2, or notice relating to prepayments under Section 5.4, or (ii) default by Borrower in the performance or observance of any covenant or condition contained in this Agreement or any other Loan Document, including any failure of Borrower to pay when due (by acceleration or otherwise) any principal, interest, Accrued Interest, Unused Commitment Fee, or any other amount due hereunder. If Lender sustains or incurs any such Loss, it shall from time to time notify Borrower of the amount determined in good faith by Lender (which determination may include such assumptions, allocations of costs and expenses and averaging or attribution methods as Lender shall deem reasonable) to be necessary to indemnify Lender for such Loss. Such Notice shall set forth in reasonable detail the basis for such determination (which shall be conclusive absent manifest error). Such amount shall be due and payable by Borrower to Lender 30 days after such Notice is given. 6.    CONDITIONS OF LENDING The obligation of Lender to fund the Loan hereunder is subject to the performance by Borrower of its Obligations to be performed hereunder at or prior to the funding of any Borrowing Tranche, and to the satisfaction of the following further conditions: 6.1.1    Delivery of Loan Documents. Lender shall have received all applicable Loan Documents together with all applicable amendments thereto, and other documents, instruments, policies and forms of evidence or other material requested by Lender under the terms of this Agreement or any of the other Loan Documents. Credit Agreement   Page 44 6.1.2    Validity of Representations. The representations and warranties contained in Section 7 and in each of the other Loan Documents shall be true and correct in all material respects on and as of the Closing Date with the same effect as though such representations and warranties had been made on and as of such date (except representations and warranties which relate solely to an earlier date or time, which representations and warranties shall be true and correct on and as of the specific dates or times referred to therein, and, with respect to any advances made after the Closing Date, except such changes as would not constitute a Material Adverse Change), and Borrower shall have performed and complied with all covenants and conditions hereof and thereof. 6.1.3    Valid Security Instrument. The Security Instrument is a valid lien upon each Collateral Pool Property and is prior and superior to all other liens and encumbrances thereon except the Permitted Exceptions. 6.1.4    No Default. There exists no Event of Default, or Potential Default under this Agreement. 6.1.5    Officer’s Certificate. There shall be delivered to Servicer and for the benefit of Lender a certificate, in form and substance acceptable to Lender, dated the Closing Date and signed by an Authorized Officer, certifying as appropriate as to: 6.1.5.1    all required actions taken by Borrower in connection with this 6.1.5.2    the names of the officer or officers authorized to sign this Agreement and the other Loan Documents and the true signatures of such officer or officers and specifying the Authorized Officers permitted to act on behalf of Borrower for purposes of this Agreement and the true signatures of such Authorized Officers, on which Lender may conclusively rely; Credit Agreement   Page 45 6.1.5.3    copies of the organizational documents of Borrower including its certificate of incorporation, by-laws, certificate of limited partnership, partnership agreement, certificate of formation, and limited liability company agreement, as applicable, as in effect on the Closing Date certified by the appropriate state official where such documents are filed in a state office together with certificates from the appropriate state officials as to the continued existence and good standing of Borrower in each state where organized or qualified to do business and dated within 30 days of the Closing Date, all of which shall be attached to such officer’s certificate; and 6.1.5.4    all material consents required to effectuate the transactions contemplated hereby shall have been obtained. 6.1.6    Opinion of Counsel. Prior to the Closing Date, there shall be delivered to Lender, written opinions of counsel for Borrower and Guarantor in form and substance satisfactory to Lender and its counsel as to matters customary to the transactions contemplated herein, or as Lender may reasonably request, including, but not limited to, an enforceability opinion with respect to Virginia law. 6.1.7    Legal Details. All legal documents and due diligence materials in connection with the transactions contemplated by this Agreement and the other Loan Documents shall be in form and substance satisfactory to Lender and counsel for Lender, and Lender shall have received all such other counterpart originals or certified or other copies of such documents or due diligence in connection with such transactions, in form and substance satisfactory to Lender and said counsel, as Lender or said counsel may reasonably request. 6.1.8    Payment of Fees. Borrower shall have paid or caused to be paid to Lender and Freddie Mac, to the extent not previously paid, all fees, costs and expenses accrued through the Closing Date, including, but not limited to, Attorneys’ Fees and Costs, title insurance premiums, surveys, appraisals, all costs incurred in obtaining environmental, engineering and credit reports, all third party due diligence costs and other costs and expenses incurred by either Lender or Freddie Mac in connection with the closing of this Loan. 6.1.9    Other Conditions. Borrower shall have satisfied such other reasonable conditions as required by Lender. Credit Agreement   Page 46 7.    REPRESENTATIONS AND WARRANTIES 7.1    Representations and Warranties. Borrower represents and warrants to Lender, as of the date hereof and as of the Expansion Option Date, Contraction Option Date, Extension Option Date, the date each Loan Request is funded, the date of the addition of a Mortgaged Property to the Collateral Pool, the date of each release of a Lien on a Collateral Pool Property, the date of a release of a Borrower, each Renewal Date, the date a joinder agreement is executed by a Proposed Borrower and such other date as may be specifically required pursuant to any other Loan Document: 7.1.1    Authority. Borrower is in compliance with all laws and regulations applicable to, and has all necessary rights and powers to execute, deliver and carry out this Agreement and the other Loan Documents to which it is a party, to incur the Loan contemplated by the Loan Documents and to perform its Obligations under the Loan Documents to which it is a party. Borrower has the lawful power to own or lease its applicable Collateral Pool Property and to engage in the business it presently conducts or proposes to conduct. Borrower is duly licensed or qualified and in good standing in all jurisdictions where the applicable property owned or leased by it or where the nature of the business transacted by it or both makes such licensing or qualification necessary and where the failure to be so qualified would result in a Material Adverse Change. 7.1.2    Binding Obligations. Borrower is authorized to execute, deliver and perform its Obligations under this Agreement and the other Loan Documents to which it is a party, and such Obligations constitute the legal, valid and binding obligations of Borrower, except to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting the enforceability of creditors’ rights generally or limiting the right of specific performance. 7.1.3    Formation and Organizational Documents. Borrower has delivered to Lender true and complete copies of all formation and organizational documents of Borrower, of the partners, managers, joint venturers or members of Borrower, if any, and of Guarantor, and all such formation and organizational documents remain in full force and effect and have not been materially amended or modified except as approved by Lender. Credit Agreement   Page 47 7.1.4    No Violation. Borrower’s execution, delivery, and performance under this Agreement and the other Loan Documents do not: (i) require any consent or approval not heretofore obtained under any partnership agreement, operating agreement, articles of incorporation, bylaws or other organizational document; (ii) to Borrower’s Knowledge violate any Law, order, writ, judgment, injunction or decree to which Borrower is subject or by which Borrower is bound; or (iii) to Borrower’s Knowledge, conflict with, or constitute a breach or default or permit the acceleration of obligations under any material agreement by which Borrower is or such Collateral Pool Property is bound. 7.1.5    Reserved. 7.1.6    Financial Condition. Neither this Agreement nor any other Loan Document, nor any material certificate, statement, agreement or other documents furnished to Lender by Borrower or its Affiliates or, to Borrower’s Knowledge, any other Person in connection herewith or therewith, contains any untrue statement of a material contained herein and therein, in light of the circumstances under which they were made, not misleading. 7.1.7    No Material Adverse Change. There has been no Material Adverse Change in the financial condition of Borrower or Guarantor since the dates of the latest financial statements furnished to Lender, except as otherwise disclosed in writing and approved by Lender. 7.1.8    Reserved. 7.1.9    Reserved. 7.1.10    Enforceability. This Agreement and the other Loan Documents are not subject to any right of rescission, set-off, counterclaim or defense by Borrower, including the defense of usury, and Borrower has not asserted any right of rescission, set-off, counterclaim or defense with respect thereto. 7.1.11    Reserved. Credit Agreement   Page 48 7.1.12    Solvency. Borrower, Taken as a Whole, and Guarantor are not insolvent (as such term is defined in Section 5.20(b) of the Loan Agreement). After giving effect to the transactions contemplated by this Agreement and the other Loan Documents, Borrower, Taken as a Whole, and Guarantor will not be insolvent. Borrower has not entered into this Agreement or any Loan Document with the actual intent to hinder, delay, or defraud any creditor, and Borrower has received reasonably equivalent value in exchange for its obligations under the Loan Documents. Borrower does not intend to, and Borrower does not believe that it will, incur debts and liabilities beyond its ability to pay such debts as they mature (taking into account the timing and amounts to be payable on or in respect of obligations of Borrower). 7.1.13    No Pending Proceedings or Judgments. Borrower is not (i) the subject of or a party to (other than as a creditor) any completed or pending bankruptcy, reorganization or insolvency proceeding, or (ii) the subject of any judgment unsatisfied of record or docketed in any court located in the United States. 7.1.14    Authorized Officer/Authorized Representative. The officers and employees of Borrower who are now (or in the future become) Authorized Officers of Borrower (i) have direct supervisory and managerial control over the Borrower and each Collateral Pool Property, subject to the management thereof in accordance with the terms of the Loan Documents, and (ii) are familiar with the organization and operations of Borrower and with the operations of each Collateral Pool Property. 7.1.15    Other Loan Documents. The representations and warranties set forth in the other Loan Documents are true and correct in all material respects. Credit Agreement   Page 49 7.2    Updates Borrower shall provide with each Loan Request that will result in an increase in the Loan, written revisions to any representations or warranties in this Agreement which have become outdated or incorrect in any material respect. In addition, should any such updates, corrections or additions relate to a matter which would be a Material Adverse Change, Borrower shall promptly provide Lender in writing with such revisions as may be necessary or appropriate, to correct or update same. Notwithstanding the providing of revised information, a breach of warranty or representation resulting from the prior inaccuracy or incompleteness shall not be deemed to have been cured thereby or waived by Lender unless and until Lender, in its sole and absolute discretion, shall have accepted in writing such revisions or updates; further provided that no representation or warranty shall be deemed to have been updated by any such revision unless and until Lender funds the additional Loan Request. 7.3    Survival Of Representations And Warranties Borrower agrees that (i) all of the representations and warranties of Borrower set forth in this Agreement and in the other Loan Documents delivered on the Closing Date are made as of the Closing Date (except as expressly otherwise provided) and (ii) all representations and warranties made by Borrower shall survive the delivery of the Revolving Credit Note and continue (a) for so long as any amount remains owing to Lender under this Agreement, the Revolving Credit Note or any of the other Loan Documents or (b) until the date on which Lender releases all assets in the Collateral Pool from any Lien securing the Loan Documents pursuant to the provisions of Section 3.2 or Section 3.3, whichever is later but in any event not later than the date the Agreement is terminated pursuant to Section 2.6. All representations, warranties, covenants and agreements made in this Agreement or in the other Loan Documents shall be deemed to have been relied upon by Lender notwithstanding any investigation heretofore or hereafter made by Lender or on its behalf. 8.    COVENANTS Borrower covenants and agrees that until the later of (i) satisfaction of all of the Obligations of Borrower under this Agreement and the other Loan Documents, and (ii) the Expiration Date, Borrower shall comply at all times with each of the following covenants: Credit Agreement   Page 50 8.1    Organization and Dissolution. Borrower shall not dissolve, terminate its existence, liquidate, merge with or consolidate into another Person except as permitted under Section 8.3. Borrower shall promptly provide Lender with copies of any material amendments or modifications to the formation or organizational documents of Borrower, of the partners, managers, joint venturers or members of Borrower, if any, and of any Guarantor of the Loan. 8.2    Affiliate Transactions. Borrower shall not enter into, or be a party to, any transaction with an Affiliate of Borrower or Guarantor, or any of the members of such Borrower or Guarantor, except for those agreements previously approved by Lender in writing or (i) in the ordinary course of business, and (ii) are no less favorable to Borrower than would be obtained in a comparable arm’s-length transaction with an unrelated third party. 8.3    Assumption. With respect to a Transfer that would otherwise constitute an Event of Default under Article VII of a Loan Agreement, Lender may permit, in its sole and absolute discretion, a 1 time Transfer of the entire Loan. To the extent the Lender approves such Transfer in its sole and absolute discretion, Lender may require each of the following be satisfied as of the date of the Transfer: (i) Borrower has submitted all information requested by Lender in connection with the Transfer in order for Lender to make its determination; (ii) transferee has executed an assumption agreement and such other documents as required by Lender which documentation shall require transferee to comply with the terms and provisions of such Loan Agreement and the other Loan Documents which previously may have been waived or modified by Lender; (iii) all amendments and/or new title policy(ies) are delivered to Lender; (iv) all of Lender’s and Servicer’s costs and expenses (including without limitation, Attorney’s Fees and Costs) incurred in connection with the requested Transfer are paid; (v) a Transfer fee in an amount equal to the greater of: (i) 1% of $350,000,000 less any contractions pursuant to Sections 2.4.1 or 2.4.2 or (ii) $250,000 is paid to Lender; (vi) the redetermination by Lender of the Net Spread applicable for any Borrowing Tranche; (vii) the transferee’s organization, credit and experience in ownership and management of similar conventional multifamily real property is adequate and appropriate to the overall structure and documentation of the Loan; and (viii) no Event of Default or Potential Default has occurred and is continuing. Credit Agreement   Page 51 8.4    Further Assurances. Upon Lender’s request and at Borrower’s sole cost and expense, Borrower shall, and shall cause any Affiliate of Borrower to, execute, acknowledge and deliver any other instruments, including, without limitation, replacement promissory notes, guaranties or other loan documents, and perform any other acts necessary, desirable or proper, as reasonably determined by Lender, to carry out the purposes of this Agreement and the other Loan Documents or to perfect and preserve any liens created by the Loan Documents; provided that Borrower shall not be required to do anything that has the effect of (i) materially increasing any obligation undertaken by or imposed under the Loan Documents as executed, (ii) changing the material, economic or other business terms set forth in the Loan Documents, or (iii) imposing on Borrower or Guarantor or any Affiliate of either any greater liability or obligation under the Loan Documents than as set forth in the Agreement, the Revolving Credit Note or any other Loan Documents. This obligation shall survive any foreclosure or deed in lieu of foreclosure of a Collateral Pool Property. 8.5    Proceedings and Judgments. If any suit or legal proceeding (“Proceeding”) is commenced seeking to enjoin or otherwise prevent or declare unlawful the use, occupancy or operation of the Collateral Pool Property or any portion thereof, or if any other Proceeding is filed against Borrower in an amount in excess of $1,000,000, Borrower shall promptly notify Lender in writing. Upon request by Lender, Borrower will provide Lender with written updates on the status of any such proceeding. Borrower shall furnish to Lender prompt notice of any order, judgment or decree in excess of $500,000 having been entered against Borrower. 8.6    Compliance with Lender Requirements. Borrower shall comply with the requirements of Lender in order to enable Lender to sell all or any part of the Loan, provided that neither Borrower nor any Guarantor shall be required to do anything that has the effect of (i) materially increasing any obligation undertaken by or imposed under the Loan Documents as executed, (ii) changing the material economic or other business terms set forth in the Loan Documents, or (iii) imposing on Borrower or Guarantor greater liability or obligation under the Loan Documents than as set forth in the Agreement, the Revolving Credit Note or any other Loan Documents. Credit Agreement   Page 52 8.7    Correction of Defects. In the event that any of the Loan Documents shall cease to be legal, valid and binding agreements enforceable against the party executing the same or such party’s successors and assigns (as permitted under the Loan Documents) in accordance with the respective terms thereof, resulting in the failure to provide the practical benefit of the respective Liens, security interests, rights, titles, interests, remedies, powers or privileges intended to be created thereby (except to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting the enforceability of creditors’ rights generally or limiting the right to specific performance) or shall in any way be terminated (except in accordance with its terms) or become or be declared ineffective or inoperative or shall in any way be challenged or contested, resulting in the failure to provide the practical benefit of the respective Liens, security interests, rights, titles, interests, remedies, powers or privileges intended to be created thereby, Borrower shall use best efforts to cure any such defect(s) in such Loan Document(s), provided that if Borrower is unable to cure any such defect(s) relating to Borrower, any Affiliate, the Loan Documents or the applicable Collateral Pool Properties within thirty (30) days Lender may in its discretion, upon ten (10) days’ Notice to Borrower, accelerate Borrower’s obligations under the Revolving Credit Note but without payment of any Termination Fee or other prepayment or other premium (other than Accrued Interest). 8.8    Notice of Material Adverse Change. Borrower shall promptly notify Lender of any Material Adverse Change affecting Borrower, Guarantor, any Collateral Pool Property, this Agreement or the other Loan Documents. 8.9    Annual Evaluation. Borrower shall deliver and cause Guarantor to deliver to Servicer by no later than 60 days prior to the first anniversary of the Closing Date dated as of December 31st, and thereafter no later than 90 days after the most recent calendar year end dated as of December 31st, the items set forth in clauses (i) through (iv) below for the purpose of Lender determining that Guarantor satisfies the Minimum Net Worth and Liquidity requirements set forth in the Guaranty as well as determining whether a Material Adverse Change has occurred. Borrower shall and will cause Guarantor to comply with this Section annually thereafter. Credit Agreement   Page 53 (i)    The most recent fiscal year-end financial statements for (a) Borrower, and (b) Guarantor (together, the “Required Financial Statements”), which Required Financial Statements must (x) comply with the requirements of the then current version of the Freddie Mac Multifamily Seller/Servicer Guide (“Guide”) in accordance with GAAP (and if a conflict between GAAP and the Guide exists, GAAP shall control), (y) include a balance sheet, income statement and statement of cash flows (provided that for the statement of cash flows, the operating entries need to be included however the investing and financing entries will not be required), each in form and substance reasonably acceptable to Lender and (z) be certified by an Authorized Officer of Borrower Guarantor , as applicable, (ii)    A complete Freddie Mac Form 1115 (which then current Freddie Mac Form 1115 will be provided by Servicer) for Borrower and Guarantor, dated as of December 31st, including, without limitation, fully completed net worth, liquidity and contingent liabilities sections, (iii)    A complete Freddie Mac Form No. 1116 (which then current Freddie Mac Form 1116 will be provided by Servicer) for the Guarantor, dated as of December 31st, and (iv)    A statement showing any change in the (a) Liquidity, (b) Minimum Net Worth, (c) contingent liabilities and (d) value of encumbered assets as set forth in Form 1116 of Guarantor (in each case, as determined in accordance with Freddie Mac Form 1115), dated as of December 31st, as certified by an Authorized Officer of Guarantor. 8.10    Compliance with Guaranty. Borrower shall cause Guarantor to comply with the terms and provisions of the Guaranty. In the event Lender determines, after an evaluation performed pursuant to Sections 8.9, 2.4.3 or as part of a Loan Request, that Guarantor is not in compliance with the Minimum Net Worth and Liquidity requirements, upon written request by Borrower, Lender may, in its sole discretion, permit Borrower to add one or more Persons as a Guarantor to satisfy the Minimum Net Worth and Liquidity requirements; provided however, such addition as approved by Lender shall be completed within 45 days of Lender’s performance of the applicable evaluation. Credit Agreement   Page 54 9.    DEFAULT 9.1    Events of Default. The occurrence or existence of any one or more of the following events or conditions (whatever the reason therefor and whether voluntary, involuntary or effected by operation of Law) shall be an “Event of Default”: 9.1.1    Payments Under Loan Documents. Borrower shall fail to pay any principal under any Borrowing Tranche (including scheduled installments, mandatory prepayments or the payment due at maturity), or shall fail to pay any interest on the Loan or any other amount owing hereunder or under any other Loan Documents after such principal, interest or other amount becomes due in accordance with the terms hereof or thereof, or shall fail to pay to Lender an amount which is payable under this Agreement or, any other Loan Document “upon demand”, and such “upon demand payment” is not made within 5 days of either written Notice to Borrower or request for such payment as set forth in any invoice or monthly statement provided to Borrower; 9.1.2    Breach of Representation or Warranty. Subject to Section 1.2.9, any representation or warranty made at any time by Borrower herein or in any other Loan Document, or in any certificate, other instrument or statement furnished pursuant to the provisions hereof or thereof, shall prove to have been false or misleading in any material respect as of the time it was made or furnished and the result of such false or misleading representation, warranty, certificate or other instrument or statement is a Material Adverse Change that is not cured within 30 days after written Notice thereof from Lender to Borrower, or within such additional reasonable time as may be necessary, in Lender’s judgment to cure such breach, in the event Borrower commences such cure within such 30 day period and thereafter diligently pursues such cure, not to exceed 90 additional days; Credit Agreement   Page 55 9.1.3    Breach of Covenant. Borrower shall default in the observance or performance of any covenant, condition or provision hereof or under any other Loan Document, which default is not otherwise specified as an “Event of Default” under (i) the provisions of this Article 9 or (ii) Section 9.01 of any Loan Agreement with respect to any from Lender to Borrower of such default, or within such additional reasonable time as may be necessary in Lender’s judgment to cure such breach, in the event pursues such cure for a period not to exceed 60 additional days (such cure period to be applicable only in the event such default can be remedied by corrective action of Borrower as determined by Lender in its reasonable discretion) provided that, no such Notice or grace period shall apply in the case of any default which could, in Lender’s judgment, absent immediate exercise by Lender of a right or remedy under this Agreement or any of the other Loan Documents, result in additional harm to Lender, impairment of the Revolving Credit Note or Fixed Rate Note, or any rights of Lender under this Agreement or any security given under any other Loan Document; 9.1.4    Event of Default under the Other Loan Documents. Borrower shall be in default under any provision of the Revolving Credit Note, the Fixed Rate Note or any other Loan Document beyond any applicable notice and cure period, if any; 9.1.5    Final Judgments or Orders. Any final judgments or orders for the payment of money in excess of $1,000,000 in the aggregate shall be entered against Borrower by a court of competent jurisdiction, which judgment is not discharged, vacated, bonded or stayed pending appeal within a period of 30 days from the date of entry; 9.1.6    Notice of Lien or Assessment. Subject to Section 1.2.9, a notice of Lien or assessment in excess of $1,000,000 which is not a Permitted Exception is filed of record with respect to all or any part of any of Borrower’s assets, or any taxes or debts owing at any time or times hereafter to the United States, or any department, agency or instrumentality thereof, or by any state, county, municipal or other governmental agency, becomes payable and the same is not paid or otherwise discharged within 30 days after the same becomes payable, unless the same is being contested in accordance with the Loan Documents; Credit Agreement   Page 56 9.1.7    Insolvency. Borrower, Taken as a Whole, becomes insolvent (as such term is defined in Section 5.20(b) of the Loan Agreement) or admits in writing its inability to pay its debts as they come due; 9.1.8    Cessation of Business. Borrower ceases to conduct the business of Borrower, or Borrower is enjoined, restrained or in any way prevented by court order from conducting all or any material part of the business of Borrower or the right to use or lease the Collateral Pool Property as a conventional multifamily real property, and such injunction, restraint or other preventive order is not dismissed within 30 days after the entry thereof; 9.1.9    Lien Priority. The Liens granted to and for the benefit of Lender do not constitute valid first priority Liens (subject to Permitted Exceptions) under applicable Laws and such default shall continue unremedied for a period of 30 Business Days after Borrower’s Knowledge of the occurrence thereof or such additional reasonable time period necessary to cure such default, in the event Borrower commences such cure within such 30 day period and thereafter diligently pursues such cure, for a period not to exceed 60 additional days (such cure period to be applicable only in the event such default can be remedied by corrective action of Borrower to the satisfaction of Lender as determined by Lender in its reasonable discretion); 9.1.10    Bankruptcy and Other Proceedings. Borrower voluntarily files for bankruptcy protection under the United States Bankruptcy Code or voluntarily becomes subject to any reorganization, receivership, insolvency proceeding or other similar proceeding pursuant to any other federal or state law affecting debtor and creditor rights, or an involuntary case is commenced against Borrower by any creditor (other than Lender) of Borrower pursuant to the United States Bankruptcy Code or other federal or state law affecting debtor and creditor rights and is not dismissed or discharged within 90 days after filing; Credit Agreement   Page 57 9.1.11    Material Adverse Change. There shall occur a Material Adverse Change which is not corrected to the reasonable satisfaction of Lender within 30 days after the occurrence of such Material Adverse Change, or such additional reasonable time period necessary to cure such Material Adverse Change, in the event Borrower commences such cure within such 30 day period and thereafter diligently pursues such cure for a period not to exceed 30 additional days (such cure period to be applicable only in the event such default can be remedied by corrective action of Borrower to the satisfaction of Lender as determined by Lender in its reasonable discretion); provided however, a Material Adverse Change pursuant to subsections (iv) or (v) of the definition of Material Adverse Change shall not constitute an Event of Default if (i) Lender determines that Borrower is in compliance with Section 2.1.4, (ii) Guarantor complies with the Minimum Net Worth and Liquidity requirements set forth in Section 8.10 as of the date of Lender’s Notice to Borrower of such perceived Material Adverse Change pursuant to subsection (iv) of the definition of Material Adverse Change, (iii) all amounts due under this Agreement, the Note and the other Loan Documents are current, and (iv) the Material Adverse Change does not involve fraud or written material misrepresentation. 9.1.12    Aggregate DSCR/LTV Ratio. Either the Aggregate DSCR fails to comply with the requirements of Section 2.1.4.1 or the LTV Ratio exceeds the ratio permitted pursuant to Section 2.1.4.2 for a period of 90 consecutive days from the date of Borrower’s receipt of Notice of such non-compliance; or 9.1.13    Guarantor Default. Guarantor fails to comply with any of the terms and provisions of the Guaranty after the expiration of any applicable notice or cure period, if any. 9.2    Consequences of Event of Default. 9.2.1    Acceleration of Loan. Upon an Event of Default, Lender shall be entitled, without limitation, to (i) accelerate the Loan, and (ii) collect the Indebtedness. Credit Agreement   Page 58 9.2.2    Remedies Cumulative. Upon an Event of Default under Section 9.1, Lender shall be entitled to all of the rights and remedies granted to Lender under the Loan Documents and applicable Law, all of which rights and remedies shall be cumulative and non-exclusive, to the extent permitted by Law. Following an Event of Default, the Loan may be reinstated only upon the express written approval of Lender, to be granted, withheld or conditioned in its sole discretion. 9.2.3    Notice of Sale. Any notice required to be given by Lender of a sale, lease, or other disposition of any Collateral that is personal property or any other intended action by Lender under the Uniform Commercial Code, if given at least 10 Business Days prior to such proposed action, shall constitute commercially reasonable notice thereof to Borrower. 10.    MISCELLANEOUS 10.1    Reserved. 10.2    Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of Lender, Borrower and their respective successors and assigns, except that Borrower may not assign or transfer any of its respective rights or Obligations hereunder or any interest herein. 10.3    Modifications, Amendments or Waivers. Lender and Borrower may from time to time enter into written agreements amending or changing any provision of this Agreement or any other Loan Document or the rights of Lender or Borrower hereunder or thereunder, or may grant written waivers or consents to a departure from the due performance of the Obligations of Borrower hereunder or thereunder. Any such written agreement, waiver or consent (i) shall be effective to bind Lender and Borrower, and (ii) shall be accompanied in each instance by a written affirmation executed by Guarantor consenting to such actions. Credit Agreement   Page 59 10.4    Forbearance. Lender may (but shall not be obligated to) agree with Borrower, from time to time, and without giving notice to, or obtaining the consent of, or having any effect upon the obligations of, any Guarantor or other third party obligor, to take any of the following actions: (i) extend the time for payment of all or any part of the Loan; (ii) reduce the payments due under this Agreement, the Revolving Credit Note, the Fixed Rate Note or any other Loan Document; (iii) release anyone liable for the payment of any amounts under this Agreement, the Revolving Credit Note, the Fixed Rate Note, or any other Loan Document; (iv) modify the terms and time of payment of the Loan; (v) join in any extension or subordination agreement; (vi) release any Collateral Pool Property; (vii) take or release other or additional security; (viii) modify the rate of interest or period of amortization of the Revolving Credit Note, the Fixed Rate Note or change the amount of the monthly installments payable under the Revolving Credit Note or the Fixed Rate Note; and (ix) otherwise modify this Agreement, the Revolving Credit Note, the Fixed Rate Note or any other Loan Document. Any forbearance by Lender in exercising any right or remedy under the Revolving Credit Note, the Fixed Rate Note, this Agreement, or any other Loan Document or otherwise afforded by applicable Law, shall be in writing and shall not be deemed a waiver of or preclude the exercise of any right or remedy except as expressly provided in such writing, if at all. The acceptance by Lender of payment of all or any part of the Loan after the due date of such payment, or in an amount which is less than the required payment, shall not be a waiver of Lender’s right to require prompt payment when due of all other payments on account of the Loan or to exercise any remedies for any failure to make prompt payment. Enforcement by Lender of any security for the Loan shall not constitute an election by Lender of remedies so as to preclude the exercise of any other right available to Lender. Lender’s receipt of any awards or proceeds shall not operate to cure or waive any Event of Default except to the extent of satisfaction of the Loan. 10.5    Remedies Cumulative. Each right and remedy provided in this Agreement is distinct from all other rights or remedies under this Agreement or any other Loan Document or afforded by applicable Law, and each shall be cumulative and may be exercised concurrently, independently, or successively, in any order. Credit Agreement   Page 60 10.6    Reimbursement and Indemnification of Lender and Servicer by Borrower; Taxes. Borrower agrees unconditionally upon demand to pay or reimburse to Lender and Servicer and to hold Lender and Servicer harmless against (i) liability for the payment of all reasonable out-of-pocket costs, expenses and disbursements (including fees and expenses of counsel for Lender and Servicer, incurred by Lender and Servicer (a) in connection with the administration and interpretation of this Agreement, and other instruments and documents to be delivered hereunder, (b) relating to any amendments, waivers or consents pursuant to the provisions hereof, (c) in connection with the enforcement of this Agreement or any other Loan Document, or collection of amounts due hereunder or thereunder or the proof and allowability of any claim arising under this Agreement or any other Loan Document, whether in bankruptcy or receivership proceedings or otherwise, and (d) in any workout or restructuring or in connection with the protection, preservation, exercise or enforcement of any of the terms hereof or of any rights hereunder or under any other Loan Document or in connection with any foreclosure, collection or bankruptcy proceedings, or (ii) all liabilities, expenses or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against Lender or Servicer, in its capacity as such, in any way relating to or arising out of this Agreement or any other Loan Documents or any action taken or omitted by Lender or Servicer hereunder or thereunder, provided that no Borrower shall be liable for any portion of such costs, expenses or disbursements (a) if the same results from Lender’s negligence or willful misconduct or breach of this Agreement, (b) if the same results from any action taken with respect to a Collateral Pool Property after Lender has acquired title to such Collateral Pool Property in a foreclosure proceeding or deed in lieu accepted by Lender, (c) if Borrower was not given notice of the subject claim and the opportunity to participate in the defense thereof, at its expense (except that Borrower shall remain liable to the extent such failure to give notice does not result in a loss to Borrower), or (d) if the same results from a compromise or settlement agreement entered into without the consent of Borrower, which shall not be unreasonably withheld. Borrower agrees unconditionally to pay all stamp, document, transfer, mortgage registration, recording or filing taxes or fees and similar impositions now or hereafter determined by Lender to be payable in connection with this Agreement or any other Loan Document, and Borrower agrees unconditionally to hold Lender and Servicer harmless from and against any and all present or future claims, liabilities or losses with respect to or resulting from any omission to pay or delay in paying any such taxes, fees or impositions. Credit Agreement   Page 61 10.7    Holidays. Whenever the funding of a Borrowing Tranche hereunder shall be due on a day which is not a Business Day such payment shall be due on the next Business Day and such extension of time shall be included in computing interest and fees, except that the Loan shall be due on the Business Day preceding the Expiration Date if the Expiration Date is not a Business Day. Whenever any payment or action to be made or taken hereunder (other than payment of the Loan) shall be stated to be due on a day which is not a Business Day, such payment or action shall be made or taken on the next following Business Day, and such extension of time shall not be included in computing interest or fees, if any, in connection with such payment or action. 10.8    Notices. (a)    All Notices under or concerning this Agreement will be in writing. Each Notice will be deemed given on the earliest to occur of (i) the date when the Notice is received by the addressee by fax or other electronic transmittal (to be followed by a second form of delivery if by electronic transmittal; provided however, such failure to do so will not constitute Notice being improperly provided except for a Notice of an Event of Default), (ii) the 1st Business Day after the Notice is delivered to a recognized overnight courier service, with arrangements made for payment of charges for next Business Day delivery, or (iii) the 3rd Business Day after the Notice is deposited in the United States mail with postage prepaid, certified mail, return receipt requested. Addresses for Notice are as follows: If to Lender: 26901 Agoura Road, Suite 200 Calabasas Hills, CA 91301 Attention: Loan Servicing Manager If to Borrower: ____________________ c/o Steadfast Companies 18100 Von Karman Avenue Suite 500 Irvine, CA 92612 Attention: Ana Marie del Rio, General Counsel Credit Agreement   Page 62 Lender shall endeavor to give the individuals or entities listed below courtesy copies of any notice given to Borrower by Lender or Servicer, at the address set forth below; provided, however, that failure to provide such courtesy copies of notices shall not affect the validity or sufficiency of any Notice to Borrower, shall not affect Lender’s rights and remedies hereunder or under any other Loan Documents, nor subject Lender to any claims by or liability to Borrower or any other individual or entity, it being acknowledged and agreed that no individual or entity listed below is a third-party beneficiary to any of the Loan Documents. Steadfast Companies 105 Oronoco Street, Suite 312 Alexandria, Virginia 22314 Attention: Ginger Davis, Associate General Counsel (b)     Any party to this Agreement may change the address to which Notices intended for it are to be directed by means of Notice given to the other party in accordance with this Section 10.8. Each party agrees that it will not refuse or reject delivery of any Notice given in accordance with this Section 10.8, that it will acknowledge, in writing, the receipt of any Notice upon request by the other party and that any Notice rejected or refused by it will be deemed for purposes of this Section 10.8 to have been received by the rejecting party on the date so refused or rejected, as conclusively established by the records of the U.S. Postal Service or the courier service. (c)     Any Notice under the Revolving Credit Note, the Fixed Rate Note and any other Loan Document that does not specify how Notices are to be given will be given in accordance with this Section 10.8. 10.9    Severability. affect the validity or enforceability of any other provision, and all other provisions shall remain in full force and effect. This Agreement contains the entire agreement between the parties as to the rights granted and the obligations assumed in this Agreement. This Agreement may not be amended or modified except by a writing signed by the party against whom enforcement is sought. Credit Agreement   Page 63 10.10    Governing Law; Consent to Jurisdiction and Venue. This Agreement, and any Loan Document which does not itself expressly identify the Law that is to apply to it, shall be governed by the Laws of the Commonwealth of Virginia. Borrower and Lender agree that any controversy arising under or in relation to this Agreement or any other Loan Document which does not expressly identify the Law that is to apply to it, shall be litigated in the courts located in the Commonwealth of Virginia. The state and federal courts and authorities with jurisdiction in the Commonwealth of Virginia shall have non-exclusive jurisdiction over all controversies which shall arise under or in relation to this Agreement. Borrower and Lender irrevocably consent to service, jurisdiction, and venue of such courts for any such litigation and waive any other venue to which it might be entitled by virtue of domicile, habitual residence or otherwise. However, nothing in this Agreement is intended to limit any right that Lender may have to bring any suit, action or proceeding relating to matters arising under this Agreement in any court of any other jurisdiction. 10.11    Prior Understanding. This Agreement and the other Loan Documents supersede all prior understandings and agreements, whether written or oral, between the parties hereto and thereto relating to the transactions provided for herein and therein, including any prior confidentiality agreements and commitments. Credit Agreement   Page 64 10.12    Duration; Survival. All representations and warranties of Borrower contained herein or made in connection herewith shall survive the funding of the initial advance hereunder and shall not be waived by the execution and delivery of this Agreement, any investigation by Lender, the funding of any Borrowing Tranche, or payment in full of the Loan (subject to the terms and provisions of Section 7.2 herein). All covenants and agreements of Borrower contained herein shall continue in full force and effect from and after the date hereof so long as Borrower may borrow hereunder and until the later of the (i) Expiration Date, or (ii) payment in full of the Obligations. Except as provided in Sections 2.6 and 3.2, all covenants and agreements of any Borrower contained herein relating to the payment of principal, interest, premiums, additional compensation or expenses and indemnification, including those set forth in the Revolving Credit Note or the Fixed Rate Note shall survive payment in full of the Loan and the Expiration Date. Notwithstanding any of the foregoing to the contrary, in no event shall (a) the release of Lender’s Lien on any Collateral Pool Property, (b) the maturity, expiration or early termination of the Revolving Credit Note or Fixed Rate Note or (c) the expiration or early termination of this Agreement, be deemed to terminate any covenants, agreements, representations or warranties contained in this Agreement, the Revolving Credit Note, the Fixed Rate Note or any of the other Loan Documents, to the extent that such covenant, agreement, representation or warranty, shall, by its terms survive the release, maturity, expiration or early termination of this Agreement, the Revolving Credit Note, Fixed Rate Note or any of the other Loan Documents. 10.13    Exceptions. The representations, warranties and covenants contained herein shall be independent of each other, and no exception to any representation, warranty or covenant shall be deemed to be an exception to any other representation, warranty or covenant contained herein unless expressly provided, nor shall any such exceptions be deemed to permit any action or omission that would be in contravention of applicable Law. 10.14    Servicing. Pursuant to the terms of the Guide and any Servicing Agreement, if any, Lender may designate Servicer to perform some or all of Lender’s obligations under this Agreement, the Revolving Credit Note, the Fixed Rate Note, and the other Loan Documents. 10.15    Reserved. Credit Agreement   Page 65 10.16    Authority to File Notices. Borrower irrevocably appoints Lender as its attorney-in-fact, with full power of substitution, to file for record, at Borrower’s cost and expense and in Borrower’s name, any notices that Lender considers reasonably necessary or desirable to protect the Collateral. 10.17    WAIVER OF TRIAL BY JURY. BORROWER AND LENDER EACH (A) COVENANTS AND AGREES NOT TO ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS AGREEMENT OR THE RELATIONSHIP BETWEEN THE PARTIES AS BORROWER AND LENDER THAT IS TRIABLE OF RIGHT BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH PARTY, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL. 10.18    Advertising. Lender may include the name of Borrower, the name and location of any Collateral Pool Property, the Loan and the number of apartment units contained in any Mortgaged Property on Lender’s client list and in any typical advertisement. 10.19    Time of Essence. Time is of the essence with respect to each obligation of Borrower and Lender hereunder. 10.20    Counterparts. This Agreement may be executed by different parties hereto on any number of separate counterparts, each of which, when so executed and delivered, shall be an original, and all such counterparts shall together constitute one and the same instrument. 10.21    NOTICE OF FINAL AGREEMENT. THIS AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES HERETO. Credit Agreement   Page 66 IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly authorized, have executed this Agreement as of the day and year first above written.   BORROWER:       WITNESS:           By: Steadfast Income Advisor, LLC, a                Delaware limited liability company, its ___/s/ Linda Syharath_______________              Manager Print Name: _Linda Syharath__________         /s/ Kevin J. Keating____________________   Name: __Kevin J. Keating_______________   Title: ___Chief Accounting Officer_________ [Signatures Continue on the Following Page]     Page 67 WITNESS:                          Manager           Title: ___Chief Accounting Officer________     Page 68 WITNESS:                          Manager               Page 69 WITNESS:                          Manager               Page 70 WITNESS:                          Manager               Page 71 WITNESS:                          Manager               Page 72 WITNESS:                          Manager               Page 73 WITNESS:                          Manager               Page 74 WITNESS:                          Manager               Page 75   LENDER:         PNC BANK, National Association, WITNESS: a national banking association               ___/s/ Lauren McCollough____________ By: ___/s/ Todd Weaver_________________ Print Name: _Lauren McCollough___________       Name: __Todd Weaver_________________       Title: ___Senior Vice President_______     Page 76 SCHEDULE 1.1(A) LIST OF COLLATERAL POOL PROPERTIES AND ASSOCIATED INITIAL NET OPERATING INCOMES AND MARKET VALUES Collateral Pool Property Initial Net Operating Income Initial Market Value Initial Allocated Loan Amount         Ashley Oaks $1,779,699.00 $34,300,000.00 $24,867,500.00 Trails at Buda Ranch $1,410,202.00 $29,000,000.00 $21,025,000.00 Deer Valley Luxury Apartments $1,632,876.00 $31,700,000.00 $22,982,500.00 Carrington Park at Huffmeister $1,411,417.00 $28,180,000.00 $20,430,500.00 Carrington Place $2,042,024.00 $37,980,000.00 $27,535,500.00 Carrington at Champion Forest $1,837,673.00 $34,650,000.00 $25,121,250.00 Audubon Park $1,246,186.00 $22,900,000.00 $16,602,500.00 Oak Crossing $1,410,362.00 $24,800,000.00 $17,980,000.00 Meritage at Steiner Ranch $3,643,654.00 $80,800,000.00 $58,580,000.00 Schedule 1.1(A) Page 77 SCHEDULE 1.1(B) LIST OF COLLATERAL POOL PROPERTY DOCUMENTS (a) Multifamily Mortgage/Deed of Trust/Deed to Secure Debt Assignment of Rents, Security Agreement and Fixture Filing (b) Multifamily Loan and Security Agreement (c) UCC-1 Financing Statements (d) Documents evidencing O & M Programs (if any) (e) Title insurance policy acceptable to Lender, in an amount equal to not less than the Initial Market Value of such Mortgaged Property, or such other amount as determined by Lender in its sole discretion, which title insurance shall include the following endorsements (where and if applicable): (i) a tie-in or aggregate endorsement, (ii) a multiple foreclosure endorsement, (iii) a first loss endorsement, (iv) a last dollar endorsement, (v) a variable rate mortgage endorsement, and (vi) a revolving credit endorsement Schedule 1.1(B)     [BORROWER MAY, SUBJECT TO LENDER’S CONSENT, REVISE THIS FORM OF LOAN REQUEST TO PROVIDE FOR MULTIPLE BORROWING TRANCHES UNDER A SINGLE LOAN REQUEST FORM] SCHEDULE 2.1.2 FORM OF LOAN REQUEST ______________, 20__ [Lender’s Name and Address] Attention: Ladies and Gentlemen: Reference is made to the Credit Agreement dated as of __________, 20____, as amended (the “Credit Agreement”) by and between _________________________, a ______________________, having an address at _________________________________________ (“Borrower”) and _______________________, a ______________________ (“Lender”). Unless otherwise defined herein, terms defined in the Credit Agreement are used herein with the same meanings. I, _______________, the _______________ of Borrower, a _______________, do hereby certify on behalf of Borrower as of the date hereof, as follows: Borrower is entitled to and hereby requests Lender to make an advance under the Credit Agreement in the amount of $__________ (which must be greater than or equal to $______________. Funds should be delivered to Borrower by wire to the following account: Bank Name and Location:      ABA Number:      Account Name:      Account Number:      Further Credit Instructions:      Attention:      1.    The requested date of the advance (the “Borrowing Date”) is ______________. Schedule 2.1.2     2.    The Borrowing Tranche or [increase of an existing Borrowing Tranche as requested herein] shall bear interest at (check one): _____    Prime Rate* _____    Base Rate _____    Fixed Rate** * Prime Rate is available only as specified in the Credit Agreement ** Fixed Rate is available only as specified in the Credit Agreement. 3.    The Interest Period (if the Base Rate is selected) applicable to the advance is (check one): _____    1-month _____    3-month* *subject to a [___] ([__]) basis point ([____]) increase in the Margin otherwise applicable to such Borrowing Tranche 4.    Borrower will (check one): _____ Pay all interest due and payable under the Borrowing Tranche [requested herein] or [as increased by this requested advance] in monthly installments pursuant to _____ Prepay all interest for such Borrowing Tranche as of the Borrowing Date. 5.    If applicable, the Base Rate for the Base Rate Borrowing Tranche requested hereunder shall be __% consisting of a LIBOR Index Rate of ___ % and a Margin of __%. 6.    Following the disbursement of the funds comprising the Borrowing Tranche [requested herein] or [as increased as requested herein], the total number of Borrowing Tranches outstanding will be __, which is not more than ___. Schedule 2.1.2     7.    If applicable (i.e. in the event of a Loan Request for [a Borrowing Tranche] or [increase of an existing Borrowing Tranche], the maturity date of the Interest Period of the Borrowing Tranche [requested herein] or [increased herein] is (choose and complete one of the following): ____________, 20__ (which is the last day of the Interest Period, in the event that such date is a Business Day) ______________, 20__ (which is the Business Day following the last day of the Interest Period, in the event that such date is not a Business Day). 8.    This request for an advance is made pursuant to and in accordance with the provisions of the Credit Agreement. The proceeds of such advance are to be used for a permitted purpose under Section 17 of the Revolving Credit Note. 9.    The principal amount outstanding under the Credit Agreement on the date hereof, prior to any advance in response to this request, is $_____________. 10.    To the best of Borrower’s Knowledge following diligent inquiry, the advance of the funds requested herein will not cause Borrower to be in non-compliance with the Sublimits set forth in Section 2.1.4 of the Credit Agreement. 11.    Guarantor is in compliance with the requirements set forth in Section 8.10 of the Credit Agreement relating to the Minimum Net Worth and Liquidity requirements. 12.    Intentionally Omitted. 13.    Except as set forth herein and approved by Lender, all of the covenants and all of the representations and warranties contained in the Credit Agreement and the other Loan Documents, and all of the other terms, covenants and conditions contained in the Loan Documents continue to be materially true and correct and continue to be complied with on the date hereof, and will continue to be materially true and correct and will continue to be complied with as of the date of, and subsequent to, the requested advance exceptions. 14.    No Potential Default or Event of Default exists as of the date hereof, and no Potential Default or Event of Default shall exist on the Borrowing Date. 15.    All of the other terms and conditions set forth in the Credit Agreement and the other Loan Documents pertaining to the Loan have been satisfied. Schedule 2.1.2     16.    All items that Borrower and Guarantor are required to furnish to Lender pursuant to the Credit Agreement to accompany this request are true and complete in all material respects. 17.    The undersigned is an Authorized Officer of Borrower. 18.    Notice of this Loan Request shall be deemed received by Lender when (i) sent by facsimile to (_____) ____-________ and (ii) verbally confirmed by telephone call to either (when called in the following order of priority): (1) __________ (__________), (2) __________ (__________), (3) __________ (__________) or such additional names and numbers as Lender may specify upon prior written Notice to Borrower. [The Loan Request continues on the following page] Schedule 2.1.2     IN WITNESS WHEREOF, the undersigned has executed this Certificate this ______ day of ___________, ____. BORROWER:     _______________________________,      a __________________________________             By: _____________________________________         Name: _______________________________        Title: ________________________________ As to item 11 set forth herein: GUARANTOR:     _______________________________,      a __________________________________             By: _____________________________________   Name: ___________________________________   Title: ____________________________________ Schedule 2.1.2     19.    The current LTV Ratio is ___%, which is less than or equal to the Maximum LTV Ratio specified in Section 2.1.4.1 of ___%, determined as follows: A. The current Loan balance $_____________ B. The current aggregate Market Value of the Collateral Pool $____________ C. Item A divided by Item B and then multiplied by 100% equals the LTV Ratio ____________% 20.    Following the disbursement of the funds comprising the Borrowing Tranche [requested herein] or [increased herein], the LTV Ratio will equal ___%, which is less than or equal to the Maximum LTV Ratio set forth in Schedule 2.1.4.1 of the Credit Agreement of ___%, determined as follows: A. The Loan balance upon disbursement of the funds comprising the Borrowing Tranche(s) requested herein $_____________ B. $____________ C. ____________% 21.    The current Aggregate DSCR is ______ : 1.00, which is not less than _____ : 1.00, as set forth in Section 2.1.4.2 of the Credit Agreement determined as follows: A. Net Operating Income of the Collateral Pool Properties determined by Lender $_____________ B. Aggregate Stressed Debt Service (as defined in the Credit Agreement) $_____________ C. Item A divided by Item B equals the Aggregate DSCR ____________% Schedule 2.1.2     22.    Following the disbursement of the funds comprising the Borrowing Tranche [requested herein] or [increased herein] the Aggregate DSCR will be ______ : 1.00, which is not less than _____ : 1.00, as set forth in Section 2.1.4.2 of the Credit Agreement determined as follows: A. Net Operating Income of the Collateral Pool Properties as determined by Lender $_____________ B. $_____________ C. ____________% Servicer hereby certifies (i) to the accuracy of each of the mathematical computations set forth in paragraphs 19 through 22 above (acknowledging that Servicer has relied, with Lender’s consent and without independent verification thereof, on the Net Operating Income and Market Value(s) prepared by Lender), and (ii) to the best of its knowledge and belief, that all statements made by Borrower herein are true and accurate in all material respects. SERVICER     _______________________________,      a __________________________________             By: _____________________________________         Name:        Title:     Dated: ___________________________________ Schedule 2.1.2     To the best of Borrower’s Knowledge following diligent inquiry, the computations set forth in Paragraphs 19 through 22 as certified by Servicer are accurate. BORROWER:     _______________________________,      a __________________________________             By: _____________________________________         Name: _______________________________        Title: ________________________________ Schedule 2.1.2     SCHEDULE 2.1.4 FORM OF NOTICE FOR SUBLIMIT VIOLATIONS [DATE] _________________ _________________ _________________ Re:    ______________________ Dear __________________: In accordance with the Credit Agreement by and between ____________, a ___________ (individually and collectively, the “Borrower”) and [____________________], a [____________________] (“Servicer”) dated [____] [__], 20__, requires a Valuation of each of the Collateral Pool Properties. Such Valuation has been performed in accordance with Freddie Mac’s current underwriting policies, practices and procedures subject to the terms and provisions of Section 1.2.3 of the Credit Agreement) and is based in large part, but not entirely, on Borrower’s supplied property level financial statements as provided to the Servicer. Based on this analysis, Freddie Mac has determined the following LTV Ratio, Aggregate DSCR and NOI: LTV Ratio: Aggregate DSCR: NOI: The [LTV Ratio] [and] [Aggregate DSCR] are not in compliance with the Sublimits set forth in [Sections 2.1.4.1 and 2.1.4.2][Section 2.1.4.1][Section 2.1.4.2] of the Credit Agreement, and Borrower shall comply with Section 5.4.2 of the Credit Agreement. Please call the undersigned at ______________________________ if you have any questions. Sincerely, Schedule 2.1.4     SCHEDULE 2.3 FORM OF [SCHEDULED MATURITY DATE EXTENSION CONFIRMATION] OR [NET SPREAD TABLE AFTER EXPANSION TO LOAN CONFIRMATION] [______________], 20[__] [__________] [__________] [__________] [__________] Attention: [__________] Ladies and Gentlemen: Reference is made to that Credit Agreement dated as of [__________], as amended (the “Credit Agreement”) initially by and between [__________], a [__________], having an address at [__________] (“Borrower”) and [__________], a [__________], having an address at [__________] (together with its successors and assigns, “Lender”). Unless otherwise defined herein, terms defined in the Credit Agreement are used herein with the same meanings. Pursuant to Section 2.4.3 of the Credit Agreement, the Borrower has elected to increase the Loan as set forth in Section 2.4.3 of the Credit Agreement, and the Net Spread applicable to any Borrowing Tranche on or after such increase shall be as set forth on Exhibit A hereto. OR Pursuant to Section [2.3.1 or 2.3.2] of the Credit Agreement, the [First Option to Extend or Second Option to Extend] has been exercised, the [Maturity Date or First Extended Maturity Date] has been extended as set forth in [Section 2.3.1 or 2.3.2] of the Credit Agreement, and the Net Spread applicable to any Borrowing Tranche on or after the initial Scheduled Maturity Date shall be as set for the on Exhibit A hereto. Sincerely, LENDER:     _______________________________, a __________________________________         By: _____________________________________ Name: Title: [signatures continue on next page] Schedule 2.3     ACKNOWLEDGED AND AGREED BORROWER: _______________________, a _____________________________ By:                          Name: Title: Schedule 2.3     EXHIBIT A TO SCHEDULE 2.3 [NET SPREAD TABLE APPLICABLE DURING AN EXTENSION PERIOD] OR [NET SPREAD TABLE APPLICABLE AFTER AN EXPANSION TO THE COMMITMENT] Aggregate DSCR Net Spread* Margin* Greater than or equal to [__] : 1.00 but less than [__]: 1.00 [_______] [_______] Greater than or equal to [__]: 1.00 but less than [___]: 1.00 [_______] [_______] Greater than or equal to [___] : 1.00 [_______] [_______] The Net Spread and Margin set forth above each assumes that the Base Rate Borrowing Tranche will have a one (1) month Interest Period. [The Net Spread and Margin shall be increased by [__] basis points ([___]) for any Base Rate Borrowing Tranche having a three-month Interest Period] Schedule 2.3     SCHEDULE 4.2.3 NET SPREAD TABLE Aggregate DSCR Net Spread* Margin* Greater than or equal to 1.45:1.00 but less than 1.65: 1.00 193 bps 198 bps Greater than or equal to 1.65: 1.00 but less than 1.85: 1.00 183 bps 188 bps Greater than or equal to 1.85: 1.00 173 bps 178 bps * The Net Spread and Margin set forth above assume that the Borrowing Tranches will have a one-month Interest Period. The Net Spread and Margin shall be increased by 0.001 for any Base Rate Borrowing Tranche having a 3 month Interest Period.     Schedule 4.2.3     [BORROWER MAY, SUBJECT TO LENDER’S CONSENT, REVISE THIS FORM OF RENEWAL REQUEST TO PROVIDE FOR THE RENEWAL OF MULTIPLE BORROWING TRANCHES UNDER A SINGLE RENEWAL REQUEST FORM OR TO PROVIDE FOR THE SPLITTING OF A MATURING BORROWING TRANCHE INTO MULTIPLE BORROWING TRANCHES UNDER A SINGLE RENEWAL REQUEST FORM OR THE CONVERSION OF A FIXED RATE BORROWING TRANCHE TO A BASE RATE BORROWING TRANCHE PURSUANT TO THE CREDIT AGREEMENT] SCHEDULE 4.3.3 RENEWAL [CONVERSION] REQUEST ______________, 20__ Attention: Ladies and Gentlemen: Reference is made to the Credit Agreement dated as of _____________, 20___, as amended (the “Credit Agreement”) by between ______________________, a _____________________ (individually and collectively the “Borrower”) and [_____________________], a [____________________] (“Lender”). Unless otherwise same meanings. I, __________________, the _______________ of Borrower, a __________________________, do hereby certify on behalf of each Borrower as of the date hereof, as follows: _____Borrower hereby requests Lender to renew the Borrowing Tranche in the amount of $______________, whose then-current Interest Period will mature on ___________, ____. or _____ Borrower, in accordance with the provisions of the Credit Agreement, will repay $___________ of the outstanding principal amount of the Borrowing Tranche originally funded in the amount of $____________, whose Interest Period will mature on ________, ____, prior to such maturity date, and hereby requests Lender to renew such Borrowing Tranche in the amount of the remaining principal balance of such Borrowing Tranche, the remaining principal balance being equal to $___________. [or Schedule 4.3.3     _____ Borrower hereby requests Lender to combine 2 or more Borrowing Tranches pursuant to the provisions of the Credit Agreement into a single Borrowing Tranche, specifically Borrower hereby requests that Lender combine the Borrowing Tranche in the amount of $______________, whose Interest Period will mature on ___________, ____ with the Borrowing Tranche in the amount of $______________, whose Interest Period will mature on ___________, ____ [add descriptions of additional Borrowing Tranches as necessary.] [or Borrower in accordance with the provisions of the Credit Agreement will convert the Fixed Rate Borrowing Tranche in the amount of $__________ to a Base Rate Borrowing Tranche in the amount of $__________] 1.    The Borrowing Tranche shall bear interest at (check one): _____    Prime Rate* _____    Base Rate 2.    The Interest Period (if the Base Rate is selected) applicable to the renewed Borrowing Tranche [converted Fixed Rate Borrowing Tranche) is (check one): _____    one-month _____    three-month* * subject to a [____] ([__]) basis point ([_____]) increase in the Margin otherwise applicable to such Borrowing Tranche 3.    Borrower will (check one): _____ Pay all interest due and payable under the requested Borrowing Tranche in monthly installments pursuant to the terms of the Credit Agreement. _____ 4.    The principal amount outstanding under the Credit Agreement on the date 5.    If applicable, the Base Rate for the Borrowing Tranche renewed hereunder [Fixed Rate Tranche converted hereunder]shall be ____% consisting of a LIBOR Index Rate of ____% and a Margin of ____%. Schedule 4.3.3     6.     If applicable (i.e. in the event of the renewal of a Borrowing Tranche [or conversion of a Fixed Rate Borrowing Tranche]), the maturity date of the Interest Period of the Borrowing Tranche requested herein is (choose and complete one of the following): 7.    Intentionally Omitted. 8.    Intentionally Omitted. 9.    Intentionally Omitted. 10.    [Check one of the following:] ____ No Potential Default or Event of Default exists as of the date hereof and as of the date of renewal. as of the date of renewal, other than Borrower’s non-compliance with [Sections 2.1.4.1 and 2.1.4.2] [Section 2.1.4.1] [Section 2.1.4.2] of the Credit Agreement, and the renewal of any Borrowing Tranche hereunder will not increase the outstanding principal balance of the Loan. 11.    All of the other terms and conditions set forth in the Credit Agreement 12.    The undersigned is an Authorized Officer of Borrower. 13.    Notice of this Loan Request shall be deemed received by Lender when (i) sent by facsimile to (____) ____-_________ and (ii) verbally confirmed by [__________] ([__________]), (2) [__________] ([__________]), (3) [__________] ([__________] or such other names and numbers as Lender may specify upon prior written notice to Borrower. [The Renewal Request continues on the following page] Schedule 4.3.3     BORROWER:     _______________________________,      a __________________________________             By: _____________________________________         Name: _______________________________       Title: ________________________________ Schedule 4.3.3     14.    The current LTV Ratio is ___________(__%), which is less than or equal to the Maximum LTV Ratio set forth in Section 2.1.4.1 of the Credit Agreement of ________________ percent (____%), determined as follows: A. The current Loan balance $_____________ B. $_____________ C. ____________% 15.    The current Aggregate DSCR is [___] : 1.00, which [check one:]              ___ is less than _____ : 1.00, or ___ is greater than or equal to _____: 1.00, determined as follows: A. $_____________ B. $_____________ C. ____________% 16.    Following the renewal of the Borrowing Tranche [conversion of the Fixed Rate Borrowing Tranche] for the Interest Period requested herein, the Aggregate DSCR will be ______ : 1.00, which [check one:] ___ is less than ____ : 1.00, or determined as follows: A. $_____________ B. $_____________ C. ____________% Schedule 4.3.3     computations set forth in paragraphs 14 through 16 above (acknowledging that SERVICER:     _______________________________,      a __________________________________             By: _____________________________________         Name: _______________________________        Title: ________________________________     Dated: ___________________________________ set forth in Paragraphs 14 through 16 as certified by Servicer are accurate. BORROWER:     _______________________________,      a __________________________________             By: _____________________________________         Name: _______________________________        Title: ________________________________ Schedule 4.3.3    

Exhibit 10.2 EMPLOYMENT AGREEMENT THIS EMPLOYMENT AGREEMENT (the “Agreement”) is entered into as of July 12, 2010 by and between CKE RESTAURANTS, INC., a Delaware corporation (the “Company”), and E. MICHAEL MURPHY (the “Employee”). RECITALS: A.The Company and Employee heretofore entered into an Employment Agreement dated as of January 12, 2004, and amended on December 6, 2005, October 12, 2006, December 16, 2008 and January 28, 2010 (collectively, the “Prior Employment Agreement”). B.Pursuant to the Agreement and Plan of Merger, dated April 18, 2010, among the Company, Columbia Lake Acquisition Holdings, Inc. (“Parent”), and Columbia Lake Acquisition Corp. (the “Merger Agreement”), the Company, as of the date hereof (the “Effective Date”), becomes a wholly-owned subsidiary of Parent, which is in turn a wholly-owned subsidiary of Apollo CKE Holdings, L.P. (“Holdings LP”), which in turn is indirectly majority-owned by investment funds controlled by Apollo Management VII, L.P. (Apollo Management VII, L.P. and the investment funds it controls are hereinafter referred to as “Apollo”). C.Immediately prior to the Effective Date, the Employee owned a significant number of shares of common stock of the Company and other stock-based rights, and as a result of the closing of the transactions contemplated by the Merger Agreement, the Employee has or shall receive substantial consideration in exchange for such shares and rights. D.The Company and the Employee desire to supersede the Prior Employment Agreement in its entirety with this Agreement, all effective as of the Effective Date. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the parties agree as follows: 1.Employment and Duties.Subject to the terms and conditions of this Agreement, the Company employs the Employee to serve in an executive and managerial capacity as President and Chief Legal Officer of the Company, and the Employee accepts such employment and agrees to perform such reasonable responsibilities and duties commensurate with the aforesaid positions as directed by the Company’s Chief Executive Officer or as set forth in the Articles of Incorporation and the Bylaws of the Company. 2.Term.The Employee’s term of employment with the Company under this Agreement shall commence on the Effective Date and extend until the fourth anniversary thereof (the “Term”), provided that the Term shall automatically be extended for successive one year periods thereafter, unless at least six months prior to the commencement of any such one year period, either party provides written notice to the other (a “Notice of Non-Renewal”) that the Term shall not be so extended.The Term shall end prior to the scheduled expiration thereof pursuant to the preceding sentence if the Employee’s employment is terminated pursuant to Section 10. 3.Salary.During the Term, the Company shall pay the Employee a minimum base annual salary of $636,750.The Compensation Committee of the Company’s Board of Directors (the “Board”) may, from time to time after the Effective Date, increase such salary in its sole discretion. 4.Bonuses. (a) With respect to each fiscal year of the Company that ends during the Term, the Employee shall be eligible to receive from the Company an annual performance bonus (the “Annual Bonus”).The Compensation Committee, after consultation with Employee, shall, prior to the commencement of each such fiscal year, agree upon a reasonable target (“Target”) for such fiscal year for the Company’s (i) comparable same store sales, (ii) earnings before interest, taxes, depreciation and amortization (“EBITDA”), and (iii) free cash flow (collectively the “Metrics” and individually a “Metric”).The Compensation Committee shall then assign a weighting to each of the Metrics based on the importance it attributes to each Metric by allocating a percentage to each Metric (the “Metric Percentage”) such that the sum of all three Metric Percentages equals 100%.Employee shall then earn an Annual Bonus for each such fiscal year equal to the sum of the bonus earned for each Metric, determined as follows: (i)If the Company achieves below 80% of the Target for any Metric, no bonus shall be earned with respect to such Metric. (ii)If the Company achieves 80% of the Target for any Metric, Employee shall earn a bonus equal to 50% of his minimum base annual salary in effect on the last day of such fiscal year (the "Current Base") multiplied by the Metric Percentage for that Metric. (iii)If the Company achieves greater than 80%, but less than 100%, of the Target for any Metric, Employee’s bonus for such Metric shall be determined by taking the Current Base multiplied by the percentage determined as follows: 50% + [(% points achieved in excess of 80%1/20) x 50%] This amount shall then be multiplied by the Metric Percentage for that Metric to determine the amount the Employee earned for that Metric. (iv)If the Company achieves 100% of the Target for any Metric, the Employee shall earn a bonus equal to 100% of Current Base multiplied by the Metric Percentage for that Metric. (v)If the Company achieves greater than 100%, but less than 120%, of the Target for any Metric, Employee’s bonus for such Metric shall be determined by taking the Current Base multiplied by the percentage determined as follows: 100% + [(% points achieved in excess of 100%2/20) x 120%] This amount shall then be multiplied by the Metric Percentage for that Metric to determine the amount the Employee earned for that Metric. (vi) If the Company achieves 120% or greater of Target for any Metric, Employee shall receive a bonus equal to 220% of Current Base multiplied by the Metric Percentage for that Metric. Targets for the fiscal year in which the Effective Date occurs will be determined based on the budget presented by management as attached as Exhibit A.Achievement levels for each Metric for a fiscal year shall be determined by the Compensation Committee based on the audited financial statement for such year, subject to such adjustments to reflect unusual, nonrecurring or extraordinary events as the Board shall deem equitable and appropriate, after consultation with the Chief Executive Officer of the Company, and subject to the approval of the Compensation Committee of the Board of Directors of Parent.Any Annual Bonus earned for a fiscal year shall be payable in full as soon as reasonably practicable following the determination thereof, but in no event later than March 15th of the calendar year following the calendar year in which such fiscal year ends, and in accordance with the Company’s normal payroll practices and procedures.Any Annual Bonus (or portion thereof) payable under this Section 4(a) shall not be earned and payable unless the Employee is employed by the Company on the last day of the period to which such Annual Bonus relates. (b) The Employee shall be entitled to three special retention bonuses each in the amount of $313,750 payable on October 1, 2011, October 1, 2012 and October 1, 2013 respectively (each a “Special Retention Installment”), provided that any unpaid Special Retention Installment will be paid immediately upon a Change of Control.Notwithstanding the foregoing, except as provided in Section 10(b), upon and following the Employee’s termination of employment for any reason, no further Special Retention Installments will be payable under this Section 4(b).For purposes of this Agreement, a Change of Control shall have the same meaning as the definition of “Change of Control” set forth in the Partnership Agreement. 5. Equity Investment; Equity Award. (a) No later than 12:00 p.m. Pacific Time on July 16, 2010 (the “Purchase Deadline”), the Employee agrees to purchase from Holdings LP, Class A Units (as defined in the Partnership Agreement) for aggregate cash consideration of $1,525,000 (the “Purchase Price”) at a price per unit equal to the same price per Class A Unit paid by Apollo for Class A Units on the Effective Date (the “Unit Purchase”).The Unit Purchase shall otherwise be on the terms set forth in a separate Subscription Agreement entered into by and between Holdings LP and the Employee in the form attached hereto as Exhibit B, and the Class A Units shall be subject to the terms set forth in the Holdings LP Amended and Restated Limited Partnership Agreement in the form attached hereto as Exhibit C (the “Partnership Agreement”).The Purchase Price shall be paid in accordance with the terms of that certain letter agreement on the matter of “Payment for Purchased Units”, dated the Effective Date, among Employee, Holdings LP, the Company and Parent.In connection with, and simultaneously with, the Unit Purchase, Employee shall execute and deliver the Partnership Agreement as a Management Limited Partner (as defined in the Partnership Agreement). (b) Upon consummation of the Unit Purchase, Holdings LP shall award the Employee 663,604 Class B Units (as defined in the Partnership Agreement).The Class B Units shall be subject to the terms set forth in the Partnership Agreement, and for purposes of Section 3.8.2 thereof, the Effective Date shall be treated as the date of grant. 6.Other Compensation and Fringe Benefits.In addition to any executive bonus, pension, deferred compensation and stock option grants which the Company may from time to time make available to the Employee upon mutual agreement, the Employee shall be entitled to the following during the Term: (a)The standard Company benefits enjoyed by the Company’s other top executives; (b)Payment by the Company of the Employee’s initiation and membership dues in a social and/or recreational club as deemed necessary and appropriate by the Employee (and pre-approved by the Compensation Committee at its discretion) to maintain various business relationships on behalf of the Company; provided, however, that the Company shall not be obligated to pay for any of the Employee’s personal purchases and expenses at such club; (c)Provision by the Company to the Employee and his dependents of the medical and other insurance coverage provided by the Company to its other top executives. In addition, the Company will reimburse Employee for all medical, dental and vision care expenses incurred by the Employee and his dependents that are not otherwise reimbursed or covered by the base health insurance plan; and (d)Provision by the Company of supplemental disability insurance sufficient to provide two-thirds of the Employee’s pre-disability minimum base annual salary for a two-year period. (e)Section 409A Limitation. Any amounts payable under Sections 6(b), 6(c), 9 or 10(b)(iv) shall be paid no later than December 31 of the year following the year in which the expenses are incurred. 7.Withholding.The Company shall deduct from all compensation payable under this Agreement to the Employee any taxes or withholdings the Company is required to deduct pursuant to state and federal laws or by mutual agreement between the parties. 8.Vacation.For and during each year of the Term and any extensions thereof, the Employee shall be entitled to reasonable paid vacation periods consistent with his position with the Company and in accordance with the Company’s standard policies, or as the Board may approve. In addition, the Employee shall be entitled to such holidays consistent with the Company’s standard policies or as the Board may approve. 9.Expense Reimbursement. In addition to the compensation and benefits provided herein, the Company shall, upon receipt of appropriate documentation, reimburse the Employee each month for his reasonable travel, lodging, entertainment, promotion and other ordinary and necessary business expenses in accordance with the Company’s policies then in effect. 10.Termination. (a)By the Company For Cause.The Company may terminate the Employee’s employment immediately for Cause upon written notice to the Employee, in which event the Company shall be obligated only to pay the Employee that portion of the minimum base annual salary due him through the date of termination.“Cause” shall mean the Employee’s (i) willful failure to perform the material duties of his position, adhere to the lawful direction of the Board or adhere to the lawful policies and practices of the Company, (ii) conviction of or plea of nolo contendere involving a felony or crime of moral turpitude under the laws of the United States or any state thereof that involves dishonesty or is otherwise detrimental to the Company determined in Board’s good faith, or (iii) material breach of a provision of his employment or other written agreement including, without limitation, the Employee’s failure to fully fund the Purchase Price by the Purchase Deadline.Notwithstanding the foregoing, if the occurrence of an event described in (i) through (iii) above is capable of being cured, such occurrence shall constitute Cause only if written notice specifying in reasonable detail the nature thereof is provided to the Employee within ninety (90) days of the alleged event and he shall have substantially failed to cure such event within fourteen (14) days after receiving such notice. (b)By the Company Without Cause.The Company may terminate the Employee’s employment immediately without Cause by giving written notice to the Employee.If the Company terminates under this Section 10(b): (i)The Company shall pay the Employee all amounts owed through the date of termination; (ii)In lieu of any further salary and bonus payments or other payments due to the Employee for periods subsequent to the date of termination, under this Agreement or otherwise, the Company shall pay, as severance to the Employee, subject to the Employee executing and delivering to the Company a release of the Company and its affiliates from all known or unknown claims at the date of such termination based upon or arising out of this Agreement, the Employee’s employment, or the termination thereof, in form reasonably acceptable to the Employee (the “Release”) (provided that the Release shall be executed and delivered on or prior to the fifty-fifth (55th) day following the date of the Employee’s termination and shall be in the form of an effective release agreement for which any applicable revocation period has expired), an amount equal to (w) the product of the Employee’s minimum base annual salary in effect as of the date of termination multiplied by the number three, payable in equal installments in accordance with the Company’s payroll periods over the two year period following such termination of employment, (x) the Annual Bonus that would have been paid to the Employee in respect of the fiscal year in which the Employee’s termination of employment occurs based upon the level of performance actually achieved through the Employee’s date of termination, prorated based on the number of days that the Employee was actually employed during such year, and payable on the date on which the Company would otherwise pay bonuses but in no event later than March 15th of the calendar year following the calendar year of the Employee’s date of termination, (y) 50% of any unpaid Special Retention Installment, payable on the date(s) such installment(s) would otherwise be paid had the Employee’s employment not been terminated, and (z) the remaining 50% of any unpaid Special Retention Installment, payable on the date(s) such installment(s) would otherwise be paid had the Employee’s employment not been terminated, but only if, prior to the date of termination of employment, any of the Employee’s Class B Performance Units (as defined in the Partnership Agreement) were converted to a time vesting schedule pursuant to Section 3.8.3 of the Partnership Agreement.Notwithstanding the foregoing, if, at the time the Company terminates Employee’s employment under this Section 10(b), the Company is a reporting company under the Exchange Act (as defined below), and the Employee is a “specified employee for purposes of Section 409A(a)(2)(B)(i) of the Internal Revenue Code of 1986, as amended (the “Code), then any payments under this Section 10(b)(ii) that otherwise would have been paid during the period commencing on the date of termination and ending six months after the last day of the calendar month in which the date of termination occurs shall be paid on the first business day that occurs at the end of the period. (iii)Subject to the Employee’s execution, delivery and non-revocation of the Release, the Company shall maintain in full force and effect for the continued benefit of the Employee during the period commencing on the date of termination and ending on the scheduled expiration of the Term then in effect (without regard to further renewals thereof), all employee benefit plans (except for the Company’s stock incentive plans) and programs in which the Employee was entitled to participate immediately prior to the date of termination, provided that the Employee’s continued participation is not prohibited under the general terms and provisions of such plans and programs, but, if prohibited, the Company shall, at the Company’s expense, arrange for substantially equivalent benefits or the equivalent cash value if the Company cannot obtain post-employment insurance coverage from any source after engaging in commercially reasonable efforts; provided, however, that notwithstanding the foregoing, there shall only be included, and Employee shall only be entitled to, those benefit plans or programs that are exempt from the term “nonqualified deferred compensation plan” under Section 409A of the Code. (iv)Subject to the Employee’s execution, delivery and non-revocation of the Release, the Company shall provide the Employee with reimbursement not to exceed $25,000 for the reasonable costs incurred for outplacement services, provided that such cash allowance shall apply only to those costs or obligations that are incurred by the Employee during the twelve month period following the date of the Employee’s termination of employment.Such reimbursement shall be made on the fifteenth day following the submission of each receipt to the Company evidencing costs or obligations incurred by the Employee in connection with outplacement activities. Notwithstanding anything in Section 10(b) to the contrary, no amount shall be payable pursuant to this Section 10(b) unless Employee has incurred a Separation from Service (within the meaning of Section 409A(a)(2)(A)(i) of the Code, and Treasury Regulation Section 1.409A-1(h) by reason of a termination of the Employee’s employment by the Company under this Section 10(b). (c)By the Employee Without Good Reason.The Employee may resign from employment immediately without Good Reason by giving written notice to the Company.If the Employee resigns under this Section 10(c), then the Company shall not pay him any separation or severance pay or other benefit in connection with his termination, but shall only be obligated to pay the Employee any unpaid portion of his base salary that he earned for services he performed through his date of termination. (d)By the Employee With Good Reason.The Employee may resign from employment with Good Reason by giving written notice to the Company.If the Employee resigns under this Section 10(d), then such resignation shall be treated as a termination by the Company pursuant to Section 10(b).“Good Reason” shall mean the occurrence of any of the following events, without the Employee’s consent, (i) a material failure by the Company to pay any compensation owed to the Employee, (ii) a material reduction in the Employee’s base salary or target bonus percentage, (iii) a material diminution in the Employee’s responsibilities or authority, or (iv) the voluntary resignation of Andrew F. Puzder as Chief Executive Officer during the period between 90 and 365 days following the occurrence of a Change of Control.Notwithstanding the foregoing, occurrence of the events described in (i) through (iii) above only shall constitute Good Reason if (A) the Employee provides the Company written notice within sixty (60) days following the occurrence of an event that allegedly constitutes Good Reason; (B) the Company fails to substantially cure such event within thirty (30) days after receiving such notice; and (C) the Employee resigns within thirty (30) days following such failure to cure.In connection with a resignation for Good Reason on account of a Mr. Puzder’s resignation following a Change of Control (i.e., (iv) above), such resignation shall be deemed to be for Good Reason only where such resignation occurs during the 90-day period commencing on the date of Mr. Puzder’s resignation. (e)Disability. If the Employee fails to perform his duties hereunder on account of illness or other incapacity for a period of six consecutive months, then the Company shall have the right upon written notice to the Employee to terminate the Employee’s employment without further obligation by paying the Employee the minimum base annual salary, without offset, for the one year period following such termination, subject to the Employee’s execution, delivery and non-revocation of the Release.The Employee shall also be entitled to additional vesting of his Class B Units to the extent provided in the Partnership Agreement. (f)Death. If the Employee dies during the Term, then this Agreement shall terminate immediately and the Employee’s legal representatives shall be entitled to receive the minimum base annual salary for the one year period following such termination, subject to the representative’s execution, delivery and non-revocation of the Release.The Employee shall also be entitled to additional vesting of his Class B Units to the extent provided in the Partnership Agreement. (g)Non-Renewal.The Employee’s employment will terminate upon the expiration of the Term.If the term expires by reason of the Employee having provided a Notice of Non-Renewal to the Company, then such termination will be treated as a termination pursuant to Section 10(c).If the Term expires by reason of the Company having provided a Notice of Non-Renewal to the Employee, then such termination will be treated as a termination pursuant to Section 10(b). (h)Effect of Termination. Termination for any reason or for no reason shall not constitute a waiver of the Company’s rights under this Agreement nor a release of the Employee from any obligation hereunder except his obligation to perform his day-to-day duties as an employee. (i)Mitigation; Offset. Employee shall not be required to mitigate the amount of any payment provided for in this Section 10 by seeking other employment or otherwise, nor shall any compensation or other payments received by the Employee after the date of termination reduce any payments due under this Section 10.However, if the Employee becomes entitled to a benefit from a subsequent employer of the type he is then receiving under Section 10(b)(iii) above, he shall immediately notify the Company, and the benefit he is receiving under Section 10(b)(iii) above shall immediately terminate. (j)Certain Taxes.Notwithstanding anything to the contrary herein, if the Employee would retain, on an after-tax basis, a greater amount by reducing his entitlement to any amounts payable under or outside of this Agreement that are described in Section 280G(b)(2)(A)(i) of the Code as a result of the transactions contemplated by the Merger Agreement to the extent necessary to avoid any portion of any such payment being treated as a “parachute payment” within the meaning of Section 280G(b)(2) of the Code, then his entitlement will be so reduced.Furthermore, if at any time following the consummation of the transactions contemplated by the Merger Agreement, Employee has the right to receive either directly or indirectly from the Company, payments or benefits which would constitute an “excess parachute payment” under Section 280G of the Code, and the Employee would retain, on an after-tax basis, a greater amount by reducing his entitlement to any amounts payable under or outside of this Agreement that are described in Section 280G(b)(2)(A)(i) of the Code to the extent necessary to avoid any portion of any such payment being treated as a “parachute payment” within the meaning of Section 280G(b)(2) of the Code, then his entitlement will be so reduced in accordance with Exhibit D. 11.Non-Delegation of Employee’s Rights. The obligations, rights and benefits of the Employee hereunder are personal and may not be delegated, assigned or transferred in any manner whatsoever, nor are such obligations, rights or benefits subject to involuntary alienation, assignment or transfer. 12.Confidential Information. The Employee acknowledges that in his capacity as an employee of the Company he will occupy a position of trust and confidence and he further acknowledges that he will have access to and learn substantial information about the Company and its operations that is confidential or not generally known in the industry, including, without limitation, information that relates to purchasing, sales, customers, marketing, and the Company’s financial position and financing arrangements. The Employee agrees that all such information is proprietary or confidential, or constitutes trade secrets and is the sole property of the Company. The Employee will keep confidential, and will not reproduce, copy or disclose to any other person or firm, any such information or any documents or information relating to the Company’s methods, processes, customers, accounts, analyses, systems, charts, programs, procedures, correspondence or records, or any other documents used or owned by the Company, nor will the Employee advise, discuss with or in any way assist any other person, firm or entity in obtaining or learning about any of the items described in this Section 12. Accordingly, the Employee agrees that during the Term and at all times thereafter he will not disclose, or permit or encourage anyone else to disclose, any such information, nor will he utilize any such information, either alone or with others, outside the scope of his duties and responsibilities with the Company. 13.Non-Competition During Employment Term. The Employee agrees that, during the Term and any extensions thereof, he will devote substantially all his business time and effort, and give undivided loyalty, to the Company, and that he will not engage in any way whatsoever, directly or indirectly, in any business that is competitive with the Company or its affiliates, nor solicit, or in any other manner work for or assist any business which is competitive with the Company or its affiliates. In addition, during the Term and any extensions thereof, the Employee will undertake no planning for or organization of any business activity competitive with the work he performs as an employee of the Company, and the Employee will not combine or conspire with any other employee of the Company or any other person for the purpose of organizing any such competitive business activity. 14.Non-Competition After Employment Term.The Employee shall execute on the Effective Date and be subject to the Non-Competition Agreement in the form attached as Exhibit E. 15.Return of Company Documents. Upon termination of this Agreement, Employee shall return immediately to the Company all records and documents of or pertaining to the Company and shall not make or retain any copy or extract of any such record or document. 16.Improvements and Inventions. Any and all improvements or inventions which the Employee may conceive, make or participate in during the period of his employment shall be the sole and exclusive property of the Company. The Employee will, whenever requested by the Company, execute and deliver any and all documents which the Company shall deem appropriate in order to apply for and obtain patents for improvements or inventions or in order to assign and convey to the Company the sole and exclusive right, title and interest in and to such improvements, inventions, patents or applications. 17.Actions. The parties agree and acknowledge that the rights conveyed by this Agreement are of a unique and special nature and that the Company will not have an adequate remedy at law in the event of a failure by the Employee to abide by its terms and conditions nor will money damages adequately compensate for such injury. It is therefore agreed between the parties that, in the event of a breach by the Employee of any of his obligations contained in this Agreement or the Non-Competition Agreement, the Company shall have the right, among other rights, to damages sustained thereby, to immediately cease any payments being made or benefits being provided pursuant to Section 10(b) and to obtain an injunction or decree of specific performance from any court of competent jurisdiction to restrain or compel the Employee to perform as agreed herein.The Company may not cease any payments being made or benefits being provided pursuant to Section 10(b) unless written notice specifying in reasonable detail the nature of the breach is provided to the Employee within ninety (90) days of the alleged breach and the Employee shall have substantially failed to have cured such breach within fourteen (14) days after receiving such notice, unless the breach is not curable.The Employee shall be considered to have substantially cured the breach if he takes, or causes to have taken, actions that result in the Company not having incurred a material detriment to its business or reputation as a result of such breach.The Employee agrees that this Section 17 shall survive the termination of his employment and he shall be bound by its terms at all times subsequent to the termination of his employment for so long a period as Company continues to conduct the same business or businesses as conducted during the Term or any extensions thereof. Nothing herein contained shall in any way limit or exclude any other right granted by law or equity to the Company. 18.Amendment; Integration. This Agreement, along with the exhibits hereto, contains, and its terms constitute, the entire agreement of the parties, and it may be amended only by a written document signed by both parties to this Agreement. This Agreement supersedes and replaces the Prior Employment Agreement in its entirety, which is of no further force or effect after the Effective Date, and, without limiting the foregoing, exclusively governs any right the Employee may have to compensation following any termination of employment that occurs after the Effective Date. 19.Governing Law.California law shall govern the construction and enforcement of this Agreement and the parties agree that any litigation pertaining to this Agreement shall be adjudicated in courts located in California; provided that if the Company is enforcing its rights under the restrictive covenants in a jurisdiction other than California as a result of the Employee’s primary place of work being located other than in California (whether as a result of the Employee or the Company relocating outside of California), then the laws of that other jurisdiction will apply, and any litigation pertaining to such enforcement may be adjudicated in courts located in such jurisdiction. 20.Attorneys’ Fees.If any party finds it necessary to employ legal counsel or to bring an action at law or other proceedings against the other party to enforce any of the terms hereof, the party prevailing in any such action or other proceeding shall be paid by the other party its reasonable attorneys’ fees as well as court costs, all as determined by the court and not a jury. 21.Severability.If any section, subsection or provision hereof is found for any reason whatsoever, to be invalid or inoperative, that section, subsection or provision shall be deemed severable and shall not affect the force and validity of any other provision of this Agreement. If any covenant herein is determined by a court to be overly broad thereby making the covenant unenforceable, the parties agree and it is their desire that such court shall substitute a reasonable judicially enforceable limitation in place of the offensive part of the covenant and that as so modified the covenant shall be as fully enforceable as if set forth herein by the parties themselves in the modified form. The covenants of the Employee in this Agreement shall each be construed as an agreement independent of any other provision in this Agreement, and the existence of any claim or cause of action of the Employee against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of the covenants in this Agreement. 22.Notices.Any notice, request, or instruction to be given hereunder shall be in writing and shall be deemed given when personally delivered or three days after being sent by United States certified mail, postage prepaid, with return receipt requested, to the parties at their respective addresses set for the below: To the Company: CKE Restaurants, Inc. 6307 Carpinteria Avenue, Suite A Carpinteria, CA 93013 Attention: General Counsel To the Employee: E. Michael Murphy 23.Waiver of Breach. The waiver by any party of any provisions of this Agreement shall not operate or be construed as a waiver of any prior or subsequent breach by the other party. 1 Expressed as an absolute number 2 Expressed as an absolute number IN WITNESS WHEREOF the parties have executed this Agreement to be effective as of the date first set forth above. CKE RESTAURANTS, INC. By: /s/ Theodore Abajian Name: Theodore Abajian Title: Executive Vice President APOLLO CKE HOLDINGS LP (Solely as to Section 5 and Section 10(e) and (f)) By:Apollo CKE Holdings GP, LLC its General Partner By: /s/ Lance Milken Name: Lance Milken Title: Vice President EMPLOYEE /s/ E. Michael Murphy E. Michael Murphy [Signature Page to Murphy Employment Agreement]

FIRST AMENDMENT TO REVOLVING CREDIT AND TERM LOAN AGREEMENT         THIS FIRST AMENDMENT TO REVOLVING CREDIT AND TERM LOAN AGREEMENT (this “Amendment”) dated as of December 3, 2004, is entered into by and among ATLAS PIPELINE PARTNERS, L.P., a Delaware limited partnership (“Borrower”); ATLAS PIPELINE NEW YORK, LLC, a Pennsylvania limited liability company (“APL New York”); ATLAS PIPELINE OHIO, LLC, a Pennsylvania limited liability company (“APL Ohio”); ATLAS PIPELINE PENNSYLVANIA, LLC, a Pennsylvania limited liability company (“APL Pennsylvania”); ATLAS PIPELINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (“APL Operating”); and SPECTRUM FIELD SERVICES LLC, a Delaware limited liability company (“Spectrum”; Spectrum, APL New York, APL Ohio, APL Pennsylvania and APL Operating are collectively referred to herein as “Guarantors,” and Borrower and Guarantors are collectively referred to herein as the “Obligors”); each of the lenders party hereto (individually, together with its successors and assigns, a “Lender,” and collectively, “Lenders”); WACHOVIA BANK, NATIONAL ASSOCIATION, as administrative agent for the Lenders (in such capacity, together with its successors in such capacity, “Administrative Agent”), and WACHOVIA BANK, NATIONAL ASSOCIATION, as issuing bank (in such capacity, together with its successors in such capacity, the “Issuing Bank”).     A.        Borrower, Guarantors, Administrative Agent and Lenders have entered into that certain Revolving Credit and Term Loan Agreement dated as of July 16, 2004 (as renewed, extended, amended or restated from time to time, the     B.        Borrower has requested that Administrative Agent, Issuing Bank and Lenders amend the Credit Agreement, as provided herein, subject to the terms and conditions hereof.         NOW, THEREFORE, in consideration of the foregoing, and intending to be         SECTION 1. Terms Defined in Credit Agreement. As used in this Amendment, except as may otherwise be provided herein, all capitalized terms which are defined in the Credit Agreement shall have the same meaning herein as therein, all of such terms and their definitions being incorporated herein by reference. Unless otherwise indicated herein, all capitalized and undefined terms used herein shall have the same meanings as set forth in the Credit Agreement.         SECTION 2. Amendments to Credit Agreement. Subject to the conditions set forth in Section 3 hereof, the Credit Agreement is hereby amended as follows:     (a)        The definition of “Aggregate Maximum Revolver Amount” in Section 1.02 of the Credit Agreement shall read as follows:   “Aggregate Maximum Revolver Amount at any time shall equal the sum of the Maximum Revolver Amounts of the Revolver Lenders ($90,000,000), as the same may be increased pursuant to Section 2.11 or reduced pursuant to Section 2.03(a).” (b)         Section 2.11(a) of the Credit Agreement is deleted in its entirety and the following is substituted in lieu thereof: “(a)         Provided there exists no Default or Event of Default and subject to the conditions set forth under clause (e) below, upon notice to the may, from time to time, request increases in the aggregate Revolver Commitments under the Revolver Facility; provided, that (i) the Aggregate Maximum Revolver Amount shall not exceed $130,000,000, and (ii) each increase of the Revolver Facility shall be in a minimum amount of $10,000,000, or integral multiples of $1,000,000 in excess thereof. At the time of sending such notice, the Borrower (in consultation with the Administrative Agent) shall specify the time period within which each Revolver Lender is requested to respond (which shall in no event be less than ten (10) Business Days from the date of delivery of such notice to the Revolver Lenders).” (c)         Annex I attached to the Credit Agreement is hereby replaced in its entirety with Exhibit A attached hereto.         SECTION 3. Amendment Effective Date. This Amendment shall be binding upon all parties to the Credit Agreement as of the date (the "Amendment Effective Date") that Administrative Agent receives:     (a)        sufficient counterparts of this Amendment, executed and delivered to Administrative Agent by (i) Borrower, (ii) Administrative Agent, (iii) Issuing Bank, and (iv) each Lender with an increased Revolver Commitment, and such additional Lenders that, when aggregated therewith, hold more than 66-2/3% of the sum of the unused portion, if any, of the Commitments under the Revolver Facility plus the total outstanding amount of the Commitments under the Revolver Facility;     (b)        replacement Revolver Notes and Term Loan Notes, reflecting Lenders’ revised Revolver Commitments and Term Loan Commitments; and     (c)        such other agreements, certificates, documents and evidence of authority as Administrative Agent, any Lender or counsel to the Administrative         SECTION 4. Representations and Warranties of Obligors. Each of the Obligors represents and warrants to Administrative Agent, Issuing Bank and Lenders, with full knowledge that Administrative Agent, Issuing Bank, and Lenders are relying on the following representations and warranties in executing this Amendment, as follows:     (a)        each Obligor has the organizational power and authority to execute, deliver and perform this Amendment and such other Loan Documents executed in connection herewith, and all organizational action on the part of such Person requisite for the due execution, delivery and performance of this Amendment and such other Loan Documents executed in connection herewith has been duly and effectively taken;     (b)        the Credit Agreement, as amended by this Amendment, the Loan Documents and each and every other document executed and delivered in connection with this Amendment to which any Obligor is a party constitute the legal, valid and binding obligations of each Obligor to the extent it is a party thereto, enforceable against such Person in accordance with their respective terms; 2     (c)        this Amendment does not and will not violate any provisions of any of the organizational documents of any Obligor, or any contract, agreement, instrument or requirement of any Governmental Authority to which any Obligor is subject. Obligors’ execution of this Amendment will not result in the creation or imposition of any lien upon any properties of any Obligor, other than those permitted by the Credit Agreement and this Amendment;     (d)        the execution, delivery and performance of this Amendment by Obligors does not require the consent or approval of any other Person, including, without limitation, any regulatory authority or governmental body of the United States of America or any state thereof or any political subdivision of the United States of America or any state thereof; and     (e)        no Default exists, and all of the representations and warranties contained in the Credit Agreement and all instruments and documents executed pursuant thereto or contemplated thereby are true and correct in all material respects on and as of this date, other than those which have been disclosed to Administrative Agent, Issuing Bank and Lenders in writing.         SECTION 5. Reference to and Effect on the Agreement.     (a)        On and after the Amendment Effective Date, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of like import shall mean and be a reference to the Credit Agreement, as amended hereby.     (b)        Except as specifically amended by this Amendment, the Credit confirmed.         SECTION 6. Costs, Expenses and Taxes. Borrower agrees to pay on demand all reasonable costs and expenses of Administrative Agent in connection with the preparation, reproduction, execution and delivery of this Amendment, and the other instruments and documents to be delivered hereunder, including reasonable attorneys’ fees and out-of-pocket expenses of Administrative Agent. In addition, Borrower shall pay any and all recording and filing fees payable or determined to be payable in connection with the execution and delivery, filing or recording of this Amendment and the other instruments and documents to be delivered hereunder, and agrees to save Administrative Agent harmless from and against any and all liabilities with respect to or resulting from any delay in paying or omission to pay such taxes or fees.         SECTION 7. Extent of Amendments. Except as otherwise expressly provided herein, the Credit Agreement and the other Loan Documents are not amended, modified or affected by this Amendment. Obligors ratify and confirm that (a) except as expressly amended hereby, all of the terms, conditions, covenants, representations, warranties and all other provisions of the Credit Agreement remain in full force and effect, (b) each of the other Loan Documents are and remain in full force and effect in accordance with their respective terms, and (c) the collateral under the Security Instruments is unimpaired by this Amendment.         SECTION 8. Disclosure of Claims. As additional consideration to the execution, delivery, and performance of this Amendment by the parties hereto and in order to induce Administrative Agent, Issuing Bank and Lenders to enter into this Amendment, each Obligor represents and warrants that it knows of no defenses, counterclaims or rights of setoff to the payment of any Indebtedness. 3         SECTION 9. Affirmation of Guaranty Agreements, Security Interest.     (a)        Each of the undersigned Guarantors hereby consents to and accepts the terms and conditions of this Amendment, and the transactions contemplated hereby, agrees to be bound by the terms and conditions hereof, and ratifies and confirms that each Guaranty Agreement and each of the other Loan Documents to which it is a party is, and shall remain, in full force and effect after giving     (b)        Obligors hereby confirm and agree that any and all liens, security interest and other security or collateral now or hereafter held by Administrative Agent for the benefit of Lenders as security for payment and performance of the Obligations hereby under such Security Instruments to which such Obligor is a party are renewed and carried forth to secure payment and performance of all of the Obligations. The Security Instruments are and remain legal, valid and binding obligations of the parties thereto, enforceable in accordance with their respective terms.         SECTION 10.Execution and Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate an original and all of which taken together shall constitute but one and the same instrument. Delivery of an executed counterpart of this Amendment by facsimile and other Loan Documents shall be equally as effective as delivery of a manually executed counterpart of this Amendment and such other Loan Documents.         SECTION 11. Governing Law. This Amendment shall be governed by and         SECTION 12. Headings. Section headings in this Amendment are included herein for convenience and reference only and shall not constitute a part of this Amendment for any other purpose.         SECTION 13. NO ORAL AGREEMENTS. THE CREDIT AGREEMENT (AS AMENDED BY THIS AMENDMENT) AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.         [The remainder of this page intentionally blank. Signature pages to follow.] 4         IN WITNESS WHEREOF, the parties have executed this Amendment to Credit   BORROWER:     ATTEST:     ATLAS PIPELINE PARTNERS, L.P., A Delaware limited partnership     (SEAL) By:  Atlas Pipeline Partners, GP, LLC,        its general partner         By:_________________________________ By:_________________________________ Name:_______________________________ Name:_______________________________ Title:________________________________ Title:________________________________     SIGNATURE PAGE TO AND TERM LOAN AGREMENT   GUARANTORS:       ATLAS PIPELINE NEW YORK, LLC, a Pennsylvania limited liability company           By:   Atlas Pipeline Operating Partnership, L.P.,         a Delaware limited partnership         and its sole member            By:    Atlas Pipeline Partners GP, LLC,               and its sole general partner                    By:__________________________________            Name:__________________________________            Title: __________________________________       ATLAS PIPELINE OHIO, LLC,         a Delaware limited partnership   By:__________________________________          __________________________________ SIGNATURE PAGE TO AND TERM LOAN AGREMENT       ATLAS PIPELINE PENNSYLVANIA, LLC,         a Delaware limited partnership   By:__________________________________          __________________________________       ATLAS PIPELINE OPERATING PARTNERSHIP, L.P., a Delaware limited liability partnership           By:   Atlas Pipeline Partners GP, LLC,         a Delaware limited partnership         and its sole general member            By:    Atlas Pipeline Partners GP, LLC,   By:__________________________________          __________________________________       SPECTRUM FIELD SERVICES LLC, a Delaware limited liability company           By:   Atlas Pipeline Operating Partners, L.P.,         a Delaware limited partnership   By:__________________________________          __________________________________ SIGNATURE PAGE TO AND TERM LOAN AGREMENT   ADMINISTRATIVE AGENT AND ISSUING BANK AND A LENDER:       WACHOVIA BANK, NATIONAL ASSOCIATION       By:__________________________________           Paul Riddle            Director SIGNATURE PAGE TO AND TERM LOAN AGREMENT   LENDERS:       KEYBANK NATIONAL ASSOCIATION       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           BANK OF OKLAHOMA N.A.       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           WELLS FARGO BANK, N.A.       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           FLEET NATIONAL BANK       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           FORTIS CAPITAL CORP.       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           GUARANTY BANK       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           BANK OF SCOTLAND       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           COMERCIA BANK       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           WESTLB AG, NEW YORK BRANK       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           COMPASS BANK       By:__________________________________           Name:            Title: SIGNATURE PAGE TO AND TERM LOAN AGREMENT           UFJBANK LIMITED, NEW YORK BRANCH       SIGNATURE PAGE TO AND TERM LOAN AGREMENT EXHIBIT A ANNEX I LIST OF PERCENTAGE SHARES, MAXIMUM REVOLVER AMOUNTS AND MAXIMUM TERM LOAN AMOUNTS       Name of Lender Maximum Revolver Amount Percentage Share (Revolver Facility) Maximum Term Loan Amount Percentage Share (Term Loan Facility)       Wachovia Bank, National Association     $ 9,166,666     10.185184444 % $ 4,506,946     10 .185188701%       KeyBank, National Association   $ 9,166,666     10.185184444 % $ 4,506,946     10 .185188701%       Bank of Oklahoma N.A     $ 8,333,333     9.259258889 % $ 4,097,223     9 .259261017%       Wells Fargo Bank, N.A   $ 8,333,333     9.259258889 % $ 4,097,223    9 .259261017%       Fleet National Bank   $ 8,333,333     9.259258889 % $ 4,097,223    9 .259261017%       Fortis Capital Corp.       $ 6,666,667     7.407407778 % $ 3,277,777    7 .407405650%       Guaranty Bank       $ 6,666,667     7.407407778 % $ 3,277,777    7 .407405650%       Bank of Scotland       $ 6,666,667     7.407407778 % $ 3,277,777    7 .407405650%       Comerica Bank       $ 6,666,667     7.407407778 % $ 3,277,777    7 .407405650%       WestLB AG, New York Branch         $ 6,666,667     7.407407778 % $ 3,277,777     7 .407405650%       Compass Bank        $ 6,666,667     7.407407778 % $ 3,277,777     7 .407405650%       UFJ Bank Limited, New York Branch        $ 6,666,667     7.407407778 % $ 3,277,777     7 .407405650%                        TOTAL     $ 90,000,000     100.000000000 % $ 44,250,000     100 .000000000%       EXHIBIT A PAGE 1

Title: My little brother (11 years old) was left behind on a field trip in another state Question:He sent on a school sponsored field trip today at carowinds amusement park for a choral concert. He was left behind and we were not informed until the bus arrived at his school this evening. What are our options? We live in south Carolina. Answer #1: Your first option will be to raise a stink with the administration school board. This was a huge mistake, but a mistake nonetheless. It is unlikely you can sue the school for anything, and it does not seem you or your brother have suffered any damages (even if you could sue.) I see no mention in your post about your brother. I hope he is doing well. > What are our options? Mostly getting your brother home safe.

Name: Commission Implementing Regulation (EU) No 834/2014 of 22 July 2014 laying down rules for the application of the common monitoring and evaluation framework of the common agricultural policy Type: Implementing Regulation Subject Matter: information technology and data processing; European Union law; agricultural policy; research and intellectual property Date Published: nan 1.8.2014 EN Official Journal of the European Union L 230/1 COMMISSION IMPLEMENTING REGULATION (EU) No 834/2014 of 22 July 2014 laying down rules for the application of the common monitoring and evaluation framework of the common agricultural policy THE EUROPEAN COMMISSION, Having regard to the Treaty on the Functioning of the European Union, Having regard to Regulation (EU) No 1306/2013 of 17 December 2013 of the European Parliament and of the Council on the financing, management and monitoring of the common agricultural policy and repealing Council Regulations (EEC) No 352/78, (EC) No 165/94, (EC) No 2799/98, (EC) No 814/2000, (EC) No 1290/2005 and (EC) No 485/2008 (1), and in particular Article 110(2) and (4) thereof, Whereas: (1) Regulation (EU) No 1306/2013 provides for a common monitoring and evaluation framework for measuring the performance of the common agricultural policy (CAP). For the application of that framework, rules need to be laid down which ensure a comprehensive and regular assessment of the progress, effectiveness and efficiency of the CAP against objectives. In order to allow Member States and the Commission to put in place a consistent monitoring and evaluation framework, a set of common indicators as referred to in Article 110(2) of Regulation (EU) No 1306/2013 should be laid down. (2) Those indicators should be linked to the structure and objectives of the CAP and be based on measurable elements. Therefore, different types of indicators should be laid down in order to allow for the assessment of the CAP at all levels. Impact indicators should reflect the common main objectives of the CAP as set out in Article 110(2) of Regulation (EU) No 1306/2013. For each of those common main objectives more specific objectives can be identified, for which result indicators need to be laid down. Those specific objectives include farm income and farm income variability, improvement of the competitiveness of the agricultural sector, market stability, consumer expectations, provision of public goods and environmental preservation, climate change mitigation and adaptation and maintenance of a diverse agriculture, as well as the specific objectives defined for the European Agricultural Fund for Rural Development (EAFRD), namely the Union priorities for rural development. In addition, the practical implementation of the CAP instruments should be monitored on the basis of output indicators that are able to reflect this operational level of the CAP. (3) It is important to ensure that the monitoring and evaluation framework can be used by Member States and the Commission efficiently and at the appropriate time. It should therefore be provided that Member States send the information necessary for the monitoring and evaluation of the CAP within the deadlines set by the relevant Regulations. With a view to avoiding any undue administrative burden, the Commission should, to the extent possible, use information already made available to it, (4) The measures provided for in this Regulation are in accordance with the opinion of the Committee on the Agricultural Funds, HAS ADOPTED THIS REGULATION: Article 1 Indicators The indicators allowing for the assessment of the progress, effectiveness and efficiency of the common agricultural policy (CAP) against its objectives as referred to in Article 110(2) of Regulation (EU) No 1306/2013 shall be measurable. Those indicators shall include: (a) impact indicators, as specified in Section 1 of the Annex to this Regulation, reflecting the areas where the CAP is expected to have an influence; (b) result indicators, as specified in Section 2 of the Annex to this Regulation, reflecting the main achievements of: (i) Regulation (EU) No 1305/2013 of the European Parliament and of the Council (2); (ii) Regulation (EU) No 1306/2013; (iii) Regulation (EU) No 1307/2013 of the European Parliament and of the Council (3); and (iv) Regulation (EU) No 1308/2013 of the European Parliament and of the Council (4); (c) output indicators, as specified in Section 3 of the Annex to this Regulation, reflecting the implementation of related CAP instruments; (d) context indicators, as referred to in Section 4 of the Annex to this Regulation, reflecting relevant aspects of the general contextual trends that are likely to have an influence on the implementation, achievements and performance of the CAP. Result indicators, output indicators and context indicators relevant for the monitoring and evaluation of the European Agricultural Fund for Rural Development (EAFRD) shall be as set out in Commission Implementing Regulation (EU) No 808/2014. (5). Article 2 Provision of information 1. Member States shall provide the Commission with the information necessary for the purpose of monitoring and evaluating the performance of the CAP within the deadlines for reporting and notifications of information relating to the operation of CAP instruments as provided for in Regulations (EU) No 1305/2013, (EU) No 1306/2013, (EU) No 1307/2013 and (EU) No 1308/2013. That information shall be accurate and reliable. 2. For the purposes of the common monitoring and evaluation framework the Commission shall use, to the extent possible, the following information already made available by Member States via existing tools for information exchange: (a) information, notifications and reports made available to the Commission in relation to the implementation of the instruments operating within the CAP and to the implementation of relevant Union environmental legislation; (b) information made available to the Commission for the purposes of the clearance of accounts; (c) information made available to Eurostat. Article 3 This Regulation shall enter into force on the seventh day following that of its publication in the Official Journal of the European Union. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 22 July 2014. For the Commission The President Josà © Manuel BARROSO (1) OJ L 347, 20.12.2013, p. 549. (2) Regulation (EU) No 1305/2013 of the European Parliament and of the Council of 17 December 2013 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) and repealing Council Regulation (EC) No 1698/2005 (OJ L 347, 20.12.2013, p. 487). (3) Regulation (EU) No 1307/2013 of the European Parliament and of the Council of 17 December 2013 establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy and repealing Council Regulation (EC) No 637/2008 and Council Regulation (EC) No 73/2009 (OJ L 347, 20.12.2013, p. 608). (4) Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (OJ L 347, 20.12.2013, p. 671). (5) Commission Implementing Regulation (EU) No 808/2014 of 17 July 2014 laying down rules for the application of Regulation (EU) No 1305/2013 of the European parliament and of the Council on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) (OJ L 227, 31.7.2014, p. 18). ANNEX Indicators of the common monitoring and evaluation framework of the CAP 1. Impact indicators referred to in point (a) of the first subparagraph of Article 1 1. Agricultural entrepreneurial income 2. Agricultural factor income 3. Total factor productivity in agriculture 4. EU commodity price variability 5. Consumer price evolution of food products 6. Agricultural trade balance 7. Emissions from agriculture 8. Farmland bird index 9. High nature value (HNV) farming 10. Water abstraction in agriculture 11. Water quality 12. Soil organic matter in arable land 13. Soil erosion by water 14. Rural employment rate 15. Degree of rural poverty 16. Rural GDP per capita 2. Result indicators referred to in point (b) of the first subparagraph of Article 1 1. Share of direct support in agricultural income 2. Variability of farm income ” by type of farm ” by economic size 3. Value added for primary producers in the food-chain 4. EU agricultural exports ” share of EU agricultural exports in world exports ” share of final products in EU agricultural exports 5. Public intervention: % volume of products bought in intervention storage out of total EU production 6. Private storage: % volume of products in private storage out of total EU production 7. Export refunds: % volume of products exported with export refunds out of total EU production 8. EU commodity prices compared to world prices (broken down by product) 9. Value of production under EU quality schemes compared to total value of agricultural and food production 10. Importance of organic farming ” share of organic area in total utilised agricultural area (UAA) ” share of organic livestock in total livestock 11. Crop diversity ” on farm (number of farms by number of crops and size) ” in a region 12. Share of grassland in total UAA 13. Share of ecological focus area (EFA) in agricultural land 14. Share of area under greening practices 15. Net greenhouse gas emission from agricultural soils 16. Structural diversity ” in absolute terms ” in relative terms 17. Additional result indicators specified in Implementing Regulation (EU) No 808/2014. 3. Output indicators referred to in point (c) of the first subparagraph of Article 1 Direct payments Basic payment scheme ” Number of farmers ” Number of hectares Single area payment scheme ” Number of farmers ” Number of hectares Transitional national aid (TNA) ” Number of farmers ” Number of units for which TNA is granted (hectares/animals/other) Redistributive payment ” Number of farmers ” Number of hectares Greening ” Total number of farmers who have to apply at least one greening obligation ” Total number of hectares declared by those farmers Greening exemptions ” Number of farmers exempted by: organic farmers/exempted from crop diversification/exempted from EFA obligation ” Number of hectares declared by these farmers (organic farmers/exempted from crop diversification/exempted from EFA obligation) Crop diversification ” Number of farmers subject to crop diversification (with 2 crops; with 3 crops) ” Number of hectares of arable land declared by farmers subject to crop diversification (with 2 crops; with 3 crops) Permanent grassland ” Number of farmers with permanent grassland counting for the ratio ” Number of hectares covered by permanent grassland declared by the farmers counting for the ratio ” Number of farmers with permanent grassland in designated environmentally sensitive areas ” Number of hectares covered by environmentally sensitive permanent grassland declared by these farmers ” Number of hectares of designated environmentally sensitive permanent grassland (total) EFA ” Number of farmers subject to EFA requirements ” Number of hectares of arable land declared by farmers subject to EFA ” Number of hectares declared by farmers as EFA, broken down by EFA type Equivalence ” Number of farmers applying equivalent measures (certification schemes or agri-environment-climate measures) ” Number of hectares declared by farmers implementing equivalent measures (certification schemes or agri-environment-climate measures) Payment for young farmers ” Number of farmers ” Number of hectares Small farmers' scheme ” Number of farmers ” Number of hectares Voluntary coupled support ” Number of beneficiaries of voluntary coupled support (broken down by sector) ” Quantities eligible (number of hectares/number of animals broken down by sector) ” Number of hectares ” Number of animals Payment for areas with natural constraints ” Number of farmers ” Number of hectares National programmes for the cotton sector ” Number of farmers ” Number of hectares Market measures Public intervention ” Volume ” Duration Private storage ” Volume ” Duration Export refunds ” Volume of products exported with export refunds Exceptional measure ” (as appropriate) Producer organisations ” % of production marketed by producer organisations and associations of producer organisations School schemes ” Number of final beneficiaries of school milk scheme ” Number of final beneficiaries of school fruit scheme Wine sector ” Number of hectares of new vine plantings ” Number of hectares of restructured vineyards ” Number of promotion projects in the wine sector ” Number of projects of investment and innovation measures Horizontal aspects Cross compliance ” Number of hectares subject to cross-compliance ” Share of CAP payments subject to cross-compliance Quality policy ” Geographical indications in the wine sector ” Number of new protected designations of origin, protected geographical indication and traditional speciality guaranteed by sector Organic farming ” Number of hectares (total and under conversion) ” Number of certified registered organic operators Promotion policy ” Number of programmes (in and outside the EU) ” Number of new proposing organisations Farm advisory system ” Number of farmers advised Rural Development The output indicators specified in Implementing Regulation (EU) No 808/2014. 4. Context indicators referred to in point (d) of the first subparagraph of Article 1 The indicators specified in Implementing Regulation (EU) No 808/2014.

Exhibit 10.23 MEDICINOVA, INC. 2013 EQUITY INCENTIVE PLAN ADOPTED BY THE BOARD OF DIRECTORS: APRIL 21, 2013 APPROVED BY THE STOCKHOLDERS: JUNE 14, 2013 [AS CORRECTED] 1. GENERAL. (a) Successor to and Continuation of Prior Plan. The Plan is intended as the successor to and continuation of the MediciNova, Inc. Amended and Restated 2004 Stock Incentive Plan (the “Prior Plan”). Following the Effective Date, no additional stock awards may be granted under the Prior Plan. Any unallocated shares remaining available for issuance pursuant to the exercise of options or issuance or settlement of stock awards not previously granted under the Prior Plan as of 12:01 a.m. Pacific time on the Effective Date will cease to be available under the Prior Plan at such time, and no further grants will be made under the Prior Plan after such time. In addition, from and after 12:01 a.m. Pacific time on the Effective Date, all outstanding stock awards granted under the Prior Plan will remain subject to the terms of the Prior Plan; provided, however, that any shares subject to outstanding stock awards granted under the Prior Plan that (i) expire or terminate for any reason prior to exercise or settlement; (ii) are forfeited, cancelled or otherwise returned to the Company because of the failure to meet a contingency or condition required to vest such shares; or (iii) are reacquired, withheld (or not issued) to satisfy a tax withholding obligation in connection with an award or to satisfy the purchase price or exercise price of a stock award (the “Returning Shares”) will immediately be added to the Share Reserve (as further described in Section 3(a) below) as and when such shares become Returning Shares, and become available for issuance pursuant to Awards granted hereunder. All Awards granted on or after 12:01 a.m. Pacific time on the Effective Date will be subject to the terms of this Plan. (b) Eligible Award Recipients. Employees, Directors and Consultants are eligible to receive Awards. (c) Available Awards. The Plan provides for the grant of the following types of Awards: (i) Incentive Stock Options, (ii) Nonstatutory Stock Options, (iii) Stock Appreciation Rights, (iv) Restricted Stock Awards, (v) Restricted Stock Unit Awards, (vi) Performance Stock Awards, (vii) Performance Cash Awards, and (viii) Other Stock Awards. (d) Purpose. The Plan, through the granting of Awards, is intended to help the Company secure and retain the services of eligible award recipients, provide incentives for such persons to exert maximum efforts for the success of the Company and any Affiliate and provide a means by which the eligible recipients may benefit from increases in value of the Common Stock. 2. ADMINISTRATION. (a) Administration by Board. The Board will administer the Plan. The Board may delegate administration of the Plan to a Committee or Committees, as provided in (b) Powers of Board. The Board will have the power, subject to, and within the limitations of, the express provisions of the Plan: (i) To determine (A) who will be granted Awards; (B) when and how each Award will be granted; (C) what type of Award will be granted; (D) the provisions of each Award (which need not be identical), including when a person will be permitted to exercise or otherwise receive cash or Common Stock under the Award; (E) the number of shares of Common Stock subject to, or the cash value of, an Award; and (F) the Fair Market Value applicable to a Stock Award. (ii) To construe and interpret the Plan and Awards granted under it, and to establish, amend and revoke rules and regulations for administration of the Plan and Awards. The Board, in the exercise of these powers, may correct any defect, omission or inconsistency in the Plan or in any Award Agreement, in a manner and to the extent it will deem necessary or expedient to make the Plan or Award fully effective. (iii) To settle all controversies regarding the Plan and Awards granted under it. (iv) To accelerate, in whole or in part, the time at which an Award may be exercised or vest (or at which cash or shares of Common Stock may be issued). (v) To suspend or terminate the Plan at any time. Except as otherwise provided in the Plan or an Award Agreement, suspension or termination of the Plan will not impair a Participant’s rights under his or her then-outstanding Award without his or her written consent except as provided in subsection (viii) below. (vi) To amend the Plan in any respect the Board deems necessary or advisable, including, without limitation, by adopting amendments relating to Incentive Stock Options and certain nonqualified deferred compensation under Section 409A of the Code and/or to make the Plan or Awards granted under the Plan compliant with the requirements for Incentive Stock Options or exempt from or compliant with the requirements for nonqualified deferred compensation under Section 409A of the Code, subject to the limitations, if any, of applicable law. However, if required by applicable law or listing requirements, and except as provided in Section 9(a) relating to Capitalization Adjustments, the Company will seek stockholder approval of any amendment of the Plan that (A) materially increases the number of shares of Common Stock available for issuance under the Plan, (B) materially expands the class of individuals eligible to receive Awards under the Plan, (C) materially increases the benefits accruing to Participants under the Plan, (D) materially reduces the price at which shares of Common Stock may be issued or purchased under the Plan, (E) materially extends the term of the Plan, or (F) materially expands the types of Awards available for issuance under the Plan. Except as provided in the Plan (including Section 2(b)(viii)) or an Award Agreement, no amendment of the Plan will impair a Participant’s rights under an outstanding Award without the Participant’s written consent.   2. (vii) To submit any amendment to the Plan for stockholder approval, including, but not limited to, amendments to the Plan intended to satisfy the requirements of (A) Section 162(m) of the Code regarding the exclusion of performance-based compensation from the limit on corporate deductibility of compensation paid to Covered Employees, (B) Section 422 of the Code regarding incentive stock options or (C) Rule 16b-3. (viii) To approve forms of Award Agreements for use under the Plan and to amend the terms of any one or more Awards, including, but not limited to, amendments to provide terms more favorable to the Participant than previously provided in the Award Agreement, subject to any specified limits in the Plan that are not subject to Board discretion; provided, however, that a Participant’s rights under any Award will not be impaired by any such amendment unless (A) the Company requests the consent of the affected Participant, and (B) such Participant consents in writing. Notwithstanding the foregoing, (1) a Participant’s rights will not be deemed to have been impaired by any such amendment if the Board, in its sole discretion, determines that the amendment, taken as a whole, does not materially impair the Participant’s rights, and (2) subject to the limitations of applicable law, if any, the Board may amend the terms of any one or more Awards without the affected Participant’s consent (A) to maintain the qualified status of the Award as an Incentive Stock Option under Section 422 of the Code; (B) to change the terms of an Incentive Stock Option, if such change results in impairment of the Award solely because it impairs the qualified status of the Award as an Incentive Stock Option under Section 422 of the Code; (C) to clarify the manner of exemption from, or to bring the Award into compliance with, Section 409A of the Code; or (D) to comply with other applicable laws or listing requirements. (ix) Generally, to exercise such powers and to perform such acts as the Board that are not in conflict with the provisions of the Plan or Awards. (x) To adopt such procedures and sub-plans as are necessary or appropriate to permit participation in the Plan by Employees, Directors or Consultants who are foreign nationals or employed outside the United States (provided that Board approval will not be necessary for immaterial modifications to the Plan or any Award Agreement that are required for compliance with the laws of the relevant foreign jurisdiction). (c) Delegation to Committee. (i) General. The Board may delegate some or all of the administration of the Plan to a Committee or Committees. If administration of the Plan is delegated to a Committee, the Committee will have, in connection with the administration of the Plan, the powers theretofore possessed by the Board that have been delegated to the Committee, including the power to delegate to a subcommittee of the Committee any of the administrative powers the Committee is authorized to exercise (and references in the Plan to the Board will thereafter be to the Committee or subcommittee, as applicable). Any delegation of administrative powers will be reflected in resolutions, not inconsistent with the provisions of the Plan, adopted from time to time by the Board or Committee (as applicable). The Committee may, at any time, abolish the subcommittee and/or revest in the Committee any powers delegated to the subcommittee. The Board may retain the authority to concurrently administer the Plan with the Committee and may, at any time, revest in the Board some or all of the powers previously delegated. (ii) Section 162(m) and Rule 16b-3 Compliance. The Committee may consist solely of two (2) or more Outside Directors, in accordance with Section 162(m) of the Code, or solely of two (2) or more Non-Employee Directors, in accordance with Rule 16b-3.   3. (d) Delegation to an Officer. The Board may delegate to one (1) or more Officers the authority to do one or both of the following (i) designate Employees who are not Officers to be recipients of Options and SARs (and, to the extent permitted by applicable law, other Stock Awards) and, to the extent permitted by applicable law, the terms of such Awards, and (ii) determine the number of shares of Common Stock to be subject to such Stock Awards granted to such Employees; provided, however, that the Board resolutions regarding such delegation will specify the total number of shares of Common Stock that may be subject to the Stock Awards granted by such Officer and that such Officer may not grant a Stock Award to himself or herself. Any such Stock Awards will be granted on the form of Award Agreement most recently approved for use by the Committee or the Board, unless otherwise provided in the resolutions approving the delegation authority. The Board may not delegate authority to an Officer who is acting solely in the capacity of an Officer (and not also as a Director) to determine the Fair Market Value pursuant to Section 13(w)(iii) below. (e) Effect of Board’s Decision. All determinations, interpretations and constructions made by the Board in good faith will not be subject to review by any person and will be final, binding and conclusive on all persons. (f) Cancellation and Re-Grant of Stock Awards. Neither the Board nor any Committee will have the authority to: (i) reduce the exercise, purchase or strike price of any outstanding Option or SAR under the Plan, or (ii) cancel any outstanding Option or SAR that has an exercise price or strike price greater than the current Fair Market Value of the Common Stock in exchange for cash or other Stock Awards under the Plan, unless the stockholders of the Company have approved such an action within twelve (12) months prior to such an event. 3. SHARES SUBJECT TO THE PLAN. (a) Share Reserve. (i) Subject to Section 9(a) relating to Capitalization Adjustments, the aggregate number of shares of Common Stock that may be issued pursuant to Stock Awards from and after the Effective Date will not exceed (A) 2,500,000 shares, plus (B) the Returning Shares, if any, which become available for grant under this Plan from time to time (such aggregate number of shares described in (A) and (B) above, the “Share Reserve”). (ii) For clarity, the Share Reserve in this Section 3(a) is a limitation on the number of shares of Common Stock that may be issued pursuant to the Plan. Accordingly, this Section 3(a) does not limit the granting of Stock Awards except as provided in Section 7(a). Shares may be issued in connection with a merger or acquisition as permitted by NASDAQ Listing Rule 5635(c) or, if applicable, NYSE Listed Company Manual Section 303A.08, AMEX Company Guide Section 711 or other applicable rule, and such issuance will not reduce the number of shares available for issuance under the Plan.   4. (b) Reversion of Shares to the Share Reserve. If a Stock Award or any portion thereof (i) expires or otherwise terminates without all of the shares covered by such Stock Award having been issued or (ii) is settled in cash (i.e., the Participant receives cash rather than stock), such expiration, termination or settlement will not reduce (or otherwise offset) the number of shares of Common Stock that may be available for issuance under the Plan. If any shares of Common Stock issued pursuant to a Stock Award are forfeited back to or repurchased by the Company because of the failure to meet a contingency or condition required to vest such shares in the Participant, then the shares that are forfeited or repurchased will revert to and again become available for issuance under the Plan. Any shares reacquired by the Company in satisfaction of tax withholding obligations on a Stock Award or as consideration for the exercise or purchase price of a Stock Award will again become available for issuance under the Plan. (c) Incentive Stock Option Limit. Subject to the Share Reserve and Section 9(a) relating to Capitalization Adjustments, the aggregate maximum number of shares of Common Stock that may be issued pursuant to the exercise of Incentive Stock Options will be 4,000,000 shares of Common Stock. (d) Section 162(m) Limitations. Subject to the Share Reserve and Section 9(a) relating to Capitalization Adjustments, at such time as the Company may be subject to the applicable provisions of Section 162(m) of the Code, the following limitations shall apply. (i) A maximum of 200,000 shares of Common Stock subject to Options, SARs and Other Stock Awards whose value is determined by reference to an increase over an exercise or strike price of at least one hundred percent (100%) of the Fair Market Value on the date any such Stock Award is granted may be granted to any Participant during any calendar year. Notwithstanding the foregoing, if any additional Options, SARs or Other Stock Awards whose value is determined by reference to an increase over an exercise or strike price of at least one hundred percent (100%) of the Fair Market Value on the date the Stock Award are granted to any Participant during any calendar year, compensation attributable to the exercise of such additional Stock Awards will not satisfy the requirements to be considered “qualified performance-based compensation” under Section 162(m) of the Code unless such additional Stock Award is approved by the Company’s stockholders. (ii) A maximum of 200,000 shares of Common Stock subject to Performance Stock Awards may be granted to any one Participant during any one calendar year (whether the grant, vesting or exercise is contingent upon the attainment during the Performance Period of the Performance Goals). (iii) A maximum of $300,000 may be granted as a Performance Cash Award to any one Participant during any one calendar year. (e) Source of Shares. The stock issuable under the Plan will be shares of authorized but unissued or reacquired Common Stock, including shares repurchased by the Company on the open market or otherwise.   5. 4. ELIGIBILITY. (a) Eligibility for Specific Stock Awards. Incentive Stock Options may be granted only to employees of the Company or a “parent corporation” or “subsidiary corporation” thereof (as such terms are defined in Sections 424(e) and 424(f) of the Code). Stock Awards other than Incentive Stock Options may be granted to Employees, Directors and Consultants; provided, however, that Stock Awards may not be granted to Employees, Directors and Consultants who are providing Continuous Service only to any “parent” of the Company, as such term is defined in Rule 405, unless (i) the stock underlying such Stock Awards is treated as “service recipient stock” under Section 409A of the Code (for example, because the Stock Awards are granted pursuant to a corporate transaction such as a spin off transaction) or (ii) the Company, in consultation with its legal counsel, has determined that such Stock Awards are otherwise exempt from or alternatively comply with the distribution requirements of (b) Ten Percent Stockholders. A Ten Percent Stockholder will not be granted an Incentive Stock Option unless the exercise price of such Option is at least one hundred ten percent (110%) of the Fair Market Value on the date of grant and the Option is not exercisable after the expiration of five (5) years from the date of grant. 5. PROVISIONS RELATING TO OPTIONS AND STOCK APPRECIATION RIGHTS. Each Option or SAR will be in such form and will contain such terms and conditions as the Board deems appropriate. All Options will be separately designated Incentive Stock Options or Nonstatutory Stock Options at the time of grant, and, if certificates are issued, a separate certificate or certificates will be issued for shares of Common Stock purchased on exercise of each type of Option. If an Option is not specifically designated as an Incentive Stock Option, or if an Option is designated as an Incentive Stock Option but some portion or all of the Option fails to qualify as an Incentive Stock Option under the applicable rules, then the Option (or portion thereof) will be a Nonstatutory Stock Option. The provisions of separate Options or SARs need not be identical; provided, however, that each Award Agreement will conform to (through incorporation of provisions hereof by reference in the applicable Award Agreement or otherwise) the substance of each of the following provisions: (a) Term. Subject to the provisions of Section 4(b) regarding Ten Percent Stockholders, no Option or SAR will be exercisable after the expiration of ten (10) years from the date of its grant or such shorter period specified in the Award Agreement. (b) Exercise Price. Subject to the provisions of Section 4(b) regarding Ten Percent Stockholders, the exercise or strike price of each Option or SAR will be not less than one hundred percent (100%) of the Fair Market Value of the Common Stock subject to the Option or SAR on the date the Award is granted. Notwithstanding the foregoing, an Option or SAR may be granted with an exercise or strike price lower than one hundred percent (100%) of the Fair Market Value of the Common Stock subject to the Award if such Award is granted pursuant to an assumption of or substitution for another option or stock appreciation right pursuant to a Corporate Transaction and in a manner consistent with the provisions of Section 409A of the Code and, if applicable, Section 424(a) of the Code. Each SAR will be denominated in shares of Common Stock equivalents.   6. (c) Purchase Price for Options. The purchase price of Common Stock acquired pursuant to the exercise of an Option may be paid, to the extent permitted by applicable law and as determined by the Board in its sole discretion, by any combination of the methods of payment set forth below. The Board will have the authority to grant Options that do not permit all of the following methods of payment (or that otherwise restrict the ability to use certain methods) and to grant Options that require the consent of the Company to use a particular method of payment. The permitted methods of payment are as follows: (i) by cash, check, bank draft or money order payable to the Company; (ii) pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that, prior to the issuance of the stock subject to the Option, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds; (iii) by delivery to the Company (either by actual delivery or attestation) of shares of Common Stock; (iv) if an Option is a Nonstatutory Stock Option, by a “net exercise” arrangement pursuant to which the Company will reduce the number of shares of Common Stock issuable upon exercise by the largest whole number of shares with a Fair Market Value that does not exceed the aggregate exercise price; provided, however, that the Company will accept a cash or other payment from the Participant to the extent of any remaining balance of the aggregate exercise price not satisfied by such reduction in the number of whole shares to be issued. Shares of Common Stock will no longer be subject to an Option and will not be exercisable thereafter to the extent that (A) shares issuable upon exercise are used to pay the exercise price pursuant to the “net exercise,” (B) shares are delivered to the Participant as a result of such exercise, and (C) shares are withheld to satisfy tax withholding obligations; or (v) in any other form of legal consideration that may be acceptable to the Board and specified in the applicable Award Agreement. (d) Exercise and Payment of a SAR. To exercise any outstanding SAR, the Participant must provide written notice of exercise to the Company in compliance with the provisions of the Award Agreement evidencing such SAR. The appreciation distribution payable on the exercise of a SAR will be not greater than an amount equal to the excess of (A) the aggregate Fair Market Value (on the date of the exercise of the SAR) of a number of shares of Common Stock equal to the number of Common Stock equivalents in which the Participant is vested under such SAR, and with respect to which the Participant is exercising the SAR on such date, over (B) the aggregate strike price of the number of Common Stock equivalents with respect to which the Participant is exercising the SAR on such date. The appreciation distribution may be paid in Common Stock, in cash, in any combination of the two or in any other form of consideration, as determined by the Board and contained in the Award Agreement evidencing such SAR.   7. (e) Transferability of Options and SARs. The Board may, in its sole discretion, impose such limitations on the transferability of Options and SARs as the Board will determine. In the absence of such a determination by the Board to the contrary, the following restrictions on the transferability of Options and SARs will apply: (i) Restrictions on Transfer. An Option or SAR will not be transferable except by will or by the laws of descent and distribution (and pursuant to Sections 5(e)(ii) and 5(e)(iii) below), and will be exercisable during the lifetime of the Participant only by the Participant. The Board may permit transfer of the Option or SAR in a manner that is not prohibited by applicable tax and securities laws. Except as explicitly provided in the Plan, neither an Option nor a SAR may be transferred for consideration. (ii) Domestic Relations Orders. Subject to the approval of the Board or a duly authorized Officer, an Option or SAR may be transferred pursuant to the terms of a domestic relations order, official marital settlement agreement or other divorce or separation instrument as permitted by Treasury Regulations Section 1.421-1(b)(2). If an Option is an Incentive Stock Option, such Option may be deemed to be a Nonstatutory Stock Option as a result of such transfer. (iii) Beneficiary Designation. Subject to the approval of the Board or a duly authorized Officer, a Participant may, by delivering written notice to the Company, in a form approved by the Company (or the designated broker), designate a third party who, upon the death of the Participant, will thereafter be entitled to exercise the Option or SAR and receive the Common Stock or other consideration resulting from such exercise. In the absence of such a designation, upon the death of the Participant, the executor or administrator of the Participant’s estate will be entitled to exercise the Option or SAR and receive the Common Stock or other consideration resulting from such exercise. However, the Company may prohibit designation of a beneficiary at any time, including due to any conclusion by the Company that such designation would be inconsistent with the provisions of applicable laws. (f) Vesting Generally. The total number of shares of Common Stock subject to an Option or SAR may vest and become exercisable in periodic installments that may or may not be equal. The Option or SAR may be subject to such other terms and conditions on the time or times when it may or may not be exercised (which may be based on the satisfaction of Performance Goals or other criteria) as the Board may deem appropriate. The vesting provisions of individual Options or SARs may vary. The provisions of this Section 5(f) are subject to any Option or SAR provisions governing the minimum number of shares of Common Stock as to which an Option or SAR may be exercised. (g) Termination of Continuous Service. Except as otherwise provided in the applicable Award Agreement or other agreement between the Participant and the Company, if a Participant’s Continuous Service terminates (other than for Cause and other than upon the Participant’s death or Disability), the Participant may exercise his or her Option or SAR (to the extent that the Participant was entitled to exercise such Award as of the date of termination of Continuous Service) within the period of time ending on the earlier of (i) the date three (3) months following the termination of the Participant’s Continuous Service (or such longer or shorter period specified in the applicable Award Agreement), and (ii) the expiration of the term of the Option or SAR as set forth in the Award Agreement. If, after termination of Continuous Service, the Participant does not exercise his or her Option or SAR (as applicable) within the applicable time frame, the Option or SAR will terminate.   8. (h) Extension of Termination Date. Except as otherwise provided in the Company, if the exercise of an Option or SAR following the termination of the Participant’s Continuous Service (other than for Cause and other than upon the Participant’s death or Disability) would be prohibited at any time solely because the issuance of shares of Common Stock would violate the registration requirements under the Securities Act, then the Option or SAR will terminate on the earlier of (i) the expiration of a total period of time (that need not be consecutive) equal to the applicable post-termination exercise period after the termination of the Participant’s Continuous Service during which the exercise of the Option or SAR would not be in violation of such registration requirements, applicable Award Agreement. In addition, unless otherwise provided in a Participant’s Award Agreement, if the sale of any Common Stock received upon exercise of an Option or SAR following the termination of the Participant’s Continuous Service (other than for Cause) would violate the Company’s insider trading policy, then the Option or SAR will terminate on the earlier of (i) the expiration of a period of time (that need not be consecutive) equal to the applicable post-termination exercise period after the termination of the Participant’s Continuous Service during which the sale of the Common Stock received upon exercise of the Option or SAR would not be in violation of the Company’s insider trading policy, or (ii) the expiration of the term of the Option or SAR as set forth in the applicable Award Agreement. (i) Disability of Participant. Except as otherwise provided in the applicable Award Agreement or other agreement between the Participant and the Company, if a Participant’s Continuous Service terminates as a result of the Participant’s Disability, the Participant may exercise his or her Option or SAR (to the extent that the Participant was entitled to exercise such Option or SAR as of the date of termination of Continuous Service), but only within such period of time ending on the earlier of (i) the date twelve (12) months following such termination of Continuous Service (or such longer or shorter period specified in the Award Agreement), and (ii) the expiration of the term of the Option or SAR as set forth in the Award Agreement. If, after termination of Continuous Service, the Participant does not exercise his or her Option or SAR within the applicable time frame, the Option or SAR (as applicable) will terminate. (j) Death of Participant. Except as otherwise provided in the applicable Award Agreement or other agreement between the Participant and the Company, if (i) a death, or (ii) the Participant dies within the period (if any) specified in the Award Agreement for exercisability after the termination of the Participant’s Continuous Service (for a reason other than death), then the Option or SAR may be exercised (to the extent the Participant was entitled to exercise such Option or SAR as of the date of death) by the Participant’s estate, by a person who acquired the right to exercise the Option or SAR by bequest or inheritance or by a person designated to exercise the Option or SAR upon the Participant’s death, but only within the period ending on the earlier of (i) the date eighteen (18) months following the date of death (or such longer or shorter period specified in the Award Agreement), and (ii) the expiration of the term of such Option or SAR as set forth in the Award Agreement. If, after the Participant’s death, the Option or SAR is not exercised within the applicable time frame, the Option or SAR (as applicable) will terminate.   9. (k) Termination for Cause. Except as explicitly provided otherwise in a Participant’s Award Agreement or other individual written agreement between the Company or any Affiliate and the Participant, if a Participant’s Continuous Service is terminated for Cause, the Option or SAR will terminate immediately upon such Participant’s termination of Continuous Service, and the Participant will be prohibited from exercising his or her Option or SAR from and after the time of such termination of Continuous Service. (l) Non-Exempt Employees. If an Option or SAR is granted to an Employee who is a non-exempt employee for purposes of the Fair Labor Standards Act of 1938, as amended, the Option or SAR will not be first exercisable for any shares of Common Stock until at least six (6) months following the date of grant of the Option or SAR (although the Award may vest prior to such date). Consistent with the provisions of the Worker Economic Opportunity Act, (i) if such non-exempt employee dies or suffers a Disability, (ii) upon a Corporate Transaction in which such Option or SAR is not assumed, continued, or substituted, (iii) upon a Change in Control, or (iv) upon the Participant’s retirement (as such term may be defined in the Participant’s Award Agreement, in another agreement between the Participant and the Company, or, if no such definition, in accordance with the Company’s then current employment policies and guidelines), the vested portion of any Options and SARs may be exercised earlier than six (6) months following the date of grant. The foregoing provision is intended to operate so that any income derived by a non-exempt employee in connection with the exercise or vesting of an Option or SAR will be exempt from his or her regular rate of pay. To the extent permitted and/or required for compliance with the Worker Economic Opportunity Act to ensure that any income derived by a non-exempt employee in connection with the exercise, vesting or issuance of any shares under any other Stock Award will be exempt from the employee’s regular rate of pay, the provisions of this Section 5(l) will apply to all Stock Awards and are hereby incorporated by reference into such Stock Award Agreements. 6. PROVISIONS OF STOCK AWARDS OTHER THAN OPTIONS AND SARS. (a) Restricted Stock Awards. Each Restricted Stock Award Agreement will be in such form and will contain such terms and conditions as the Board deems appropriate. To the extent consistent with the Company’s bylaws, at the Board’s election, shares of Common Stock underlying a Restricted Stock Award may be (i) held in book entry form subject to the Company’s instructions until any restrictions relating to the Restricted Stock Award lapse; or (ii) evidenced by a certificate, which certificate will be held in such form and manner as determined by the Board. The terms and conditions of Restricted Stock Award Agreements may change from time to time, and the terms and conditions of separate Restricted Stock Award Agreements need not be identical. Each Restricted Stock Award Agreement will conform to (through incorporation of the provisions hereof by reference in the agreement or otherwise) the substance of each of the following provisions: (i) Consideration. A Restricted Stock Award may be awarded in consideration for (A) cash, check, bank draft or money order payable to the Company, (B) past services to the Company or an Affiliate, or (C) any other form of legal consideration (including future services) that may be acceptable to the Board, in its sole discretion, and permissible under applicable law.   10. (ii) Vesting. Shares of Common Stock awarded under the Restricted Stock Award Agreement may be subject to forfeiture to the Company in accordance with a vesting schedule to be determined by the Board. (iii) Termination of Participant’s Continuous Service. If a Participant’s Continuous Service terminates, the Company may receive through a forfeiture condition or a repurchase right any or all of the shares of Common Stock held by the Participant as of the date of termination of Continuous Service under the terms of the Restricted Stock Award Agreement. (iv) Transferability. Rights to acquire shares of Common Stock under the Restricted Stock Award Agreement will be transferable by the Participant only upon such terms and conditions as are set forth in the Restricted Stock Award Agreement, as the Board will determine in its sole discretion, so long as Common Stock awarded under the Restricted Stock Award Agreement remains subject to the (v) Dividends. A Restricted Stock Award Agreement may provide that any dividends paid on Restricted Stock will be subject to the same vesting and forfeiture restrictions as apply to the shares subject to the Restricted Stock Award to which they relate. (b) Restricted Stock Unit Awards. Each Restricted Stock Unit Award Agreement will be in such form and will contain such terms and conditions as the Board deems appropriate. The terms and conditions of Restricted Stock Unit Award separate Restricted Stock Unit Award Agreements need not be identical. Each Restricted Stock Unit Award Agreement will conform to (through incorporation of the provisions hereof by reference in the Agreement or otherwise) the substance of each of the following provisions: (i) Consideration. At the time of grant of a Restricted Stock Unit Award, the Board will determine the consideration, if any, to be paid by the Participant upon delivery of each share of Common Stock subject to the Restricted Stock Unit Award. The consideration to be paid (if any) by the Participant for each share of Common Stock subject to a Restricted Stock Unit Award may be paid in any form of legal consideration that may be acceptable to the Board, in its sole discretion, and permissible under applicable law. (ii) Vesting. At the time of the grant of a Restricted Stock Unit Award, the Board may impose such restrictions on or conditions to the vesting of the Restricted Stock Unit Award as it, in its sole discretion, deems appropriate. (iii) Payment. A Restricted Stock Unit Award may be settled by the delivery of shares of Common Stock, their cash equivalent, any combination thereof or in any other form of consideration, as determined by the Board and contained in the Restricted Stock Unit Award Agreement. (iv) Additional Restrictions. At the time of the grant of a Restricted Stock Unit Award, the Board, as it deems appropriate, may impose such restrictions or conditions that delay the delivery of the shares of Common Stock (or their cash equivalent) subject to a Restricted Stock Unit Award to a time after the vesting of such Restricted Stock Unit Award.   11. (v) Dividend Equivalents. Dividend equivalents may be credited in respect of shares of Common Stock covered by a Restricted Stock Unit Award, as determined by the Board and contained in the Restricted Stock Unit Award Agreement. At the sole discretion of the Board, such dividend equivalents may be converted into additional shares of Common Stock covered by the Restricted Stock Unit Award in such manner as determined by the Board. Any additional shares covered by the Restricted Stock Unit Award credited by reason of such dividend equivalents will be subject to all of the same terms and conditions of the underlying Restricted Stock Unit Award Agreement to which they relate. (vi) Termination of Participant’s Continuous Service. Except as otherwise provided in the applicable Restricted Stock Unit Award Agreement, such portion of the Restricted Stock Unit Award that has not vested will be forfeited upon the Participant’s termination of Continuous Service. (c) Performance Awards. (i) Performance Stock Awards. A Performance Stock Award is a Stock Award (covering a number of shares not in excess of that set forth in Section 3(d)(ii)) that is payable (including that may be granted, vest or be exercised) contingent upon the attainment during a Performance Period of certain Performance Goals. A Performance Stock Award may, but need not, require the Participant’s completion of a specified period of Continuous Service. The length of any Performance Period, the Performance Goals to be achieved during the Performance Period, and the measure of whether and to what degree such Performance Goals have been attained will be conclusively determined by the Committee (or, if not required for compliance with Section 162(m) of the Code, the Board), in its sole discretion. In addition, to the extent permitted by applicable law and the applicable Award Agreement, the Board may determine that cash may be used in payment of Performance Stock Awards. (ii) Performance Cash Awards. A Performance Cash Award is a cash award (for a dollar value not in excess of that set forth in Section 3(d)(iii)) that is payable contingent upon the attainment during a Performance Period of certain Performance Goals. A Performance Cash Award may also require the Participant’s completion of a specified period of Continuous Service. At the time of grant of a Performance Cash Award, the length of any Performance Period, the Performance Goals to be achieved during the Performance Period, and the measure of whether and to what degree such Performance Goals have been attained will be conclusively determined by the Committee (or, if not required for compliance with Section 162(m) of the Code, the Board), in its sole discretion. The Board may specify the form of payment of Performance Cash Awards, which may be cash or other property, or may provide for a Participant to have the option for his or her Performance Cash Award, or such portion thereof as the Board may specify, to be paid in whole or in part in cash or other property. (iii) Board Discretion. The Board retains the discretion to reduce or eliminate the compensation or economic benefit due upon attainment of Performance Goals and to define the manner of calculating the Performance Criteria it selects to use for a Performance Period.   12. (iv) Section 162(m) Compliance. Unless otherwise permitted in compliance with Section 162(m) of the Code with respect to an Award intended to qualify as “performance-based compensation” thereunder, the Committee will establish the Performance Goals applicable to, and the formula for calculating the amount payable under, the Award no later than the earlier of (A) the date ninety (90) days after the commencement of the applicable Performance Period, and (B) the date on which twenty-five percent (25%) of the Performance Period has elapsed, and in any event at a time when the achievement of the applicable Performance Goals remains substantially uncertain. Prior to the payment of any compensation under an Award intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the Committee will certify the extent to which any Performance Goals and any other material terms under such Award have been satisfied (other than in cases where the Performance Goals relate solely to the increase in the value of the Common Stock). Notwithstanding satisfaction or any completion of any Performance Goals, shares subject to Options, cash or other benefits granted, issued, retainable and/or vested under an Award on account of satisfaction of such Performance Goals may be reduced by the Committee on the basis of any further considerations as the Committee, in its sole discretion, will determine. (d) Other Stock Awards. Other forms of Stock Awards valued in whole or in part by reference to, or otherwise based on, Common Stock, including the appreciation in value thereof (e.g., options or stock rights with an exercise price or strike price less than one hundred percent (100%) of the Fair Market Value of the Common Stock at the time of grant) may be granted either alone or in addition to Stock Awards granted under Section 5 and this Section 6. Subject to the provisions of the Plan, the Board will have sole and complete authority to determine the persons to whom and the time or times at which such Other Stock Awards will be granted, the number of shares of Common Stock (or the cash equivalent thereof) to be granted pursuant to such Other Stock Awards and all other terms and conditions of such Other Stock Awards. 7. COVENANTS OF THE COMPANY. (a) Availability of Shares. The Company will keep available at all times the number of shares of Common Stock reasonably required to satisfy then-outstanding Stock Awards. (b) Securities Law Compliance. The Company will seek to obtain from each regulatory commission or agency having jurisdiction over the Plan the authority required to grant Stock Awards and to issue and sell shares of Common Stock upon exercise of the Stock Awards; provided, however, that this undertaking will not require the Company to register under the Securities Act the Plan, any Stock Award or any Common Stock issued or issuable pursuant to any such Stock Award. If, after reasonable efforts and at a reasonable cost, the Company is unable to obtain from any such regulatory commission or agency the authority that counsel for the Company deems necessary for the lawful issuance and sale of Common Stock under the Plan, the Company will be relieved from any liability for failure to issue and sell Common Stock upon exercise of such Stock Awards unless and until such authority is obtained. A Participant will not be eligible for the grant of an Award or the subsequent issuance of cash or Common Stock pursuant to the Award if such grant or issuance would be in violation of any applicable securities law. (c) No Obligation to Notify or Minimize Taxes. The Company will have no duty or obligation to any Participant to advise such holder as to the time or manner of exercising such Stock Award. Furthermore, the Company will have no duty or obligation to warn or otherwise advise such holder of a pending termination or expiration of an Award or a possible period in which the Award may not be exercised. The Company has no duty or obligation to minimize the tax consequences of an Award to the holder of such Award.   13. 8. MISCELLANEOUS. (a) Use of Proceeds from Sales of Common Stock. Proceeds from the sale of shares of Common Stock issued pursuant to Stock Awards will constitute general funds of the Company. (b) Corporate Action Constituting Grant of Awards. Corporate action constituting a grant by the Company of an Award to any Participant will be deemed completed as of the date of such corporate action, unless otherwise determined by the Board, regardless of when the instrument, certificate, or letter evidencing the Award is communicated to, or actually received or accepted by, the Participant. In the event that the corporate records (e.g., Board consents, resolutions or minutes) documenting the corporate action constituting the grant contain terms (e.g., exercise price, vesting schedule or number of shares) that are inconsistent with those in the Award Agreement or related grant documents as a result of a clerical error in the papering of the Award Agreement or related grant documents, the corporate records will control and the Participant will have no legally binding right to the incorrect term in the Award Agreement or related grant documents. (c) Stockholder Rights. No Participant will be deemed to be the holder of, or to have any of the rights of a holder with respect to, any shares of Common Stock subject to an Award unless and until (i) such Participant has satisfied all requirements for exercise of, or the issuance of shares of Common Stock under, the Award pursuant to its terms, and (ii) the issuance of the Common Stock subject to such Award has been entered into the books and records of the Company. (d) No Employment or Other Service Rights. Nothing in the Plan, any Award Agreement or any other instrument executed thereunder or in connection with any Award granted pursuant thereto will confer upon any Participant any right to continue to serve the Company or an Affiliate in the capacity in effect at the time the Award was granted or will affect the right of the Company or an Affiliate to terminate (i) the employment of an Employee with or without notice and with or without Cause, (ii) the service of a Consultant pursuant to the terms of such Consultant’s agreement with the Company or an Affiliate, or (iii) the service of a Director pursuant to the bylaws of the Company or an Affiliate, and any applicable provisions of the corporate law of the state in which the Company or the Affiliate is incorporated, as the case may be. (e) Change in Time Commitment. In the event a Participant’s regular level of time commitment in the performance of his or her services for the Company and any Affiliates is reduced (for example, and without limitation, if the Participant is an Employee of the Company and the Employee has a change in status from a full-time Employee to a part-time Employee)   14. after the date of grant of any Award to the Participant, the Board has the right in its sole discretion to (x) make a corresponding reduction in the number of shares or cash amount subject to any portion of such Award that is scheduled to vest or become payable after the date of such change in time commitment, and (y) in lieu of or in combination with such a reduction, extend the vesting or payment schedule applicable to such Award. In the event of any such reduction, the Participant will have no right with respect to any portion of the Award that is so reduced or extended. (f) Incentive Stock Option Limitations. To the extent that the aggregate Fair Market Value (determined at the time of grant) of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by any Optionholder during any calendar year (under all plans of the Company and any Affiliates) exceeds one hundred thousand dollars ($100,000) (or such other limit established in the Code) or otherwise does not comply with the rules governing Incentive Stock Options, the Options or portions thereof that exceed such limit (according to the order in which they were granted) or otherwise do not comply with such rules will be treated as Nonstatutory Stock Options, notwithstanding any contrary provision of the applicable Option Agreement(s). (g) Investment Assurances. The Company may require a Participant, as a condition of exercising or acquiring Common Stock under any Award, (i) to give written assurances satisfactory to the Company as to the Participant’s knowledge and experience in financial and business matters and/or to employ a purchaser representative reasonably satisfactory to the Company who is knowledgeable and experienced in financial and business matters and that he or she is capable of evaluating, alone or together with the purchaser representative, the merits and risks of exercising the Award; and (ii) to give written assurances satisfactory to the Company stating that the Participant is acquiring Common Stock subject to the Award for the Participant’s own account and not with any present intention of selling or otherwise distributing the Common Stock. The foregoing requirements, and any assurances given pursuant to such requirements, will be inoperative if (A) the issuance of the shares upon the exercise or acquisition of Common Stock under the Stock Award has been registered under a then currently effective registration statement under the Securities Act, or (B) as to any particular requirement, a determination is made by counsel for the Company that such requirement need not be met in the circumstances under the then applicable securities laws. The Company may, upon advice of counsel to the Company, place legends on stock certificates issued under the Plan as such counsel deems necessary or appropriate in order to comply with applicable securities laws, including, but not limited to, legends restricting the transfer of the Common Stock. (h) Withholding Obligations. Unless prohibited by the terms of an Award Agreement, the Company may, in its sole discretion, satisfy any federal, state or local tax withholding obligation relating to an Award by any of the following means or by a combination of such means: (i) causing the Participant to tender a cash payment; (ii) withholding shares of Common Stock from the shares of Common Stock issued or otherwise issuable to the Participant in connection with the Stock Award; provided, however, that no shares of Common Stock are withheld with a value exceeding the minimum amount of tax required to be withheld by law (or such lesser amount as may be necessary to avoid classification of the Stock Award as a liability for financial accounting purposes); (iii) withholding cash from an Award settled in cash; (iv) withholding payment from any amounts otherwise payable to the Participant; or (v) by such other method as may be set forth in the Award Agreement.   15. (i) Electronic Delivery. Any reference herein to a “written” agreement or document will include any agreement or document delivered electronically, filed publicly at www.sec.gov (or any successor website thereto) or posted on the Company’s intranet (or other shared electronic medium controlled by the Company to which the Participant has access). (j) Deferrals. To the extent permitted by applicable law, the Board, in its sole discretion, may determine that the delivery of Common Stock or the payment of cash, upon the exercise, vesting or settlement of all or a portion of any Award may be deferred and may establish programs and procedures for deferral elections to be made by Participants. Deferrals by Participants will be made in accordance with Section 409A of the Code. Consistent with Section 409A of the Code, the Board may provide for distributions while a Participant is still an employee or otherwise providing services to the Company. The Board is authorized to make deferrals of Awards and determine when, and in what annual percentages, Participants may receive payments, including lump sum payments, following the Participant’s termination of Continuous Service, and implement such other terms and conditions consistent with the provisions of the Plan and in accordance with applicable law. (k) Compliance with Section 409A of the Code. To the extent that the Board determines that any Award granted hereunder is subject to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms and conditions necessary to avoid the consequences specified in Section 409A(a)(1) of the Code. To the extent applicable, the Plan and Award Agreements shall be interpreted in accordance with Section 409A of the Code. Notwithstanding anything to the contrary in this Plan (and unless the Award Agreement specifically provides otherwise), if the shares of Common Stock are publicly traded and a Participant holding an Award that constitutes “deferred compensation” under Section 409A of the Code is a “specified employee” for purposes of Section 409A of the Code, no distribution or payment of any amount shall be made upon a “separation from service” before a date that is six (6) months following the date of such Participant’s “separation from service” (as defined in Section 409A of the Code without regard to alternative definitions thereunder) or, if earlier, the date of the Participant’s death. (l) Clawback/Recovery. All Awards granted under the Plan will be subject to recoupment in accordance with any clawback policy that the Company is required to adopt pursuant to the listing standards of any national securities exchange or association on which the Company’s securities are listed or as is otherwise required by the Dodd-Frank Wall Street Reform and Consumer Protection Act or other applicable law. In addition, the Board may impose such other clawback, recovery or recoupment provisions in an Award Agreement as the Board determines necessary or appropriate, including but not limited to a reacquisition right in respect of previously acquired shares of Common Stock or other cash or property upon the occurrence of Cause. No recovery of compensation under such a clawback policy will be an event giving rise to a right to resign for “good reason” or “constructive termination” (or similar term) under any agreement with the Company.   16. 9. ADJUSTMENTS UPON CHANGES IN COMMON STOCK; OTHER CORPORATE EVENTS. (a) Capitalization Adjustments. In the event of a Capitalization Adjustment, the Board will appropriately and proportionately adjust: (i) the class(es) and maximum number of securities subject to the Plan pursuant to Section 3(a), (ii) the class(es) and maximum number of securities that may be issued pursuant to the exercise of Incentive Stock Options pursuant to Section 3(c), (iii) the class(es) and maximum number of securities that may be awarded to any person pursuant to Sections 3(d), and (iv) the class(es) and number of securities and price per share of stock subject to outstanding Stock Awards. The Board will make such adjustments, and its determination will be final, binding and conclusive. (b) Dissolution or Liquidation. Except as otherwise provided in the Stock Award Agreement, in the event of a dissolution or liquidation of the Company, all outstanding shares of Common Stock not subject to a forfeiture condition or the Company’s right of repurchase) will terminate immediately prior to the completion of such dissolution or liquidation, and the shares of Common Stock subject to the Company’s repurchase rights or subject to a forfeiture condition may be repurchased or reacquired by the Company notwithstanding the fact that the holder of such Stock Award is providing Continuous Service, provided, however, that the Board may, in its sole discretion, cause some or all Stock Awards to become fully vested, exercisable and/or no longer subject to repurchase or forfeiture (to the extent such Stock Awards have not previously expired or terminated) before the dissolution or liquidation is completed but contingent on its completion. (c) Corporate Transactions. The following provisions will apply to Stock Awards in the event of a Transaction unless otherwise provided in the Stock Award Agreement or any other written agreement between the Company or any Affiliate and the Participant or unless otherwise expressly provided by the Board at the time of grant of a Stock Award. In the event of a Transaction, then, notwithstanding any other provision of the Plan, the Board may take one or more of the following actions with respect to Stock Awards, contingent upon the closing or completion of the Transaction: (i) arrange for the surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company) to assume or continue the Stock Award or to substitute a similar stock award for the Stock Award (including, but not limited to, an award to acquire the same consideration paid to the stockholders of the Company pursuant to the Transaction); (ii) arrange for the assignment of any reacquisition or repurchase rights held by the Company in respect of Common Stock issued pursuant to the Stock Award to the surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company); (iii) accelerate the vesting, in whole or in part, of the Stock Award (and, if applicable, the time at which the Stock Award may be exercised) to a date prior to the effective time of such Transaction as the Board determines (or, if the Board does not determine such a date, to the date that is five (5) days prior to the effective date of the Transaction), with such   17. Stock Award terminating if not exercised (if applicable) at or prior to the effective time of the Transaction; provided, however, that the Board may require Participants to complete and deliver to the Company a notice of exercise before the effective date of a Transaction, which exercise is contingent upon the effectiveness of such Transaction; (iv) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by the Company with respect to the Stock Award; (v) cancel or arrange for the cancellation of the Stock Award, to the extent not vested or not exercised prior to the effective time of the Transaction, in exchange for such cash consideration, if any, as the Board, in its sole discretion, may consider appropriate; and (vi) make a payment, in such form as may be determined by the Board equal to the excess, if any, of (A) the value of the property the Participant would have received upon the exercise of the Stock Award immediately prior to the effective time of the Transaction, over (B) any exercise price payable by such holder in connection with such exercise. For clarity, this payment may be zero ($0) if the value of the property is equal to or less than the exercise price. Payments under this provision may be delayed to the same extent that payment of consideration to the holders of the Company’s Common Stock in connection with the Transaction is delayed as a result of escrows, earn outs, holdbacks or any other contingencies. The Board need not take the same action or actions with respect to all Stock Awards or portions thereof or with respect to all Participants. The Board may take different actions with respect to the vested and unvested portions of a Stock Award. (d) Change in Control. A Stock Award may be subject to additional acceleration of vesting and exercisability upon or after a Change in Control as may be provided in the Stock Award Agreement for such Stock Award or as may be provided in any other written agreement between the Company or any Affiliate and the Participant, but in the absence of such provision, no such acceleration will occur. 10. PLAN TERM; EARLIER TERMINATION OR SUSPENSION OF THE PLAN. (a) The Board may suspend or terminate the Plan at any time. The Plan will automatically terminate upon the tenth (10th) anniversary of the earlier of (i) the date the Plan is adopted by the Board, or (ii) the date the Plan is approved by the stockholders of the Company. No Awards may be granted under the Plan while the Plan is suspended or after it is terminated. (b) No Impairment of Rights. Suspension or termination of the Plan will not impair rights and obligations under any Award granted while the Plan is in effect except with the written consent of the affected Participant or as otherwise permitted in the Plan. 11. EFFECTIVE DATE OF PLAN. This Plan will become effective on the Effective Date.   18. 12. CHOICE OF LAW. The laws of the State of California will govern all questions concerning the construction, validity and interpretation of this Plan, without regard to that state’s conflict of laws rules. 13. DEFINITIONS. As used in the Plan, the following definitions will apply to the capitalized terms indicated below: (a) “Affiliate” means, at the time of determination, any “parent” or “subsidiary” of the Company as such terms are defined in Rule 405. The Board will have the authority to determine the time or times at which “parent” or “subsidiary” status is determined within the foregoing definition. (b) “Award” means a Stock Award or a Performance Cash Award. (c) “Award Agreement” means a written agreement between the Company and a Participant evidencing the terms and conditions of an Award. (e) “Capitalization Adjustment” means any change that is made in, or other events that occur with respect to, the Common Stock subject to the Plan or subject to any Stock Award after the Effective Date without the receipt of consideration by the Company through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, large nonrecurring cash dividend, stock split, reverse stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or any similar equity restructuring transaction, as that term is used in Statement of Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor thereto). Notwithstanding the foregoing, the conversion of any convertible securities of the Company will not be treated as a Capitalization Adjustment. (f) “Cause” will have the meaning ascribed to such term in any written agreement between the Participant and the Company defining such term and, in the absence of such agreement, such term means, with respect to a Participant, the occurrence of any of the following events: (i) such Participant’s commission of any felony or any crime involving fraud, dishonesty or moral turpitude under the laws of the United States or any state thereof; (ii) such Participant’s attempted commission of, or participation in, a fraud or act of dishonesty against the Company; (iii) such Participant’s intentional, material violation of any contract or agreement between the Participant and the Company or of any statutory duty owed to the Company; (iv) such Participant’s unauthorized use or disclosure of the Company’s confidential information or trade secrets; or (v) such Participant’s gross misconduct. The determination that a termination of the Participant’s Continuous Service is either for Cause or without Cause will be made by the Company, in its sole discretion. Any determination by the Company that the Continuous Service of a Participant was terminated with or without Cause for the purposes of outstanding Awards held by such Participant will have no effect upon any determination of the rights or obligations of the Company or such Participant for any other purpose.   19. (g) “Change in Control” means the occurrence, in a single transaction or in a series of related transactions, of any one or more of the following events: (i) any Exchange Act Person becomes the Owner, directly or indirectly, of securities of the Company representing more than fifty percent (50%) of the combined voting power of the Company’s then outstanding securities other than by virtue of a merger, consolidation or similar transaction. Notwithstanding the foregoing, a Change in Control will not be deemed to occur (A) on account of the acquisition of securities of the Company directly from the Company, (B) on account of the acquisition of securities of the Company by an investor, any affiliate thereof or any other Exchange Act Person that acquires the Company’s securities in a transaction or series of related transactions the primary purpose of which is to obtain financing for the Company through the issuance of equity securities, or (C) solely because the level of Ownership held by any Exchange Act Person (the “Subject Person”) exceeds the designated percentage threshold of the outstanding voting securities as a result of a repurchase or other acquisition of voting securities by the Company reducing the number of shares outstanding, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of voting securities by the Company, and after such share acquisition, the Subject Person becomes the Owner of any additional voting securities that, assuming the repurchase or other acquisition had not occurred, increases the percentage of the then outstanding voting securities Owned by the Subject Person over the designated percentage threshold, then a Change in Control will be deemed to occur; (ii) there is consummated a merger, consolidation or similar transaction involving (directly or indirectly) the Company and, immediately after the stockholders of the Company immediately prior thereto do not Own, directly or Entity in such merger, consolidation or similar transaction or (B) more than the surviving Entity in such merger, consolidation or similar transaction, in each case in substantially the same proportions as their Ownership of the outstanding voting securities of the Company immediately prior to such transaction; (iii) there is consummated a sale, lease, exclusive license or other disposition of all or substantially all of the consolidated assets of the Company and its Subsidiaries, other than a sale, lease, license or other disposition of all or substantially all of the consolidated assets of the Company and its Subsidiaries to an Entity, more than fifty percent (50%) of the combined voting power of the voting securities of which are Owned by stockholders of the Company in substantially the same proportions as their Ownership of the outstanding voting securities of the Company immediately prior to such sale, lease, license or other disposition; or (iv) individuals who, on the date the Plan is adopted by the Board, are members a majority of the members of the Board; provided, however, that if the appointment or election (or nomination for election) of any new Board member was approved or recommended by a majority vote of the members of the Incumbent Board then still in office, such new member will, for purposes of this Plan, be considered as a member of the Incumbent Board.   20. Notwithstanding the foregoing definition or any other provision of this Plan, (A) the term Change in Control will not include a sale of assets, merger or other transaction effected exclusively for the purpose of changing the domicile of the Company, and (B) the definition of Change in Control (or any analogous term) in an individual written agreement between the Company or any Affiliate and the Participant will supersede the foregoing definition with respect to Awards subject to such agreement; provided, however, that if no definition of Change in Control or any analogous term is set forth in such an individual written agreement, the foregoing definition will apply. (h) “Code” means the Internal Revenue Code of 1986, as amended, including any applicable regulations and guidance thereunder. (i) “Committee” means a committee of one (1) or more Directors to whom authority has been delegated by the Board in accordance with Section 2(c). (j) “Common Stock” means the common stock of the Company. (k) “Company” means MediciNova, Inc., a Delaware corporation. (l) “Consultant” means any person, including an advisor, who is (i) engaged by the Company or an Affiliate to render consulting or advisory services and is compensated for such services, or (ii) serving as a member of the board of directors of an Affiliate and is compensated for such services. However, service solely as a Director, or payment of a fee for such service, will not cause a Director to be considered a “Consultant” for purposes of the Plan. Notwithstanding the foregoing, a person is treated as a Consultant under this Plan only if a Form S-8 Registration Statement under the Securities Act is available to register either the offer or the sale of the Company’s securities to such person. (m) “Continuous Service” means that the Participant’s service with the Company or an Affiliate, whether as an Employee, Director or Consultant, is not interrupted or terminated. A change in the capacity in which the Participant renders service to the Company or an Affiliate as an Employee, Director or Consultant or a change in the Entity for which the Participant renders such service, provided that there is no interruption or termination of the Participant’s service with the Company or an Affiliate, will not terminate a Participant’s Continuous Service; provided, however, that if the Entity for which a Participant is rendering services ceases to qualify as an Affiliate, as determined by the Board, in its sole discretion, such Participant’s Continuous Service will be considered to have terminated on the date such Entity ceases to qualify as an Affiliate. For example, a change in status from an Employee of the Company to a Consultant of an Affiliate or to a Director will not constitute an interruption of Continuous Service. To the extent permitted by law, the Board or the chief executive officer of the Company, in that party’s sole discretion, may determine whether Continuous Service will be considered interrupted in the case of (i) any leave of absence approved by the Board or chief executive officer, including sick leave, military leave or any other personal leave, or (ii) transfers between the Company, an Affiliate, or their successors. Notwithstanding the foregoing, a leave of absence will be treated as Continuous Service for purposes of vesting in a Stock Award only to such extent as may be provided in the Company’s leave of absence policy, in the written terms of any leave of absence agreement or policy applicable to the Participant, or as   21. (n) “Corporate Transaction” means the consummation, in a single transaction or in a series of related transactions, of any one or more of the following events: (i) a sale or other disposition of all or substantially all, as determined by the Board, in its sole discretion, of the consolidated assets of the Company and its Subsidiaries; (ii) a sale or other disposition of at least ninety percent (90%) of the outstanding securities of the Company; (iii) a merger, consolidation or similar transaction following which the Company is not the surviving corporation; or (iv) a merger, consolidation or similar transaction following which the Company is the surviving corporation but the shares of Common Stock outstanding immediately preceding the merger, consolidation or similar transaction are converted or exchanged by virtue of the merger, consolidation or similar transaction into other property, whether in the form of securities, cash or otherwise. (o) “Covered Employee” will have the meaning provided in Section 162(m)(3) of the Code. (p) “Director” means a member of the Board. (q) “Disability” means, with respect to a Participant, the inability of such Participant to engage in any substantial gainful activity by reason of any result in death or that has lasted or can be expected to last for a continuous period of not less than twelve (12) months, as provided in Sections 22(e)(3) and 409A(a)(2)(c)(i) of the Code, and will be determined by the Board on the basis of such medical evidence as the Board deems warranted under the circumstances. (r) “Effective Date” means the effective date of this Plan document, which is the date of the annual meeting of stockholders of the Company held in 2013, provided this Plan is approved by the Company’s stockholders at such meeting. (s) “Employee” means any person employed by the Company or an Affiliate. However, service solely as a Director, or payment of a fee for such services, will not cause a Director to be considered an “Employee” for purposes of the Plan. (t) “Entity” means a corporation, partnership, limited liability company or other entity. (u) “Exchange Act” means the Securities Exchange Act of 1934, as amended, and   22. (v) “Exchange Act Person” means any natural person, Entity or “group” (within the meaning of Section 13(d) or 14(d) of the Exchange Act), except that “Exchange Act Person” will not include (i) the Company or any Subsidiary of the Company, (ii) any employee benefit plan of the Company or any Subsidiary of the Company or any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any Subsidiary of the Company, (iii) an securities, (iv) an Entity Owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their Ownership of stock of the Company; or (v) any natural person, Entity or “group” (within the meaning of Section 13(d) or 14(d) of the Exchange Act) that, as of the Effective Date, is the Owner, directly or indirectly, of securities of the Company representing outstanding securities. (w) “Fair Market Value” means, as of any date, the value of the Common Stock determined as follows: (i) If the Common Stock is listed on any established stock exchange or traded on any established market, the Fair Market Value of a share of Common Stock will be, unless otherwise determined by the Board, the closing sales price for such stock as quoted on such exchange or market (or the exchange or market with the greatest volume of trading in the Common Stock) on the date of determination, as reported in a source the Board deems reliable. (ii) Unless otherwise provided by the Board, if there is no closing sales price for the Common Stock on the date of determination, then the Fair Market Value will be the closing selling price on the last preceding date for which such quotation exists. (iii) In the absence of such markets for the Common Stock, the Fair Market Value will be determined by the Board in good faith and in a manner that complies with Sections 409A and 422 of the Code. (x) “Incentive Stock Option” means an option granted pursuant to Section 5 that is intended to be, and that qualifies as, an “incentive stock option” within the meaning of Section 422 of the Code. (y) “Non-Employee Director” means a Director who either (i) is not a current employee or officer of the Company or an Affiliate, does not receive compensation, either directly or indirectly, from the Company or an Affiliate for services rendered as a consultant or in any capacity other than as a Director (except for an amount as to which disclosure would not be required under Item 404(a) of Regulation S-K promulgated pursuant to the Securities Act (“Regulation S-K”)), does not possess an interest in any other transaction for which disclosure would be required under Item 404(a) of Regulation S-K, and is not engaged in a business relationship for which disclosure would be required pursuant to Item 404(b) of Regulation S-K; or (ii) is otherwise considered a “non-employee director” for purposes of Rule 16b-3. (z) “Nonstatutory Stock Option” means any option granted pursuant to Section 5 that does not qualify as an Incentive Stock Option.   23. (aa) “Officer” means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act. (bb) “Option” means an Incentive Stock Option or a Nonstatutory Stock Option to purchase shares of Common Stock granted pursuant to the Plan. (cc) “Option Agreement” means a written agreement between the Company and an Optionholder evidencing the terms and conditions of an Option grant. Each Option Agreement will be subject to the terms and conditions of the Plan. (dd) “Optionholder” means a person to whom an Option is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding Option. (ee) “Other Stock Award” means an award based in whole or in part by reference to the Common Stock which is granted pursuant to the terms and conditions of Section 6(d). (ff) “Other Stock Award Agreement” means a written agreement between the Company and a holder of an Other Stock Award evidencing the terms and conditions of an Other Stock Award grant. Each Other Stock Award Agreement will be subject to the terms and conditions of the Plan. (gg) “Outside Director” means a Director who either (i) is not a current employee of the Company or an “affiliated corporation” (within the meaning of Treasury Regulations promulgated under Section 162(m) of the Code), is not a former employee of the Company or an “affiliated corporation” who receives compensation for prior services (other than benefits under a tax-qualified retirement plan) during the taxable year, has not been an officer of the Company or an “affiliated corporation,” and does not receive remuneration from the Company or an “affiliated corporation,” either directly or indirectly, in any capacity other than as a Director, or (ii) is otherwise considered an “outside (hh) “Own,” “Owned,” “Owner,” “Ownership” A person or Entity will be deemed to “Own,” to have “Owned,” to be the “Owner” of, or to have acquired “Ownership” of securities if such person or Entity, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, has or shares voting power, which includes the power to vote or to direct the voting, with respect to such securities. (ii) “Participant” means a person to whom an Award is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding Stock Award. (jj) “Performance Cash Award” means an award of cash granted pursuant to the terms and conditions of Section 6(c)(ii). (kk) “Performance Criteria” means the one or more criteria that the Board will select for purposes of establishing the Performance Goals for a Performance Period. The Performance Criteria that will be used to establish such Performance Goals may be based on any one of, or combination of, the following as determined by the Board: (i) earnings (including earnings per share and net earnings); (ii) earnings before interest, taxes and depreciation; (iii) earnings before interest, taxes, depreciation and amortization; (iv) total stockholder return; (v) return on equity or   24. average stockholder’s equity; (vi) return on assets, investment, or capital employed; (vii) stock price; (viii) margin (including gross margin); (ix) income (before or after taxes); (x) operating income; (xi) operating income after taxes; (xii) pre-tax profit; (xiii) operating cash flow; (xiv) sales or revenue targets; (xv) increases in revenue or product revenue; (xvi) expenses and cost reduction goals; (xvii) improvement in or attainment of working capital levels; (xviii) economic value added (or an equivalent metric); (xix) market share; (xx) cash flow; (xxi) cash flow per share; (xxii) share price performance; (xxiii) debt reduction; (xxiv) implementation or completion of projects or processes; (xxv) customer satisfaction; (xxvi) stockholders’ equity; (xxvii) capital expenditures; (xxviii) debt levels; (xxix) operating profit or net operating profit; (xxx) workforce diversity; (xxxi) growth of net income or operating income; (xxxii) billings; (xxxiii) clinical goals; (xxxiv) financing goals, and (xxxv) to the extent that an Award is not intended to comply with Section 162(m) of the Code, other measures of performance selected by the Board. (ll) “Performance Goals” means, for a Performance Period, the one or more goals established by the Board for the Performance Period based upon the Performance Criteria. Performance Goals may be based on a Company-wide basis, with respect to one or more business units, divisions, Affiliates, or business segments, and in either absolute terms or relative to the performance of one or more comparable companies or the performance of one or more relevant indices. Unless specified otherwise by the Board (i) in the Award Agreement at the time the Award is granted or (ii) in such other document setting forth the Performance Goals at the time the Performance Goals are established, the Board will appropriately make adjustments in the method of calculating the attainment of Performance Goals for a Performance Period as follows: (1) to exclude restructuring and/or other nonrecurring charges; (2) to exclude exchange rate effects, as applicable, for non-U.S. dollar denominated Performance Goals; (3) to exclude the effects of changes to generally accepted accounting principles; (4) to exclude the effects of any statutory adjustments to corporate tax rates; and (5) to exclude the effects of any “extraordinary items” as determined under generally accepted accounting principles. (mm) “Performance Period” means the period of time selected by the Board over purpose of determining a Participant’s right to and the payment of a Stock Award or a Performance Cash Award. Performance Periods may be of varying and overlapping duration, at the sole discretion of the Board. (nn) “Performance Stock Award” means a Stock Award granted under the terms and conditions of Section 6(c)(i). (oo) “Plan” means this MediciNova, Inc. 2013 Equity Incentive Plan. (pp) “Restricted Stock Award” means an award of shares of Common Stock which is granted pursuant to the terms and conditions of Section 6(a). (qq) “Restricted Stock Award Agreement” means a written agreement between the Company and a holder of a Restricted Stock Award evidencing the terms and conditions of a Restricted Stock Award grant. Each Restricted Stock Award   25. (rr) “Restricted Stock Unit Award” means a right to receive shares of Common Stock which is granted pursuant to the terms and conditions of Section 6(b). (ss) “Restricted Stock Unit Award Agreement” means a written agreement between the Company and a holder of a Restricted Stock Unit Award evidencing the terms and conditions of a Restricted Stock Unit Award grant. Each Restricted Stock Unit Award Agreement will be subject to the terms and conditions of the Plan. (tt) “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any successor to Rule 16b-3, as in effect from time to time. (uu) “Rule 405” means Rule 405 promulgated under the Securities Act. (vv) “Rule 701” means Rule 701 promulgated under the Securities Act. (ww) “Securities Act” means the Securities Act of 1933, as amended. (xx) “Stock Appreciation Right” or “SAR” means a right to receive the appreciation on Common Stock that is granted pursuant to the terms and conditions of Section 5. (yy) “Stock Appreciation Right Agreement” means a written agreement between the Company and a holder of a Stock Appreciation Right evidencing the terms and conditions of a Stock Appreciation Right grant. Each Stock Appreciation Right (zz) “Stock Award” means any right to receive Common Stock granted under the Plan, including an Incentive Stock Option, a Nonstatutory Stock Option, a Restricted Stock Award, a Restricted Stock Unit Award, a Stock Appreciation Right, a Performance Stock Award or any Other Stock Award. (aaa) “Stock Award Agreement” means a written agreement between the Company and a Participant evidencing the terms and conditions of a Stock Award grant. Each Stock Award Agreement will be subject to the terms and conditions of the Plan. (bbb) “Subsidiary” means, with respect to the Company, (i) any corporation of which more than fifty percent (50%) of the outstanding capital stock having ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether, at the time, stock of any other class or classes of such corporation will have or might have voting power by reason of the happening of any contingency) is at the time, directly or indirectly, Owned by the Company, and (ii) any partnership, limited liability company or other entity in which the Company has a direct or indirect interest (whether in the form of voting or participation in profits or capital contribution) of more than fifty percent (50%). (ccc) “Ten Percent Stockholder” means a person who Owns (or is deemed to Own pursuant to Section 424(d) of the Code) stock possessing more than ten percent or any Affiliate. (ddd) “Transaction” means a Corporate Transaction or a Change in Control.   26.

Title: My sister abandoned our autistic brother with me. Now 6 months later finally admitted that she won't be resuming custody, and has told me he is now "my problem" as she won't be coming back to Canada. Is this legal..? Question:I am in **Ontario, Canada** while my sister was in Vancouver BC. My brother is on the spectrum, and he is someone who basically needs constant and around the clock care. He is in his 20's now, but mentally he is about \~8 years old. Nearly a year ago my mom suddenly passed away due to a blood clot in the brain, it came out of nowhere and shocked our family and my dad passed a few years back from cancer. 3 years ago our mom had a will drawn up, and my older sister basically agreed in the event of something happening she would be responsible for my brother (there were a ton of reasons for this specifically the fact she lived within my brothers support network, while i am far away). In agreement with this my mom put aside a large amount of money for the purpose of my brothers well being. My sister and her fiancee took my brother in for about 6 months, but it became very apparent that she misunderstood the amount of work required for his care. She asked if i would be willing to take him for a month or so while she went and took time off. I agreed simply because of the fact i am now a stay at home mom, but told her i couldn't do this for long. One month turned into two, and then finally 4. She kept making excuse after excuse, but she finally agreed that she would take him when they got back from a vacation in Europe to visit her fiancee's family. When she got back she would let me know. Then basically nothing, absolutely fucking nothing for two months. Never responded to any of my emails, messages or phone calls. Finally yesterday i received a long facebook message from her telling me: * She isn't coming back to Canada, as she has decided to get married in Europe and live there with her fiancee. * She isn't coming back for my brother, and said i needed to take care of him as he is now "my problem". * She said she was sorry but she couldn't deal with him anymore. She has blocked me on facebook, and her cell phone number no longer seems to work anymore. I know this sounds cold, but i can't do this. I can't take care of my brother anymore. On top of this all the money that my parents put aside for my brother, aside from a bit she sent me early on i have no idea where that money is or where it went. I have tried a variety of services, and explained my situation about my brother, but i have discovered there is basically fuck all help for me. I was told it could take several years to find a place for him in a care facility, and it is just wait list after wait list. So like my question is, can my sister really just abandon him like this? Isn't there some sort of law against basically abandoning someone your responsible for? I know he isn't a child anymore, but mentally he is. Answer #1: Call the attorney that handled your parents estate. Your sister taking that set-aside money was most likely contingent on her using it for his care.......not for getting married and starting a life in Europe. She most likely owes you that money. At the very least. I’m sorry you’re dealing with this. You don’t deserve it. Answer #2: The money is a completely separate issue altogether. I do hope that the money was identified specifically as being for him and that it wasn't vague. The care however I'm unsure of. I mean it could very well be that she assumed legal guardianship of him. But that usually has to be well taken care of in advance. If this really was a sudden thing idk if she actually has any more liability for your brother than you do. And I'm not sure that she should. Your brother needs a facility and that should have been thought out ahead of time. I'm not sure why your sister would have more liability to your brother than you would. If she doesn't want to take care of him. I don't see why she would be legally bound to. The money she should have to give up. But as I said before. Hopefully it was left in the correct name.Answer #3: First of all, check if your sister is using the money that was set aside for your brother. See if you can find the lawyer that notorized the will. Maybe he/she can help you determine if there is any fraud. Right now, it seems like your sister tapped in the reserves that were for your brother to go on this vacation and stuff. Since you are related to your brother, I think responsibility eventually lies with you unless you find a place for him in some care facility. Next, keep it together and take care of your brother. I know it's difficult and I don't know much about your hardships and other issues but trust me, take care of your brother because there will be a time in life where you may regret for not doing so. He needs support and love and theres nothing better than getting love and support from people who are family. Since you live in Canada, there are plenty of provincial and federal programs that can help you take care of your brother. Try this website: https://www2.gov.bc.ca/gov/content/family-social-supports/services-for-people-with-disabilities/supports-services There's a similar website for Ontario: https://www.mcss.gov.on.ca/en/mcss/index.aspx & http://www.children.gov.on.ca/htdocs/english/specialneeds/index.aspx The above websites may help you to connect with the right person. There are many at home programs and special schools that are paid by the government. If you can get your brother enrolled in one of the schools then that would be helpful for you. It gives you more time to focus on your family and stuff. Answer #4: Wow your sister is a complete scumbag. She absolutely cannot do this and once you get a lawyer he’ll be able to advise you on how to get a hold of the money she basically stole from your brother. Answer #5: First of all, I would like to say, as you well know, what a wonderful sister you are for being there for your brother for any amount of time. Thank you as a parent of a child with autism. Are you by any chance connected to any parent or sibling advocacy groups? I am in US so my resources would not be helpful. However, this is a link in Ontario. [http://www.autismontario.com/client/aso/ao.nsf/Toronto/Family+-+Support+Groups](http://www.autismontario.com/client/aso/ao.nsf/Toronto/Family+-+Support+Groups) Sometimes, accessing parent advocates who know the ropes can help you with the very steep learning curve to access services. Might I ask where in Canada you are and I can ask a few people in advocacy groups here if they know of anyone. Your brother at the very least should be receiving some form of social security, which we have here called SSDI. Is that the case there? If so, where is that money going?Answer #6: She will be back to your home state, at some point. You can’t just decide to live in another country. There’s an entire process go it. Get a lawyer, and get her to sign over any rights she has to him, financially or otherwise.

  Exhibit 10.1 EXECUTION COPY FIRST AMENDMENT           FIRST AMENDMENT, dated as of April 12, 2006 (this “Amendment”), to the FIVE-YEAR CREDIT AGREEMENT, dated as of July 14, 2005, among AUTONATION, INC., a Delaware corporation (the “Borrower”), the lenders party thereto (the “Lenders”), J.P. MORGAN SECURITIES INC. (“JPMorgan”) and BANC OF AMERICA SECURITIES LLC, as co-lead arrangers and joint bookrunners, BANK OF AMERICA, N.A., as syndication agent, WACHOVIA BANK, NATIONAL ASSOCIATION, BNP PARIBAS and TOYOTA MOTOR CREDIT CORPORATION, as documentation agents, and JPMORGAN CHASE BANK, N.A., as administrative agent (in such capacity, the “Administrative Agent”) (as amended, supplemented or otherwise modified from time to time, the : make, and have made, certain loans and other extensions of credit to the Borrower;           WHEREAS, the Borrower intends to (i) tender for shares of its common stock, and (ii) purchase up to $323,513,000 principal amount of outstanding senior notes of the Borrower (collectively, the “Transaction”).           WHEREAS, the Borrower has requested certain amendments to the Credit Agreement as more fully set forth herein;           WHEREAS, the Lenders have agreed to such amendments but only on the terms and conditions contained in this Amendment.           SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement (as proposed to be amended).           SECTION 2. Amendments. Effective as of the date on which all the conditions precedent set forth in Section 3 shall be satisfied (such date, the “Effective Date”), the Credit Agreement, including all exhibits and schedules thereto, shall be amended to read in its entirety as set forth in Exhibit A to this Amendment.           SECTION 3. Lender Addendum. By executing this Amendment on or prior to the Effective Date, each institution not a party to the Credit Agreement prior to the Effective Date agrees to and shall, as of the Effective Date, join the Credit Agreement (as amended pursuant to this Amendment) as a Lender.           SECTION 4. Conditions to Effectiveness. This Amendment shall become effective upon the date on which each of the following shall have been received, each in form and substance satisfactory to the applicable recipient:     2           (i) the Administrative Agent shall have received this Amendment, executed and delivered by a duly authorized officer of (a) the Borrower, (b) the Administrative Agent, (c) each Lender (as defined prior to giving effect to this Amendment) and (d) each Term Lender (as defined in the Credit Agreement after giving effect to this Amendment), together with all schedules and exhibits hereto;           (ii) the Administrative Agent shall have received an acknowledgment and consent (“Acknowledgment and Consent”), substantially in the form of Exhibit B hereto, duly executed and delivered by each Guarantor;           (iii) the Administrative Agent shall have received the favorable written opinion or opinions with respect to the Amendment and related Loan Documents and the transactions contemplated thereby of (A) in-house legal counsel to the Borrower and (B) Skadden, Arps, Slate, Meagher & Flom LLP, special counsel to the Borrower and Guarantors, in each case dated the Effective Date, addressed to the Administrative Agent and the Lenders and reasonably satisfactory to the Administrative Agent, substantially in the form of Exhibits I-1 and I-2 to the Credit Agreement;           (iv) the Administrative Agent shall have received resolutions of the boards of directors or other appropriate governing body (or of the appropriate committee thereof) of the Borrower and each Guarantor certified by its secretary or assistant secretary as of the Effective Date, approving this Amendment, including, without limitation, the addition of the Term Facility effected hereby, and adopting the Loan Documents to be executed by such Person, and authorizing the execution and delivery thereof;           (v) the Administrative Agent shall have received specimen signatures of officers or other appropriate representatives executing the Loan Documents on behalf of the Borrower and each Guarantor, certified by the secretary or assistant secretary of such Borrower or Guarantor;           (vi) the Administrative Agent shall have received any changes to the Organizational Documents of the Borrower and each Guarantor since the Closing Date certified as true and correct by its secretary or assistant secretary;           (vii) the Administrative Agent shall have received any changes to the Operating Documents of the Borrower and each Guarantor since the Closing Date certified as of the Effective Date as true and correct by its secretary or assistant secretary;           (viii) the Administrative Agent shall have received certificates issued as of a recent date by the Secretaries of State of the respective jurisdictions of formation of the Borrower and each Guarantor as to the due existence and good standing of such Person;           (ix) the Administrative Agent shall have received a Borrowing Notice in respect of the Revolving Credit Loans and a borrowing notice in respect of the Term Loans in each case requested to be made on the First Amendment Effective Date in accordance with the Credit Agreement (after giving effect to this Amendment), and, if elected by the Borrower, Interest Rate Selection Notice; provided, that the Borrowing Notice for any Eurodollar Loans shall have been received at least three Business Days prior to the First Amendment Effective Date and shall, in the case of requested Term Loans that are Eurodollar Loans, include a funding indemnity side letter by the Borrower for the benefit of the Administrative Agent and each Term     3 Lender reasonably satisfactory to each thereof, and in case such notices and side letter are not so received by such time, the Borrower shall be deemed to have requested Base Rate Loans in lieu of such Eurodollar Loans.           (x) the Administrative Agent shall have received evidence that all fees payable by the Borrower on the Effective Date to the Administrative Agent, JPMorgan and the Lenders required pursuant to Section 5 herein have been paid in full, including the fees and expenses of counsel to the Administrative Agent to the extent invoiced three Business Days prior to or on the Effective Date (which may include amounts constituting reasonable estimates of such fees and expenses incurred or to be incurred in connection with the transaction; provided that no such estimate shall thereafter preclude the final settling of accounts as to such fees and expenses); and           (xi) the Administrative Agent shall have received evidence that (A) the Transaction shall have been consummated, (B) the sources and uses of funding for the Transaction shall be substantially consistent with the table attached to the Commitment Letter dated March 6, 2006 among the Borrower, JPMorgan and the Administrative Agent and the terms of such funding sources shall be substantially consistent with the terms thereof or otherwise reasonably satisfactory to JPMorgan and (C) all material governmental and third party approvals necessary in connection with the Transaction and the financing thereof shall have been obtained and there shall not exist any action, investigation, litigation or proceeding pending or threatened against the Borrower or any of its Subsidiaries in any court or before any arbitrator or governmental authority that (x) materially and adversely affects the Borrower and its Subsidiaries, taken as a whole, or (y) materially and adversely affects the Transaction, the financing thereof or any of the other transactions contemplated hereby or any other Loan Document or the ability of the Borrower and its Subsidiaries to perform their respective obligations under the Loan Documents.           (xii) the Administrative Agent shall have received (i) audited consolidated financial statements of the Borrower for the three most recent fiscal years and (ii) all other financial statements for completed or pending acquisitions that may be required under Regulation S-X of the Securities Act of 1933, as amended (“Regulation S-X”).           (xiii) the Administrative Agent shall have received a pro forma consolidated balance sheet of the Borrower as at the date of the most recent balance sheet delivered pursuant to the preceding paragraph and a pro forma statement of operations for the 12-month period ending on such date, in each case adjusted to give effect to the consummation of the Transaction and the financings contemplated hereby as if such transactions had occurred on such date or on the first day of such period, as applicable, prepared in accordance with Regulation S-X and consistent in all material respects with information previously provided by the Borrower.           (xiv) the Administrative Agent shall have received projections through 2010.           (xv) An indicative rating from both Moody’s and S&P with respect to the Term Facility shall have been given to the Lenders not later than 20 days prior to the Effective Date.           SECTION 5. Representations and Warranties. The Borrower hereby represents and warrants to the Administrative Agent and each Lender that (before and after giving effect to this Amendment):     4           (a) Each Loan Party has the power and authority to execute, deliver and perform this Amendment and the Acknowledgement and Consent (the “Amendment Documents”) to which it is a party and, in the case of the Borrower, to borrow under the Credit Agreement as amended by this Amendment (the “Amended Credit Agreement”). Each Loan Party has taken all necessary corporate or other action to authorize the execution, delivery and performance of the Amendment Documents to which it is a party and, in the case of the Borrower, to authorize the borrowings under the Amended Credit Agreement. No material consent, approval or authorization of or filing, registration or qualification with, any Governmental Authority or other authority or any other Person on the part of the Borrower or any Subsidiary is required as a condition to the execution, delivery, performance or consummation of the transactions contemplated by this Amendment or the Acknowledgement and Consent, except consents, approvals, filings, registrations or qualifications which have been obtained or effected, as the case may be and are in full force and effect. Each Amendment Document has been duly executed and delivered on behalf of each Loan Party that is a party thereto. Each Amendment Document constitutes a legal, valid and binding obligation of each Loan Party that is a party thereto, enforceable against each such Loan Party in accordance with its terms, except as enforceability may be similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).           (b) The execution, delivery and performance of the Amendment Documents will not violate any applicable law, rule or regulation or conflict with any material indenture, agreement or other instrument to which the Borrower is a party, or by which the properties or assets of the Borrower is bound and will not result in the creation or imposition of any Lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Borrower pursuant to any such agreement.           (c) Each of the representations and warranties made by any Loan Party herein or in the Loan Documents as amended by this Amendment is true and correct on and as of the Effective Date, as if made on and as of such date (except that any representation or warranty which by its terms is made as of an earlier date shall be true and correct as of such earlier date).           (d) There does not exist any Default or Event of Default.           SECTION 6. Payment of Expenses. The Borrower agrees to pay or reimburse the Administrative Agent for all of its reasonable and documented out-of-pocket costs and expenses incurred in connection with this Amendment, any other documents prepared in connection herewith and the transactions contemplated hereby, including, without limitation, the reasonable fees and disbursements of counsel to the Administrative Agent, but in each case only to the extent agreed upon in the Commitment Letter, dated March 6, 2006, between the Administrative Agent, JPMorgan and the Borrower.           SECTION 7. No Other Amendment or Waivers; Confirmation. Except as expressly provided hereby, all of the terms and provisions of the Credit Agreement, the Facility Guaranties and the other Loan Documents are and shall remain in full force and effect. The amendments contained herein shall not be construed as an amendment of any other provision of     5 the Credit Agreement, the Facility Guaranties or the other Loan Documents or for any purpose except as expressly set forth herein or a consent to any further or future action on the part of the Borrower that would require the waiver or consent of the Administrative Agent or the Lenders.           SECTION 8. GOVERNING LAW; MISCELLANEOUS. (a) THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.           (b) On and after the Effective Date, each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to the “Credit Agreement”, “thereunder”, “thereof”, or words of like import referring to the Credit Agreement shall mean and be a reference to the Amended Credit Agreement.           (c) This Amendment may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said instrument. A set of the copies of this Amendment and the Acknowledgement and Consent signed by all the parties shall be lodged with the Borrower and the Administrative Agent. This Amendment may be delivered by facsimile transmission of the relevant signature pages hereof.           (d) The Administrative Agent shall give notice to the Borrower promptly upon the occurrence of the “Effective Date.”           (e) The execution and delivery of this Amendment by any Lender shall be binding upon each of its successors and assigns (including assignees of its Loans in whole or in part prior to effectiveness hereof).     duly executed and delivered by their respective proper and duly authorized             AUTONATION, INC.       By:   /s/ James J. Teufel         Name:   James J. Teufel        Title:   Vice President & Treasurer        JPMORGAN CHASE BANK, N.A., as Administrative Agent and as Lender       By:   /s/ Thomas H. Kozlark         Name:   Thomas H. Kozlark        Title:   Vice President                              Name of Institution: Bank of America, N.A.       By:   /s/ M. Patricia Kay         Name:   M. Patricia Kay        Title:   Senior Vice President        Name of Institution: BNP PARIBAS       By:   /s/ Brad Ellis         Name:   Brad Ellis        Title:   Vice President              By:   /s/ Aurora Abella         Name:   Aurora Abella        Title:   Vice President        Name of Institution: Toyota Motor Credit Corporation       By:   /s/ P. Reid Boozer         Name:   P. Reid Boozer        Title:   National Accounts Manager        Name of Institution: Wachovia Bank, National Association       By:   /s/ Douglas T. Davis         Name:   Douglas T. Davis        Title:   Director        Name of Institution: Comerica Bank       By:   /s/ Joseph M. Davignon         Name:   Joseph M. Davignon        Title:   First Vice President        Name of Institution: SUNTRUST BANK       By:   /s/ Kimberly S. Evans         Name:   Kimberly S. Evans        Title:   Director                              Name of Institution: Sovereign Bank       By:   /s/ Stephen Delaney         Name:   Stephen Delaney        Title:   Vice President        Name of Institution: Sumitomo Mitsui Banking Corporation       By:   /s/ Paolo de Alessandrini         Name:   Paolo de Alessandrini        Title:   General Manager        Name of Institution: Wells Fargo Bank, N.A.       By:   /s/ William P. Schmechel         Name:   William P. Schmechel        Title:   Vice President        Name of Institution: Fifth Third Bank       By:   /s/ John A. Marian         Name:   John A. Marian        Title:   Vice President        Name of Institution: Union Bank of California, N.A.       By:   /s/ Christine Davis         Name:   Christine Davis        Title:   Vice President        Name of Institution: The Bank of New York       By:   /s/ David C. Siegel         Name:   David C. Siegel        Title:   Vice President                            Name of Institution: CALYON NEW YORK BRANCH       By:   /s/ Corey Billups         Name:   Corey Billups        Title:   Director              By:   /s/ Lee E. Greve         Name:   Lee E. Greve        Title:   Managing Director, Deputy Manager        Name of Institution: LaSalle Bank, N.A.       By:   /s/ Mark J. Nyland         Name:   Mark J. Nyland        Title:   Vice President        Name of Institution: Mizuho Corporate Bank, Ltd.       By:   /s/ Bertram Tang         Name:   Bertram Tang        Title:   Senior Vice President & Team Leader        Name of Institution: REGIONS BANK       By:   /s/ Thomas A. Conroy         Name:   Thomas A. Conroy        Title:   Senior Vice President        Name of Institution: E.Sun Commercial Bank, Ltd., Los Angeles Branch       By:   /s/ Teddy Mou         Name:   Teddy Mou        Title:   V.P. & Deputy General Manager                          Name of Institution: The Bank of East Asia, Ltd., New York Branch       By:   /s/ Stanley H. Kung         Name:   Stanley H. Kung        Title:   Senior Vice President & Chief Lending Officer              By:   /s/ Douglas Price         Name:   Douglas Price        Title:   Senior Vice President & Chief Credit Officer        Name of Institution: Bank of Taiwan, New York Agency       By:   /s/ Hung Chen         Name:   Hung Chen        Title:   AVP & Deputy General Manager        Name of Institution: Chiao Tung Bank Co., Ltd., New York Agency       By:   /s/ Chun-Kai Hu         Name:   Chun-Kai Hu        Title:   VP & Acting General Manager        Name of Institution: First Commercial Bank, New York Agency       By:   /s/ Bruce M.J. Ju         Name:   Bruce M.J. Ju        Title:   VP & General Manager        Name of Institution: Chang Hwa Commercial Bank Ltd., New York Branch       By:   /s/ Jim C.Y. Chen         Name:   Jim C.Y. Chen        Title:   VP & General Manager                              Name of Institution: Israel Discount Bank of New York       By:   /s/ David Keinan         Name:   David Keinan        Title:   Senior Vice President Regional Manager for Florida              By:   /s/ Dilian G. Schulz         Name:   Dilian G. Schulz        Title:   Senior Vice President                  EXECUTION COPY   FIVE-YEAR CREDIT AGREEMENT by and among AUTONATION, INC., as Borrower, as Administrative Agent and as Lender, and as Syndication Agent and as Lender, and WACHOVIA BANK, NATIONAL ASSOCIATION, SUNTRUST BANK and TOYOTA MOTOR CREDIT CORPORATION, as Documentation Agents and as Lenders, and THE LENDERS PARTY HERETO FROM TIME TO TIME July 14, 2005 As amended pursuant to the First Amendment, dated April 12, 2006 J.P. MORGAN SECURITIES INC.   BANC OF AMERICA SECURITIES LLC Co-Lead Arrangers and Joint Bookrunners       TABLE OF CONTENTS                       Page ARTICLE I               DEFINITIONS               1.1   Definitions     1   1.2   Rules of Interpretation     25   1.3   Accounting for Permitted Acquisitions     26   1.4   Accounting for Derivatives     26   1.5   Accounting and Financial Determinations     26                 ARTICLE II               THE LOANS               2.1   Term Commitments     27   2.2   Procedure for Term Loan Borrowing     27   2.3   Repayment of Term Loans     28   2.4   Revolving Credit Commitments     28   2.5   Competitive Bid Loans     30   2.6   Payment of Interest     34   2.7   Payment of Principal     35   2.8   Non-Conforming Payments     35   2.9   Pro Rata Payments     36   2.10   Reductions and Prepayment     36   2.11   Decrease in Amounts     37   2.12   Conversions and Elections of Subsequent Interest Periods     37   2.13   Fees     38   2.14   Deficiency Advances; Failure to Purchase Participations     39   2.15   Intraday Funding     39   2.16   Use of Proceeds     40   2.17   Swing Line     40   2.18   Increased Amounts     42                 ARTICLE III               LETTERS OF CREDIT               3.1   Letters of Credit     44   3.2   Reimbursement and Participations     44   3.3   Governmental Action     47   3.4   Letter of Credit Fee     48   3.5   Administrative Fees     48    i                           Page ARTICLE IV               CHANGE IN CIRCUMSTANCES               4.1   Increased Cost and Reduced Return     48   4.2   Limitation on Types of Loans     50   4.3   Illegality     50   4.4   Treatment of Affected Loans     51   4.5   Compensation     51   4.6   Taxes     52   4.7   Replacement Lenders     54                 ARTICLE V               CONDITIONS TO MAKING LOANS AND ISSUING LETTERS OF CREDIT               5.1   Conditions of Initial Advance     55   5.2   Conditions of Loans     56   5.3   Supplements to Schedules     57                 ARTICLE VI               REPRESENTATIONS AND WARRANTIES               6.1   Representations and Warranties     58                 ARTICLE VII               AFFIRMATIVE COVENANTS               7.1   Financial Reports, Etc.     63   7.2   Maintain Properties     65   7.3   Existence, Qualification, Etc.     65   7.4   Regulations and Taxes     65   7.5   Insurance     65   7.6   True Books     65   7.7   Right of Inspection     65   7.8   Observe all Laws     66   7.9   Governmental Licenses     66   7.10   Covenants Extending to Subsidiaries     66   7.11   Officer’s Knowledge of Default     66   7.12   Suits or Other Proceedings     66   7.13   Notice of Discharge of Hazardous Material or Environmental Complaint     66   7.14   Environmental Compliance     67   7.15   Employee Benefit Plans     67   7.16   Continued Operations     68   7.17   Use of Proceeds     68    ii                           Page 7.18   New Subsidiaries     68                 ARTICLE VIII               NEGATIVE COVENANTS               8.1   Financial Covenants     68   8.2   Indebtedness     69   8.3   Liens     69   8.4   Merger, Consolidation or Fundamental Changes     70   8.5   Transactions with Affiliates     71   8.6   Compliance with ERISA, the Code and Foreign Benefit Laws     71   8.7   Fiscal Year     72   8.8   Change in Control     72   8.9   Limitations on Upstreaming     72   8.10   Subsidiary Guaranties     72   8.11   Manufacturer Consents     72                 ARTICLE IX               EVENTS OF DEFAULT AND ACCELERATION               9.1   Events of Default     73   9.2   Administrative Agent to Act     75   9.3   Cumulative Rights     75   9.4   No Waiver     76   9.5   Allocation of Proceeds     76                 ARTICLE X               THE ADMINISTRATIVE AGENT               10.1   Appointment     76   10.2   Delegation of Duties     77   10.3   Exculpatory Provisions     77   10.4   Reliance by Administrative Agent     77   10.5   Notice of Default     78   10.6   Non-Reliance on Agents and Other Lenders     78   10.7   Indemnification     79   10.8   Agent in its Individual Capacity     79   10.9   Successor Administrative Agent     79   10.10   Other Agents, etc.     80                 ARTICLE XI               MISCELLANEOUS               11.1   Assignments and Participations     80    iii                           Page 11.2   Notices     83   11.3   Right of Set-off; Adjustments     84   11.4   Survival     85   11.5   Expenses     85   11.6   Amendments and Waivers     85   11.7   Counterparts; Facsimile Signatures     86   11.8   Termination     87   11.9   Indemnification; Limitation of Liability     87   11.10   Severability     88   11.11   Entire Agreement     88   11.12   Agreement Controls     88   11.13   Usury Savings Clause     88   11.14   Governing Law; Waiver of Jury Trial     89   11.15   Confidentiality     90   11.16   Releases of Facility Guarantees     91   11.17   MANUFACTURER CONSENTS     91   11.18   USA Patriot Act Notice     91         EXHIBIT A   Commitment Percentages EXHIBIT B EXHIBIT C   Notice of Appointment (or Revocation) of Authorized Representative EXHIBIT D-1   Form of Borrowing Notice—Revolving Credit Facility EXHIBIT D-2   Form of Borrowing Notice — Term Facility EXHIBIT D-3   Form of Borrowing Notice—Swing Line EXHIBIT E   Compliance Certificate EXHIBIT F   Form of Interest Rate Selection Notice EXHIBIT G   Form of Competitive Bid Quote Request EXHIBIT H   Form of Competitive Bid Quote EXHIBIT I-1   Form of Opinion of Borrower’s In-House Counsel EXHIBIT I-2   Form of Opinion of Borrower’s Special Counsel EXHIBIT J   Form of Facility Guaranty EXHIBIT K   Form of Commitment Increase Agreement EXHIBIT L   Form of Added Lender Agreement   Existing Issuing Banks and Existing Letters of Credit   Manufacturer Consents   Existing Vehicle Lenders Schedule 6.1(c)   Subsidiaries and Investments in Other Persons Schedule 6.1(g)   Litigation Schedule 6.1(k)   Consenting Manufacturers Schedule 6.1(l)   ERISA Schedule 6.1(n)   Environmental Issues Schedule 7.5   Insurance Schedule 8.3   Existing Liens Schedule 8.9   Limitations on Upstreaming  iv     FIVE-YEAR CREDIT AGREEMENT      THIS FIVE-YEAR CREDIT AGREEMENT, dated as of July 14, 2005 (the “Agreement”), is made by and among:      AUTONATION, INC., a Delaware corporation (the “Borrower”); and      JPMORGAN CHASE BANK, N.A., a national banking association organized and existing under the laws of the United States of America (“JPMorgan Chase Bank”), each other lender signatory hereto on the Closing Date, each Person which may hereafter execute and deliver an Assignment and Assumption with respect to this Agreement pursuant to Section 11.1 and each Person which hereafter becomes an Added Lender pursuant to Section 2.18 (hereinafter JPMorgan Chase Bank and such other lenders and Added Lenders may be referred to individually as a “Lender” or collectively as the “Lenders”); and      JPMORGAN CHASE BANK, N.A., in its capacity as administrative agent for the Lenders (in such capacity, the “Administrative Agent”);      WHEREAS, the Borrower has requested that the Lenders make available a revolving credit facility of $600,000,000, with a sublimit of $200,000,000 for the issuance of standby letters of credit and a sublimit of $25,000,000 for swing line loans; and      WHEREAS, the Borrower has requested that the Lenders make available a term loan facility of $600,000,000; and      WHEREAS, the Lenders are willing to make such revolving credit facility and term loan facility available to the Borrower upon the terms and conditions set forth herein;      NOW, THEREFORE, the Borrower, the Lenders and the Administrative Agent ARTICLE I Definitions      1.1 Definitions. For the purposes of this Agreement, in addition to the definitions set forth above, the following terms shall have the respective      “Absolute Rate” has the meaning assigned to such term in Section 2.5(c)(ii)(C) hereof.      “Acquisition” means the acquisition of (i) a controlling equity interest in another Person (including the purchase of an option, warrant or convertible or similar type security to acquire such a controlling interest at the time it is exercised by the holder thereof), whether by purchase of such equity interest or upon exercise of an option or warrant for, or conversion of securities into, such equity interest, or (ii) assets of another   2 Person which constitute all or substantially all of the assets of such Person or of a line or lines of business conducted by such Person.      “Acquisition Adjustments” means with respect to any Permitted Acquisition the adjustments provided for in Section 1.3.      “Added Commitments” has the meaning assigned to such term in Section 2.18 hereof.      “Added Lender” has the meaning assigned to such term in Section 2.18 hereof.      “Adjusted Consolidated EBITDA” means Consolidated EBITDA minus any Consolidated Interest Expense related to Vehicle Secured Indebtedness.      “Administrative Agent” has the meaning assigned to such term in the preamble hereto.      “Advance” means a borrowing under (i) the Revolving Credit Facility, consisting of the aggregate principal amount of a Base Rate Loan or a Eurodollar Loan, as the case may be, (ii) the Swing Line consisting of a Base Rate Loan or a Swing Line Loan bearing interest at a rate equal to the Base Rate plus the Applicable Base Rate Margin, (iii) the Competitive Bid Facility consisting of a Competitive Bid Loan or (iv) the Term Facility, consisting of the aggregate principal amount of a Base Rate Loan or a Eurodollar Loan, as the case may be.      “Affiliate” means, with respect to any Person, any other Person (i) which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with such Person; (ii) which beneficially owns or holds 5% or more of any class of the outstanding Voting Securities of such Person; or (iii) 5% or more of any class of the outstanding Voting Securities of which is beneficially owned or held by such Person. The term “control” means the possession, directly or indirectly, of the power to whether through ownership of voting stock, by contract or otherwise.      “Agent-Related Persons” means the Administrative Agent (including any successor administrative agent), together with its Affiliates (including, in the case of JPMorgan Chase Bank in its capacity as the Administrative Agent, J.P. Morgan Securities Inc.), and the officers, directors, employees and attorneys-in-fact of such Persons and Affiliates.      “Agents” means the collective reference to the Administrative Agent and the Syndication Agent and Documentation Agents referred to on the cover page hereof. hereto, as amended, restated, supplemented or otherwise modified from time to time.      “Aggregate Exposure” means, with respect to any Lender at any time, an amount equal to (a) until the First Amendment Effective Date, the aggregate amount of such Lender’s Revolving Commitments at such time and (b) thereafter, the sum of (i) the aggregate then unpaid principal amount of such   3 Lender’s Term Loans and (ii) the amount of such Lender’s Revolving Credit Commitment then in effect or, if the Revolving Credit Commitments have been terminated, the amount of such Lender’s Outstanding Revolving Credit Obligations then in effect.      “Aggregate Exposure Percentage” means, with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time to the Aggregate Exposure of all Lenders at such time.      “Applicable Base Rate Margin” means, for any Facility, that number of basis points per annum set forth in the Pricing Grid under the heading “Applicable Base Rate Margin” with respect to such Facility which shall be based upon the Borrower’s Rating as set forth in the Pricing Grid.      “Applicable Eurodollar Margin” means, for any Facility, that number of basis points per annum set forth on the Pricing Grid under the heading “Applicable Eurodollar Margin” for such Facility which shall be based upon the Borrower’s Rating as set forth on the Pricing Grid.      “Applicable Facility Fee” for each Revolving Credit Lender means (a) that number of basis points per annum set forth on the Pricing Grid under the heading “Applicable Facility Fee”, which shall be based upon the Borrower’s Rating as set forth on the Pricing Grid, multiplied times (b) such Lender’s Revolving Credit Commitment.      “Applicable Lending Office” means, for each Lender and for each Type of Loan, the “Lending Office” of such Lender (or of an Affiliate of such Lender) designated for such Type of Loan on the signature pages hereof or such other office of such Lender (or an Affiliate of such Lender) as such Lender may from time to time specify to the Administrative Agent and the Borrower by written notice in accordance with the terms hereof as the office by which its Loans of such Type are to be made and maintained.      “Applicable Margin” means the Applicable Base Rate Margin or Applicable Eurodollar Margin, as applicable.      “Applications and Agreements for Letters of Credit” means, collectively, the Applications and Agreements for Letters of Credit executed by the Borrower from time to time and delivered to the applicable Issuing Bank to support the issuance of Letters of Credit.      “Assignment and Assumption” shall mean an Assignment and Assumption substantially in the form of Exhibit B (with blanks appropriately filled in) delivered to the Administrative Agent in connection with an assignment of a Lender’s interest under this Agreement pursuant to Section 11.1.      “Authorized Representative” means any of the Chairman, Vice Chairmen, President, Executive Vice Presidents or Vice Presidents of the Borrower and, with respect to financial matters, the Treasurer or Chief Financial Officer of the Borrower or any other   4 person expressly designated by the Board of Directors of the Borrower (or the appropriate committee thereof) as an Authorized Representative of the Borrower, as set forth from time to time in a certificate in the form attached hereto as Exhibit C.      “Automobile Retailing Activities” means new and used vehicle retailing, renting, leasing, financing, servicing, repairing and related or complementary activities, including but not limited to the selling of finance and insurance related products and other aftermarket parts and accessories.      “Base Rate” means the sum of:      (a) the greater of (i) the sum of the Federal Funds Rate plus one-half of one percent (1/2%), or (ii) the Prime Rate      plus      (b) the Applicable Base Rate Margin.      “Base Rate Loan” means a Loan for which the rate of interest is determined by reference to the Base Rate.      “Base Rate Refunding Loan” means a Base Rate Revolving Credit Loan or Swing Line Loan made either to (i) satisfy Reimbursement Obligations arising from a drawing under a Letter of Credit or (ii) pay JPMorgan Chase Bank in respect of Swing Line Outstandings.      “Board” means the Board of Governors of the Federal Reserve System (or any successor body).      “Borrower” has the meaning assigned to such term in the preamble hereto.      “Borrowing Notice” means the notice delivered by an Authorized Representative in connection with an Advance under the Revolving Credit Facility, the Term Facility or the Swing Line, in the forms attached hereto as Exhibits D-1, D-2 and D-3 respectively.      “Business Day” means (i) with respect to any Eurodollar Loan or any Competitive Bid Loan at the Eurodollar Competitive Rate, any day which is a Business Day, as described below, and on which the relevant international financial markets are open for the transaction of business contemplated by this Agreement in New York City and in the relevant interbank eurodollar market, and (ii) with respect to any other Loan and for any other purposes hereof, any day which is not a Saturday, Sunday or a day on which banks in the State of New York are authorized or obligated by law, executive order or governmental decree to be closed.      “Capital Leases” means all leases which have been or should be capitalized in accordance with GAAP (including Statement No. 13 of the Financial Accounting   5      “Change in Control” means (i) if any Person or group of Persons acting in concert, other than the Permitted Investors, shall own or control, directly or indirectly, more than 35% of the outstanding securities (on a fully diluted basis and taking into account any Voting Securities or contract rights exercisable, exchangeable or convertible into equity securities) of the Borrower having voting rights in the election of directors; or (ii) the replacement or resignation (other than by reason of death, illness or incapacity), within any two-year period, of a majority of the members of the Board of Directors of the Borrower (the “Board”) or a change in the size of the Board, within any two-year period, which results in members of the Board who were in office at the beginning of such two-year period constituting less than a majority of the members of the Board (unless such replacement, resignation or change in size of the Board shall have been effected or initiated by a majority of the members of the Board in office at the beginning of such two-year period or whose Board nomination or appointment were previously so approved).      “Closing Date” means the date as of which this Agreement is executed by the Borrower, the Lenders and the Administrative Agent and on which the conditions set forth in Section 5.1 have been satisfied or waived.      “Code” means the Internal Revenue Code of 1986, as amended, any successor provision or provisions and any regulations promulgated thereunder.      “Commitment” means, as to any Lender, the sum of the Revolving Credit Commitment and the Term Commitment of such Lender.      “Competitive Bid Borrowing” has the meaning assigned to such term in Section 2.5(b) hereof.      “Competitive Bid Facility” means the facility described in Section 2.5 hereof providing for Competitive Bid Loans to the Borrower.      “Competitive Bid Loans” means the Loans bearing interest at an Absolute Rate or a Eurodollar Competitive Rate provided for in Section 2.5 hereof.      “Competitive Bid Quote” means an offer in accordance with Section 2.5 hereof by a Revolving Credit Lender to make a Competitive Bid Loan with one single specified interest rate.      “Competitive Bid Quote Request” has the meaning assigned to such term in      “Compliance Certificate” means a certificate in the form of Exhibit E furnished to the Administrative Agent and Lenders by the Borrower pursuant to Section 7.1 hereof.      “Consenting Manufacturers” means the Manufacturers listed on Schedule 6.1(l).      “Consistent Basis” in reference to the application of GAAP means the accounting principles (including interpretations of GAAP) observed in the period referred to are   6 comparable in all material respects to those observed in the preparation of the audited financial statements of the Borrower referred to in Section 6.1(e)(i) hereof.      “Consolidated Capitalization Ratio” means the ratio of (a) the sum of Consolidated Funded Indebtedness plus Vehicle Secured Indebtedness to (b) the sum of Consolidated Total Capitalization plus Vehicle Secured Indebtedness.      “Consolidated EBITDA” means, with respect to the Borrower and its Subsidiaries for any period of computation thereof during such period, the sum of, without duplication, (i) Consolidated Net Income, plus (ii) Consolidated Interest Expense during such period, plus (iii) taxes on income during such period, plus (iv) amortization during such period, plus (v) depreciation during such period (with the exclusion of any depreciation related to Vehicles), plus (vi) non-cash charges arising from share-based payments (as defined in accordance with GAAP) to employees and directors, determined on a consolidated basis in accordance with GAAP applied on a Consistent Basis subject to the Acquisition Adjustments.      “Consolidated Funded Indebtedness” means Funded Indebtedness of the Borrower and its Subsidiaries, determined on a consolidated basis in accordance with GAAP applied on a Consistent Basis.      “Consolidated Interest Expense” means, with respect to any period of computation thereof, the gross interest expense of the Borrower and its Subsidiaries, including without limitation (i) the amortization of debt discounts, (ii) the amortization of all fees payable in connection with the incurrence of Indebtedness to the extent included in interest expense and (iii) the portion of any liabilities incurred in connection with Capital Leases allocable to interest expense, all determined on a consolidated basis in accordance with GAAP applied on a Consistent Basis, subject to the Acquisition Adjustments.      “Consolidated Leverage Ratio” means, as at the date of computation thereof, the ratio of Consolidated Funded Indebtedness (determined as at such date) to Adjusted Consolidated EBITDA (for the Four-Quarter Period ending on (or most recently ended prior to) such date).      “Consolidated Net Income” means, for any period of computation thereof, the net income from continuing operations of the Borrower and its Subsidiaries, but excluding all extraordinary gains or losses, all as determined in accordance with GAAP applied on a Consistent Basis, subject to Acquisition Adjustments.      “Consolidated Shareholders’ Equity” means at any time as of which the amount thereof is to be determined, the sum of the following in respect of the Borrower and its Subsidiaries (determined on a consolidated basis and excluding intercompany items among the Borrower and its Subsidiaries and any upward adjustment after December 31, 2004 due to revaluation of assets): (i) the amount of issued and outstanding share capital, plus (ii) the amount of additional paid-in capital and retained income (or, in the case of a deficit, minus the amount of such deficit), minus (iii) the amount of any foreign currency   7 translation adjustment which is included in the equity section of the consolidated balance sheet (whether positive or negative), minus (iv) the absolute value of any treasury stock and the absolute value of any stock subscription receivables, as determined in accordance with GAAP applied on a Consistent Basis.      “Consolidated Tangible Assets” means Consolidated Total Assets minus the book value of all Intangible Assets of the Borrower and its Subsidiaries.      “Consolidated Tangible Unencumbered Assets” means Consolidated Tangible Assets excluding assets encumbered by a Lien (other than a Lien permitted by Section 8.3(ii), (iii), (v), (viii) or (x)).      “Consolidated Total Assets” means assets of the Borrower and its Subsidiaries as determined in accordance with GAAP applied on a Consistent Basis.      “Consolidated Total Capitalization” means, as at any time as of which the amount thereof is to be determined, the sum of Consolidated Funded Indebtedness plus Consolidated Shareholders’ Equity.      “Contingent Obligation” of any Person means all contingent liabilities required (or which, upon the creation or incurring thereof, would be required) to be included in the consolidated financial statements (including footnotes) of such Person in accordance with GAAP applied on a Consistent Basis, including Statement No. 5 of the Financial Accounting Standards Board, and any Guaranty Obligation.      With respect to Contingent Obligations (such as litigation and pension plan liabilities), such liabilities shall be computed at the amount which, in light of all the facts and circumstances existing at the time, represent the present value of the amount which can reasonably be expected to become an actual or matured liability.      “Continue”, “Continuation”, and “Continued” shall refer to the continuation pursuant to Section 2.12 hereof of a Loan of one Type as a Loan of the same Type from one Interest Period to the next Interest Period.      “Control Investment Affiliate” means, as to any Person, any other Person that (a) directly or indirectly, is in control of, is controlled by, or is under common control with, such Person and (b) is organized by such Person primarily for the purpose of making equity or debt investments in one or more companies. For purposes of this definition, “control” of a Person means the power, directly or indirectly, to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.      “Convert”, “Conversion”, and “Converted” shall refer to a conversion pursuant to Section 2.12 of one Type of Loan into another Type of Loan.      “Default” means any event or condition which, with the giving or receipt of notice or lapse of time or both, would constitute an Event of Default hereunder.   8      “Default Rate” means an interest rate equal to (a) with respect to a Base Rate Loan under the Revolving Credit Facility, the Base Rate otherwise applicable to such Loan plus 2% per annum; (b) with respect to a Eurodollar Loan under the Revolving Credit Facility, the Eurodollar Rate otherwise applicable to such Loan plus 2% per annum; (c) with respect to a Base Rate Loan under the Term Facility, the Base Rate otherwise applicable to such Loan plus 2% per annum; (d) with respect to a Eurodollar Loan under the Term Facility, the Eurodollar Rate otherwise applicable to such Loan plus 2% per annum; and (e) with respect to a Competitive Bid Loan under the Revolving Credit Facility, the Absolute Rate or Eurodollar Competitive Rate otherwise applicable to such Loan plus 2% per annum; in each case to the fullest extent permitted by applicable law.      “Dollars” and the symbol “$” means dollars constituting legal tender for the payment of public and private debts in the United States of America.      “Eligible Special Purpose Entity” means any Person which is or is not a Subsidiary of the Borrower which has been formed by or for the benefit of the Borrower or any Subsidiary for the purpose of (i) financing or refinancing, leasing, selling or securitizing Vehicles or related receivables and which finances, refinances or securitizes Vehicles or related receivables of, leases Vehicles to or purchases Vehicles or related receivables from the Borrower or any Subsidiary; or (ii) financing or refinancing consumer receivables, leases, loans or retail installment contracts; provided that AutoNation Financial Services Corp. shall not be deemed an Eligible Special Purpose Entity.      “Employee Benefit Plan” means (i) any employee benefit plan, including any Pension Plan, within the meaning of Section 3(3) of ERISA which (A) is maintained for employees of the Borrower or any of its ERISA Affiliates, or any Subsidiary or is assumed by the Borrower or any of its ERISA Affiliates, or any Subsidiary in connection with any Acquisition or (B) has at any time within the last six (6) years been maintained for the employees of the Borrower, any current or former ERISA Affiliate, or any Subsidiary and (ii) any plan, arrangement, understanding or scheme maintained by the Borrower or any Subsidiary that provides retirement, deferred compensation, employee or retiree medical or life insurance, severance benefits or any other benefit covering any employee or former employee and which is administered under any Foreign Benefit Law or regulated by any Governmental Authority other than the United States of America.      “Environmental Laws” means, collectively, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, the Superfund Amendments and Reauthorization Act of 1986, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, as amended, the Clean Air Act, as amended, the Clean Water Act, as amended, any other “Superfund” or “Superlien” law or any other applicable statute, law, ordinance, code, rule, regulation, order or decree, of the United States or any foreign nation or any province, territory, state, protectorate or other political subdivision thereof, regulating, relating to, or imposing liability or standards of conduct concerning, any hazardous, toxic or dangerous waste, substance or material.   9      “ERISA” means, at any date, the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder, all as the same shall be in effect at such date.      “ERISA Affiliate”, as applied to the Borrower, means any Person or trade or business which is a member of a group which is under common control with the Borrower, who together with the Borrower, is treated as a single employer within the meaning of Section 414(b) and (c) of the Code.      “Eurodollar Competitive Rate” means, for the Interest Period for any Competitive Bid Loan at a Eurodollar Competitive Rate, the rate of interest per annum determined pursuant to the following formula:                           Interbank Offered Rate                           Eurodollar       1 — Reserve Requirement   + or -   a margin Competitive   =   applicable to such         Rate       Competitive Bid Loan              “Eurodollar Loan” or “Eurodollar Rate Loan” means a Loan for which the rate of interest is determined by reference to the Eurodollar Rate.      “Eurodollar Rate” means, for the Interest Period for any Eurodollar Loan, the rate of interest per annum determined pursuant to the following formula:                           Interbank Offered Rate                           Eurodollar       1 — Reserve Requirement       Applicable Rate =       applicable to such   +   Eurodollar         Eurodollar Loan       Margin      “Event of Default” means any of the occurrences set forth as such in Section 9.1 hereof, provided that any requirement for notice or lapse of time, or both, has been satisfied.      “Excluded Subsidiaries” means, collectively, (a) all Eligible Special Purpose Entities, (b) each Subsidiary organized solely for the purpose of engaging in the insurance business, (c) Rosecrans Holdings, L.L.C. and Auto By Internet, Inc. and (d) any Subsidiary organized or incorporated outside of the United States.      “Executive Officer” means the President, Chief Executive Officer, Treasurer, Chief Financial Officer or General Counsel of the Borrower.      “Existing Issuing Banks” means those financial institutions which have issued the Existing Letters of Credit, as described on Schedule 1.1(a) attached hereto.   10      “Existing Letters of Credit” means those Letters of Credit issued by the Existing Issuing Banks, which are outstanding on the Closing Date and which are described in Schedule 1.1 (a) attached hereto.      “Existing Loan Documents” means, collectively, (i) the Multi-Year Credit Agreement, dated as of August 10, 2001, among the Borrower, the lenders party thereto and certain other parties and the Amended and Restated 364 Day Credit Agreement, dated as of August 6, 2004, among the Borrower, the lenders party thereto and certain other parties (collectively, the “Existing Credit Agreements”), and (ii) all instruments, documents and agreements executed and delivered or issued in connection with the Existing Credit Agreements, as any of such documents have been amended, supplemented or otherwise modified.      “Existing Vehicle Lenders” means those financial institutions listed on Schedule 1.1(c).      “Existing Vehicle Secured Indebtedness” means Indebtedness arising under floorplan arrangements with the Existing Vehicle Lenders described on      “Facility” means each of the Revolving Credit Facility and the Term Facility, as applicable.      “Facility Guaranty” means each Guaranty Agreement between one or more Guarantors and the Administrative Agent for the benefit of the Administrative Agent and the Lenders, delivered as of the Closing Date and otherwise pursuant to Section 7.18, as the same may be amended, modified or supplemented.      “Facility Termination Date” means such date as all of the following shall have occurred: (a) termination of the Revolving Credit Facility, the Term Facility, the Letter of Credit Facility, the Competitive Bid Facility and the Swing Line and payment in full of all Revolving Credit Outstandings, all Term Loan Outstandings, the outstanding principal of all Competitive Bid Loans, all Swing Line Outstandings and, except as provided in clause (b), all Letter of Credit Outstandings, together with all accrued and unpaid interest and fees thereon, (b) the undrawn portion of Letters of Credit and all letter of credit fees relating thereto accruing after such date to the respective expiry dates of the Letters of Credit (which fees shall be payable solely for the account of the applicable Issuing Bank and shall be computed based on interest rates and the Applicable Eurodollar Margin then in effect) shall be fully cash collateralized in a manner consistent with the terms of Section 9.1(B) or otherwise provided for pursuant to arrangements satisfactory to the applicable Issuing Bank; and (c) the Borrower shall have fully, finally and irrevocably paid and satisfied in full all other Obligations then due and owing (except for Obligations consisting of continuing indemnities and other contingent Obligations of the Borrower or any Guarantor that may be owing to any Agent-Related Person or any Lender pursuant to the Loan Documents that expressly survive termination of this Agreement).      “FASB 133” means Statement of Financial Accounting Standards No. 133.   11      “FASB 142” means Statement of Financial Accounting Standards No. 142.      “Federal Funds Rate” means, for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next succeeding published for any day that is a Business Day, the average of the quotations for the day of such transactions received by JPMorgan Chase Bank from three federal funds brokers of recognized standing selected by it.      “Fiscal Year” means the period of the Borrower beginning on the first day of January of each calendar year and ending on December 31 of such calendar year.      “First Amendment” means the First Amendment, dated as of April 12, 2006, to this Agreement.      “First Amendment Documents” means the First Amendment and the Acknowledgment and Consent executed by certain Subsidiaries in accordance with the First Amendment.      “First Amendment Effective Date” means the Effective Date as defined in Section 2 of the First Amendment.      “Foreign Benefit Law” means any applicable statute, law, ordinance, code, rule, regulation, order or decree of any foreign nation or any province, state, territory, protectorate or other political subdivision thereof regulating, relating to, or imposing liability or standards of conduct concerning, any Employee Benefit Plan.      “Four-Quarter Period” means a period of four full consecutive fiscal quarterly periods, taken together as one accounting period.      “Funded Indebtedness” means, with respect to the Borrower and its Subsidiaries, without duplication, all indebtedness in respect of money borrowed, including without limitation all Capital Leases and the deferred purchase price of any property or asset, evidenced by a promissory note, bond or similar written obligation for the payment of money (including, but not limited to, conditional sales or similar title retention agreements), all determined in accordance with GAAP applied on a Consistent Basis, and all undrawn amounts of letters of credit, Guaranty Obligations (excluding Guaranty Obligations with respect to obligations of Subsidiaries that are not Funded Indebtedness), Synthetic Lease Obligations and any reimbursement obligations under letters of credit, provided, Vehicle Secured Indebtedness and Vehicle Receivables Indebtedness shall be excluded from the calculation of Funded Indebtedness.      “GAAP” means those principles of accounting set forth in pronouncements of the Financial Accounting Standards Board, the American Institute of Certified Public Accountants or which have other substantial authoritative support and are applicable in the circumstances as of the date of a report, as such principles are from time to time supplemented and amended.   12      “Government Securities” means direct obligations of, or obligations the timely payment of principal and interest on which are fully and unconditionally guaranteed by, the United States of America.      “Governmental Authority” shall mean any Federal, state, municipal, national or other governmental department, commission, board, bureau, agency or instrumentality or political subdivision thereof or any entity or officer exercising executive, legislative or judicial, regulatory or administrative functions of or pertaining to any government, any court or any arbitrator, in each case whether a state of the United States, the United States or foreign nation, state, province or other governmental instrumentality.      “Guarantors” means, at any date, the Subsidiaries which are required to be parties to a Facility Guaranty at such date.      “Guaranty Obligation” means, as to any Person, any (a) guaranty by such Person of Indebtedness of, or other obligation payable by, any other Person or (b) assurance, agreement, letter of responsibility, letter of awareness, undertaking or arrangement given by such Person to an obligee of any other Person with respect to the payment of an obligation by, or the financial condition of, such other Person, whether direct or indirect or contingent, including any purchase or repurchase agreement covering such obligation or any collateral security therefor, any agreement to provide funds (by means of loans, capital contributions or otherwise) to such other Person, any agreement to support the solvency or level of any balance sheet item of such other Person or any “keep-well” or other arrangement of whatever nature given for the purpose of assuring or holding harmless such obligee against loss with respect to any obligation of such other Person; provided, however, that the term Guaranty Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guaranty Obligation shall be computed at the amount which, in the light of all facts and circumstances existing at the time, represents the present value of the amount which can reasonably be expected to become an actual or matured liability.      “Hazardous Material” means and includes any pollutant, contaminant, or hazardous, toxic or dangerous waste, substance or material (including without limitation petroleum products, asbestos-containing materials and lead), the generation, handling, storage, transportation, disposal, treatment, release, discharge or emission of which is subject to any Environmental Law.      “Increased Commitment Date” has the meaning assigned to such term in Section 2.18 hereof.      “Increasing Lender” has the meaning assigned to such term in Section 2.18 hereof.      “Indebtedness” means with respect to any Person, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, including all Funded Indebtedness, all Vehicle Secured Indebtedness, all Vehicle Receivables Indebtedness, and all Rate Hedging Obligations (but excluding any   13 premiums, fees and deposits received in the ordinary course of business), (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (d) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable or other like obligations incurred in the ordinary course of business), (e) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (f) all Guaranty Obligations of such Person with respect to Indebtedness of others, (g) all Capital Lease obligations of such Person, (h) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and (i) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances.      “Indemnified Liabilities” has the meaning therefor provided in Section 11.9.      “Intangible Assets” means all assets of the Borrower and its Subsidiaries which would be treated as intangible assets, such as (without limitation) goodwill (whether representing the excess of cost over book value of assets acquired or otherwise), capitalized debt cost and expenses, unamortized debt discount and expense, consignment inventory rights, patents, trademarks, trade names, copyrights, franchises and licenses, all as determined in accordance with GAAP applied on a Consistent Basis.      “Interbank Offered Rate” means, with respect to any Eurodollar Rate Loan or any Competitive Bid Loan at a Eurodollar Competitive Rate, with respect to each day during each Interest Period pertaining thereto, the rate per annum determined on the basis of the rate for deposits in Dollars for a period equal to such Interest Period commencing on the first day of such Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M., London time, two Business Days prior to the beginning of such Interest Period. In the event that such rate does not appear on Page 3750 of the Telerate screen (or otherwise on such screen), the “Interbank Offered Rate” shall be determined by reference to such other comparable publicly available service for displaying eurodollar rates as may be selected by the Administrative Agent or, in the absence of such availability, by reference to the rate at which the Administrative Agent is offered Dollar deposits at or about 11:00 A.M., New York City time, two Business Days prior to the beginning of such Interest Period in the interbank eurodollar market where its eurodollar and foreign currency and exchange operations are then being conducted for delivery on the first day of such Interest Period for the number of days comprised therein.      “Interest Period” (a) for each Eurodollar Loan means a period commencing on the date such Eurodollar Loan is made or Converted or Continued and each subsequent period commencing on the last day of the immediately preceding Interest Period for such Eurodollar Loan, and ending, at the Borrower’s option, on the date one, three or six months thereafter or, subject to market availability to all Lenders, one week, two months or twelve months thereafter, as notified to the Administrative Agent by the Authorized Representative three (3) Business Days prior to the beginning of such Interest Period; provided, that,   14      (i) if the Authorized Representative fails to notify the Administrative Agent of the length of an Interest Period three (3) Business Days prior to the first day of such Interest Period, the Loan for which such Interest Period was to be determined shall be deemed to be a Base Rate Loan bearing interest at the Base Rate, as of the first day thereof;      (ii) if an Interest Period for a Eurodollar Loan would end on a day which is not a Business Day such Interest Period shall be extended to the next Business Day (unless such extension would cause the applicable Interest Period to end in the succeeding calendar month, in which case such Interest Period shall end on the next preceding Business Day); and      (iii) on any day, with respect to all Revolving Credit Loans, Term Loans and Competitive Bid Loans, there shall not be in effect (x) more than ten (10) Interest Periods, or (y) more than one (1) Interest Period having a term of one (1) week;      (b) for each Competitive Bid Loan at an Absolute Rate means the period commencing on the date of such Loan and ending on such date as may be mutually agreed upon by the Borrower and the Lender or Lenders making such Competitive Bid Loan or Loans, as the case may be, comprising such Competitive Bid Loan; provided that no Interest Period for a Competitive Bid Loan at an Absolute Rate shall be for a period of less than seven (7) or greater than 90 days; and      (c) for each Competitive Bid Loan at a Eurodollar Competitive Rate means the period commencing on the date such Competitive Bid Loan is made and ending, at the Borrower’s option, on the date one week or one, two, three, six or (to the extent available) twelve months thereafter as notified by the Borrower to such Lender by the Authorized Representative three (3) Business Days prior to the beginning of such Interest Period; provided that if an Interest Period for such Loan would end on a day which is not a Business Day, such Interest Period shall be extended to the next Business Day (unless such extension would cause the applicable Interest Period to end in the succeeding calendar month, in which case such Interest Period shall end in the next preceding Business Day).      “Interest Rate Selection Notice” means the written notice delivered by an Authorized Representative in connection with the election of a subsequent Interest Period for any Eurodollar Loan or Competitive Bid Loan bearing interest at a Eurodollar Competitive Rate or the Conversion of any Eurodollar Rate Loan or Competitive Bid Loan bearing interest at a Eurodollar Competitive Rate into a Base Rate Loan or the Conversion of any Base Rate Loan into a Eurodollar Rate Loan or Competitive Bid Loan bearing interest at a Eurodollar Competitive Rate, in the form of Exhibit F.      “Issuing Banks” means the Lenders who agree from time to time (upon the request of Borrower) to issue (provided that no Lender shall be obligated to do so) Letters of Credit (including the Existing Issuing Banks) in accordance with Section 3.1 and “Issuing Bank” means any one of such Issuing Banks. On any date of determination, no   15 more than four (4) Lenders (including any Existing Issuing Banks) may be Issuing Banks hereunder.      “JPMorgan Chase Bank” shall have the meaning assigned to such term in the preamble hereto.      “Lender” shall as of any date have the meaning assigned to such term in the preamble hereto so long as such Lender still holds a Term Loan, a Revolving Credit Loan or a Revolving Credit Commitment as of such date.      “Letter of Credit” means (i) a standby letter of credit issued by an Issuing Bank for the account of the Borrower in favor of a Person advancing credit or securing an obligation on behalf of the Borrower or any of its Subsidiaries and (ii) each of the Existing Letters of Credit.      “Letter of Credit Commitment” means with respect to each Revolving Credit Lender, the obligation of such Lender to acquire Letter of Credit Participations up to an aggregate stated amount at any one time outstanding equal to such Lender’s Revolving Percentage of the Total Letter of Credit Commitment as the same may by increased or decreased from time to time pursuant to this Agreement.      “Letter of Credit Facility” means the facility described in Article III hereof providing for the issuance by the Issuing Banks for the account of the Borrower of Letters of Credit in an aggregate stated amount at any time outstanding not exceeding the Total Letter of Credit Commitment.      “Lien” means any interest in property securing any obligation owed to, or a claim by, a Person other than the owner of the property, whether such interest is based on the common law, statute or contract, and including but not limited to the lien or security interest arising from a mortgage, encumbrance, pledge, security agreement, conditional sale or trust receipt or a lease, consignment or bailment for security purposes. For the purposes of this Agreement, the Borrower and its Subsidiaries shall be deemed to be the owners of any property which either of them have acquired or hold subject to a conditional sale agreement, financing lease, or other arrangement pursuant to which title to the property has been retained by or vested in some other Person for security purposes.      “Loan” or “Loans” means any of the Revolving Credit Loans, Term Loans, Competitive Bid Loans or Swing Line Loans.      “Loan Documents” means this Agreement, the Notes, the Applications and Agreements for Letters of Credit, the Facility Guaranties and all other instruments and documents heretofore or hereafter executed or delivered to and in favor of any Lender or the Administrative Agent in connection with the Loans or the Letters of Credit made, issued or created under this Agreement, as the same may be amended, modified or supplemented from time to time.      “Loan Parties” means the collective reference to the Borrower and the Guarantors.   16      “Manufacturer” means a vehicle manufacturer or distributor which is party to a dealer agreement, franchise agreement or framework agreement with, or binding upon, the Borrower or any Retail Subsidiary.      “Manufacturer Consents” means, collectively, (a) those consent letters described on Schedule 1.1(b) attached hereto on the date hereof, and (b) any additional written consent by a Manufacturer to the Loan Documents and the transactions contemplated thereby which consent is added to Schedule 1.1(b) and is in form and substance reasonably acceptable to the Administrative Agent. business, properties, operations, business prospects, or condition, financial or otherwise, of the Borrower and its Subsidiaries, taken as a whole, (ii) the ability of the Borrower to pay or perform its obligations, liabilities and indebtedness under the Loan Documents as such payment or performance becomes due in accordance with the terms thereof, or (iii) the rights, powers and remedies of the Administrative Agent or any Lender under any Loan Document or the validity, legality or enforceability thereof.      “Moody’s” means Moody’s Investors Service, Inc., a Delaware corporation.      “Mortgage Facilities” means one or more debt facilities with banks, manufacturers and/or other entities providing for borrowings by the Borrower or a Subsidiary secured primarily by real estate, in each case as such facilities are amended, modified or supplemented from time to time. Section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is making, or is accruing an obligation to make, contributions or has made, or been obligated to make, contributions within the preceding six (6) Fiscal Years.      “Notes”: the collective reference to any promissory note evidencing Loans.      “Obligations” means the obligations, liabilities and Indebtedness of the Borrower with respect to (i) the principal and interest on the Loans, (ii) the Reimbursement Obligations and (iii) the payment and performance of all other obligations, liabilities and Indebtedness of the Borrower hereunder, under any one or more of the other Loan Documents or with respect to the Loans.      “Operating Documents” means with respect to any corporation, limited liability company, partnership, limited partnership, limited liability partnership or other legally authorized incorporated or unincorporated entity, the bylaws, operating agreement, partnership agreement, limited partnership agreement or other applicable documents relating to the operation, governance or management of such entity.      “Organizational Action” means with respect to any corporation, limited any corporate, organizational or   17 partnership action (including any required shareholder, member or partner action), or other similar action, as applicable, taken by such entity.      “Organizational Documents” means with respect to any corporation, limited the articles of incorporation, certificate of incorporation, articles of organization, certificate of limited partnership, certificate of formation or other applicable organizational or charter documents relating to the creation of such entity.      “Outstanding Letters of Credit” means all undrawn amounts of Letters of Credit plus Reimbursement Obligations.      “Outstanding Revolving Credit Obligations” means the sum of (i) the Revolving Credit Outstandings, (ii) Outstanding Letters of Credit, (iii) Swing Line Outstandings, and (iv) outstanding Competitive Bid Loans, all as at the date of determination thereof.      “Participation” means, with respect to any Revolving Credit Lender (other than JPMorgan Chase Bank with respect to a Swing Line Loan, and other than the applicable Issuing Bank with respect to a Letter of Credit), the extension of credit represented by the participation of such Lender hereunder in (a) the rights of JPMorgan Chase Bank in respect of a Swing Line Loan made or (b) the liability of the applicable Issuing Bank in respect of Letters of Credit issued, and the rights of the applicable Issuing Bank in respect of Reimbursement Obligations, all in accordance with the terms hereof.      “PBGC” means the Pension Benefit Guaranty Corporation and any successor thereto.      “Pension Plan” means any employee pension benefit plan within the meaning of Section 3(2) of ERISA, other than a Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of the Code and which (i) is maintained for employees of the Borrower or any of its ERISA Affiliates or is assumed by the Borrower or any of its ERISA Affiliates in connection with any Acquisition or (ii) has at any time during the last six (6) years been maintained for the employees of the Borrower or any current or former ERISA Affiliate.      “Permitted Acquisition” means an Acquisition effected with the consent and approval of the Board of Directors (or the appropriate committee thereof) or other applicable governing body of such Person being acquired and the duly obtained approval of such shareholders or other holders of equity interests in such Person as may be required to be obtained under applicable law, the charter documents of or any shareholder agreements or similar agreements pertaining to such Person, which Person derives the majority of its revenues from Automobile Retailing Activities.      “Permitted Indebtedness” means (i) the endorsement of negotiable course of business and (ii) Indebtedness owing to the Borrower or a Subsidiary.   18      “Permitted Investor” means (a) any Person that, on the Closing Date, owns more than 10% of the outstanding securities of the Borrower having voting rights in the election of directors and (b) any Control Investment Affiliate of any such Person. company, trust, unincorporated organization, association, joint venture or a government or agency or political subdivision thereof.      “Pricing Grid” means the table set forth below setting forth the Rating and the number of basis points to be utilized in calculating each of (i) the Applicable Eurodollar Margin with respect to Revolving Credit Loans and Swing Line Loans, (ii) the Applicable Base Rate Margin with respect to Revolving Credit Loans and Swing Line Loans, (iii) the Applicable Eurodollar Margin with respect to Term Loans, (iv) the Applicable Base Rate Margin with respect to Term Loans, and (v) the Applicable Facility Fee. Any change in the Applicable Eurodollar Margin with respect to Revolving Credit Loans and Swing Line Loans, Applicable Base Rate Margin with respect to Revolving Credit Loans and Swing Line Loans, Applicable Eurodollar Margin with respect to Term Loans, Applicable Base Rate Margin with respect to Term Loans or Applicable Facility Fee shall become effective on and as of the date of any public announcement by any Rating Agency of any Rating that indicates a different Applicable Eurodollar Margin with respect to Revolving Credit Loans and Swing Line Loans, Applicable Base Rate Margin with respect to Revolving Credit Loans and Swing Line Loans, Applicable Eurodollar Margin with respect to Term Loans, Applicable Base Rate Margin with respect to Term Loans or Applicable Facility Fee.                                                                       Applicable     Applicable               Applicable     Applicable Base     Eurodollar     Base Rate               Eurodollar Margin     Rate Margin     Margin     Margin       Applicable     (Revolving and     (Revolving and     (Term     (Term   Ratings   Facility Fee     Swing Line Loans)     Swing Line Loans)     Loans)     Loans)   Baa1 / BBB+ or higher     10.0       40.0       0       100.0       0                                             Baa2 / BBB     12.5       50.0       0       100.0       0                                             Baa3 / BBB-     15.0       60.0       0       100.0       0                                             Ba1 / BB+     20.0       80.0       0       125.0       25.0                                             Ba2 / BB     37.5       87.5       0       150.0       50.0                                             Ba3 / BB- or lower     50.0       125.0       25.0       200.0       100.0   If the Ratings from the Rating Agencies fall within different levels: (i) if one Rating is one level higher than the other Rating, the Pricing Grid level will be based on the higher   19 Rating and (ii) otherwise, the Pricing Grid level will be based on the Rating that is one level higher than the lower Rating.      “Prime Rate” means the rate of interest per annum publicly announced from time to time by JPMorgan Chase Bank as its prime rate in effect at its principal office in New York City (the Prime Rate not being intended to be the lowest rate of interest charged by JPMorgan Chase Bank in connection with extensions of credit to debtors).      “Principal Office” means the office of the Administrative Agent at JPMorgan Chase Bank, N.A., Loan & Agency, 1111 Fannin Street, 10th Floor, Houston, Texas 77002, Attention: Cherry Arnaez or such other office and address as the Administrative Agent may from time to time designate.      “Quotation Date” has the meaning assigned to such term in Section (b)2.5(b) hereof.      “Rate Hedge Value” means, with respect to each contract, instrument or other arrangement creating a Rate Hedging Obligation, the net obligations of the Borrower or any Subsidiary thereunder equal to the termination value thereof as determined in accordance with its provisions (if such Rate Hedging Obligation has been terminated) or the mark to market value thereof as determined on the basis of available quotations from any recognized dealer in, or from Bloomberg or other similar service providing market quotations for, the applicable Rate Hedging Obligation (if such Rate Hedging Obligation has not been terminated).      “Rate Hedging Obligations” means, without duplication, any and all obligations of the Borrower or any Subsidiary, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (i) any and all agreements, devices or arrangements designed to protect at least one of the parties thereto from the fluctuations of interest rates, exchange rates or forward rates applicable to such party’s assets, liabilities or exchange transactions, including, but not limited to, Dollar-denominated or cross-currency interest rate exchange agreements, forward currency exchange agreements, interest rate cap or collar protection agreements, forward rate currency or interest rate options, puts, warrants and those commonly known as interest rate “swap” agreements; (ii) all other “derivative instruments” as defined in FASB 133 and which are subject to the reporting requirements of FASB 133; and (iii) any and all cancellations, buybacks, reversals, terminations or assignments of any of the foregoing. For purposes of any computation hereunder, each Rate Hedging Obligation shall be valued at the Rate Hedge Value thereof.      “Rating” means the rating assigned by any Rating Agency to the Loans.      “Rating Agencies” means S&P and Moody’s.      “Reimbursement Obligation” shall mean at any time, the obligation of the Borrower with respect to any Letter of Credit to reimburse the applicable Issuing Bank and the Revolving Credit Lenders to the extent of their respective Participations   20 (including by the receipt by such Issuing Bank of proceeds of Revolving Credit Loans pursuant to Section 3.2) for amounts theretofore paid by such Issuing Bank or the Lenders pursuant to a drawing under such Letter of Credit;      “Required Lenders” means, as of any date, the holders of more than 50% of the sum of (i) the Term Loan Outstandings and (ii) the Total Revolving Credit Commitments then in effect or, if the Revolving Credit Commitments have been terminated, the Outstanding Revolving Credit Obligations.      “Reserve Requirement” means, for any day as applied to any Eurodollar Loan or Competitive Rate Loan bearing interest at a Eurodollar Competitive Rate during any Interest Period, the reserve percentage (expressed as a decimal, rounded upward to the next 1/100th of 1%), if any, in effect on such day with respect to such Eurodollar Loan or Competitive Rate Loan under regulations issued from time to time by the Board for determining the maximum reserve “Eurocurrency liabilities”). The Eurodollar Rate for each outstanding Eurodollar Rate Loan and the Eurodollar Competitive Rate for each outstanding Competitive Bid Loan bearing interest at a Eurodollar Competitive Rate shall be adjusted automatically as of the effective date of any change in the Reserve Requirement.      “Retail Subsidiary” means a Subsidiary which is engaged in the sale or distribution of new or used motor vehicles, or both, and/or parts and accessories used in connection with motor vehicles.      “Revolving Credit Commitment” means with respect to each Revolving Credit Lender, the obligation of such Lender to make Revolving Credit Loans to the Borrower and purchase Participations up to an aggregate principal amount at any one time outstanding, determined with reference to such Lender’s Revolving Percentage as set forth on Exhibit A attached hereto of the Total Revolving Credit Commitment as the same may be increased or decreased from time to time      “Revolving Credit Facility” means the facility described in Section 2.4(a) hereof providing for Revolving Credit Loans to the Borrower by the Revolving Credit Lenders in the aggregate principal amount of the Total Revolving Credit Commitment less the aggregate amount of Swing Line Outstandings, Outstanding Letters of Credit and outstanding Competitive Bid Loans.      “Revolving Credit Lender” means each Lender that has a Revolving Credit Commitment or that holds Revolving Credit Loans.      “Revolving Credit Loan” means a Loan made pursuant to the Revolving Credit Facility.      “Revolving Credit Outstandings” means, as of any date of determination, the aggregate principal amount of all Revolving Credit Loans then outstanding.   21      “Revolving Credit Termination Date” means (i) the Stated Termination Date, (ii) such earlier date of termination of Lenders’ obligations pursuant to Section 9.1 upon the occurrence of an Event of Default, or (iii) such date as the Borrower may voluntarily permanently terminate the Revolving Credit Facility, the Swing Line, the Letter of Credit Facility and the Competitive Bid Facility by payment in full of all Obligations with respect to the Revolving Credit Facility (including the discharge of all Obligations of JPMorgan Chase Bank, the Issuing Banks and the Revolving Credit Lenders with respect to Letters of Credit, Participations, Swing Line Loans and Competitive Bid Loans) other than contingent indemnification Obligations with respect to the Revolving Credit Facility and other contingent Obligations with respect to the Revolving Credit Facility that expressly survive termination of this Agreement.      “Revolving Percentage”: as to any Revolving Credit Lender at any time, the percentage which such Lender’s Revolving Credit Commitment (which Revolving Credit Commitment for each Lender as of the First Amendment Effective Date is as set forth in Exhibit A attached hereto and incorporated herein by this reference) then constitutes of the Total Revolving Credit Commitment (or, at any time after the Revolving Credit Commitments shall have expired or terminated, the percentage which the aggregate principal amount of such Lender’s Revolving Credit Loans then outstanding constitutes of the Revolving Credit Outstandings); provided that each Revolving Percentage of each Revolving Credit Lender shall be increased or decreased to reflect any assignments to or by such Lender effected in accordance with Section 11.1 hereof and any voluntary or mandatory reductions in such committed amounts.      “S&P” means Standard & Poor’s Rating Group, a division of The McGraw-Hill Companies.      “Senior Note Guaranty” means each Guaranty Agreement delivered by the Guarantors to the Trustee for the benefit of the holders of the Senior Notes.      “Senior Note Indenture” means the Indenture dated August 10, 2001 among the Borrower, the guarantors party thereto and the Trustee pursuant to which the Borrower has issued the Senior Notes as amended, restated, supplemented or      “Senior Notes” means the Borrower’s 9% Senior Notes due August 1, 2008 issued pursuant to the Senior Note Indenture and shall include the notes issued in exchange therefor (as contemplated by the Senior Note Indenture and the registration rights agreement described therein), as amended, restated,      “Stated Termination Date” means July 14, 2010.      “Subsidiary” means any corporation or other entity in which more than 50% of its outstanding voting stock or more than 50% of all equity interests is owned directly or indirectly by the Borrower and/or by one or more of the Borrower’s Subsidiaries.   22      “Subsidiary Securities” means the shares of capital stock or the other equity interests issued by or equity participations in any Subsidiary, whether or not constituting a “security” under Article 8 of the Uniform Commercial Code as in effect in any jurisdiction.      “Swing Line” means the revolving line of credit established by JPMorgan Chase Bank in favor of the Borrower pursuant to Section 2.17.      “Swing Line Loan” means a Loan made by JPMorgan Chase Bank to the Borrower      “Swing Line Outstandings” means, as of any date of determination, the aggregate principal amount of all Swing Line Loans then outstanding.      “Synthetic Lease Obligations” means all monetary obligations of a lessee under any tax retention or other synthetic leases which is treated as an operating lease under GAAP but the liabilities under which are or would be characterized as indebtedness of such Person for tax purposes or upon the insolvency of such Person. The amount of Synthetic Lease Obligations in respect of any synthetic lease at any date of determination thereof shall be equal to the aggregate purchase price of any property subject to such lease less the aggregate amount of payments of rent theretofore made which reduce the lessee’s obligations under such synthetic lease and which are not the financial equivalent of interest.      “Term Commitment” means, as to any Lender, the obligation of such Lender, if any, to make a Term Loan to the Borrower in a principal amount not to exceed the amount set forth under the heading “Term Commitment” opposite such Lender’s name on Exhibit A attached hereto. The original aggregate amount of the Term Commitments is $600,000,000.      “Term Facility” means the Term Commitments and the Term Loans made thereunder.      “Term Percentage” means, as to any Term Lender at any time, the percentage which such Lender’s Term Commitment then constitutes of the aggregate Term Commitments (or, at any time after the First Amendment Effective Date, the percentage which the aggregate principal amount of such Lender’s Term Loans then outstanding); provided, that each Term Percentage of each Term Lender shall be in accordance with Section 11.1 hereof.      “Term Lender” means each Lender that has a Term Commitment or that holds a Term Loan.      “Term Loan” has the meaning assigned to such term in Section 2.1.   23      “Term Loan Outstandings” means, as of any date of determination, the aggregate principal amount of all Term Loans then outstanding.      “Termination Event” means: (i) a “Reportable Event” described in Section 4043 of ERISA and the regulations issued thereunder (other than an event for which the 30-day notice requirement has been waived by applicable regulation); or (ii) the withdrawal of the Borrower or any ERISA Affiliate from a Pension Plan during a plan year in which it was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or was deemed such under Section 4062(e) of ERISA; or (iii) the termination of a Pension Plan, the filing of a notice of intent to terminate a Pension Plan or the treatment of a Pension Plan amendment as a termination under Section 4041 of ERISA; or (iv) the institution of proceedings to terminate a Pension Plan by the PBGC; or (v) any other event or condition which would constitute grounds under Section 4042(a) of ERISA for the or (vi) the partial or complete withdrawal of the Borrower or any ERISA Affiliate from a Multiemployer Plan; or (vii) the imposition of a Lien pursuant to Section 412 of the Code or Section 302 of ERISA; or (viii) any event or condition which results in the reorganization or insolvency of a Multiemployer Plan under Section 4241 or Section 4245 of ERISA, respectively; or (ix) any event or condition which results in the termination of a Multiemployer Plan under Section 4041A of ERISA or the institution by the PBGC of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA; or (x) any event or condition with respect to any Employee Benefit Plan which is regulated by any Foreign Benefit Law that results in the termination of such Employee Benefit Plan or the revocation of such Employee Benefit Plan’s authority to operate under the applicable Foreign Benefit Law.      “Total Letter of Credit Commitment” means an amount not to exceed $200,000,000.      “Total Revolving Credit Commitment” means $600,000,000, as increased from time to time in accordance with Section 2.18 and as reduced from time to time in accordance with Section 2.10 and Section 2.11, which shall be made available by the Lenders to the Borrower during the period from the date hereof until the Revolving Credit Termination Date.      “Transaction” has the meaning assigned to such term in the First Amendment.      “Trustee” means Wells Fargo Bank Minnesota, National Association, as trustee under the Senior Note Indenture for the holders of the Senior Notes.      “Type” shall mean any type of Loan (i.e., a Base Rate Loan or a Eurodollar Loan).      “Vehicle Receivables Indebtedness” means Indebtedness incurred by any Eligible Special Purpose Entity to finance, refinance or guaranty the financing or refinancing of consumer receivables, leases, loans or retail installment contracts incurred in the sale, transfer or lease of Vehicles; provided (x) such Indebtedness shall in accordance with   24 GAAP on a Consistent Basis not appear as an asset or liability on the balance sheet of the Borrower or any of its Subsidiaries; (y) no assets other than the Vehicles, consumer receivables, leases, loans, retail installment contracts or related proceeds (including, without limitation, proceeds from insurance, Vehicles and other obligations under such receivables, leases, loans or retail installment contracts) to be so financed or refinanced secure such Indebtedness; and (z) neither the Borrower nor any of its Subsidiaries other than such Eligible Special Purpose Entity shall incur any liability with respect to such Indebtedness other than liability arising by reason of (1) a breach of a representation or warranty or customary indemnities in each case contained in any instrument relating to such Indebtedness or (2) customary interests retained by the Borrower or its Subsidiaries in such assets or Indebtedness.      “Vehicle Secured Indebtedness” means, collectively, (a) the Existing Vehicle Secured Indebtedness and (b) Indebtedness incurred by the Borrower, any Subsidiary or any Eligible Special Purpose Entity to lease, finance or refinance or guaranty the leasing, financing or refinancing of Vehicles or related receivables, which Indebtedness in the case of this clause (b) is secured by the Vehicles or related receivables so financed and (but only to the extent permitted by the last sentence of this definition) other assets, to the extent, at any date of determination thereof, the amount of such Indebtedness does not exceed the depreciated book value of the Vehicles so financed or the book value of such related receivables, in each case plus the book value of any other assets securing such Indebtedness (in the aggregate, “Security Book Value”) as determined in accordance with GAAP applied on a Consistent Basis. It is understood that, to the extent the amount of such Indebtedness exceeds the associated Security Book Value, such excess amount shall not constitute “Vehicle Secured Indebtedness” and, accordingly, shall constitute “Funded Indebtedness”. On the date any Vehicle Secured Indebtedness is incurred and on any date any lien is granted securing such Indebtedness, the percentage of Security Book Value contributed by Vehicles and related receivables financed thereby shall not be less than 85% of the total Security Book Value with respect to such Indebtedness.      “Vehicles” means all now existing or hereafter acquired new and used automobiles, sport utility vehicles, trucks and vans of all types and descriptions, whether held for sale, lease, rental or operational purposes, which relate to the Borrower’s or any Subsidiary’s Automobile Retailing Activities.      “Voting Securities” means shares of capital stock issued by a corporation, or equivalent interests in any other Person, the holders of which are      “Year 2006 Senior Note Guaranty” means each Guaranty Agreement delivered by the Guarantors to the Trustee for the benefit of the holders of the Year 2006 Senior Notes.      “Year 2006 Senior Note Indenture” means the Indenture dated April 12, 2006 among the Borrower, the guarantors party thereto and the Wells Fargo Bank, N.A.   25 pursuant to which the Borrower has issued the Year 2006 Senior Notes as amended, restated, supplemented or otherwise modified from time to time.      “ Year 2006 Senior Notes” means the Borrower’s 7% Senior Notes due April 15, 2014 and the Floating Rate Senior Notes due April 15, 2013 issued pursuant to the Year 2006 Senior Note Indenture and shall include the notes issued in exchange therefor (as contemplated by the Year 2006 Senior Note Indenture and the registration rights agreement described therein), as amended,      1.2 Rules of Interpretation.      (a) The headings, subheadings and table of contents used herein or in any other Loan Document are solely for convenience of reference and shall not constitute a part of any such document or affect the meaning, construction or      (b) Except as otherwise expressly provided, references in any Loan Document to articles, sections, paragraphs, clauses, annexes, appendices, exhibits and schedules are references to articles, sections, paragraphs, clauses, annexes, appendices, exhibits and schedules in or to such Loan Document.      (c) All definitions set forth herein or in any other Loan Document shall apply to the singular as well as the plural form of such defined term, and all references to the masculine gender shall include reference to the feminine or neuter gender, and vice versa, as the context may require.      (d) When used herein or in any other Loan Document, words such as “hereunder”, “hereto”, “hereof” and “herein” and other words of like import shall, unless the context clearly indicates to the contrary, refer to the whole of the applicable document and not to any particular article, section, subsection, paragraph or clause thereof.      (e) References to “including” means including without limiting the generality of any description preceding such term, and such term shall not limit a general statement to matters similar to those specifically mentioned.      (f) Except as otherwise expressly provided, all dates and times of day specified herein shall refer to such dates and times at New York City.      (g) Whenever interest rates or fees are established in whole or in part by reference to a numerical percentage expressed as “___%”, such arithmetic expression shall be interpreted in accordance with the convention that 1% = 100 basis points.      (h) Each of the parties to the Loan Documents and their counsel have reviewed and revised, or requested (or had the opportunity to request) revisions to, the Loan Documents, and any rule of construction that ambiguities are to be resolved against the drafting party shall be inapplicable in the construing and interpretation of the Loan Documents and all exhibits, schedules and appendices thereto.   26      (i) Any reference to an officer of the Borrower or any other Person by reference to the title of such officer shall be deemed to refer to each other officer of such Person, however titled, exercising the same or substantially similar functions.      (j) All references to any agreement or document as amended, modified or supplemented, or words of similar effect, shall mean such document or agreement, as the case may be, as amended, modified or supplemented from time to time only as and to the extent permitted therein and not prohibited by the Loan Documents.      (k) Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and permitted assigns of such party and all covenants, provisions and agreements by or on behalf of the Borrower which are contained in the Loan Documents shall inure to the benefit of the successors and permitted assigns of the Administrative Agent, the Lenders, or any of them.      1.3 Accounting for Permitted Acquisitions. With respect to any Permitted Acquisition consummated on or after the Closing Date and prior to the Revolving Credit Termination Date, the following shall apply:      For each Four-Quarter Period that includes the date of a Permitted Acquisition, Consolidated EBITDA and Consolidated Interest Expense shall include the results of operations of the Person or assets so acquired, which amounts shall be determined on a historical pro forma basis and which may include such adjustments as are permitted under Regulation S-X of the Securities and Exchange Commission; provided, however, Consolidated Interest Expense shall be adjusted on a historical pro forma basis to (i) eliminate interest expense accrued during such period on any Indebtedness repaid in connection with such Permitted Acquisition and (ii) include interest expense on any Indebtedness (including Indebtedness hereunder) incurred, acquired or assumed in connection with such Permitted Acquisition (“Incremental Debt”) calculated (x) as if all such Incremental Debt had been incurred as of the first day of such Four-Quarter Period and (y) at the following interest rates: (I) for all periods subsequent to the date of the Permitted Acquisition and for Incremental Debt assumed or acquired in the Permitted Acquisition and in effect prior to the date of Permitted Acquisition, at the actual rates of interest applicable thereto, and (II) for all periods prior to the actual incurrence of such Incremental Debt, equal to the rate of interest actually applicable to such Incremental Debt hereunder or under other financing documents applicable thereto as at the end of each affected Four-Quarter Period.      1.4 Accounting for Derivatives. In making any computation under Section 8.1, all adjustments to such computation or amount resulting from the application of FASB 133 shall be disregarded.      1.5 Accounting and Financial Determinations. Except as provided in Section 1.3, where the character or amount of any asset or liability or item of income or expense is required to be determined, or any accounting computation is required to be made, for the purpose of this Agreement, such determination or calculation shall, to the extent applicable, be made in accordance with GAAP applied on a Consistent Basis except insofar as:   27      (a) the Borrower shall have elected (with the concurrence of its independent public accountant and upon prior written notification to the Lenders) to adopt more recently promulgated GAAP (which election shall continue to be effective for subsequent years); and      (b) the Administrative Agent and the Required Lenders shall have consented to such election (it being understood that such consent may be conditioned upon the implementation of such changes to Article VIII as are appropriate to reflect such adoption of more recently promulgated GAAP and it being further understood that such consent shall be deemed to have been given upon the implementation of such changes).      Upon a change in GAAP which becomes effective after the Closing Date which would have a material effect on the Borrower’s consolidated financial statements and the assets and liabilities reflected therein or otherwise affect the calculation or the application of the covenants contained in Article VIII hereof, such change shall not be given effect for purposes hereof until sixty (60) days from the otherwise effective date of such change. Prior to such effectiveness the Administrative Agent, the Lenders and the Borrower shall in good faith negotiate to amend the pertinent provisions of this Agreement to account for such change to the extent appropriate to effect the substance thereof as of the Closing Date. If such an amendment is not entered into with respect to any such change, such change shall not be given effect for purposes hereof. The Borrower shall provide to the Administrative Agent and the Lenders, upon request, comfort from its accountants that, without giving effect to such change in GAAP, upon their review of the calculations set forth in the Compliance Certificate prepared on a Consistent Basis, nothing has come to their attention that would lead them to believe the Borrower was not in compliance with the financial covenants contained in this Agreement. ARTICLE II The Loans      2.1 Term Commitments. Subject to the terms and conditions hereof, each Term Lender severally agrees to make a term loan (a “Term Loan”) to the Borrower on the First Amendment Effective Date in an amount not to exceed the amount of the Term Commitment of such Lender. The Term Loans may from time to time be Eurodollar Loans or Base Rate Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.2 and 2.12.      2.2 Procedure for Term Loan Borrowing. The Borrower shall give the Administrative Agent irrevocable notice in the form of a borrowing notice (which notice shall be substantially in the form of a Borrowing Notice for Revolving Credit Loans, mutatis mutandis, and (1) for each Term Loan that is a Eurodollar Loan shall have been received by the Administrative Agent prior to 12:00 Noon, New York City time, three (3) Business Days prior to the proposed borrowing date and (2) for each Term Loan that is a Base Rate Loan shall have been received by the Administrative Agent prior to 12:00 Noon, New York City time, one Business Day prior to the proposed borrowing date) requesting that the Term Lenders make the Term Loans on the First Amendment Effective Date and specifying the amount to be borrowed. Upon receipt of such notice the Administrative Agent shall promptly notify each Term Lender thereof. Not later than   28 10:30 A.M., New York City time, on the First Amendment Effective Date each Term Lender shall, pursuant to the terms and subject to the conditions of this Agreement, make available to the Administrative Agent at the Principal Office an amount in immediately available funds equal to the Term Loan or Term Loans to be made by such Lender. The Administrative Agent shall credit the account of the Borrower on the books of such office of the Administrative Agent with the aggregate of the amounts made available to the Administrative Agent by the Term Lenders in immediately available funds.      2.3 Repayment of Term Loans. The Term Loan of each Term Lender shall mature on the Stated Termination Date in an amount equal to such Lender’s Term Percentage multiplied by the amount of the Term Loan Outstandings.      2.4 Revolving Credit Commitments.      (a) Commitments. Subject to the terms and conditions of this Agreement, each Revolving Credit Lender severally agrees to make Advances to the Borrower, from time to time from the Closing Date until the Revolving Credit Termination Date, on a pro rata basis as to the total borrowing requested by the Borrower under the Revolving Credit Facility on any day determined by its Revolving Percentage up to but not exceeding the Revolving Credit Commitment of such Lender, provided, however, that the Revolving Credit Lenders will not be required and shall have no obligation to make any Advance (i) so long as not all of the conditions under Section 5.2 hereof have been fulfilled, (ii) so long as a Default or an Event of Default has occurred and is continuing or (iii) if the Administrative Agent has accelerated the maturity of the Revolving Credit Loans as a result of an Event of Default in accordance with Section 9.1 hereof; provided further, however, that immediately after giving effect to each such Advance, the principal amount of Outstanding Revolving Credit Obligations shall not exceed the Total Revolving Credit Commitment. Within such limits, the Borrower may borrow, repay and reborrow hereunder, on any Business Day, from the Closing Date until, but (as to borrowings and reborrowings) not including, the Revolving Credit Termination Date; provided, however, that (x) no Eurodollar Loan that is a Revolving Credit Loan shall be made which has an Interest Period that extends beyond the Revolving Credit Termination Date and (y) each Revolving Credit Loan that is a Eurodollar Loan may, subject to the provisions of Section 2.12, be repaid only on the last day of the Interest Period with respect thereto unless the Borrower has paid any amounts due pursuant to Section 4.5 hereof.      (b) Amounts. The aggregate unpaid principal amount of the Outstanding Revolving Credit Obligations shall not exceed at any time an amount equal to the Total Revolving Credit Commitment. Each Loan under the Revolving Credit Facility, other than a Swing Line Loan or a Base Rate Refunding Loan, and each Conversion thereof under Section 2.12 shall be in a principal amount of (i) at least $10,000,000, and, if greater than $10,000,000, an integral multiple of $1,000,000, in the case of Eurodollar Loans, or (ii) at least $5,000,000 and, if greater than $5,000,000, an integral multiple of $1,000,000, in the case of Base Rate Loans.      (c) Advances and Rate Selection. (i) An Authorized Representative shall give the Administrative Agent (1) at least three (3) Business Days’ irrevocable telephonic notice of each Revolving Credit Loan that is a Eurodollar Loan (whether representing an additional   29 borrowing hereunder or the Conversion of borrowing hereunder from Base Rate Loans or other Eurodollar Loans to Eurodollar Loans) prior to 12:00 Noon; and (2) irrevocable telephonic notice of each Revolving Credit Loan that is a Base Rate Loan (other than Base Rate Refunding Loans to the extent the same are effective without notice pursuant to Section 2.4(c)(iv)) representing an additional borrowing hereunder prior to 12:00 noon on the day of such proposed Base Rate Loan. Each such borrowing notice, which shall be effective upon receipt by the Administrative Agent, shall specify the amount of the borrowing, the Type of Loan, the date of borrowing and, if a Eurodollar Loan, the Interest Period to be used in the computation of interest. The Authorized Representative shall provide the Administrative Agent written confirmation of each such telephonic notice on the same day by telefacsimile transmission in the form of a Borrowing Notice, for additional Advances, or in the form attached hereto as Exhibit F as to selection or Conversion of interest rates as to outstanding Revolving Credit Loans, in each case with appropriate insertions, but failure to provide such confirmation shall not affect the validity of such telephonic notice. The duration of the initial Interest Period for each Revolving Credit Loan that is a Eurodollar Loan shall be as specified in the initial Borrowing Notice. The Borrower shall have the option to elect the duration of subsequent Interest Periods and to Convert the Revolving Credit Loans (other than Swing Line Loans) in accordance with Section 2.12 hereof. If the Administrative Agent does not receive a notice of election of duration of an Interest Period or to Convert by the time prescribed hereby and by Section 2.12 hereof, the Borrower shall be deemed to have elected as to any Revolving Credit Loan, to Convert such Loan to (or Continue such Loan as) a Base Rate Loan bearing interest at the Base Rate until the Borrower notifies the Administrative Agent in accordance with this Section and Section 2.12.      (ii) Notice of receipt of each Borrowing Notice shall be provided by the Administrative Agent to each Revolving Credit Lender by telefacsimile or telephonic notice with reasonable promptness on the same day as Administrative Agent’s receipt of such Borrowing Notice.      (iii) Not later than 3:00 P.M. on the date specified for each Advance under the Revolving Credit Facility, each Revolving Credit Lender shall, pursuant to the terms and subject to the conditions of this Agreement, make the amount of the Loan or Loans to be made by it on such day available to the Administrative Agent, by depositing or transferring the proceeds thereof in immediately available funds at the Principal Office. The amount so received by the Administrative Agent shall, subject to the terms and conditions of this Agreement, be made available to the Borrower by delivery of the proceeds thereof as shall be directed in the applicable Borrowing Notice by the Authorized Representative.      (iv) If a drawing is made under any Letter of Credit, the Borrower shall reimburse the Issuing Bank for such drawing by paying to the Administrative Agent an amount equal to such drawing not later than 2:00 P.M. on (A) the Business Day (which may be the date such drawing is made) that the Borrower receives notice of such drawing, if the Borrower shall have received such notice prior to 10:00 a.m., or (B) the Business Day immediately following the day that the Borrower receives such notice, if such notice is received by the Borrower on a day other than a Business Day or after 10:00 a.m. on a Business Day. Notwithstanding the foregoing, if a drawing is made under any Letter of Credit, such drawing is honored by the Issuing Bank thereunder prior to the Revolving Credit Termination Date, and the Borrower shall not immediately fully reimburse such Issuing Bank in respect of such drawing, (y) provided that the   30 conditions to making a Revolving Credit Loan as herein provided shall then be satisfied, the Reimbursement Obligation arising from such drawing shall be paid to such Issuing Bank by the Administrative Agent without the requirement of notice to or from the Borrower from immediately available funds which shall be advanced as a Base Rate Refunding Loan by each Lender under the Revolving Credit Facility in an amount determined with reference to such Revolving Credit Lender’s Revolving Percentage of such Reimbursement Obligation, and (z) if the conditions to making a Revolving Credit Loan as herein provided shall not then be satisfied, each of the Revolving Credit Lenders shall fund by payment to the Administrative Agent (for the benefit of the Issuing Bank) in immediately available funds the purchase from such Issuing Bank of their respective Participations in the related Reimbursement Obligation based on their respective Revolving Percentages of the Total Letter of Credit Commitment. If a drawing is presented under any Letter of Credit in accordance with the terms thereof and the Borrower shall not immediately reimburse the Issuing Bank thereunder in respect thereof as provided above, then notice of such drawing shall be provided promptly by such Issuing Bank to the Administrative Agent and the Administrative Agent shall provide notice to each Revolving Credit Lender by telephone or telefacsimile transmission. If notice to the Revolving Credit Lenders of a drawing under any Letter of Credit is given by the Administrative Agent at or before 2:00 P.M. on any Business Day, each Revolving Credit Lender shall, pursuant to the conditions specified in this Section 2.4(c)(iv), either make a Base Rate Refunding Loan or fund the purchase of its Participation in the amount of such Lender’s Revolving Percentage of such drawing or payment and shall pay such amount to the Administrative Agent for the account of the Issuing Bank at the Principal Office in Dollars and in immediately available funds before 2:30 P.M. on the same Business Day. If notice to the Revolving Credit Lenders of a drawing under a Letter of Credit is given by the Administrative Agent after 2:00 P.M. on any Business Day, each Revolving Credit Lender shall, pursuant to the conditions specified in this Section 2.4(c)(iv), either make a Base Rate Refunding Loan or fund the purchase of its Participation in the amount of such Lender’s Revolving Percentage of such drawing and shall pay such amount to the Administrative Agent for the account of the Issuing Bank at the Principal Office in Dollars and in immediately available funds before 2:00 P.M. on the next following Business Day. Any such Base Rate Refunding Loans shall be advanced as, and shall continue as, a Base Rate Loan unless and until the Borrower Converts such Base Rate Loan in accordance with the terms of Section 2.12.      2.5 Competitive Bid Loans.      (a) In addition to Revolving Credit Loans, at any time prior to the Revolving Credit Termination Date and provided no Default or Event of Default exists hereunder, the Borrower may, as set forth in this Section 2.5, request the Revolving Credit Lenders to make offers to make Competitive Bid Loans to the Borrower in Dollars. The Revolving Credit Lenders may, but shall have no obligation to, make such offers and the Borrower may, but shall have no obligation to, accept any such offers in the manner set forth in this Section 2.5. There may be no more than ten (10) Interest Periods, and no more than one (1) one-week Interest Periods, for all Revolving Credit Loans and Competitive Bid Loans outstanding at the same time (for which purpose Interest Periods for each Eurodollar Revolving Credit Loan and each Competitive Bid Loan shall be deemed to be different Interest Periods even if they are coterminous). The aggregate principal   31 amount of all Outstanding Revolving Credit Obligations shall not exceed the Total Revolving Credit Commitment at any time. The aggregate principal amount of all outstanding Competitive Bid Loans shall not exceed one hundred percent (100%) of the Total Revolving Credit Commitment at any time.      (b) When the Borrower wishes to request offers to make Competitive Bid Loans, it shall give the Administrative Agent and the Revolving Credit Lenders notice (a “Competitive Bid Quote Request”) to be received no later than 12:00 Noon on (A) the fourth Business Day prior to the date of borrowing proposed therein, in the case of a Competitive Bid Quote Request for Competitive Bid Loans at the Eurodollar Competitive Rate or (B) the Business Day prior to the date of borrowing proposed therein, in the case of a Competitive Bid Quote Request for Competitive Bid Loans at the Absolute Rate (or, in any such case, such other time and date as the Borrower and the Administrative Agent may agree). The Borrower may request offers to make Competitive Bid Loans for up to three (3) different Interest Periods in a single notice; provided that the request for each separate Interest Period shall be deemed to be a separate Competitive Bid Quote Request for a separate borrowing (a “Competitive Bid Borrowing”) and there shall not be outstanding at any one time more than four (4) Competitive Bid Borrowings. Each such Competitive Bid Quote Request shall be substantially in the form of Exhibit G attached hereto and shall specify as to each Competitive Bid Borrowing:      (i) the proposed date of such borrowing, which shall be a Business Day;      (ii) the aggregate amount of such Competitive Bid Borrowing, which shall be at least $10,000,000 (or in increments of $1,000,000 in excess thereof) but shall not cause the limits specified in Section 2.5(a) hereof to be violated;      (iii) the duration of the Interest Period applicable thereto;      (iv) whether the Competitive Bid Quote Request for a particular Interest Period is seeking quotes for Competitive Bid Loans at the Absolute Rate or the Eurodollar Competitive Rate;      (v) whether the Borrower shall have the right to prepay a requested Competitive Bid Loan; and      (vi) the date on which the Competitive Bid Quotes are to be submitted if it is before the proposed date of borrowing (the date on which such Competitive Bid Quotes are to be submitted is called the “Quotation Date”). Except as otherwise provided in this Section 2.5(b), no more than two (2) Competitive Bid Quote Requests shall be given within five (5) Business Days (or such other number of days as the Borrower and the Administrative Agent may agree) of any other Competitive Bid Quote Request.      (c) (i) Each Revolving Credit Lender may submit one or more Competitive Bid Quotes, each containing an offer to make a Competitive Bid Loan in response to any Competitive Bid Quote Request; provided that, if the Borrower’s request under Section 2.5(b) hereof specified more than one Interest Period, such Lender may make a single submission containing one or more Competitive Bid Quotes for each such Interest Period. Each Competitive Bid Quote must be submitted to the Borrower not later than 9:30 A.M. on (A) the   32 third Business Day prior to the proposed date of borrowing, in the case of a Competitive Bid Quote Request for Competitive Bid Loans at the Eurodollar Competitive Rate or (B) the Quotation Date, in the case of a Competitive Bid Quote Request for Competitive Bid Loans at the Absolute Rate (or, in any such case, such other time and date as the Borrower and the Administrative Agent may agree) provided that if JPMorgan Chase Bank is receiving quotes as provided in Section 2.5(g), any Competitive Bid Quote may be submitted by JPMorgan Chase Bank (or its applicable Lending Office) only if JPMorgan Chase Bank (or such applicable Lending Office) notifies the Borrower of the terms of the offer contained therein not later than 9:15 A.M. on the Quotation Date. Any Competitive Bid Quote so made shall be irrevocable except with the consent of the Administrative Agent given on the instructions of the Borrower.      (ii) Each Competitive Bid Quote shall be substantially in the form of Exhibit H attached hereto and shall specify:      (A) the proposed date of borrowing and the Interest Period therefor;      (B) the principal amount of the Competitive Bid Loan for which each such offer is being made, which principal amount shall be at least $5,000,000 (or in increments of $1,000,000 in excess thereof); provided that the aggregate principal amount of all Competitive Bid Loans for which a Lender submits Competitive Bid Quotes may not exceed the principal amount of the Competitive Bid Borrowing for a particular Interest Period for which offers were requested;      (C) in the case of a Competitive Bid Quote for Competitive Bid Loans at an Absolute Rate, the rate of interest per annum (rounded upwards, if necessary, to the nearest 1/10,000th of 1%) offered for each such Competitive Bid Loan (the “Absolute Rate”);      (D) in the case of a Competitive Bid Quote for Competitive Bid Loans at the Eurodollar Competitive Rate, the positive or negative margin to be added to or deducted from the Interbank Offered Rate; and      (E) the identity of the quoting Lender. Unless otherwise agreed by the Administrative Agent and the Borrower, no Competitive Bid Quote shall contain qualifying, conditional or similar language or propose terms other than or in addition to those set forth in the applicable Competitive Bid Quote Request and, in particular, no Competitive Bid Quote may be conditioned upon acceptance by the Borrower of all (or some specified minimum) of the principal amount of the Competitive Bid Loan for which such Competitive Bid Quote is being made. Any subsequent Competitive Bid Quote submitted by a Revolving Credit Lender that amends, modifies or is otherwise inconsistent with a previous Competitive Bid Quote submitted by such Lender with respect to the same Competitive Bid Quote Request shall be disregarded by the Borrower unless such subsequent Competitive Bid Quote is submitted solely to correct a manifest error in such former Competitive Bid Quote.      (d) The Borrower shall as promptly as practicable after the Competitive Bid Quote is submitted (but in any event not later than 12:00 Noon on (A) in the case of a Competitive Bid Loan at an Absolute Rate, the Quotation Date (or such other time and date as   33 the Borrower and the Administrative Agent may agree) or (B) in the case of a Competitive Bid Loan at a Eurodollar Competitive Rate, the third Business Day prior to the proposed date of borrowing) notify the Administrative Agent and Revolving Credit Lenders of (x) the aggregate principal amount of the Competitive Bid Borrowing for which Competitive Bid Quotes have been received as well as the ranges of bids submitted for each Interest Period requested, (y) the respective principal amounts and Absolute Rates or Eurodollar Competitive Rates, as the case may be, so offered by each Revolving Credit Lender (identifying the Lender that made each Competitive Bid Quote), and (z) its acceptance or nonacceptance of the Competitive Bid Quotes. In the case of acceptance, such notice shall specify the aggregate principal amount of offers for each Interest Period that are accepted. The Borrower may accept any Competitive Bid Quote in whole or in part (provided that any Competitive Bid Quote accepted in part shall be at least $5,000,000 or in increments of $1,000,000 in excess thereof); provided that:      (i) the aggregate principal amount of each Competitive Bid Borrowing may not exceed the applicable amount set forth in the related Competitive Bid Quote Request;      (ii) the aggregate principal amount of each Competitive Bid Borrowing shall be at least $5,000,000 (or an increment of $1,000,000 in excess thereof) but      (iii) except as provided below, acceptance of Competitive Bid Quotes for any Interest Period may be made only in ascending order of Absolute Rates or Eurodollar Competitive Rates, as the case may be, beginning with the lowest rate so offered; and      (iv) the Borrower may not accept any Competitive Bid Quote where such Competitive Bid Quote fails to comply with Section 2.5(c)(ii) hereof or otherwise fails to comply with the requirements of this Agreement (including, without limitation, Section 2.5(a) hereof). Any of the conditions above notwithstanding, the Borrower may, in its sole discretion, accept a Competitive Bid Quote that does not contain the lowest Absolute Rate or Eurodollar Competitive Rates, as the case may be, where acceptance of the Competitive Bid Quote containing the lowest Absolute Rate or Eurodollar Competitive Rate, as the case may be, would be less favorable to the Borrower or would cause the principal amount of Outstanding Revolving Credit Obligations to exceed the Total Revolving Credit Commitment.      If Competitive Bid Quotes are made by two or more Revolving Credit Lenders with the same Absolute Rates or Eurodollar Competitive Rates, as the case may be, for a greater aggregate principal amount than the amount in respect of which Competitive Bid Quotes are accepted for the related Interest Period after the acceptance of all Competitive Bid Quotes, if any, of all lower Absolute Rates or Eurodollar Competitive Rates, as the case may be, offered by any Revolving Credit Lender for such related Interest Period, the principal amount of Competitive Bid Loans in respect of which such Competitive Bid Quotes are accepted shall be allocated by the Borrower among such Lenders as nearly as possible (in amounts of at least $1,000,000 or in increments of $100,000 in excess thereof) in proportion to the aggregate principal amount of such Competitive Bid Quotes. Determinations by the Borrower of the   34 amounts of Competitive Bid Loans and the lowest bid after adjustment as provided in Section 2.5(d)(iii) shall be conclusive in the absence of manifest error.      (e) Any Revolving Credit Lender whose offer to make any Competitive Bid Loan has been accepted shall, not later than 1:00 P.M. on the date specified for the making of such Loan, make the amount of such Loan available to the Borrower as shall be directed by the Authorized Representative in Dollars and in immediately available funds.      (f) From time to time, the Borrower shall furnish such information to the Administrative Agent as the Administrative Agent may request relating to the making of Competitive Bid Loans, including the amounts, interest rates, dates of borrowings and maturities thereof.      (g) The Borrower may request the Administrative Agent to receive the Competitive Bid Quotes, in which event the Administrative Agent shall (A) in the case of a Competitive Bid Loan at the Absolute Rate, as promptly as practicable after the Competitive Bid Quote is submitted (but in no event later than 10:00 A.M. on the Quotation Date) or (B) in the case of a Competitive Bid Loan at the Eurodollar Competitive Rate, by 10:00 A.M. on the date a Competitive Quote is submitted, notify the Borrower of the terms of any Competitive Bid Quote submitted by a Revolving Credit Lender that is in accordance with Section 2.5(c) hereof. The Administrative Agent’s notice to the Borrower shall specify (A) the aggregate principal amount of the Competitive Bid Borrowing for which Competitive Bid Quotes have been received and (B) the respective principal amounts and Absolute Rates or Eurodollar Competitive Rate, as the case may be, offered by each Revolving Credit Lender (identifying the Lender that made each Competitive Bid Quote). Not later than 12:00 Noon on (A) the third Business Day prior to the proposed date of borrowing, in the case of Competitive Bid Loans at the Eurodollar Competitive Rate or (B) the Quotation Date (or, in any such case, agree), the Borrower shall notify the Administrative Agent of their acceptance or nonacceptance of the Competitive Bid Quotes so notified to it (and the failure of the Borrower to give such notice by such time shall constitute nonacceptance) and the Administrative Agent shall promptly notify each affected Lender. Together with each notice of a request for Competitive Bid Quotes which the Borrower requires the Administrative Agent to issue pursuant to this paragraph (g), the Borrower shall pay to the Administrative Agent for the account of the Administrative Agent a bid administration fee of $1,500.00.      2.6 Payment of Interest. (a) The Borrower shall pay interest (i) to the Administrative Agent at the Principal Office for the account of each Lender on the outstanding and unpaid principal amount of each Revolving Credit Loan and each Term Loan made by such Lender for the period commencing on the date of such Loan until such Loan shall be due at the Eurodollar Rate or the Base Rate, as elected or deemed elected by the Borrower or otherwise applicable to such Loan as herein provided, (ii) to each Revolving Credit Lender making a Competitive Bid Loan at its Applicable Lending Office, at the applicable Absolute Rate or Eurodollar Competitive Rate, as the case may be, and (iii) to the Administrative Agent in the case of each Swing Line Loan, at the Base Rate; provided, however, that if any amount shall not be paid when due (at maturity, by acceleration or otherwise), all amounts outstanding hereunder shall bear interest thereafter at a fluctuating interest rate per annum equal to the Default Rate, or (in each   35 case) the maximum rate permitted by applicable law, whichever is lower, from the date such amount was due and payable until the date such amount is paid in full.      (a) Interest on the outstanding principal balance of each Loan shall be computed on the basis of (x) in the case of Loans, other than Loans bearing interest based on the Prime Rate, a year of 360 days and calculated for the actual number of days elapsed and (y) in the case of Loans bearing interest based on the Prime Rate, a year of 365-366 days and calculated for the actual number of days elapsed. Interest on the outstanding principal balance of each Loan shall be paid (a) quarterly in arrears, such payment to be made not later than the third (3rd) Business Day of each April, July, October and January commencing on the third (3rd) Business Day of October 2005, on each Base Rate Loan, (b) on the last day of the applicable Interest Period for each Eurodollar Loan and Competitive Bid Loan, but in no event less frequently than at the end of each three month period and (c) upon payment in full of the principal amount of such Loan at the Revolving Credit Termination Date.      2.7 Payment of Principal. The principal amount of the Revolving Credit Outstandings and all Swing Line Outstandings shall be due and payable to the Administrative Agent for the benefit of each applicable Lender in full on the Revolving Credit Termination Date, or earlier as herein expressly provided. The principal amount of all Competitive Bid Loans shall be due and payable to the Lender making such Competitive Bid Loan in full on the last day of the Interest Period therefor, or earlier as herein expressly provided. The principal amount of all Term Loans shall be due and payable to each Term Lender making such Term Loan as provided in Section 2.3, or earlier as herein expressly provided. Prepayments of Term Loans may not be reborrowed. The principal amount of Eurodollar Loans may only be prepaid at the end of the applicable Interest Period, unless the Borrower shall pay to the applicable Lenders the amounts, if any, required under Section 4.5. The principal amount of Competitive Bid Loans may only be prepaid at the end of the applicable Interest Period, unless (i) the Borrower shall have retained in the Competitive Bid Quote Request with respect to such Competitive Bid Loans the right of prepayment, and (ii) the Borrower shall have paid to the Lender making such Competitive Bid Loans which bear interest at a Eurodollar Competitive Rate or to the Administrative Agent, as applicable, the amounts, if any, required under Section 4.5. The Borrower shall furnish the Administrative Agent telephonic notice of its intention to make a principal payment (including Competitive Bid Loans) prior to 12:00 noon on the date of such payment. All payments of principal on Loans other than Competitive Bid Loans and Swing Line Loans shall be in the amount of (i) $10,000,000, or such greater amount which is an integral multiple of $1,000,000, in the case of Eurodollar Loans, or (ii) $5,000,000, or such greater amount which is an integral multiple of $1,000,000, in the case of Base Rate Loans. Optional prepayments of Term Loans shall be applied to the outstanding balance of the Term Loans.      2.8 Non-Conforming Payments. (a) Each payment of principal (including any prepayment) and payment of interest (other than principal and interest on Competitive Bid Loans which shall be paid to the Lender making such Loans) shall be made to the Administrative Agent at the Principal Office, for the account of each applicable Lender’s Applicable Lending Office, in Dollars and in immediately available funds before 2:00 P.M. on the date such payment is due. The Administrative Agent may, but shall not be obligated to, debit the amount of any such payment which is not made by such time to any ordinary deposit account, if any, of the Borrower with the Administrative Agent.   36      (b) The Administrative Agent shall deem any payment by or on behalf of the Borrower hereunder that is not made both (a) in Dollars and in immediately available funds and (b) prior to 2:00 P.M. on the date payment is due to be a non-conforming payment. Any such payment shall not be deemed to be received by the Administrative Agent until the time such funds become available funds. The Administrative Agent shall give prompt telephonic notice to the Authorized Representative and each of the applicable Lenders (confirmed in writing) if any payment is non-conforming. Interest shall continue to accrue on any principal as to which a non-conforming payment is made until such funds become available funds (but in no event less than the period from the date of such payment to the next succeeding Business Day) at the applicable rate of interest per annum specified in Section 2.6(a) until the date such amount is paid in Dollars and in immediately available funds.      (c) In the event that any payment hereunder becomes due and payable on a day other than a Business Day, then such due date shall be extended to the next succeeding Business Day; provided that interest shall continue to accrue during the period of any such extension.      2.9 Pro Rata Payments. Except as otherwise provided herein, (a) each payment and prepayment on account of the principal of and interest on the Revolving Credit Loans and the fee described in Section 2.13(a) hereof shall be made to the Administrative Agent in the aggregate amount payable to the Revolving Credit Lenders for the account of the Revolving Credit Lenders pro rata based on their Revolving Percentages, (b) each payment and prepayment on account of the principal of and interest on the Term Loans shall be made to the Administrative Agent in the aggregate amount payable to the Term Lenders for the account of the Term Lenders pro rata based on their Term Percentages and each principal prepayment of the Term Loans shall be applied to reduce the Term Loans pro rata based upon the respective then remaining principal amounts thereof, (c) each payment of principal and interest on the Competitive Bid Loans shall be made to (i) the Administrative Agent for the account of the respective Lender making such Competitive Bid Loan if the Borrower has elected that the Administrative Agent act under Section 2.5(g) hereof and (ii) otherwise directly to the Lender making such Competitive Bid Loan, (d) each payment of principal and interest on Swing Line Loans shall be made to the Administrative Agent for the account of JPMorgan Chase Bank, (e) all payments to be made by the Borrower for the account of each of the Lenders on account of principal, interest and fees, shall be made without set-off or counterclaim except as provided in Section 4.6, and (f) the Administrative Agent will distribute such payments when received to the Lenders as provided for herein and subject to Section 4.6.      2.10 Reductions and Prepayment. (a) Reductions. The Borrower shall, by notice from an Authorized Representative, have the right from time to time (but not more frequently than twice during each Fiscal Year), upon not less than three (3) Business Days irrevocable written notice to the Administrative Agent to reduce the Total Revolving Credit Commitment without premium or penalty. The Administrative Agent shall give each Revolving Credit Lender, within one (1) Business Day of receipt of such notice from the Borrower, telephonic notice (confirmed in writing) of such reduction. Each such reduction shall be in the aggregate amount of $10,000,000 or such greater amount which is in an integral multiple of $1,000,000, and shall permanently reduce the Total Revolving Credit Commitment of the Revolving Credit Lenders pro rata. No such reduction shall be permitted that results in the payment of any Eurodollar Loan   37 other than on the last day of the Interest Period of such Loan unless such prepayment is accompanied by amounts due, if any, under Section 4.5. Each reduction of the Total Revolving Credit Commitment shall be accompanied by payment of the Revolving Credit Loans to the extent that the aggregate principal amount of Outstanding Revolving Credit Obligations exceeds the Total Revolving Credit Commitment after giving effect to such reduction, together with accrued and unpaid interest on the amounts prepaid. In no event shall the Borrower be entitled to reduce the Total Revolving Credit Commitment if, as a result of and after giving effect to such reduction, the Outstanding Revolving Credit Obligations exceed the Total Revolving Credit Commitment.      (b) Optional Prepayments. The Borrower may at any time and from time to time, subject to Section 2.7, prepay the Loans, in whole or in part, without premium or penalty, upon irrevocable prior notice which notice may be given by telephone (to be promptly confirmed in writing, including by facsimile) delivered to the Administrative Agent no later than 12:00 Noon, New York City time, three Business Days prior thereto in the case of Eurodollar Rate Loans and no later than 12:00 Noon, New York City time, one Business Day prior thereto in the case of Base Rate Loans, which notice shall specify the date and amount of prepayment and whether the prepayment is of Eurodollar Rate Loans or Base Rate Loans. Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof. If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with (except in the case of Revolving Credit Loans that are Base Rate Loans and Swingline Loans) accrued interest to such date on the amount prepaid.      2.11 Decrease in Amounts. The amount of the Total Revolving Credit Commitment which shall be available to the Borrower shall be reduced by the aggregate amount of all Swing Line Outstandings, all Outstanding Letters of Credit and all outstanding Competitive Bid Loans.      2.12 Conversions and Elections of Subsequent Interest Periods. Subject to the limitations set forth below and in Article IV hereof, the Borrower may:      (a) upon notice to the Administrative Agent on or before 12:00 noon on any Business Day Convert all or a part of Eurodollar Loans to Base Rate Loans on the last day of the Interest Period for such Eurodollar Loans; and      (b) provided that no Default or Event of Default shall have occurred and be continuing and on three (3) Business Days’ notice to the Administrative Agent on or before 12:00 noon:      (i) elect a subsequent Interest Period for all or a portion of Eurodollar Loans to begin on the last day of the current Interest Period for such Eurodollar Loans; or      (ii) Convert Base Rate Loans (other than Swing Line Loans) to Eurodollar Loans on any Business Day.      Notice of any such elections or Conversions shall specify the effective date of such election or Conversion and, with respect to Eurodollar Loans, the Interest Period to be applicable to the Loan as Continued or Converted. Each election and Conversion pursuant to this Section   38 2.12 shall be subject to the limitations on Eurodollar Loans set forth in the definition of “Interest Period” herein and in Article IV hereof. All such Continuations or Conversions of Loans shall be effected pro rata based on the Revolving Percentages or Term Percentages of the applicable Lenders, as the case may be.      2.13 Fees. (a) Facility Fee. For the period beginning on the Closing Date and ending on the Revolving Credit Termination Date (or such earlier date on which the Revolving Credit Facility has terminated), the Borrower agrees to pay to the Administrative Agent, for the benefit of each Revolving Credit Lender based on such Lender’s Revolving Credit Commitment, the quarterly portion of the Applicable Facility Fee for such Lender. Such payments of fees provided for in this Section 2.13(a) shall be payable quarterly in arrears, such payments to be made not later than the third (3rd) Business Day of each April, July, October and January beginning on the third (3rd) Business Day of October 2005 to and on the Revolving Credit Termination Date (or such earlier date on which the Revolving Credit Facility has terminated). Notwithstanding the foregoing, so long as any Lender fails to make available any portion of its Revolving Credit Commitment when requested, such Lender shall not be entitled to receive payment of its pro rata share of such fee until such Lender shall make available such portion. Such fee shall be calculated on the basis of a year of 360 days for the      (b) Utilization Fee. For the period beginning on the Closing Date and ending on the later of (i) the Revolving Credit Termination Date (or such earlier date on which the Revolving Credit Facility has terminated) and (ii) the date on which no Revolving Credit Loans, Swing Line Loans, Competitive Bid Loans or Letters of Credit (other than Letters of Credit (“Covered Letters of Credit”) that have been cash collateralized in an amount of at least 105% of the face amount thereof or covered by a “back-to-back” letter of credit, in each case in a manner reasonably satisfactory to the Administrative Agent) remain outstanding, the Borrower agrees to pay to the Administrative Agent, for the benefit of each Revolving Credit Lender based on such Lender’s Revolving Credit Commitment, a utilization fee for each day Utilization is greater than 50%. The utilization fee for any day shall be an amount equal to 0.125% per annum times the sum of the actual outstanding principal balance of each Lender’s Revolving Credit Loans on such day and such Lender’s participating interest in the then outstanding Swing Line Loans and Letters of Credit. Such payments of fees provided for in this Section 2.13(b) shall be payable quarterly in arrears, such payments to be made not later than the third (3rd) Business Day of each April, July, October and January beginning on the third (3rd) Business Day of October 2005 to and on the later of (i) the Revolving Credit Termination Date (or such earlier date on which the Revolving Credit Revolving Credit Facility has terminated) and (ii) the date on which no Revolving Credit Loans, Swing Line Loans, Competitive Bid Loans or Letters of Credit (other than Covered Letters of Credit) remain outstanding. For the purposes hereof, “Utilization” means, for any day, a percentage equal to the actual aggregate principal amount of Loans (other than Term Loans) under this Agreement outstanding during each day, divided by the aggregate Revolving Credit Commitments as of the end of such day. If any Revolving Credit Loans, Swing Line Loans, Competitive Bid Loans or Letters of Credit remain outstanding after the Revolving Credit Commitments have been terminated, Utilization shall be determined based on the aggregate Revolving Credit Commitments immediately prior to such termination.   39      (c) Agent Fees. The Borrower agrees to pay to the Administrative Agent, for the Administrative Agent’s individual account, an annual Administrative Agent’s fee to be payable in advance and annually thereafter on the anniversary of the Closing Date such amounts as agreed to by the Administrative Agent and the Borrower in writing.      2.14 Deficiency Advances; Failure to Purchase Participations. No Lender shall be responsible for any default of any other Lender in respect of such other Lender’s obligation to make any Loan or Advance hereunder nor shall the Revolving Credit Commitment or Term Commitment of any Lender hereunder be increased as a result of such default of any other Lender. Without limiting the generality of the foregoing or the provisions of Section 2.15, in the event any Lender shall fail to advance funds to the Borrower as herein provided, the Administrative Agent may in its discretion, but shall not be obligated to, advance to the Borrower all or any portion of such amount or amounts (each, a “deficiency advance”) and shall thereafter be entitled to payments of principal of and interest on such deficiency advance in the same manner and at the same interest rate or rates to which such other Lender would have been entitled had it made such Advance; provided that, (i) such defaulting Lender shall not be entitled to receive payments of principal, interest or fees with respect to such deficiency advance until such deficiency advance (together with interest thereon as provided in clause (ii)) shall be paid by such Lender and (ii) upon payment to the Administrative Agent from such other Lender of the entire outstanding amount of each such deficiency advance, together with accrued and unpaid interest thereon, from the most recent date or dates interest was paid to the Administrative Agent by the Borrower on each Loan comprising the deficiency advance at the Federal Funds Rate, then such payment shall be credited in full payment of such deficiency advance and the Borrower shall be deemed to have borrowed the amount of such deficiency advance from such other Lender as of the most recent date or dates, as the case may be, upon which any payments of interest were made by the Borrower thereon.      2.15 Intraday Funding. Without limiting the provisions of Section 2.14, unless the Borrower or any Lender has notified the Administrative Agent not later than 12:00 Noon of the Business Day before the date any payment (including in the case of Lenders any Advance) to be made by it is due, that it does not intend to remit such payment, the Administrative Agent may, in its discretion, assume that Borrower or each Lender, as the case may be, has timely remitted such payment in the manner required hereunder and may, in its discretion and in reliance thereon, make available such payment (or portion thereof) to the Person entitled thereto as otherwise provided herein. If such payment was not in fact remitted to the Administrative Agent in the manner required hereunder, then:      (i) if Borrower failed to make such payment, each applicable Lender shall forthwith on demand repay to the Administrative Agent the amount of such assumed payment made available to such Lender, together with interest thereon in respect of each day from and including the date such amount was made available by the Administrative Agent to such Lender to the date such amount is repaid to the Administrative Agent at the Federal Funds Rate; and      (ii) if any Lender failed to make such payment, the Administrative Agent shall be entitled to recover such corresponding amount forthwith upon the Administrative Agent’s demand therefor, the Administrative Agent promptly shall notify the Borrower,   40 and the Borrower shall promptly pay such corresponding amount to the Administrative Agent in immediately available funds upon receipt of such demand. The Administrative Agent also shall be entitled to recover interest on such corresponding amount in respect of each day from the date such corresponding amount was made available by the Administrative Agent to the Borrower to the date such corresponding amount is recovered by the Administrative Agent, (A) from such Lender at a rate per annum equal to the daily Federal Funds Rate or (B) from the Borrower, at a rate per annum equal to the interest rate applicable to the Loan which includes such corresponding amount. Until the Administrative Agent shall recover such corresponding amount together with interest thereon, such corresponding amount shall constitute a deficiency advance within the meaning of Section 2.14. Nothing herein shall be deemed to relieve any Lender from its obligation to fulfill its commitments hereunder or to prejudice any rights which the Administrative Agent or the Borrower may have against any Lender as a result of any default by such Lender hereunder.      2.16 Use of Proceeds. The proceeds of the Loans made pursuant to the Revolving Credit Facility, the Competitive Bid Facility, the Swing Line and the Letters of Credit issued pursuant to the Letter of Credit Facility shall be used by the Borrower and its Subsidiaries to finance a portion of the Transaction and to repay indebtedness, finance acquisitions and for working capital, capital expenditures, share repurchases and other general corporate purposes of the Borrower and its Subsidiaries. The proceeds of the Term Loans shall be used to finance a portion of the Transaction and to pay related fees and expenses.      2.17 Swing Line. (a) Notwithstanding any other provision of this Agreement to the contrary, in order to administer the Revolving Credit Facility in an efficient manner and to minimize the transfer of funds between the Administrative Agent and the Revolving Credit Lenders, JPMorgan Chase Bank, in its individual capacity and not as Administrative Agent, and subject to the provisions of Section 2.17(c), shall make available Swing Line Loans to the Borrower prior to the Revolving Credit Termination Date. JPMorgan Chase Bank shall not make any Swing Line Loan pursuant hereto (i) if to the actual knowledge of JPMorgan Chase Bank the Borrower is not in compliance with all the conditions to the making of Loans set forth in this Agreement, (ii) if after giving effect to such Swing Line Loan, the Swing Line Outstandings exceed $25,000,000, or (iii) if after giving effect to such Swing Line Loan, the principal amount of Outstanding Revolving Credit Obligations exceeds the Total Revolving Credit Commitment. Swing Line Loans shall be limited to Base Rate Loans unless JPMorgan Chase Bank and the Borrower shall agree otherwise. The Borrower may borrow, repay and reborrow under this Section 2.17. Unless notified to the contrary by JPMorgan Chase Bank, borrowings under the Swing Line shall be made in the minimum amount of $1,000,000 or, if greater, in amounts which are integral multiples of $100,000, or in the amount necessary to effect a Base Rate Refunding Loan, upon irrevocable telephonic notice, by an Authorized Representative of Borrower made to JPMorgan Chase Bank not later than 12:30 P.M. on the Business Day of the requested borrowing. The Borrower shall provide the Administrative Agent written confirmation of each such telephonic notice on the same day by telefacsimile transmission in the form of a Borrowing Notice. Each such Borrowing Notice shall specify the amount of the borrowing and the date of borrowing, and shall be in the form of Exhibit D-3, with appropriate insertions. Unless notified to the contrary by JPMorgan Chase Bank, each repayment of a Swing Line Loan shall be in an amount which is an integral multiple of $100,000   41 or the aggregate amount of all Swing Line Outstandings. If the Borrower instructs JPMorgan Chase Bank to debit any demand deposit account of the Borrower in the amount of any payment with respect to a Swing Line Loan, or JPMorgan Chase Bank otherwise receives repayment, after 2:00 P.M. on a Business Day, such payment shall be deemed received on the next Business Day.      (b) Swing Line Loans shall bear interest at the Base Rate applicable to Revolving Credit Loans or at any rate otherwise mutually agreed upon by JPMorgan Chase Bank and the Borrower. The interest payable on Swing Line Loans is solely for the account of JPMorgan Chase Bank, and all accrued and unpaid interest on Swing Line Loans shall be payable on the dates and in the manner provided in Section 2.6 with respect to interest on Base Rate Loans.      (c) Upon the making of a Swing Line Loan, each Revolving Credit Lender shall be deemed to have purchased from JPMorgan Chase Bank a Participation therein in an amount determined with reference to such Lender’s Revolving Percentage of such Swing Line Loan. Upon demand made by JPMorgan Chase Bank, each Revolving Credit Lender shall, according to its Revolving Percentage of such Swing Line Loan, promptly provide to JPMorgan Chase Bank its purchase price therefor in an amount equal to its Participation therein. Any Advance made by a Revolving Credit Lender pursuant to demand of JPMorgan Chase Bank of the purchase price of its Participation shall be deemed (i) provided that the conditions to making Revolving Credit Loans shall be satisfied, a Base Rate Refunding Loan under Section 2.4 until the Borrower converts such Base Rate Loan in accordance with the terms of Section 2.12, and (ii) in all other cases, the funding by each Revolving Credit Lender of the purchase price of its Participation in such Swing Line Loan. The obligation of each Revolving Credit Lender to so provide its purchase price to JPMorgan Chase Bank shall be absolute and unconditional and shall not be affected by the occurrence of a Default, an Event of Default or any other occurrence or event. Simultaneously with the making of each such payment by a Revolving Credit Lender to JPMorgan Chase Bank to fund such Lender’s purchase price of a Participation in such Swing Line Loan pursuant to clause (ii) of this paragraph, such Lender shall, automatically and without any further action on the part of JPMorgan Chase Bank or such Lender, have the right to enforce its Participation in an amount equal to such payment (excluding the portion thereof constituting interest accrued prior to the date the Revolving Credit Lender made its payment) in the related rights of JPMorgan Chase Bank with respect to obligations of the Borrower as to such Swing Line Loan.      The Borrower, at its option and subject to the terms hereof, may request an Advance pursuant to Section 2.4 in an amount sufficient to repay Swing Line Outstandings on any date and the Administrative Agent shall provide from the proceeds of such Advance to JPMorgan Chase Bank the amount necessary to repay such Swing Line Outstandings (which JPMorgan Chase Bank shall then apply to such repayment) and credit any balance of the Advance in immediately available funds in the manner directed by the Borrower pursuant to Section 2.4(c)(iii). The proceeds of such Advances shall be paid to JPMorgan Chase Bank for application to the Swing Line Outstandings and the Revolving Credit Lenders shall then be deemed to have made Revolving Credit Loans in the amount of such Advances. The Swing Line shall continue in effect until the Revolving Credit Termination Date, at which time all Swing Line Outstandings and accrued interest thereon shall be due and payable in full. Notwithstanding the foregoing, the Swing Line Outstandings shall be immediately due and   42 payable at any time upon notice by JPMorgan Chase Bank or the Administrative Agent to the Borrower. In the event the Revolving Credit Lenders have funded Participations in any Swing Line Loan, then at the time payment (in fully collected, immediately available funds) of any principal amount of, or interest on, such Swing Line Loan, in whole or in part, is received by JPMorgan Chase Bank or the Administrative Agent, JPMorgan Chase Bank or the Administrative Agent (as applicable) shall promptly pay to each Revolving Credit Lender an amount equal to its Revolving Percentage of such payment from the Borrower.      2.18 Increased Amounts. (a) The Borrower shall have the right from time to time, without the consent of the Lenders, subject to the terms of this Section 2.18 and provided that the Borrower has obtained any required consents of third parties, to effectuate during the period commencing on the Closing Date and ending on the date of any voluntary reduction of the Total Revolving Credit Commitment, an increase in the Total Revolving Credit Commitment under this Agreement by adding to this Agreement one or more Persons acceptable to the Borrower and reasonably acceptable to the Administrative Agent, who shall, upon completion of the requirements of this Section 2.18, constitute a “Revolving Credit Lender” or “Revolving Credit Lenders” hereunder (each an “Added Lender”), or by allowing one or more Revolving Credit Lenders in their sole discretion to increase their respective Revolving Credit Commitments hereunder (each an “Increasing Lender”), so that such increased Revolving Credit Commitments shall equal the aggregate increase in the Total Revolving Credit Commitment effectuated pursuant to this Section 2.18; provided that (i) the aggregate addition of or increase in the Revolving Credit Commitment of any Lender to be effected under this Section 2.18 (collectively, the “Added Commitments”) shall be in an amount not less than $5,000,000, and, if greater than $5,000,000, an integral multiple of $1,000,000, (ii) no increase in or added Revolving Credit Commitments pursuant to this Section 2.18 shall result in the sum of the Total Revolving Credit Commitment hereunder exceeding $800,000,000, (iii) no Lender’s Revolving Credit Commitment shall be increased under this Section 2.18 without the consent of such Lender, and (iv) there shall not exist any Default or Event of Default immediately prior to and immediately after giving effect to any such Added Commitment. The Borrower shall deliver or pay, as applicable, to the Administrative Agent not later than five (5) Business Days prior to any such increase in the Total Revolving Credit Commitment each of the following items with respect to each Added Lender and Increasing Lender:      (i) a written notice of Borrower’s intention to increase the Total Revolving Credit Commitment pursuant to this Section 2.18, which shall specify each Added Lender and Increasing Lender, the proposed effective date for the increase in Revolving Credit Commitments, the amounts of the Added Commitments of each such Lender that will result (which amounts shall be subject to confirmation by the Administrative Agent), and such other information as is reasonably requested by the Administrative Agent;      (ii) documents in the form of Exhibit K or Exhibit L, as may be required by the Administrative Agent, executed and delivered by each Added Lender and each Increasing Lender, pursuant to which it becomes a party hereto or increases its Revolving Credit Commitment; and      (iii) a non-refundable processing fee of $3,500 with respect to each Added Lender or Increasing Lender for the sole account of the Administrative Agent.   43      (b) Upon receipt of any notice referred to in clause (a)(i) above, the Administrative Agent shall promptly notify each Lender thereof and shall distribute an amended Exhibit A (which shall be deemed effective as of the Increased Commitment Date referred to below and thereupon incorporated into this Agreement) to reflect any changes therein resulting from such increase. Upon execution and delivery of the documents and the payment of the fee as described above, and upon delivery to the Administrative Agent by each Added Lender and Increasing Lender for further delivery to the Borrower or other Revolving Credit Lenders (as applicable) of immediately available, freely transferable funds in an amount equal to, for each Added Lender, such Added Lender’s Revolving Percentage (after giving effect to all Added Commitments) of Revolving Credit Outstandings and funded Participations and, for each Increasing Lender, the product of the increase in such Increasing Lender’s Revolving Percentage (after giving effect to all Added Commitments) multiplied by the sum of Revolving Credit Outstandings and funded Participations, as applicable (the “Increased Commitment Date”), (x) each such Added Lender shall constitute a “Revolving Credit Lender” for all purposes under this Agreement and related documents without any acknowledgment by or the consent of the other Lenders, with a Revolving Credit Commitment as specified in such documents and revised Exhibit A, (y) each such Increasing Lender’s Revolving Credit Commitment shall increase as specified in such documents and revised Exhibit A, and each other Lender’s Revolving Percentage shall be adjusted to reflect the Added Commitments and shall be specified in such revised Exhibit A, as the case may be. As of the Increased Commitment Date, (i) the respective Revolving Percentages of the Lenders shall be deemed modified as appropriate to correspond to such Added Commitments, and (ii) on the Increased Commitment Date, to the extent necessary to keep all outstanding Revolving Credit Loans and funded Participations ratable among all Revolving Credit Lenders in accordance with any revised Revolving Percentages arising from any Added Commitments under this Section 2.18, all Interest Periods then outstanding shall be deemed to be terminated without further action or consent of the Borrower and the Borrower shall pay any additional amounts required pursuant to Section 4.5 in connection therewith). In addition, if there are at such time outstanding any Revolving Credit Outstandings and funded Participations, each Revolving Credit Lender whose Revolving Percentage has been decreased as a result of the increase in the Total Revolving Credit Commitment shall be deemed to have assigned, without recourse, to each Added Lender and Increasing Lender such portion of such Lender’s Revolving Credit Outstandings or funded Participations as shall be necessary to effectuate such adjustment in Revolving Percentages. Each Increasing Lender and Added Lender (i) shall be deemed to have assumed such portion of such Revolving Credit Outstandings and funded Participations and (ii) shall fund to each other Revolving Credit Lender on the Increased Commitment Date the amount of Revolving Credit Outstandings and funded Participations assigned to it by such Lender. The Borrower agrees to pay to the Revolving Credit Lenders on demand any and all amounts required pursuant to Section 4.5 resulting from any such assignment of Revolving Credit Outstandings.      (c) This Section 2.18 shall supersede any provisions in Section 11.1 and 11.6 to the contrary.   44 ARTICLE III Letters of Credit      3.1 Letters of Credit. The Issuing Banks agree, subject to the terms and conditions of this Agreement, upon request of the Borrower, to issue from time to time for the account of the Borrower Letters of Credit upon delivery to the applicable Issuing Bank of an Application and Agreement for Letter of Credit relating thereto in form and content acceptable to such Issuing Bank; provided, that (i) no Issuing Bank shall issue (or renew) any Letter of Credit if it has been notified by the Administrative Agent or has actual knowledge that a Default or Event of Default has occurred and is continuing, (ii) the Outstanding Letters of Credit shall not exceed the Total Letter of Credit Commitment and (iii) no Letter of Credit shall be issued (or renewed) if, after giving effect thereto, Outstanding Letters of Credit plus Revolving Credit Outstandings plus Swing Line Outstandings plus outstanding Competitive Bid Loans shall exceed the Total Revolving Credit Commitment. No Letter of Credit shall have an expiry date (including all rights of the Borrower or any beneficiary named in such Letter of Credit to require renewal, but not any renewal options that are subject to the approval of the Issuing Bank) or payment date occurring later than the earlier to occur of one year after the date of its issuance or the fifth Business Day prior to the Revolving Credit Termination Date. Each request by the Borrower for the issuance or renewal of a Letter of Credit, whether pursuant to an Application and Agreement for Letter of Credit or otherwise, shall constitute its certification that the conditions specified in Section 5.2 with respect to such issuance or renewal have been satisfied. At any one time during the term of this Agreement, not more than four (4) different Revolving Credit Lenders (including any Existing Issuing Banks) shall be allowed to act as an Issuing Bank.      3.2 Reimbursement and Participations.      (a) The Borrower hereby unconditionally agrees to pay to the applicable Issuing Bank immediately on demand at its Applicable Lending Office all amounts required to pay all drafts drawn under any Letters of Credit and all reasonable expenses incurred by an Issuing Bank in connection with the Letters of Credit, and in any event and without demand to place in possession of the applicable Issuing Bank (which shall include Advances under the Revolving Credit Facility if permitted by Section 2.4 and Swing Line Loans if permitted by Section 2.17) sufficient funds to pay all debts and liabilities arising under any Letter of Credit. The Borrower’s obligations to pay an Issuing Bank under this Section 3.2, and such Issuing Bank’s right to receive the same, shall be absolute and unconditional and shall not be affected by any circumstance whatsoever. Each Issuing Bank agrees to give the Borrower prompt notice of any request for a draw under a Letter of Credit, but failure to provide such notice shall not affect the parties’ Obligations with respect thereto. Each Issuing Bank may charge any account the Borrower may have with it for any and all amounts such Issuing Bank pays under a Letter of Credit, plus reasonable charges and reasonable expenses as from time to time agreed to by such Issuing Bank and the Borrower; provided that to the extent permitted by Section 2.4(c)(iv) and Section 2.17, such amounts shall be paid pursuant to Advances under the Revolving Credit Facility or, if the Borrower shall elect, by Swing Line Loans. The Borrower agrees that an Issuing Bank may, in its sole discretion, accept or pay, as complying with the terms of any Letter of Credit, any drafts or other documents otherwise in order which may be signed or issued by an administrator, executor, trustee in bankruptcy, debtor in possession, assignee for the benefit of   45 creditors, liquidator, receiver, attorney in fact or other legal representative of a party who is authorized under such Letter of Credit to draw or issue any drafts or other documents. The Borrower agrees to pay an Issuing Bank interest on any Reimbursement Obligations not paid when due hereunder at the Default Rate.      (b) In accordance with the provisions of Section 2.4(c), each Issuing Bank shall notify the Administrative Agent (and shall also notify the Borrower) of any drawing under any Letter of Credit as promptly as practicable following the receipt by the Issuing Bank of such drawing, but failure to provide such notice shall not affect the parties’ Obligations with respect thereto.      (c) Each Revolving Credit Lender (other than the applicable Issuing Bank) shall automatically acquire on the date of issuance thereof, a Participation in the liability of such Issuing Bank in respect of each Letter of Credit in an amount equal to such Lender’s Revolving Percentage of such liability, and to the extent that the Borrower is obligated to pay such Issuing Bank under Section 3.2(a), each Revolving Credit Lender (other than the Issuing Bank) thereby shall absolutely, unconditionally and irrevocably assume, and shall be unconditionally obligated to pay to such Issuing Bank, its Revolving Percentage of the liability of such Issuing Bank under such Letter of Credit in the manner and with the effect provided in Section 2.4(c)(iv). With respect to drawings under any of the Letters of Credit, each Revolving Credit Lender, upon receipt from the Administrative Agent of notice of a drawing in the manner described in Section 2.4(c)(iv), shall promptly pay to the Administrative Agent for the account of the applicable Issuing Bank, prior to the applicable time set forth in Section 2.4(c)(iv), its Revolving Percentage of such drawing. Simultaneously with the making of each such payment by a Revolving Credit Lender to an Issuing Bank, such Lender shall, automatically and without any further action on the part of such Issuing Bank or such Lender, acquire a Participation in an amount equal to such payment (excluding the portion thereof constituting interest accrued prior to the date such Lender made its payment) in the related Reimbursement Obligation of the Borrower. The Reimbursement Obligations of the Borrower shall be immediately due and payable upon notice to the Borrower, whether in Advances made in accordance with Section 2.4(c)(iv) or otherwise. Each Revolving Credit Lender’s obligation to make payment to the Administrative Agent for the account of an Issuing Bank pursuant to Section 2.4(c)(iv) and this Section 3.2(c), and the right of such Issuing Bank to receive the same, shall be absolute and unconditional, shall not be affected by any circumstance whatsoever and shall be made without any offset, abatement, withholding or reduction whatsoever. In the event the Revolving Credit Lenders have purchased Participations in any Reimbursement Obligation as set forth above, then at any time payment (in fully collected, immediately available funds) of such Reimbursement Obligation, in whole or in part, is received by the applicable Issuing Bank or the Administrative Agent from the Borrower, such Issuing Bank or Administrative Agent shall promptly pay to each Revolving Credit Lender an amount equal to its Revolving Percentage of such payment from the Borrower. If any Revolving Credit Lender is obligated to pay but does not pay amounts to the Administrative Agent for the account of an Issuing Bank in full upon such request as required by this Section 3.2(c), such Lender shall, on demand, pay to the Administrative Agent for the account of such Issuing Bank interest on the unpaid amount for each day during the period commencing on the date of notice given to such Lender pursuant to Section 2.4(c) until such Lender pays such amount to the Administrative Agent for the account of such Issuing Bank in full at the Federal Funds Rate.   46      (d) As soon as practical following the issuance of a Letter of Credit, the applicable Issuing Bank shall notify the Administrative Agent, and the Administrative Agent shall notify each Revolving Credit Lender, of the date of issuance of such Letter of Credit, the stated amount and the expiry date of such Letter of Credit. Promptly following the end of each calendar quarter, each Issuing Bank shall deliver to the Administrative Agent a notice describing the aggregate undrawn amount of all Letters of Credit at the end of such quarter. Upon the request of any Revolving Credit Lender from time to time, each Issuing Bank shall deliver to the Administrative Agent, and the Administrative Agent shall deliver to such Lender, any other information reasonably requested by such Lender with respect to each Outstanding Letter of Credit.      (e) Each issuance by an Issuing Bank of a Letter of Credit shall, in addition to the conditions precedent set forth in Article V, be subject to the conditions that (x) such Letter of Credit be in such form and contain such terms as shall be reasonably satisfactory to the Issuing Bank consistent with the then current practices and procedures of such Issuing Bank with respect to similar letters of credit, (y) the issuance of such Letter of Credit shall not violate any written policy of the Issuing Bank, and (z) the Borrower shall have executed and delivered such other instruments and agreements relating to such Letters of Credit as the Issuing Bank shall have reasonably requested consistent with such practices and procedures. Except as otherwise provided therein, all Letters of Credit shall be governed by the rules of the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice (or such later version thereof as may be in effect at the time of issuance).      (f) Without limiting the generality of the provisions of Section 11.9, the Borrower hereby agrees to indemnify and hold harmless each Issuing Bank, each other Revolving Credit Lender and the Administrative Agent from and against any and all claims and damages, losses, liabilities, and reasonable costs and expenses which such Issuing Bank, such other Revolving Credit Lender or the Administrative Agent may incur (or which may be claimed against such Issuing Bank, such other Revolving Credit Lender or the Administrative Agent) by any Person by reason of or in connection with the issuance or transfer of or payment or failure to pay under any Letter of Credit; provided that the Borrower shall not be required to indemnify an Issuing Bank, any other Revolving Credit Lender or the Administrative Agent for any claims, damages, losses, liabilities, costs or expenses to the extent, but only to the extent, (i) caused by the willful misconduct or gross negligence of the party to be indemnified or (ii) caused by the failure of an Issuing Bank to pay under any Letter of Credit after the presentation to it of a request for payment strictly complying with the terms and conditions of such Letter of Credit, unless such payment is prohibited by any law, regulation, court order or decree or failure to pay is permitted under the terms of the Applicable Letter of Credit. The indemnification and hold harmless provisions of this Section 3.2(f) shall survive repayment of the Obligations, occurrence of the Revolving Credit Termination Date, the Facility Termination Date and expiration or termination of this Agreement.      (g) Without limiting the provisions of Section 3.2(f), the obligation of the Borrower to immediately reimburse an Issuing Bank for drawings made under Letters of Credit and each Issuing Bank’s right to receive such payment shall be absolute, unconditional and irrevocable, and such obligations of the Borrower shall be performed strictly in accordance with the terms of this Agreement and such Letters of Credit and the related Application and   47 Agreement for any Letter of Credit, under all circumstances whatsoever, including the following circumstances:      (i) any lack of validity or enforceability of the Letter of Credit, the obligation supported by the Letter of Credit or any other agreement or instrument relating thereto (collectively, the “Related LC Documents”);      (ii) any amendment or waiver of or any consent to or departure from all or any of the Related LC Documents;      (iii) the existence of any claim, setoff, defense (other than the defense of payment in accordance with the terms of this Agreement) or other rights which the Borrower may have at any time against any beneficiary or any transferee of a Letter of Credit (or any persons or entities for whom any such beneficiary or any such transferee may be acting), the Administrative Agent, the Lenders or any other Person, whether in connection with the Loan Documents, the Related LC Documents or any unrelated transaction;      (iv) any breach of contract or other dispute between the Borrower and any beneficiary or any transferee of a Letter of Credit (or any persons or entities for whom such beneficiary or any such transferee may be acting), the Administrative Agent, the Lenders or any other Person;      (v) any draft, statement or any other document presented under the Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect whatsoever so long as any such document appeared to comply with the terms of the Letter of Credit;      (vi) any delay, extension of time, renewal, compromise or other indulgence or modification granted or agreed to by the Administrative Agent, with or without notice to or approval by the Borrower in respect of any of Borrower’s Obligations; or      (vii) any other circumstance or happening whatsoever where the applicable Issuing Bank has acted in good faith, whether or not similar to any of the foregoing; provided, however, that nothing contained herein shall be deemed to release an Issuing Bank or any other Lender of any liability for actual loss arising as a result of its gross negligence or willful misconduct or out of the wrongful dishonor by an Issuing Bank of a proper demand for payment made under and strictly complying with the terms of any Letter of Credit.      3.3 Governmental Action. No Issuing Bank shall be under any obligation to issue any Letter of Credit if any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such Issuing Bank from issuing such Letter of Credit, or any law applicable to such Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuing   48 Bank shall prohibit, or request that such Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuing Bank with respect to such Letter of Credit any restriction, reserve or capital requirement (for which such Issuing Bank is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the Letter of Credit any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which such Issuing Bank in good faith deems material to it, unless the Borrower agrees to compensate the Issuing Bank for such restriction, reserve, capital requirement, loss, cost or expense on terms satisfactory to the Issuing Bank.      3.4 Letter of Credit Fee. The Borrower agrees to pay (i) to the Administrative Agent, for the pro rata benefit of the Revolving Credit Lenders based on their Revolving Percentages, a fee on the aggregate amount available to be drawn on each Outstanding Letter of Credit at a rate equal to the Applicable Eurodollar Margin with respect to the Revolving Credit Facility as in effect from time to time, and (ii) to the applicable Issuing Bank, as issuer of each Letter of Credit, an issuance fee in such amount as may be agreed by such Issuing Bank and the Borrower from time to time. Such payments of fees provided for in this Section 3.4 shall be due with respect to each Letter of Credit quarterly in arrears, such payment to be made not later than the third (3rd) Business Day of each April, July, October and January, commencing on the first such date following the issuance of a Letter of Credit under this Agreement. Such fees shall be calculated on the basis of a year of 360 days for the actual number of days elapsed.      3.5 Administrative Fees. The Borrower shall pay to any Issuing Bank such standard administrative fee and other standard fees, if any, in connection with the Letters of Credit in such amounts and at such times as such Issuing Bank and the Borrower shall agree from time to time. ARTICLE IV Change in Circumstances      4.1 Increased Cost and Reduced Return.      (a) If, after the date hereof with respect to each Revolving Credit Lender, and, after the First Amendment Effective Date, with respect to each Term Lender, the adoption of any applicable law, rule, or regulation, or any change in any applicable law, rule, or regulation, or any change in the interpretation or administration thereof by any governmental authority, central bank, or comparable agency charged with the interpretation or administration thereof, or compliance by any Lender (or its Applicable Lending Office) with any request or directive (whether or not having the force of law) of any such governmental authority, central bank, or comparable agency:      (i) shall subject such Lender (or its Applicable Lending Office) to any increase in the cost (other than Taxes and Other Taxes as to which Section 4.6 shall govern, and other than the Reserve Requirement utilized in the determination of the Eurodollar Rate or Eurodollar Competitive Rate) of making or maintaining any Eurodollar Loans, any Competitive Bid Loans bearing interest at a Eurodollar Competitive Rate or its obligation to make Eurodollar Loans or Competitive Bid Loans at the Eurodollar Competitive Rate, or change the basis of taxation of any amounts payable   49 to such Lender (or its Applicable Lending Office) under this Agreement in respect of any Eurodollar Rate Loans or Competitive Bid Loans at the Eurodollar Competitive Rate (other than taxes imposed on the income, assets, receipts or branch profits of such Lender, franchise taxes, or taxes described in Sections 4.6(iii)-(v) by the jurisdiction in which such Lender has its principal office or such Applicable Lending Office);      (ii) shall impose, modify, or deem applicable any reserve, special deposit, assessment or similar requirement (other than the Reserve Requirement utilized in the determination of the Eurodollar Rate or Eurodollar Competitive Rate) other liabilities or commitments of, such Lender (or its Applicable Lending Office), including the Revolving Credit Commitment of such Lender hereunder; or      (iii) shall impose on such Lender (or its Applicable Lending Office) or on the London interbank market any other condition affecting this Agreement or any of such extensions of credit or liabilities or commitments; (or its Applicable Lending Office) of making, Converting into, Continuing, or maintaining any Loans or to reduce any sum received or receivable by such Lender (or its Applicable Lending Office) under this Agreement in each case with respect to any Eurodollar Rate Loans or any Competitive Bid Loans bearing interest at a Eurodollar Competitive Rate, then, within five (5) Business Days of the Borrower’s receipt of a request certifying in reasonable detail calculations of such amount and the basis therefor, the Borrower shall pay to such Lender such amount or amounts as will compensate such Lender for such increased cost or reduction, provided, that no Lender shall be entitled to claim any such amount or amounts for such increased cost or reduction incurred more than six months prior to the delivery of such request and, with respect to each Term Lender, prior to the First Amendment Effective Date. If any Lender requests compensation by the Borrower under this Section 4.1(a), the Borrower may, by notice to such Lender (with a copy to the Administrative Agent), suspend the obligation of such Lender to make or Continue Loans of the Type with respect to which such compensation is requested, or to Convert Loans of any other Type into Loans of such Type, until the event or condition giving rise to such request ceases to be in effect (in which case the provisions of Section 4.4 shall be applicable); provided that such suspension shall not affect the right of such Lender to receive the compensation so requested.      (b) If, after the date hereof with respect to each Revolving Credit Lender, any Lender shall have determined that the adoption of any applicable law, rule, or regulation regarding capital adequacy or any change therein or in the thereof, or any request or directive made or issued after the date hereof with respect to each Revolving Credit Lender, and, after the First Amendment Effective Date, with respect to each Term Lender, regarding capital adequacy (whether or not having the force of law) of any such governmental authority, central bank, or comparable agency, has or would have the effect of reducing the rate of return on the capital of such Lender or any corporation controlling such Lender as a consequence of such Lender’s obligations hereunder to a level below that which such Lender or such corporation could have achieved but for such adoption, change,   50 request, or directive (taking into consideration its policies with respect to capital adequacy), then, within five (5) Business Days of the Borrower’s receipt of a request certifying in reasonable detail calculations of such amount and the basis therefor, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender for such reduction, provided, that no Lender shall be entitled to claim any such amount or amounts for such increased cost incurred more than six months prior to the delivery of such request and, with respect to each Term Lender, prior to the First Amendment Effective Date.      (c) Each Lender shall promptly notify the Borrower and the Administrative Agent of any event of which it has knowledge, occurring after the date hereof, which will entitle such Lender to compensation pursuant to this Section 4.1 and will designate a different Applicable Lending Office if such designation will avoid the need for, or reduce the amount of, such compensation and will not, in the judgment of such Lender, be otherwise disadvantageous to it. Any Lender claiming compensation under this Section 4.1 shall furnish to the Borrower and the Administrative Agent a statement setting forth the additional amount or amounts to be paid to it hereunder which shall be conclusive in the absence of manifest error. In determining such amount, such Lender may use any reasonable      (d) The provisions of this Section 4.1 shall continue in effect notwithstanding the Facility Termination Date.      4.2 Limitation on Types of Loans. If on or prior to the first day of any Interest Period for any Eurodollar Rate Loan or Competitive Bid Loan bearing interest at a Eurodollar Competitive Rate:      (a) the Administrative Agent reasonably determines (which determination shall be conclusive) that by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the Eurodollar Rate or Eurodollar Competitive Rate, as the case may be, for such Interest Period; or      (b) the Required Lenders determine in good faith (which determination shall be conclusive) and notify the Administrative Agent that the Eurodollar Rate or Eurodollar Competitive Rate, as the case may be, will not adequately and fairly reflect the cost to the Lenders of funding Eurodollar Rate Loans or Competitive Bid Loan bearing interest at a Eurodollar Competitive Rate for such Interest Period; then the Administrative Agent shall give the Borrower prompt notice thereof specifying the relevant Type of Loans and the relevant amounts or periods, and so long as such condition remains in effect, the Lenders shall be under no obligation to make additional Loans of such Type, Continue Loans of such Type, or to Convert Loans of any other Type into Loans of such Type and the Borrower shall, on the last day(s) of the then current Interest Period(s) for the outstanding Loans of the affected Type, either prepay such Loans or Convert such Loans into another Type of Loan in accordance with the terms of this Agreement.      4.3 Illegality. Notwithstanding any other provision of this Agreement, in the event that it becomes unlawful for any Lender or its Applicable Lending Office to make, maintain, or fund Eurodollar Rate Loans or Competitive Bid Loans bearing interest at the Eurodollar   51 Competitive Rate hereunder, then such Lender shall promptly notify the Borrower thereof and such Lender’s obligation to make or Continue Eurodollar Rate Loans or Competitive Bid Loans bearing interest at the Eurodollar Competitive Rate and to Convert other Types of Loans into Eurodollar Rate Loans or Competitive Bid Loans bearing interest at the Eurodollar Competitive Rate shall be suspended until such time as such Lender may again make, maintain, and fund Eurodollar Rate Loans (in which case the provisions of Section 4.4 shall be applicable).      4.4 Treatment of Affected Loans. If the obligation of any Lender to make a Eurodollar Rate Loan or a Competitive Bid Loan bearing interest at a Eurodollar Competitive Rate or to Continue, or to Convert Loans of any other Type into, Loans of a particular Type shall be suspended pursuant to Section 4.1 or 4.3 hereof (Loans of such Type being herein called “Affected Loans” and such Type being herein called the “Affected Type”), such Lender’s Affected Loans shall be current Interest Period(s) for Affected Loans (or, in the case of a Conversion required by Section 4.3 hereof, on such earlier date as such Lender may specify to the Borrower with a copy to the Administrative Agent) and, unless and until such Lender gives notice as provided below that the circumstances specified in Section 4.1 or 4.3 hereof that gave rise to such Conversion no longer exist:      (a) to the extent that such Lender’s Affected Loans have been so Converted, all payments and prepayments of principal that would otherwise be applied to such Lender’s Affected Loans shall be applied instead to its Base Rate Loans; and      (b) all Loans that would otherwise be made or Continued by such Lender as Loans of the Affected Type shall be made or Continued instead as Base Rate Loans, and all Loans of such Lender that would otherwise be Converted into Loans of the Affected Type shall be Converted instead into (or shall remain as) Base Rate Loans. If such Lender gives notice to the Borrower (with a copy to the Administrative Agent) that the circumstances specified in Section 4.1 or 4.3 hereof that gave rise to the Conversion of such Lender’s Affected Loans pursuant to this Section 4.4 no longer exist (which such Lender agrees to do promptly upon such circumstances ceasing to exist) at a time when Loans of the Affected Type made by other Lenders are outstanding, such Lender’s Base Rate Loans shall be Period(s) for such outstanding Loans of the Affected Type, to the extent necessary so that, after giving effect thereto, all Loans held by the Lenders holding Loans of the Affected Type and by such Lender are held pro rata (as to principal amounts, Types, and Interest Periods) in accordance with their respective Revolving Credit Commitments or Term Commitments, as applicable.      4.5 Compensation. Upon demand of any Lender (with a copy to the Eurodollar Rate Loan or Competitive Bid Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise); or     52 such Lender to make a Loan notwithstanding satisfaction of all conditions precedent thereto) to prepay, borrow, Continue (including by reason of any prepayment) or Convert any Eurodollar Rate Loan on the date or in the amount notified by the Borrower; including any loss of anticipated profits and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or      For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 4.5, each Lender shall be deemed to have funded each Eurodollar Rate Loan or Competitive Bid Loan made by it at the Interbank Offered Rate used in determining the Eurodollar Rate or Eurodollar Competitive Rate for such Loan by a matching deposit or other borrowing in the applicable offshore Dollar interbank market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Loan was in fact so funded.      The provisions of this Section 4.5 shall continue in effect notwithstanding the Facility Termination Date.      4.6 Taxes. (a) Subject to Sections 4.6(d) and 4.6(e), any and all payments by the Borrower to or for the account of any Lender or the Administrative Agent hereunder or under any other Loan Document shall be made free and clear of and without deduction for any and all present or future taxes, duties, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding, in the case of each Lender and the Administrative Agent, (i) taxes imposed on its assets, income, receipts or branch profits, (ii) franchise taxes imposed on it, by the jurisdiction under the laws of which such Lender (or its Applicable Lending Office) or the Administrative Agent (as the case may be) is organized or any political subdivision thereof, (iii) any taxes (other than withholding taxes) that would not be imposed but for a connection between a Lender or the Administrative Agent and the jurisdiction imposing such taxes (other than a connection arising solely by virtue of the activities of such Lender or the Administrative Agent pursuant to or in respect of this Agreement or any other Loan Document), (iv) any withholding taxes payable with respect to payments hereunder or under any other Loan Document under laws (including, without limitation, any statute, treaty, ruling, determination or regulation) in effect, with respect to any Lender or the Administrative Agent, on the date such Lender or Administrative Agent became a Lender or the Administrative Agent (as applicable), and (v) any taxes arising after the Closing Date solely as a result of or attributable to Lender changing its designated lending office after the date such Lender becomes a party hereto (all such non-excluded taxes, duties, levies, imposts, deductions, charges, withholdings, and liabilities being hereinafter referred to as “Taxes”). If the Borrower shall be required by law to deduct any Taxes from or in respect of any sum payable under this Agreement or any other Loan Document to any Lender or the Administrative Agent, (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 4.6) such Lender or the Administrative Agent receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions, authority or other authority in accordance with applicable law,   53 and (iv) the Borrower shall furnish to the Administrative Agent, at its address referred to in Section 11.2, the original or a certified copy of a receipt or other reasonably acceptable documentation evidencing payment thereof.      (b) In addition, the Borrower agrees to pay any and all present or future stamp or documentary taxes and any other excise or property taxes or charges or similar levies which arise from any payment made under this Agreement or any other Loan Document or from the execution or delivery of, or otherwise with respect to, this Agreement or any other Loan Document (hereinafter referred to as “Other Taxes”).      (c) The Borrower agrees to indemnify each Lender and the Administrative Agent for the full amount of Taxes and Other Taxes (including, without limitation, any Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable under this Section 4.6) paid by such Lender or the Administrative Agent (as the case may be) and any liability (including penalties, interest, and expenses) arising therefrom or with respect thereto.      (d) Each Lender organized under the laws of a jurisdiction outside the United States, on or prior to the date of its execution and delivery of this Agreement in the case of each Lender listed on the signature pages hereof and on or prior to the date on which it becomes a Lender in the case of each other Lender shall provide the Borrower and the Administrative Agent two duly signed completed copies of either IRS Form W-8BEN or any successor thereto (relating to such Person and entitling it to an exemption from, or (in the case of a Lender consented to by the Borrower) reduction of, United States backup withholding tax and exemption from, or (in the case of a Lender consented to by the Borrower) reduction of, other withholding tax on all payments to be made to such Person by the Borrower pursuant to this Agreement) or IRS Form W-8ECI or any successor thereto (relating to all payments to be made to such Person by the Borrower pursuant to this Agreement) or such other evidence satisfactory to the Borrower and the Administrative Agent that such Person is entitled to an exemption from, or (in the case of a Lender consented to by the Borrower) reduction of, U.S. withholding tax. Thereafter and from time to time, each such Person shall (a) promptly submit to the Administrative Agent such additional duly completed and signed copies of one of such forms (or such successor forms as shall be adopted from time to time by the relevant United States taxing authorities) as may then be available under then current United States laws and regulations to avoid, or such evidence as is satisfactory to the Borrower and the Administrative Agent of any available exemption from or reduction of, United States withholding taxes in respect of all payments to be made to such Person by the Borrower pursuant to this Agreement, (b) promptly notify the Administrative Agent of any change in circumstances which would modify or render invalid any claimed exemption or reduction, and (c) take such steps as shall not be materially disadvantageous to it, in the reasonable judgment of such Lender, and as may be reasonably necessary (including the re-designation of its lending office) to avoid any requirement of applicable laws that the Borrower make any deduction or withholding for taxes from amounts payable to such Person. If such Person fails to deliver the above forms or other documentation, then the Administrative Agent may withhold from any interest payment to such Person an amount equivalent to the applicable withholding tax imposed by Sections 1441 and 1442 of the Code, without reduction. If any Governmental Authority asserts that the Administrative Agent or the Borrower did not properly withhold any tax or other amount from payments made in respect of such Person, such Person shall indemnify the Administrative Agent or the Borrower therefor, including all   54 penalties and interest, any taxes imposed by any jurisdiction on the amounts payable to the Administrative Agent or the Borrower under this Section, and costs and expenses (including the reasonable fees and expenses of counsel (including the allocated cost of internal counsel)) of the Administrative Agent or the Borrower. The obligation of the Lenders under this Section shall survive the resignation or replacement of the Administrative Agent and shall continue in effect notwithstanding the Facility Termination Date.      (e) For any period with respect to which a Lender has failed to provide the Borrower and the Administrative Agent with the appropriate form pursuant to Section 4.6(d) (unless such failure is due to an inability or restriction caused by a change in treaty, law, or regulation occurring subsequent to the date on which a form originally was required to be provided), such Lender shall not be entitled to indemnification under Section 4.6(a) or 4.6(b) with respect to Taxes imposed by the United States; provided, however, that should a Lender, which is otherwise exempt from or subject to a reduced rate of withholding tax, become subject to Taxes because of its failure to deliver a form required hereunder, the Borrower shall take such steps as such Lender shall reasonably request to assist such Lender to recover such Taxes.      (f) If the Borrower is required to pay additional amounts to or for the account of any Lender pursuant to this Section 4.6, then such Lender will agree to use reasonable efforts to change the jurisdiction of its Applicable Lending Office so as to eliminate or reduce any such additional payment which may thereafter accrue if such change, in the reasonable judgment of such Lender, is not otherwise disadvantageous to such Lender.      (g) Within thirty (30) days after the date of any payment of Taxes, the Borrower shall furnish to the Administrative Agent the original or certified copy of a receipt or other reasonably acceptable documentation evidencing such payment.      (h) The provisions of this Section 4.6 shall continue in effect      4.7 Replacement Lenders. The Borrower may, in its sole discretion, on ten (10) Business Days’ prior written notice to the Administrative Agent and a Lender, cause a Lender that is or may become entitled to receive any indemnification payment, additional amount or other compensation under this Article IV or that fails to make Loans for the reasons provided in this Article IV to (and such Lender shall) assign pursuant to Section 11.1 hereof, all of its rights and obligations under this Agreement to another Lender, an Affiliate of another Lender or a Person reasonably acceptable to the Administrative Agent and designated by the Borrower which is willing to become a Lender for a purchase price equal to the outstanding principal amount of the Loans payable to such Lender, together with any accrued but unpaid interest on such Loans, any accrued but unpaid fees with respect to such Lender’s Revolving Credit Commitment and any other amounts payable to such Lender under this Agreement; provided, that any expenses or other amounts which would be owing to such Lender pursuant to any indemnification provision hereunder shall be payable by the Borrower to such Lender. The replacement Lender under this Section shall pay the applicable processing fee under Section 11.1.   55 ARTICLE V Conditions to Making Loans and Issuing Letters of Credit      5.1 Conditions of Initial Advance. The obligation of the Lenders to make the initial Advance under the Revolving Credit Facility, and of the Issuing Banks to issue Letters of Credit (if any) on the Closing Date, is subject to the conditions precedent that:      (a) the Administrative Agent shall have received on the Closing Date, in form and substance satisfactory to the Administrative Agent and Lenders, the following:      (i) executed originals of each of this Agreement, the initial Facility Guaranties and the other Loan Documents, together with all schedules and exhibits thereto;      (ii) the favorable written opinion or opinions with respect to the Loan Documents and the transactions contemplated thereby of (A) in-house counsel to the Borrower and (B) Skadden, Arps, Slate, Meagher & Flom LLP, special counsel to the Borrower and Guarantors, in each case dated the Closing Date, addressed to the Administrative Agent and the Lenders and satisfactory to the Administrative Agent, substantially in the form of Exhibits I-1 — I-2;      (iii) resolutions of the boards of directors or other appropriate governing body (or of the appropriate committee thereof) of the Borrower and each Guarantor certified by its secretary or assistant secretary as of the Closing Date, approving and adopting the Loan Documents to be executed by such Person, and authorizing the execution and delivery thereof;      (iv) specimen signatures of officers or other appropriate representatives executing the Loan Documents on behalf of the Borrower and each Guarantor, certified by the secretary or assistant secretary of such Borrower or Guarantor;      (v) the Organizational Documents of the Borrower and each Guarantor certified as true and correct by its secretary or assistant secretary;      (vi) Operating Documents of the Borrower and each Guarantor certified as of the Closing Date as true and correct by its secretary or assistant secretary;      (vii) certificates issued as of a recent date by the Secretaries of State of the respective jurisdictions of formation of the Borrower and each Guarantor as to the due existence and good standing of such Person;      (viii) notice of appointment of the initial Authorized Representative(s);      (ix) certificate of an Authorized Representative dated the Closing Date demonstrating compliance with the financial covenants contained in Section 8.1 as of the end of the fiscal quarter most recently ended prior to the Closing Date   56 for which financial statements have been delivered to the Lenders pursuant to Section 6.1(e) or Section 7.1, substantially in the form of Exhibit E;      (x) an initial Borrowing Notice, if any, and, if elected by the Borrower, Interest Rate Selection Notice;      (xi) evidence that all fees payable by the Borrower on the Closing Date to the Administrative Agent, J.P. Morgan Securities Inc. and the Lenders have been paid in full, including the fees and expenses of counsel for the Administrative Agent to the extent invoiced prior to or on the Closing Date (which may include amounts constituting reasonable estimates of such fees and expenses incurred or to be incurred in connection with the transaction; provided that no such estimate shall thereafter preclude the final settling of accounts as to such fees and expenses); and      (xii) evidence of payment in full of all obligations arising under the Existing Loan Documents and termination thereof; and      (b) In the good faith judgment of the Administrative Agent and the Lenders:      (i) there shall not have occurred a material adverse change since December 31, 2004 in the business, assets, liabilities, operations, condition (financial or otherwise) of the Borrower and its Subsidiaries taken as a whole;      (ii) there shall not exist any action, suit, investigation or proceeding pending or threatened in any court or before any arbitrator or governmental authority that: (x) materially and adversely affects the Borrower or its Subsidiaries taken as a whole or (y) materially affects any transaction contemplated hereby or the ability of the Borrower and its Subsidiaries to perform their respective obligations under the Loan Documents; and      (iii) the Borrower and Guarantors shall have received all approvals, consents and waivers, and shall have made or given all necessary filings and notices as shall be required to consummate the transactions contemplated hereby without the occurrence of any default under, conflict with or violation of (A) any applicable law, rule, regulation, order or decree of any Governmental Authority or arbitral authority or (B) any agreement, document or instrument to which any of the Borrower and Guarantors is a party or by which any of them or their properties is bound.      5.2 Conditions of Loans. The obligations of the Lenders to make any Loans, and of the Issuing Banks to issue Letters of Credit, hereunder on or subsequent to the Closing Date are subject to the satisfaction of the following conditions:      (a) the Administrative Agent shall have received a Borrowing Notice if required by Article II;   57      (b) the representations and warranties of the Borrower and Guarantors set forth in Article VI and in each of the other Loan Documents shall be true and correct in all material respects on and as of the date of such Advance or issuance of such Letters of Credit with the same effect as though such representations and warranties had been made on and as of such date, except to the extent that such representations and warranties expressly relate to an earlier date and except that the financial statements referred to in Section 6.1(e)(i) shall be deemed (solely for the purpose of the representation and warranty contained in such Section 6.1(e)(i) but not for the purpose of any cross reference to such Section 6.1(e)(i) or to the financial statements described therein contained in any other provision of Section 6.1(e) or elsewhere in Article VI) to be those financial statements most recently delivered to the Administrative Agent and the Lenders pursuant to Section 7.1;      (c) in the case of the issuance of a Letter of Credit, the Borrower shall have executed and delivered to the applicable Issuing Bank an Application and Agreement for Letter of Credit in form and content acceptable to such applicable Issuing Bank together with such other instruments and documents as it shall request;      (d) immediately after giving effect to a Swing Line Loan, the aggregate Swing Line Outstandings shall not exceed $25,000,000;      (e) at the time of (and after giving effect to) each Advance, Swing Line Loan or issuance of each Letter of Credit, no Default or Event of Default shall have occurred and be continuing; and      (f) immediately after giving effect to:      (i) a Loan or Letter of Credit, the aggregate principal balance of all outstanding Loans (other than Term Loans) and Participations for each Lender shall not exceed, respectively, such Lender’s Revolving Credit Commitment or Letter of Credit Commitment; and      (ii) a Loan or Letter of Credit, the Outstanding Revolving Credit Obligations shall not exceed the Total Revolving Credit Commitment.      5.3 Supplements to Schedules. The Borrower may, from time to time, amend or supplement the Schedules, other than Schedules 1.1(a), 1.1(b) and 8.3 to this Agreement by delivering (effective upon receipt) to the Administrative Agent and each Lender a copy of such revised Schedule or Schedules which shall (i) be dated the date of delivery, (ii) be certified by an Authorized Representative as true, complete and correct as of such date and as delivered in replacement for the corresponding Schedule or Schedules previously in effect, and (iii) show in reasonable detail (by blacklining or other appropriate graphic means) the changes from each such corresponding predecessor Schedule. Notwithstanding anything to the contrary contained herein or in any of the other Loan Documents, in the event that the Required Lenders determine based upon such revised Schedule (whether individually or in the aggregate or cumulatively) that there has been a material adverse change since the First Amendment Effective Date which could   58 reasonably be expected to have a Material Adverse Effect, the Lenders shall have no further obligation to fund additional Advances hereunder. ARTICLE VI Representations and Warranties      6.1 Representations and Warranties. The Borrower represents and warrants with respect to itself and to its Subsidiaries (which representations and warranties shall survive the delivery of the documents mentioned herein and the making of Loans and issuance of Letters of Credit), that:      (a) Organization and Authority.      (i) the Borrower and each Subsidiary is a corporation, limited liability company or partnership duly organized and validly existing under the laws of the jurisdiction of its incorporation or creation;      (ii) the Borrower and each Subsidiary (x) has the requisite power and authority to own its properties and assets and to carry on its business as now being conducted and as contemplated in the Loan Documents, and (y) is qualified to do business in every jurisdiction in which failure so to qualify would have a Material Adverse Effect;      (iii) the Borrower has the power and authority to execute, deliver and perform this Agreement, and to borrow hereunder, and to execute, deliver and perform each of the other Loan Documents to which it is a party;      (iv) each Guarantor has the power and authority to execute, deliver and perform the Facility Guaranty and each of the other Loan Documents to which it is a party; and      (v) when executed and delivered, each of the Loan Documents to which the Borrower or any Guarantor is a party will be the legal, valid and binding obligation or agreement of the Borrower or such Guarantor, as the case may be, enforceable against the Borrower or such Guarantor in accordance with its terms, subject to the effect of any applicable bankruptcy, moratorium, insolvency, reorganization or other similar law affecting the enforceability of creditors’ rights generally and to the effect of general principles of equity which may limit the availability of equitable remedies (whether in a proceeding at law or in equity).      (b) Loan Documents. The execution, delivery and performance by the Borrower and each Guarantor of each of the Loan Documents to which such Person is a party:   59      (i) have been duly authorized by all Organizational Action of the Borrower or such Guarantor, as the case may be, required for the lawful execution, delivery and performance thereof;      (ii) do not violate any provisions of (1) any applicable law, rule or regulation, (2) any judgment, writ, order, determination, decree or arbitral award of any Governmental Authority or arbitral authority binding on the Borrower or such Guarantor or its properties, or (3) the Organizational Documents or Operating Documents of the Borrower or such Guarantor;      (iii) do not and will not be in conflict with, result in a breach of or constitute an event of default, or an event which, with notice or lapse of time, or both, would constitute an event of default, under any material indenture, agreement or other instrument to which the Borrower is a party, or by which the properties or assets of the Borrower is bound; and      (iv) do not and will not result in the creation or imposition of any Lien, charge or encumbrance of any nature whatsoever upon any of the properties or      (c) Subsidiaries and Stockholders. As of the First Amendment Effective Date, the Borrower has no Subsidiaries other than those Persons listed as Subsidiaries on Schedule 6.1(c)) hereto; Schedule 6.1(c) to this Agreement states as of the First Amendment Effective Date the capitalization of each Subsidiary listed thereon, the number of shares or other equity interests of each class of capital stock or interest issued and outstanding of each such Subsidiary and the number and/or percentage of outstanding shares or other equity interest (including options, warrants and other rights to acquire any interest) of each such class of capital stock or equity interest owned by the Borrower or by any such Subsidiary, whether such Subsidiary is an Eligible Special Purpose Entity or a Subsidiary engaged solely in the insurance business or otherwise; as of the First Amendment Effective Date, the outstanding shares or other equity interests of each such Subsidiary which is a corporation have been duly authorized and validly issued and are fully paid and nonassessable; and, as of the First Amendment Effective Date, the Borrower and each such Subsidiary owns beneficially and of record all the shares and other interests it is listed as owning in Schedule 6.1(c), free and clear of any Lien other than the Liens permitted under Section 8.3.      (d) Ownership Interests. As of the First Amendment Effective Date, the Borrower owns no interest in any Person having an aggregate book value of $1,000,000 or more other than the Persons listed in Schedule 6.1(c) hereto.      (e) Financial Condition. (i) The Borrower has prior to the First Amendment Effective Date furnished to each Lender an audited consolidated balance sheet of the Borrower and its Subsidiaries as at December 31, 2005 and the notes thereto and the related consolidated statements of operations, cash flows, and changes in stockholders’ equity and the notes thereto for the Fiscal Year then ended as examined and certified by KPMG LLP. Except as set forth therein (including, in the case of such audited balance   60 sheet, the notes thereto), such financial statements (including, in the case of such audited balance sheet, the notes thereto) present fairly the financial condition of the Borrower and its Subsidiaries as of the end of such Fiscal Year and such interim period and results of their operations and the changes in their stockholders’ equity for the Fiscal Year and interim period then ended, all in conformity with GAAP applied on a Consistent Basis (except for, with respect to interim financial statements, normal year-end adjustments); and      (ii) since the later of (i) December 31, 2005 or (ii) the date of the audited financial statements most recently delivered pursuant to Section 7.1(a) hereof, there has been no material adverse change in the condition, financial or otherwise, of the Borrower and its Subsidiaries or in the businesses, properties and operations of the Borrower and its Subsidiaries, considered as a whole.      (f) Taxes. The Borrower and its Subsidiaries have filed or caused to be filed all federal, state, local and foreign tax returns which are required to be filed by them and except for taxes and assessments being contested in good faith and against which reserves satisfactory to the Borrower’s independent certified public accountants have been established, and have paid or caused to be paid all taxes as shown on said returns or on any assessment received by them, to the extent that such taxes have become due except, with respect to any of the foregoing, where any failure to do so could not reasonably be expected to have a Material Adverse Effect.      (g) Litigation. Except as set forth in Schedule 6.1(g) attached hereto, there is no action, suit or proceeding at law or in equity or by or before any governmental instrumentality or agency or arbitral body pending, or, to the knowledge of the Borrower, threatened by or against the Borrower or any Subsidiary or affecting the Borrower or any Subsidiary or any properties or rights of the Borrower or any Subsidiary, which could reasonably be expected to      (h) Margin Stock. No part of the proceeds of any Loan will be used in violation of Regulation U, as amended (12 C.F.R. Part 221), of the Board; and the Borrower and each of the Subsidiaries will comply with Regulation U at all times. The proceeds of the borrowings made pursuant to Article II hereof will be used by the Borrower and its Subsidiaries only for the purposes set forth in Section 2.16 hereof.      (i) Investment Company. Neither the Borrower nor any Subsidiary is an “investment company,” or an “affiliated person” of, or “promoter” or “principal underwriter” for, an “investment company,” as such terms are defined in the Investment Company Act of 1940, as amended (15 U.S.C. § 80a-1, et seq.).      (j) No Untrue Statement. Neither this Agreement nor any other Loan Document or certificate or document executed and delivered by or on behalf of the Borrower or any Subsidiary in accordance with or pursuant to any Loan Document, nor any statement, representation or warranty provided to the Administrative Agent in writing in connection with the negotiation or preparation of (i) the Loan Documents (other than the First Amendment Documents) through the Closing Date or (ii) the First Amendment   61 Documents through the First Amendment Effective Date, contains any misrepresentation or untrue statement of material fact or omits to state a material fact necessary, in light of the circumstance under which it was made, in order to make any such representation or statement contained herein or therein not misleading in any material respect.      (k) No Consents, Etc. Neither the respective businesses or properties of the Borrower or any Subsidiary, nor any relationship between the Borrower or any Subsidiary and any other Person, nor any circumstance in connection with the execution, delivery and performance of the Loan Documents and the transactions contemplated thereby is such as to require a material consent, approval or authorization of, or filing, registration or qualification with, any Governmental Authority or other authority or any other Person on the part of the Borrower or any Subsidiary as a condition to the execution, delivery and performance of, or consummation of the transactions contemplated by, this Agreement or the other Loan Documents or if so, such material consent, approval, authorization, filing, registration or qualification has been obtained or effected, as the case may be and is in full force and effect. As of the First Amendment Effective Date, and subject to Section 11.17, the Borrower and its Subsidiaries have obtained the consent of the Manufacturers set forth on Schedule 6.1(k) to the Borrower’s or such Subsidiary’s execution, delivery and performance of the Loan Documents.      (l) Employee Benefit Plans.      (i) The Borrower and each ERISA Affiliate is in material compliance with all applicable provisions of ERISA and the regulations and published interpretations thereunder and in material compliance with all Foreign Benefit Laws with respect to all Employee Benefit Plans except for any required amendments for which the remedial amendment period as defined in Section 401(b) of the Code has not yet expired. Each Employee Benefit Plan that is intended to be qualified under Section 401(a) of the Code has been determined or the Borrower or its Subsidiaries is in the process of obtaining a determination by the Internal Revenue Service to be so qualified, each trust related to such plan has been determined to be exempt under Section 501(a) of the Code, and each Employee Benefit Plan subject to any Foreign Benefit Law has received the required approvals by any Governmental Authority regulating such Employee Benefit Plan or the Borrower or its Subsidiaries is in the process of obtaining such determination or approvals. No material liability has been incurred by the Borrower or any ERISA Affiliate which remains unsatisfied for any taxes or penalties with respect to any Employee Benefit Plan or any Multiemployer Plan;      (ii) Neither the Borrower nor any ERISA Affiliate has (a) engaged in a nonexempt prohibited transaction described in Section 4975 of the Code or Section 406 of ERISA affecting any of the Employee Benefit Plans or the trusts created thereunder which could subject any such Employee Benefit Plan or trust to a material tax or penalty on prohibited transactions imposed under Internal Revenue Code Section 4975 or ERISA, (b) incurred any accumulated funding deficiency with respect to any Employee Benefit Plan, whether or not waived, or any other liability to the PBGC which remains outstanding other than the payment   62 of premiums and there are no premium payments which are due and unpaid, (c) failed to make a material required contribution or payment to a Multiemployer Plan, (d) failed to make a required installment or other required payment under Section 412 of the Code, Section 302 of ERISA or the terms of such Employee Benefit Plan, or (e) failed to make a required contribution or payment, or otherwise failed to operate in compliance with any Foreign Benefit Law regulating any Employee Benefit Plan;      (iii) No Termination Event has occurred or is reasonably expected to occur with respect to any Pension Plan or Multiemployer Plan, and neither the Borrower nor any ERISA Affiliate has incurred any unpaid withdrawal liability with respect to any Multiemployer Plan;      (iv) Except as provided in Schedule 6.1(l), the present value of all vested accrued benefits under each Employee Benefit Plan which is subject to Title IV of ERISA, or the funding of which is regulated by any Foreign Benefit Law did not, as of the most recent valuation date for each such plan, exceed the then current value of the assets of such Employee Benefit Plan allocable to such benefits;      (v) To the best of the Borrower’s knowledge, each Employee Benefit Plan which is subject to Title IV of ERISA or the funding of which is regulated by any Foreign Benefit Law, maintained by the Borrower or any ERISA Affiliate, has been administered in accordance with its terms in all material respects and is in compliance in all material respects with all applicable requirements of ERISA, applicable Foreign Benefit Law and other applicable laws, regulations and rules;      (vi) Assuming that none of the Lenders is, is acting on behalf of, or is an entity the assets of which constitute the assets of an “employee benefit plan” (as defined in Section 3(3) of ERISA) or a “plan” (as defined in Section 4975 of the Code) with respect to which the Borrower is a “party in interest” (as defined in Section 3(14) of ERISA) or a “disqualified person” (as defined in Section 4975 of the Code), the consummation of the Loans and the issuance of the Letters of Credit provided for herein will not involve any prohibited transaction under ERISA which is not subject to a statutory or administrative exemption; and      (vii) No material proceeding, claim, lawsuit and/or investigation exists or, to the best knowledge of the Borrower after due inquiry, is threatened concerning or involving any Employee Benefit Plan.      (m) No Default. There does not exist any Default or Event of Default.      (n) Environmental Laws. Except as listed on Schedule 6.1(n) and except as would not have a Material Adverse Effect, the Borrower and each Subsidiary is in compliance with all applicable Environmental Laws and has been issued and currently maintains all required federal, state and local permits, licenses, certificates and approvals. Except as listed on Schedule 6.1(n) and except as would not have a Material Adverse   63 Effect, neither the Borrower nor any Subsidiary has been notified of any pending or threatened action, suit, proceeding or investigation, and neither the Borrower nor any Subsidiary is aware of any facts, which (a) calls into question, or could reasonably be expected to call into question, compliance by the Borrower or any Subsidiary with any Environmental Laws, (b) seeks, or could reasonably be expected to form the basis of a meritorious proceeding, to suspend, revoke or terminate any license, permit or approval necessary for the operation of the Borrower’s or any Subsidiary’s business or facilities or for the generation, handling, storage, treatment or disposal of any Hazardous Materials, or (c) seeks to cause, or could reasonably be expected to form the basis of a meritorious proceeding to cause, any property of the Borrower or any Subsidiary to be subject to any restrictions on ownership, use, occupancy or transferability under any Environmental Law. ARTICLE VII Affirmative Covenants      Until the Facility Termination Date, unless the Required Lenders shall otherwise consent in writing, the Borrower will, and where applicable will cause each Subsidiary to:      7.1 Financial Reports, Etc. (a) as soon as practical and in any event within 90 days after the end of each Fiscal Year of the Borrower, deliver or cause to be delivered to the Administrative Agent and each Lender (i) the consolidated balance sheets of the Borrower and its Subsidiaries, with the notes thereto, the related consolidated statements of operations, cash flows, and shareholders’ equity and the respective notes thereto for such Fiscal Year, setting forth comparative financial statements for the preceding Fiscal Year, all prepared in accordance with GAAP applied on a Consistent Basis and containing opinions of KPMG LLP, or other such independent certified public accountants selected by the Borrower and approved by the Administrative Agent (such approval not to be unreasonably withheld), which are unqualified as to the scope of the audit performed and as to the “going concern” status of the Borrower; and (ii) a Compliance Certificate of an Authorized Representative as to the existence of any Default or Event of Default and demonstrating compliance with Section 8.1 of this Agreement;      (b) as soon as practical and in any event within 55 days after the end of each quarterly period (except the last reporting period of the Fiscal Year), deliver to the Administrative Agent and each Lender (i) the consolidated balance sheet of the Borrower and its Subsidiaries as of the end of such reporting period, the related consolidated statements of operations, cash flows, and shareholders’ equity for such reporting period and for the period from the beginning of the Fiscal Year through the end of such reporting period, accompanied by a certificate of an Authorized Representative to the effect that such financial statements present fairly the financial position of the Borrower and its Subsidiaries as of the end of such reporting period and the results of their operations and the changes in their financial position for such reporting period, in conformity with the standards set forth in Section 6.1(e)(i) with respect to interim financials, and (ii) a Compliance Certificate of an Authorized Representative as to the existence of any Default or Event of Default and containing computations for such quarter comparable to that required pursuant to Section 7.1(a)(ii);   64      (c) with respect to any financial statements required by Section 7.1(a)(i), either      (i) include a footnote in such financial statements stating that, as at the end of the Fiscal Year covered by such financial statements, the Borrower was in compliance with all financial covenants set forth in this Agreement, or if the Borrower was in default under any such financial covenant, describing such default, and specifying the nature and period of existence thereof; or      (ii) deliver to the Administrative Agent and each Lender (together with the delivery of such financial statements) a letter from the Borrower’s accountants specified in Section 7.1(a)(i) stating that in performing the audit necessary to render an opinion on the financial statements delivered under Section 7.1(a)(i), they obtained no knowledge of any default by the Borrower in complying with the financial covenants set forth in this Agreement; or if the accountants have obtained knowledge of such default, a statement specifying the nature and period of existence thereof;      (d) promptly upon their becoming available to the Borrower, the Borrower shall deliver to the Administrative Agent and each Lender a copy of (i) all regular or special reports or effective registration statements which the Borrower or any Subsidiary shall file with the Securities and Exchange Commission (or any successor thereto) or any securities exchange, (ii) any proxy statement distributed by the Borrower to its shareholders, bondholders or the financial community in general, and (iii) any management letter or other report submitted to the Borrower or any of its Subsidiaries by independent accountants in connection with any annual, interim or special audit of the Borrower or any of its Subsidiaries;      (e) promptly upon an Executive Officer obtaining actual knowledge thereof, deliver to the Administrative Agent notice of any announcement by any Rating Agency of any change in any Rating or other announcement as to the Borrower; and      (f) promptly, from time to time, deliver or cause to be delivered to the Administrative Agent and each Lender such other information regarding Borrower’s and any Subsidiary’s operations, business affairs and financial condition as the Administrative Agent or such Lender may reasonably request.      The Administrative Agent and the Lenders are hereby authorized to deliver a copy of any such financial or other information delivered hereunder to the Lenders (or any Affiliate of any Lender) or to the Administrative Agent, to any Governmental Authority having jurisdiction over the Administrative Agent or any of the Lenders pursuant to any written request therefor or in the ordinary course of examination of loan files, or to any other Person who shall acquire or consider the assignment of, or acquisition of any participation interest in, any Obligation permitted by this Agreement, subject to Section 11.15.      Financial statements required to be delivered by the Borrower pursuant to clauses (a)(i) and (b)(i) of this Section 7.1 shall be deemed to have been delivered on the date on which the Borrower causes such financial statements, or reports containing such financial statements, to be posted on the Internet at www.sec.gov or at such other website identified by the Borrower in a   65 notice to the Administrative Agent and the Lenders and that is accessible by the Lenders without charge.      7.2 Maintain Properties. Maintain all properties necessary to its operations in good working order and condition (ordinary wear and tear excepted), make all needed repairs, replacements and renewals to such properties, and maintain free from Liens (other than Liens permitted by Section 8.3) all trademarks, trade names, patents, copyrights, trade secrets, know-how, and other intellectual property and proprietary information (or adequate licenses thereto), in each case as are reasonably necessary to conduct its business as currently conducted or as contemplated hereby, all in accordance with prudent business practices.      7.3 Existence, Qualification, Etc. Do or cause to be done all things necessary to preserve and keep in full force and effect its existence and all material rights and franchises, trade names, trademarks and permits, except to the extent conveyed or permitted in connection with a transaction permitted under Section 8.4 hereof, and maintain its license or qualification to do business as a foreign corporation and good standing in each jurisdiction in which its ownership or lease of property or the nature of its business makes such license or qualification necessary, except, with respect to any of the Material Adverse Effect.      7.4 Regulations and Taxes. Comply in all material respects with all statutes and governmental regulations and pay all taxes, assessments, governmental charges, claims for labor, supplies, rent and any other obligation which, if unpaid, might become a Lien against any of its properties except liabilities being contested in good faith and against which adequate reserves have been established and except, with respect to any of the foregoing, where Effect.      7.5 Insurance. (i) Keep all of its insurable properties adequately insured at all times with responsible insurance carriers or self-insured against loss or damage by fire and other hazards as are customarily insured against by similar businesses owning such properties similarly situated, (ii) maintain general public liability insurance at all times with responsible insurance carriers or self-insured against liability on account of damage to persons and property having such limits, deductibles, exclusions and co-insurance and other provisions providing coverage similar to that specified in Schedule 7.5 attached hereto, such insurance policies to be in form reasonably satisfactory to the Administrative Agent, and (iii) maintain insurance under all applicable workers’ compensation laws (or in the alternative, maintain required reserves if self-insured for workers’ compensation purposes).      7.6 True Books. Keep true books of record and account in which full, true and correct entries will be made of all of its dealings and transactions in accordance with customary business practices, and set up on its books such reserves as may be required by GAAP with respect to doubtful accounts and all taxes, assessments, charges, levies and claims and with respect to its business in general, and include such reserves in interim as well as year-end financial statements.      7.7 Right of Inspection. Permit any Person designated by any Lender or the Administrative Agent at the Lender’s or Administrative Agent’s expense, as the case may be, to   66 visit and inspect any of the properties, corporate books and financial reports of the Borrower and its Subsidiaries, and to discuss their respective affairs, finances and accounts with their principal officers and independent certified public accountants, all at reasonable times, at reasonable intervals and with reasonable prior notice.      7.8 Observe all Laws. Conform to and duly observe in all material respects all laws, rules and regulations and all other valid requirements of any Governmental Authority (including Environmental Laws) with respect to the conduct of its business the non-compliance with which could reasonably be      7.9 Governmental Licenses. Obtain and maintain all licenses, permits, certifications and approvals of all applicable Governmental Authorities as are required for the conduct of its business as currently conducted and as contemplated by the Loan Documents, except where the failure to do so could not      7.10 Covenants Extending to Subsidiaries. Cause each of its Subsidiaries to do with respect to itself, its business and its assets, each of the things required of the Borrower in Sections 7.2 through 7.9, inclusive to the extent the failure to do so could reasonably be expected to have a Material Adverse Effect.      7.11 Officer’s Knowledge of Default. Upon any Executive Officer of the Borrower obtaining knowledge of any Default or Event of Default hereunder or under any other obligation of the Borrower or any Subsidiary to any Lender, or any event, development or occurrence which could reasonably be expected to have a Material Adverse Effect, cause such officer or an Authorized Representative to promptly notify the Administrative Agent of the nature thereof, the period of existence thereof, and what action the Borrower or any Subsidiary proposes to take with respect thereto.      7.12 Suits or Other Proceedings. Upon any Executive Officer of the Borrower obtaining knowledge of any litigation or other proceedings being instituted against the Borrower or any Subsidiary, or any attachment, levy, execution or other process being instituted against any assets of the Borrower or any Subsidiary that could reasonably be expected to result in a Material Adverse Effect, promptly deliver to the Administrative Agent written notice thereof stating the nature and status of such litigation, dispute, proceeding, levy, execution or other process.      7.13 Notice of Discharge of Hazardous Material or Environmental Complaint. Promptly provide to the Administrative Agent true, accurate and complete copies of any and all notices, complaints, orders, directives, claims, or citations received by the Borrower or any Subsidiary relating to any (a) violation or alleged violation by the Borrower or any Subsidiary of any applicable Environmental Laws or OSHA; (b) release or threatened release by the Borrower or any Subsidiary of any Hazardous Material, except where occurring legally; or (c) liability or alleged liability of the Borrower or any Subsidiary for the costs of cleaning up, removing, remediating or responding to a release of Hazardous Materials, which violation, alleged violation, release, threatened release, actual liability or threatened liability described in clause (a), (b) or (c) could reasonably be expected to result in a Material Adverse Effect.   67      7.14 Environmental Compliance. If the Borrower or any Subsidiary shall receive notice from any Governmental Authority that the Borrower or any Subsidiary has violated any applicable Environmental Laws in any respect that could reasonably be expected to result in a Material Adverse Effect, the Borrower shall promptly (and in any event within the time period permitted by the applicable Governmental Authority) remove or remedy, or the Borrower shall cause the applicable Subsidiary to remove or remedy, such violation.      7.15 Employee Benefit Plans.      (a) With reasonable promptness, and in any event within thirty (30) days thereof, give notice to the Administrative Agent of (i) the establishment of any new Pension Plan (which notice shall include a copy of such plan), (ii) the commencement of contributions to any funded Employee Benefit Plan to which the Borrower or any of its ERISA Affiliates was not previously contributing, (iii) any material increase in the benefits of any existing funded Employee Benefit Plan, (iv) each funding waiver request filed with respect to any Pension Plan and all communications received or sent by the Borrower or any ERISA Affiliate with respect to such request and (v) the failure of the Borrower or any ERISA Affiliate to make a required installment or payment under Section 302 of ERISA or Section 412 of the Code (in the case of Employee Benefit Plans regulated by the Code or ERISA) or under any Foreign Benefit Law (in the case of Employee Benefit Plans regulated by any Foreign Benefit Law) by the due date;      (b) Promptly and in any event within fifteen (15) days of becoming aware of the occurrence or forthcoming occurrence of any (a) Termination Event or (b) nonexempt “prohibited transaction,” as such term is defined in Section 406 of ERISA or Section 4975 of the Code, in connection with any Employee Benefit Plan or any trust created thereunder, deliver to the Administrative Agent a notice specifying the nature thereof, what action the Borrower or any ERISA Affiliate has taken, is taking or proposes to take with respect thereto and, when known, any action taken or threatened by the Internal Revenue Service, the Department of Labor or the PBGC with respect thereto; and      (c) With reasonable promptness but in any event within fifteen (15) days for purposes of clauses (a), (b) and (c), deliver to the Administrative Agent copies of (a) any unfavorable determination letter from the Internal Revenue Service regarding the qualification of an Employee Benefit Plan under Section 401(a) of the Code, (b) all notices received by the Borrower or any ERISA Affiliate of the PBGC’s or any Governmental Authority’s intent to terminate any Pension Plan or to have a trustee appointed to administer any Pension Plan, (c) each Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed by the Borrower or any ERISA Affiliate with the Internal Revenue Service with respect to each Employee Benefit Plan and (d) all notices received by the Borrower or any ERISA Affiliate from a Multiemployer Plan sponsor concerning the imposition or amount of withdrawal liability pursuant to Section 4202 of ERISA. The Borrower will notify the Administrative Agent in writing within five (5) Business Days of the Borrower or any ERISA Affiliate obtaining knowledge or reason to know that the Borrower or any ERISA Affiliate has filed or intends to file a notice of intent to terminate any Pension Plan under a distress termination within the meaning of Section 4041(c) of ERISA.   68      7.16 Continued Operations. Continue at all times (i) to conduct its business and engage principally in the same or complementary line or lines of business substantially as heretofore conducted (subject to the right to make Permitted Acquisitions) and (ii) preserve, protect and maintain free from Liens (other than Liens permitted under Section 8.3 hereof) its material patents, copyrights, licenses, trademarks, trademark rights, trade names, trade name rights, trade secrets and know-how necessary or reasonably required in the conduct of its operations.      7.17 Use of Proceeds. Use the proceeds of the Loans solely for the purposes specified in Section 2.16 hereof.      7.18 New Subsidiaries. Cause to be delivered to the Administrative Agent each of the following (by the earlier of (I) the date that any Subsidiary guarantees any obligations under the Senior Notes or the Year 2006 Senior Notes or the Senior Note Indenture or the Year 2006 Senior Note Indenture and (II) the date that is thirty (30) days after the acquisition or creation of any Subsidiary other than an Excluded Subsidiary):      (a) a Facility Guaranty executed by such Subsidiary substantially in the form of Exhibit J;      (b) an opinion of counsel to the Subsidiary dated as of the date of delivery of the Facility Guaranty provided for in this Section 7.18 and addressed to the Administrative Agent and the Lenders, in form and substance reasonably acceptable to the Administrative Agent (which opinion shall include opinions regarding such Subsidiary and Facility Guaranty substantially similar to the opinions of counsel delivered pursuant to Section 5.1(a), and which opinion may include assumptions and qualifications of similar effect to those contained in the opinions of counsel delivered pursuant to Section 5.1(a)); and      (c) current copies of the Organizational Documents and Operating Documents of such Subsidiary, minutes of duly called and conducted meetings (or duly effected consent actions) of the Board of Directors, partners, or appropriate committees thereof (and, if required by such Organizational Documents, Operating Documents or applicable law, of the shareholders, members or partners) of such Subsidiary authorizing the actions and the execution and delivery of documents described in this Section 7.18. ARTICLE VIII Negative Covenants      Until the Facility Termination Date unless the Required Lenders shall otherwise consent in writing, the Borrower will not, nor will it permit any Subsidiary to:      8.1 Financial Covenants.      (a) Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio as at the last day of any Four-Quarter Period to be greater than 2.75 to 1.00.   69      (b) Consolidated Total Capitalization. Permit at any time the Consolidated Capitalization Ratio to be greater than 0.65 to 1.00.      8.2 Indebtedness. Incur, create or assume any Funded Indebtedness (other than Permitted Indebtedness) unless, after giving pro forma effect thereto, the Borrower shall be in compliance with Section 8.1 (with Consolidated EBITDA, for such purpose, being calculated in respect of the most recent period of four consecutive fiscal quarters for which financial statements are available).      8.3 Liens. Incur, create or permit to exist any Lien of any nature whatsoever with respect to any property or assets now owned or hereafter acquired by the Borrower or any of its Subsidiaries, other than      (i) Liens existing as of the First Amendment Effective Date and as set forth in Schedule 8.3 attached hereto;      (ii) Liens imposed by law for taxes, assessments or charges of any Governmental Authority for claims not yet due or, Liens for judgments or levies, in each case which are being contested in good faith by appropriate proceedings diligently pursued and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;      (iii) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen, laborers, employees or suppliers and other Liens imposed by law or created in the ordinary course of business and in existence less than 120 days from the date of creation thereof for amounts not yet due or which are being contested in good faith by appropriate proceedings and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;      (iv) Liens incurred or deposits made in the ordinary course of business (including, without limitation, surety bonds and appeal bonds) in connection with workers’ compensation, unemployment insurance and other types of social security benefits or to secure the performance of tenders, bids, leases, contracts (other than for the repayment of Indebtedness), self insurance general liability insurance programs, public or statutory obligations, surety and appeal bonds posted in the ordinary course of business, letters of credit issued in the ordinary course of business and other similar obligations or arising as a result of progress payments under government contracts;      (v) easements (including, without limitation, reciprocal easement agreements and utility agreements), licenses, rights of others for rights-of-way, utilities, sewers, electric lines, telephone or telegraph lines and similar purposes, covenants, consents, reservations, encroachments, variations and zoning and other restrictions, charges or encumbrances (whether or not recorded), which do not interfere materially with the ordinary conduct of the business of the Borrower or any Subsidiary and which do not materially detract from the value of the property to which they attach or materially impair the use thereof to the Borrower or any Subsidiary;   70      (vi) Liens on real property and improvements securing (A) Mortgage Facilities of the Borrower or any Guarantor in an aggregate principal amount not to exceed $500,000,000 at any time outstanding and (B) Rate Hedging Obligations related to such Mortgage Facilities (which Rate Hedging Obligations are owed to any of the respective lenders under such Mortgage Facilities and secured by the same assets as such Mortgage Facilities), provided that the amount of Indebtedness under any Mortgage Facility does not exceed eighty-five percent (85%) of the fair market value of the real property and improvements securing such Indebtedness as of the date such Liens are granted on such real property and improvements;      (vii) Liens to secure the refinancing of any Indebtedness described on Schedule 8.3 to the extent such Liens encumber substantially the same assets in substantially the same manner as the Liens securing the debt being refinanced or to the extent such Liens constitute Liens permitted under this Section 8.3; and any extension, renewal, refinancing or replacement in whole or in part of any Lien described in the foregoing clauses (i) through (vi) so long as no additional collateral is granted as security;      (viii) Liens on claims of the Borrower or any Subsidiary against Persons renting or leasing Vehicles, Persons damaging Vehicles or Persons issuing applicable insurance coverage for such Persons, which claims relate to damage to Vehicles, to the extent that such damage exceeds the renter’s or lessee’s collision damage waiver limitation or insurance deductible;      (ix) Liens securing Vehicle Receivables Indebtedness and Vehicle Secured Indebtedness and Rate Hedging Obligations related to such Indebtedness, which Rate Hedging Obligations are owed to any of the respective lenders of such Indebtedness and secured by the same assets as such Indebtedness; and      (x) Liens not otherwise permitted hereby securing Indebtedness of the Borrower and its Subsidiaries so long as, on the date any such Lien is granted or any such Indebtedness is incurred, after giving effect thereto, the aggregate principal amount of Indebtedness described in this clause (x) shall not exceed 15% of Consolidated Tangible Unencumbered Assets (calculated using Consolidated Tangible Unencumbered Assets as of the most recently ended fiscal quarter of the Borrower for which financial statements are available).      8.4 Merger, Consolidation or Fundamental Changes. (a) Sell, lease, transfer or otherwise dispose of all or a majority of the assets of the Borrower and its Subsidiaries (taken as a whole), (b) consolidate with or merge into any other Person, or (c) permit any other Person to merge into it or (d) in the case of the Borrower, liquidate, wind-up or dissolve; provided, however, (i) any Subsidiary of the Borrower may merge or transfer all or substantially all of its assets into or consolidate with any other Subsidiary of the Borrower (which, for the avoidance of doubt, shall be the case so long as the surviving or continuing entity shall be a Subsidiary and, if not a corporation, directly or indirectly controlled by the Borrower, upon consummation of such merger, transfer or consolidation), (ii) any Person may merge with the Borrower if the Borrower shall be the survivor thereof and such merger shall not cause, create or result in the occurrence of any Default or Event of Default hereunder, (iii) any Subsidiary may merge with or transfer   71 substantially all of its assets to or consolidate with any other Person so long as such merger, transfer or consolidation does not constitute a sale, lease, transfer or other disposition of all or a majority of the assets of the Borrower and its Subsidiaries (taken as a whole) to such other Person and (iv) any Person (other than the Borrower) may consolidate with or merge into any Subsidiary.      8.5 Transactions with Affiliates. Other than transactions (x) permitted under Section 8.4 hereof, (y) between or among one or more Loan Parties or (z) share repurchases of the Borrower’s common stock and the repurchases of the Senior Notes in connection with the Transaction, enter into any transaction after the date hereof, including, without limitation, the purchase, sale, leasing or exchange of property, real or personal, or the rendering of any service, with any Affiliate of the Borrower, except (a) that such Persons may render services to the Borrower or its Subsidiaries for compensation at the same rates generally paid by Persons engaged in the same or similar businesses for the same or similar services and (b) in the ordinary course of the Borrower’s (or any Subsidiary’s) business and upon fair and reasonable terms no less favorable to the Borrower (or any Subsidiary) than would be obtained in a comparable arm’s-length transaction with a Person not an Affiliate, provided, that share repurchases of the Borrower’s common stock shall not be restricted to the ordinary course of the Borrower’s business.      8.6 Compliance with ERISA, the Code and Foreign Benefit Laws. With respect to any Pension Plan, Employee Benefit Plan or Multiemployer Plan:      (a) permit the occurrence of any Termination Event which is reasonably likely to result in a liability on the part of the Borrower or any ERISA Affiliate to the PBGC or to any Governmental Authority; or      (b) except as provided in Schedule 6.1(l), permit the present value of all benefit liabilities under all Pension Plans to exceed the current value of the assets of such Pension Plans allocable to such benefit liabilities by a material amount; or      (c) except as provided in Schedule 6.1(l), permit any accumulated funding deficiency (as defined in Section 302 of ERISA and Section 412 of the Code) with respect to any Pension Plan, whether or not waived; or      (d) fail to make any material contribution or payment to any Multiemployer Plan which the Borrower or any ERISA Affiliate may be required to make under any agreement relating to such Multiemployer Plan, or any law pertaining thereto; or      (e) engage, or permit any Borrower or any ERISA Affiliate to engage, in any prohibited transaction under Section 406 of ERISA or Sections 4975 of the Code for which a civil penalty pursuant to Section 502(I) of ERISA or a tax pursuant to Section 4975 of the Code may be imposed; or      (f) permit the establishment of any Employee Benefit Plan providing post-retirement welfare benefits or establish or amend any Employee Benefit Plan which establishment or amendment could result in liability to the Borrower or any ERISA Affiliate or increase the obligation of the Borrower or any ERISA Affiliate, in each case,   72 to a Multiemployer Plan which annual liability or increase, individually or together with all similar liabilities and increases, is in excess of $500,000; or      (g) fail, or permit the Borrower or any ERISA Affiliate to fail, to establish, maintain and operate each Employee Benefit Plan in compliance in all material respects with the provisions of ERISA, the Code, all applicable Foreign Benefit Laws and all other applicable laws and the regulations and interpretations thereof.      8.7 Fiscal Year. Change the Borrower’s Fiscal Year.      8.8 Change in Control. Permit at any time a Change in Control.      8.9 Limitations on Upstreaming. Enter into any agreement restricting or limiting the payment of dividends or other distributions from any Subsidiary to the Borrower or to any other Subsidiary owning Subsidiary Securities of such Subsidiary; provided that the foregoing shall not apply to restrictions or conditions (i) imposed by law or any Loan Document, (ii) existing on the date hereof identified on Schedule 8.9, (iii) customarily contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iv) in existence at the time a Person becomes a Subsidiary and not incurred in connection with, or in contemplation of, such Person becoming a Subsidiary, (v) contained in (A) any agreement in respect of Vehicle Secured Indebtedness or Vehicle Receivables Indebtedness or (B) any other agreement of an entity or related to assets acquired by or merged into or consolidated with the Borrower or any Subsidiary so long (in the case of clause (B)) as such encumbrance or restriction was not entered into in connection with, or in contemplation of, such acquisition, merger or consolidation, (vi) customary provisions restricting subletting or assignment of any lease governing any leasehold interest of the Borrower or any Subsidiary, or (vii) covenants in franchise agreements and/or framework agreements with Manufacturers customary for franchise agreements and/or framework agreements in the automobile retailing industry.      8.10 Subsidiary Guaranties. Permit any Subsidiary to enter into any guaranty agreement, or incur any Guaranty Obligation, with respect to any Indebtedness unless such Subsidiary has executed and delivered a Facility Guaranty to the Administrative Agent.      8.11 Manufacturer Consents.      (a) Terminate, revoke or violate the terms of any Manufacturer Consent or amend or modify the terms of any Manufacturer consent in any manner adverse to the interests of the Lenders.      (b) Authorize any Manufacturer to amend, modify, terminate, revoke or violate the terms of any Manufacturer Consent or to amend or modify the terms of any Manufacturer consent in each case in any manner adverse to the interests of the Lenders.   73 ARTICLE IX Events of Default and Acceleration      9.1 Events of Default. If any one or more of the following events (herein called “Events of Default”) shall occur for any reason whatsoever (and whether such occurrence shall be voluntary or involuntary or come about or be effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body), that is to say:      (a) if default shall be made in the due and punctual payment of the principal of any Loan or Reimbursement Obligation, when and as the same shall be due and payable whether pursuant to any provision of Article II or Article III hereof, at maturity, by acceleration or otherwise; or      (b) if default shall be made in the due and punctual payment of any amount of interest on any Loan or of any fees or other amounts payable to the Lenders, the Administrative Agent, any Issuing Banks or JPMorgan Chase Bank under the Loan Documents on the date on which the same shall be due and payable and such failure to pay shall continue for a period of three Business Days (after receipt of written notice from the Administrative Agent with respect to amounts other than interest); or      (c) if default shall be made in the performance or observance of any covenant set forth in Sections 7.7, 7.11, 7.17, 7.18 or Article VIII hereof; or      (d) if a default shall be made in the performance or observance of, or shall occur under, any covenant, agreement or provision contained in any Loan Document (other than as described in clauses (a), (b) or (c) above) and such default shall continue for 30 or more days after the earlier of receipt of notice of such default by an Authorized Representative from the Administrative Agent or the Borrower becomes aware of such default, or if any Loan Document ceases to be in full force and effect (other than by reason of any action by the Administrative Agent), or if without the written consent of the Administrative Agent and the Lenders, this Agreement or any other Loan Document shall be disaffirmed by the Borrower or any of its Subsidiaries or shall terminate, be terminable or be terminated or become void or unenforceable for any reason whatsoever (other than in accordance with its terms in the absence of default or by reason of any action by the Administrative Agent or any Lender); or      (e) if a default shall occur, which is not waived, (i) in the payment of any principal, interest, premium or other amounts with respect to any Indebtedness (other than the Loans) of the Borrower or of any Subsidiary in an outstanding aggregate amount not less than $20,000,000, or (ii) in the performance, observance or fulfillment of any term or covenant contained in any agreement or instrument under or pursuant to which any such Indebtedness described in clause (i) above may have been issued, created, assumed, guaranteed or secured by the Borrower or any Subsidiary, and in the case of each of clauses (i) and (ii) such default shall continue for more than the period of grace, if   74 any, therein specified, and if such default shall permit the holder of any such Indebtedness to accelerate the maturity thereof; or      (f) if any representation, warranty or other statement of fact contained herein or any other Loan Document or in any writing, certificate, report or statement at any time furnished to the Administrative Agent or any Lender by or on behalf of the Borrower or any Subsidiary pursuant to or in connection with this Agreement or the other Loan Documents, or otherwise, shall be false or misleading in any material respect when given or made or deemed given or made; or      (g) if the Borrower or any Subsidiary shall be unable to pay its debts generally as they become due; file a petition to take advantage of any insolvency, reorganization, bankruptcy, receivership or similar law, domestic or foreign; make an assignment for the benefit of its creditors; commence a proceeding for the appointment of a receiver, trustee, liquidator or conservator of itself or of the whole or any substantial part of its property; file a petition or answer seeking reorganization or arrangement or similar relief under the federal bankruptcy laws or any other applicable law or statute, federal, state or foreign; or      (h) if a court of competent jurisdiction shall enter an order, judgment or decree appointing a custodian, receiver, trustee, liquidator or conservator of the Borrower or any Subsidiary or of the whole or any substantial part of its properties and such order, judgment or decree continues unstayed and in effect for a period of sixty (60) days, or approve a petition filed against the Borrower or any Subsidiary seeking reorganization or arrangement or similar relief under the federal bankruptcy laws or any other applicable law or statute of the United States of America or any state or foreign country, province or other political subdivision, which petition is not dismissed within sixty (60) days; or if, under the provisions of any other law for the relief or aid of debtors, a court of competent jurisdiction shall assume custody or control of properties, which control is not relinquished within sixty (60) days; or if there is commenced against the Borrower or any Subsidiary any proceeding or petition seeking reorganization, arrangement or similar relief under the federal bankruptcy laws or any other applicable law or statute of the United States of America or any state or foreign country, province or other political subdivision which proceeding or petition remains undismissed for a period of thirty (30) days; or if the Borrower or any Subsidiary takes any action to indicate its consent to or approval of any such proceeding or petition; or      (i) if (i) any judgments where the aggregate amount not covered by insurance (or the amount as to which the insurer denies liability) is in excess of $10,000,000 are rendered against the Borrower or any Subsidiary, or (ii) there are attachments, injunctions or executions against any of the Borrower’s or any Subsidiary’s properties for an aggregate amount in excess of $10,000,000; and such judgments, attachments, injunctions or executions referred to in clauses (i) and (ii) above remain unpaid, unstayed, undischarged, unbonded or undismissed for a period of thirty (30) days; then, and in any such event and at any time thereafter, if such Event of Default or any other Event of Default shall be continuing,   75      (A) either or both of the following actions may be taken: (i) the Administrative Agent may with the consent of the Required Lenders, and at the direction of the Required Lenders shall, declare any obligation of the Lenders to make further Loans or of the Issuing Banks to issue Letters of Credit terminated, whereupon the obligation of each Lender to make further Loans or of the Issuing Banks to issue Letters of Credit hereunder shall terminate immediately, and (ii) the Administrative Agent shall at the direction of the Required Lenders, at their option, declare by notice to the Borrower any or all of the Obligations to be immediately due and payable, and the same, including all interest accrued thereon and all other obligations of the Borrower to the Administrative Agent, the Lenders and the Issuing Banks, shall forthwith become immediately due and payable without presentment, demand, protest, notice or other formality of any kind, all of which are hereby expressly waived, anything contained herein or in any instrument evidencing the Obligations to the contrary notwithstanding; provided, however, that notwithstanding the above, if there shall occur an Event of Default under clause (g) or (h) above with respect to the Borrower, then the obligation of the Lenders to lend and of the Issuing Banks to issue Letters of Credit hereunder shall automatically terminate and any and all of the Obligations shall be immediately due and payable without the necessity of any action by the Administrative Agent or the Required Lenders or notice to the Administrative Agent or the Lenders;      (B) at any time after the Administrative Agent has received the consent or direction of the Required Lenders to take action under clause (A)(i) or (A)(ii) above (or if an Event of Default described under clause (g) or (h) has occurred with respect to the Borrower) the Borrower shall, upon demand of the Administrative Agent or the Required Lenders, deposit cash with the Administrative Agent in an amount equal to the amount of any Letters of Credit remaining undrawn or unpaid, as collateral security for the repayment of any future drawings or payments under such Letters of Credit and the Borrower shall forthwith deposit and pay such amounts and such amounts shall be held by the Administrative Agent as cash collateral for the Borrower’s obligations in respect thereof; and      (C) the Administrative Agent and the Lenders shall have all of the rights and remedies available under the Loan Documents or under any applicable law.      9.2 Administrative Agent to Act. In case any one or more Events of Default shall occur and be continuing, the Administrative Agent may, and at the direction of the Required Lenders shall, proceed to protect and enforce their rights or remedies either by suit in equity or by action at law, or both, whether for the specific performance of any covenant, agreement or other provision contained herein or in any other Loan Document, or to enforce the payment of the Obligations or any other legal or equitable right or remedy.      9.3 Cumulative Rights. No right or remedy herein conferred upon the Lenders or the Administrative Agent is intended to be exclusive of any other rights or remedies contained herein   76 or in any other Loan Document, and every such right or remedy shall be cumulative and shall be in addition to every other such right or remedy contained herein and therein or now or hereafter existing at law or in equity or by statute, or otherwise.      9.4 No Waiver. No course of dealing between the Borrower and any Lender or the Administrative Agent or any failure or delay on the part of any Lender or the Administrative Agent in exercising any rights or remedies under any Loan Document or otherwise available to it shall operate as a waiver of any rights or remedies and no single or partial exercise of any rights or remedies shall operate as a waiver or preclude the exercise of any other rights or remedies hereunder or of the same right or remedy on a future occasion.      9.5 Allocation of Proceeds. If an Event of Default has occurred and is continuing and the maturity of the Loans has been accelerated pursuant to Article X hereof, all payments received by the Administrative Agent hereunder, in respect of any principal of or interest on the Obligations or any other amounts payable by the Borrower hereunder (other than amounts deposited with the Administrative Agent pursuant to Section 9.1(B), which shall be applied to repay any unreimbursed drawings or payments under the Letters of Credit) shall be applied by the Administrative Agent in the following order:      (i) amounts due to the Issuing Banks, JPMorgan Chase Bank and the Lenders pursuant to Sections 2.13, 3.4 and 11.5 hereof;      (ii) amounts due to (A) any Issuing Bank pursuant to Section 3.5 hereof, and (B) the Administrative Agent pursuant to Section 2.13(c) hereof;      (iii) payments of interest on Loans, to be applied for the ratable benefit of the Lenders;      (iv) payments of principal on Loans, to be applied for the ratable benefit of the Lenders;      (v) payment of cash amounts to the Administrative Agent in respect of Outstanding Letters of Credit pursuant to Section 9.1(B) hereof;      (vi) payments of all remaining Obligations, if any, to be applied for the ratable benefit of the Lenders; and      (vii) any surplus remaining after application as provided for herein, to the Borrower or otherwise as may be required by applicable law. ARTICLE X The Administrative Agent      10.1 Appointment. Each Lender hereby irrevocably designates and appoints the Administrative Agent as the agent of such Lender under this Agreement and the other Loan Documents, and each such Lender irrevocably authorizes the Administrative Agent, in such capacity, to take such action on its behalf under the provisions of this Agreement and the other   77 Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement, the Administrative Agent shall not have any duties or Administrative Agent.      10.2 Delegation of Duties. The Administrative Agent may execute any of its duties under this Agreement and the other Loan Documents by or through agents or attorneys in fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Administrative Agent shall not be responsible for the negligence or misconduct of any agents or attorneys in fact selected by it with reasonable care.      10.3 Exculpatory Provisions. Neither any Agent nor any of their respective officers, directors, employees, agents, attorneys in fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or any other Loan Document (except to the extent that any of the foregoing are found by a final and from its or such Person’s own gross negligence or willful misconduct) or      10.4 Reliance by Administrative Agent. (a) The Administrative Agent shall statements of legal counsel (including counsel to the Borrower), independent acting, or in refraining from acting, under this   78 Agreement and the other Loan Documents in accordance with a request of the Required Lenders (or, if so specified by this Agreement, all Lenders), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Loans.      (b) For purposes of determining compliance with the conditions specified in Section 5.1, each Lender shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter either sent by the Administrative Agent to such Lender for consent, approval, acceptance or satisfaction, or required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender.      10.5 Notice of Default. The Administrative Agent shall not be deemed to unless the Administrative Agent has received notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”. In the event that the Administrative Agent receives such a notice, the Administrative Agent shall give notice thereof to the Lenders. The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders (or, if so specified by this Agreement, all Lenders); provided that unless and until the Administrative Agent shall have received such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Lenders.      10.6 Non-Reliance on Agents and Other Lenders. Each Lender expressly directors, employees, agents, attorneys in fact or affiliates have made any any of its officers, directors, employees, agents, attorneys in fact or affiliates.   79      10.7 Indemnification. The Lenders agree to indemnify each Agent in its capacity as such (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so to the extent required by Section 11.9 hereof), ratably according to their respective Aggregate Exposure Percentages in effect on the date on which indemnification is sought under this Section (or, if indemnification is sought after the date upon which the Commitments shall have terminated and the Loans shall have been paid in full, ratably in accordance with such Aggregate Exposure Percentages immediately prior to such date), from and against any and all liabilities, obligations, losses, of any kind whatsoever that may at any time (whether before or after the payment of the Loans) be imposed on, incurred by or asserted against such Agent in any way relating to or arising out of, the Commitments, this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such costs, expenses or disbursements that are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from such Agent’s gross negligence or willful misconduct. The agreements in this Section shall survive the payment of the Loans and all other amounts payable hereunder.      10.8 Agent in its Individual Capacity. Each Agent and its affiliates may make loans to, accept deposits from and generally engage in any kind of business with any Loan Party as though such Agent were not an Agent. With respect to its Loans made or renewed by it and with respect to any Letter of Credit issued or participated in by it, each Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and may exercise the same as though it were not an Agent, and the terms “Lender” and “Lenders” shall include each Agent in its individual capacity.      10.9 Successor Administrative Agent. The Administrative Agent may resign as Administrative Agent upon 30 days’ notice to the Lenders and the Borrower. If the Administrative Agent shall resign as Administrative Agent under this Agreement and the other Loan Documents, then the Required Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall (unless an Event of Default under Section 9.1(g) or (h) with respect to the Borrower shall have occurred and be continuing) be subject to approval by the Borrower (which approval shall not be unreasonably withheld or delayed), whereupon such successor agent shall succeed to the rights, powers and duties of the Administrative Agent, and the term “Administrative Agent” shall mean such successor agent effective upon such appointment and approval, and the former Administrative Agent’s rights, powers and duties as Administrative Agent shall be terminated, without any other or further act or deed on the part of such former Administrative Agent or any of the parties to this Agreement or any holders of the Loans. If no successor agent has accepted appointment as Administrative Agent by the date that is 30 days following a retiring Administrative Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective, and the Lenders shall assume and perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above. After any retiring Administrative Agent’s resignation as Administrative Agent, the   80 provisions of this Article X shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement and the other Loan Documents.      10.10 Other Agents, etc. None of the Lenders or other Persons identified on the cover page or signature pages of this Agreement as a “Syndication Agent,” “Documentation Agent,” “Co-Lead Arranger” or “Joint Bookrunner” shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than those applicable to all Lenders as such. Without limiting the foregoing, none of the Lenders so identified shall have or be deemed to have any fiduciary relationship with any Lender. Each Lender acknowledges that it has not relied, and will not rely, on any of the Lenders so identified in deciding to enter into this Agreement or in taking or not taking action hereunder. ARTICLE XI Miscellaneous      11.1 Assignments and Participations. (a) The provisions of this Agreement respective successors and assigns permitted hereby, except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder or transfer by the Borrower without such consent shall be null and void) and Lender may assign to one or more assignees (each, an “Assignee”) all or a      (A) the Borrower, provided that no consent of the Borrower shall be required for an assignment to a Lender, an affiliate of a Lender, an Approved continuing, any other Person (in which case the Borrower shall instead be promptly notified of such assignment by the assigning Lender unless the Assignee is an Affiliate of such assigning Lender); and      (B) the Administrative Agent, provided that no consent of the Administrative Agent shall be required for an assignment to a Lender, an affiliate of a Lender or an Approved Fund (as defined below).      (A) except in the case of an assignment to a Lender, an affiliate of a Lender or an Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s Commitments or Loans under any Facility, the amount of the Commitments or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with   81 respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000 unless each of the Borrower and the Administrative Agent otherwise consent, provided that (1) no such consent of the Borrower shall be      (B) the parties to each assignment shall execute and deliver to the and recordation fee of $3,500 (which fee shall not be reimbursed by the Borrower); and      (C) the Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an administrative questionnaire. For the purposes of this Section 11.1, “Approved Fund” means any Person (other affiliate of a Lender or (c) an entity or an affiliate of an entity that      (iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) below, from and after the effective date specified in each Assignment and Assumption the Assignee thereunder shall be a party hereto and, to the Sections 4.1, 4.5, 4.6 and 11.9). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 11.1 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with addresses of the Lenders, and the Commitments of, and principal amount of the Loans and Reimbursement Obligations owing to, each Lender pursuant to the terms conclusive, and the Borrower, the Administrative Agent, the Issuing Banks and Agreement, notwithstanding notice to the contrary. by an assigning Lender and an Assignee, the Assignee’s completed   82 administrative questionnaire (unless the Assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and recorded in the Register as provided in this paragraph.      (c) (i) Any Lender may, without the consent of or notice to the Borrower or the Administrative Agent, sell participations to one or more banks or other entities (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitments and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, (C) the Borrower, the Administrative Agent, the Issuing Lender and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and (D) such participations shall be in a minimum amount equal to the lesser of $5,000,000 or the remaining portion of a Lender’s rights and obligations hereunder which are not subject to a pre-existing participation. Any agreement that such agreement may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver that (1) requires the consent of each Lender directly affected thereby pursuant to Section 11.6(a) or (b) and (2) directly affects such Participant. Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 4.1, 4.5 and 4.6 to the same pursuant to paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 11.3(b) as though it were a Lender, provided such Participant shall be subject to Section 11.3(a) as though it were a Lender.      (ii) A Participant shall not be entitled to receive any greater payment under Section 4.1, 4.5 or 4.6 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent. Any Participant that is organized under the laws of a jurisdiction outside the United States shall not be entitled to the benefits of Section 4.6 unless such Participant complies with Section 4.6(d). or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or Assignee for such Lender as a party hereto. The Borrower, upon   83 receipt of written notice from the relevant Lender, agrees to issue a Note to any Lender requiring such Note to facilitate transactions of the type described in this paragraph (d).      (e) Notwithstanding anything to the contrary herein, no Lender will assign or sell participations in all or a portion of its Loans or Commitments to any Person who is (i) listed on the Specially Designated Nationals and Blocked Persons List maintained by the U.S. Department of Treasury Office of Foreign Assets Control (“OFAC”) and/or on any other similar list maintained by the OFAC pursuant to any authorizing statute, Executive Order or regulation or (ii) either (A) included within the term “designated national” as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (B) designated under Sections 1(a), 1(b), 1(c) or 1(d) of Executive Order No. 13224, 66 Fed. Reg. 49079 (published September 25, 2001) or similarly designated under any related enabling legislation or any other similar Executive Orders.      11.2 Notices. Any notice shall be conclusively deemed to have been received by any party hereto and be effective (i) on the day on which delivered (including hand delivery by commercial courier service) to such party (against receipt therefor), (ii) on the date of transmission to such party, in the case of notice by telefacsimile (where the proper transmission of such notice is either acknowledged by the recipient or electronically confirmed by the transmitting device), or (iii) on the fifth Business Day after the day on which mailed to such party, if sent prepaid by certified or registered mail, return receipt requested, in each case delivered, transmitted or mailed, as the case may be, to the address or telefacsimile number, as appropriate, set forth below or such other address or number as such party shall specify by notice hereunder:               (a)   if to the Borrower:                   AutoNation, Inc.         110 Southeast 6th Street, 16th Floor         Ft. Lauderdale, Florida 33301         Attn: Treasurer         Telephone: (954)769-7734         Telefacsimile: (954) 769-4521                               AutoNation, Inc.             Attn: General Counsel         Telephone: (954) 769-7224         Telefacsimile: (954) 769-6340   84               (b)   if to the Administrative Agent:                     Loan & Agency         1111 Fannin Street, 10th Floor         Houston, Texas 77002         Attn: Mary Ann Bui         Telephone: (713) 750-7932         Telefacsimile: (713) 750-2358         Email: [email protected]                                 270 Park Avenue           Attn: Vincent Bolognini         Telephone: (212) 270-3292         Telefacsimile: (212) 270-4016         Email: [email protected]               (c)   if to the Lenders:                   At the addresses set forth in administrative questionnaires furnished by the Lenders to the Administrative Agent;               (d)   if to any Guarantor, at the address set forth in (a) above.      11.3 Right of Set-off; Adjustments. (a) Upon the occurrence and during the continuance of any Event of Default, each Lender is hereby authorized at any or final) at any time held and other indebtedness at any time owing by such Lender to or for the credit or the account of the Borrower against any and all of the obligations of the Borrower now or hereafter existing under this Agreement held by such Lender. Each Lender agrees promptly to notify the Borrower after any such set-off and application made by such Lender; provided, however, that the failure to give such notice shall not affect the validity of such set-off and application. The rights of each Lender under this Section 11.3 are in addition to other rights and remedies (including, without limitation, other rights of set-off) that such Lender may have.      (b) If any Lender (a “benefitted Lender”) shall at any time receive any payment of all or part of the Loans owing to it, or interest thereon, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, or otherwise), in a greater proportion than any such payment to or collateral received by any other Lender, if any, in respect of such other Lender’s Loans owing to it, or interest thereon, such benefitted Lender shall purchase for cash from the other Lenders a participating interest in such portion of each such other Lender’s Loans owing to it, or shall provide such other Lenders with the benefits of any such collateral, or the proceeds thereof, as shall be necessary to cause such benefitted Lender to   85 share the excess payment or benefits of such collateral or proceeds ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such benefitted Lender or is repaid in whole or in part by such benefitted Lender in good faith settlement of a pending or threatened avoidance claim, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery or settlement payment, but without interest. The Borrower agrees that any Lender so purchasing a participation from a Lender pursuant to this Section 11.3 may, to the fullest extent permitted by law, exercise all of its rights of payment (including the right of set-off) with respect to such participation as fully as if such Person were the direct creditor of the      11.4 Survival. All covenants, agreements, representations and warranties made herein shall survive the making by the Lenders of the Loans and the issuance of the Letters of Credit and the execution and delivery to the Lenders of this Agreement and shall continue in full force and effect until the Facility Termination Date, subject to Section 11.8.      11.5 Expenses. The Borrower agrees to pay on demand all reasonable out-of-pocket costs and expenses of the Administrative Agent in connection with the syndication, preparation, execution, delivery, administration, modification, and amendment of this Agreement, the other Loan Documents, and the other documents to be delivered hereunder, including, without limitation, the reasonable fees and expenses of counsel for the Administrative Agent with respect thereto and with respect to advising the Administrative Agent as to its rights and responsibilities under the Loan Documents. The Borrower further agrees to pay on demand all costs and expenses of the Administrative Agent and, during the continuance of any Event of Default, the Lenders, if any (including, without limitation, reasonable attorneys’ fees and expenses), in connection with of the Loan Documents and the other documents to be delivered hereunder.      11.6 Amendments and Waivers. Any provision of this Agreement or any other Loan Document may be amended or waived if, but only if, such amendment or waiver is in writing and is signed (or consented to in writing) by the Borrower or other applicable Loan Party party to such Loan Document and (except as provided in clauses (a) and (b) below) either the Required Lenders or (as to Loan Documents other than this Agreement) the Administrative Agent with the consent of the Required Lenders (and, if Article X hereof or the rights or duties of the Administrative Agent are affected thereby, by the Administrative Agent); provided that      (a) no such amendment or waiver shall, unless signed by each Lender directly affected thereby, (i) (except as provided in Section 2.18) increase the Revolving Credit Commitments of such Lender or the Total Revolving Credit Commitment, (ii) reduce (x) the principal of or rate of interest on any Revolving Credit Loan, Term Loan or Competitive Bid Loan made by such Lender, (y) the amounts of any Reimbursement Obligations owed to such Lender hereunder or (z) any fees payable to such Lender hereunder, except that only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” hereunder or to waive any obligation of the Borrower to pay interest at the Default Rate, (iii) postpone any date scheduled for the payment of principal, interest or fees payable to such Lender hereunder or for termination of any Revolving Credit Commitment of such Lender, (iv) adversely change any pro rata   86 provisions of Section 2.9 or (v) reduce the specified percentage amount below 50% in the definition of Required Lenders or the percentage of the Revolving Credit Commitments or outstanding Loans held by any Lender, as applicable, which shall be required for the Lenders or any of them to take any action under this Section 11.6(a); and provided, further, that no such amendment or waiver that affects the rights, privileges or obligations of JPMorgan Chase Bank as provider of Swing Line Loans, shall be effective unless signed in writing by JPMorgan Chase Bank or that affects the rights, privileges or obligations of any Issuing Bank as issuer of Letters of Credit, shall be effective unless signed in writing by such Issuing Bank; and      (b) no such amendment or waiver shall, unless signed by each Lender directly affected thereby, release any Guarantor (unless such Person is simultaneously released from its Senior Note Guaranty and Year 2006 Senior Note Guaranty), subordinate any Facility Guaranty of any Guarantor (unless the Senior Note Guaranty and Year 2006 Senior Note Guaranty of such Person is subordinated or substantially the same terms), release all or substantially all of the Guarantors, or subordinate all or substantially all of the Facility Guaranties, except as otherwise provided in this Agreement or as contemplated in the applicable Loan Documents.      In addition, notwithstanding the foregoing, this Agreement may be amended with only the written consent of the Administrative Agent (not to be unreasonably withheld), the Borrower and the Lenders providing the relevant Replacement Term Loans (as defined below) (but not any other Lender) to permit the refinancing, replacement or modification of all outstanding Term Loans (“Replaced Term Loans”) with a replacement term loan tranche hereunder (“Replacement Term Loans”), provided that (a) the aggregate principal amount of such Replacement Term Loans shall not exceed the aggregate principal amount of such Replaced Term Loans, (b) the Applicable Margin for such Replacement Term Loans shall not be higher than the Applicable Margin for such Replaced Term Loans and (c) the weighted average life to maturity of such Replacement Term Loans shall not be shorter than the weighted average life to maturity of such Replaced Term Loans at the time of such refinancing.      Any such waiver and any such amendment or modification pursuant to this Section 11.6 shall be binding upon the Borrower, the Guarantors, the Lenders, the Administrative Agent and all future holders of the Loans. Except as otherwise set forth in such waiver, any Default or Event of Default that is waived pursuant to this Section 11.6 shall not be deemed to be a Default or Event of Default during the period of such waiver. circumstances, except as otherwise expressly provided herein. No delay or omission on any Lender’s or the Administrative Agent’s part in exercising any right, remedy or option shall operate as a waiver of such or any other right, remedy or option or of any Default or Event of Default.      11.7 Counterparts; Facsimile Signatures. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original, and it shall not be necessary in making proof of this Agreement to produce or account for more than one such fully-executed counterpart. Signatures on communications and other   87 documents may be transmitted by facsimile only with the consent of the Administrative Agent in its sole and absolute discretion in each instance. The effectiveness of any such signatures accepted by the Administrative Agent shall, subject to applicable law, have the same force and effect as manual signatures and shall be binding on all parties. The Administrative Agent may also require that any such signature be confirmed by a manually-signed hard copy thereof. Each party hereto hereby adopts as an original executed signature page each signature page hereafter furnished by such party to the Administrative Agent (or an agent of the Administrative Agent) bearing (with the consent of the Administrative Agent) a facsimile signature by or on behalf of such party. Nothing contained in this Section shall limit the provisions of Section 10.4.      11.8 Termination. This Agreement shall terminate on the Facility Termination Date, except that (x) those provisions which by the express terms thereof continue in effect notwithstanding the Facility Termination Date, and (y) obligations in the nature of continuing indemnities or expense reimbursement obligations not yet due and payable, shall continue in effect. Notwithstanding the foregoing, if after receipt of any payment of all or any part of the Obligations, the Administrative Agent, any Issuing Bank or any Lender (including the Swing Line lender) is for any reason compelled to surrender such payment to any Person because such payment is determined to be void or voidable as a preference, impermissible setoff, a diversion of trust funds or for any other reason or elects to repay any such amount in good faith settlement of a pending or threatened avoidance claim, (i) this Agreement (including the provisions pertaining to Participations in Letters of Credit, Reimbursement Obligations and Swing Line Loans) shall continue in full force (or be reinstated, as the case may be) and the Borrower shall be liable to, and shall indemnify and hold the Administrative Agent, such Issuing Bank or such Lender harmless for, the amount of such payment surrendered until the Administrative Agent, such Issuing Bank or such Lender shall have been finally paid in full, and (ii) in the event any portion of any amount so required to be surrendered by the Administrative Agent or any Issuing Bank or the Swing Line lender shall have been distributed to the Lenders, the Lenders shall promptly repay such amounts to the Administrative Agent or such Issuing Bank or the Swing Line lender on demand therefor. The provisions of the foregoing sentence shall be and remain effective notwithstanding any contrary action which may have been taken by the Administrative Agent, any Issuing Bank or the Lenders in reliance upon such payment, and any such contrary action so taken shall be without prejudice to the Administrative Agent’s, any Issuing Bank’s or the Lenders’ rights under this Agreement and shall be deemed to have been conditioned upon such payment having become final and irrevocable.      11.9 Indemnification; Limitation of Liability. (a) Whether or not the transactions contemplated hereby are consummated, the Borrower agrees to indemnify and hold harmless each Agent-Related Person and each Lender and each of their Affiliates and their respective officers, directors, employees, agents, and advisors (each, an “Indemnified Party”) from and against any and all claims, damages, losses, liabilities, and reasonable out-of-pocket costs and expenses (including, without limitation, reasonable attorneys’ fees) that may be incurred by or awarded against any Indemnified Party, in each case arising out of or in connection with or by reason of (including, without limitation, in connection with any investigation, litigation, or proceeding or preparation of defense in connection therewith) the Loan Documents or the First Amendment or the actual or proposed use of the proceeds of the Loans or the Letters of Credit (all of the foregoing, collectively, the “Indemnified Liabilities”), except to the extent such claim, damage, loss, liability, cost, or expense resulted from such Indemnified Party’s gross negligence   88 or willful misconduct. In the case of an investigation, litigation or other proceeding to which the indemnity in this Section 11.9 applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by the Borrower, its directors, shareholders or creditors or an Indemnified Party or any other Person or any Indemnified Party is otherwise a party thereto and whether or not the transactions contemplated hereby are consummated. The Borrower agrees that no Indemnified Party shall have any liability (whether direct or indirect, in contract or tort or otherwise) to it, any of its Subsidiaries, any Guarantor, or any security holders or creditors thereof arising out of, related to or in connection with the transactions contemplated herein, except to the extent that such liability resulted from such Indemnified Party’s gross negligence or willful misconduct. The Borrower agrees not to assert any claim against any Agent-Related Person, any Lender, any of their Affiliates, or any of their respective directors, officers, employees, attorneys, agents, and advisers, on any theory of liability, for special, indirect, consequential, or punitive damages arising out of or otherwise relating to the Loan Documents, any of the transactions contemplated herein or the First Amendment or the actual or proposed use of the proceeds of the Loans.      (b) The agreements and obligations of the Borrower contained in this Section 11.9 shall continue in effect notwithstanding the Facility Termination Date.      11.10 Severability. If any provision of this Agreement or the other Loan Documents shall be determined to be illegal or invalid as to one or more of the parties hereto, then such provision shall remain in effect with respect to all parties, if any, as to whom such provision is neither illegal nor invalid, and in any event all other provisions hereof shall remain effective and binding on the parties hereto.      11.11 Entire Agreement. This Agreement, together with the other Loan Documents, constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes all previous proposals, negotiations, representations, commitments and other communications between or among the parties, both oral and written, with respect thereto (except that those provisions (if any) which by the express terms of (i) the commitment letter dated as of June 6, 2005, executed by JPMorgan Chase Bank, J.P. Morgan Securities Inc., Bank of America, N.A. and Banc of America Securities LLC and accepted by the Borrower or (ii) the commitment letter, dated as of March 6, 2006, executed by JPMorgan Chase Bank, N.A. and J.P. Morgan Securities Inc. and accepted by the Borrower, survive the closing of the Revolving Credit Facility, the Term Facility or Letter of Credit Facility, as applicable, shall survive and continue in effect).      11.12 Agreement Controls. In the event that any term of any of the Loan Documents other than this Agreement conflicts with any express term of this Agreement, the terms and provisions of this Agreement shall control to the extent of such conflict.      11.13 Usury Savings Clause. Notwithstanding any other provision herein, the aggregate interest rate charged hereunder, including all charges or fees in connection therewith deemed in the nature of interest under applicable law shall not exceed the Highest Lawful Rate (as such term is defined below). If the rate of interest (determined without regard to the preceding sentence) under this Agreement at any time exceeds the Highest Lawful Rate (as defined below), the outstanding amount of the Loans made hereunder shall bear interest at the Highest Lawful   89 Rate until the total amount of interest due hereunder equals the amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times been in effect. In addition, if when the Loans made hereunder are repaid in full the total interest due hereunder (taking into account the increase provided for above) is less than the total amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times been in effect, then to the extent permitted by law, the Borrower shall pay to the Administrative Agent an amount equal to the difference between the amount of interest paid and the amount of interest which would have been paid if the Highest Lawful Rate had at all times been in effect. Notwithstanding the foregoing, it is the intention of the Lenders and the Borrower to conform strictly to any applicable usury laws. Accordingly, if any Lender contracts for, charges, or receives any consideration which constitutes interest in excess of the Highest Lawful Rate, then any such excess shall be cancelled automatically and, if previously paid, shall at such Lender’s option be applied to the outstanding amount of the Loans made hereunder or be refunded to the Borrower. As used in this paragraph, the term “Highest Lawful Rate” means the maximum lawful interest rate, if any, that at any time or from time to time may be contracted for, charged, or received under the laws applicable to such Lender which are presently in effect or, to the extent allowed by law, under such applicable laws which may hereafter be in effect and which allow a higher maximum nonusurious interest rate than applicable laws now allow.      11.14 Governing Law; Waiver of Jury Trial.      (a) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY, AND ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY OF NEW YORK, STATE OF NEW YORK, UNITED STATES OF AMERICA AND, BY THE EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER EXPRESSLY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN, OR TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY, ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND THE BORROWER HEREBY IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.      (c) THE BORROWER AGREES THAT SERVICE OF PROCESS MAY BE MADE BY PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF THE BORROWER PROVIDED IN SECTION   90 11.2, OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN EFFECT IN THE STATE OF NEW YORK.      (d) NOTHING CONTAINED IN SUBSECTIONS (b) OR (c) HEREOF SHALL PRECLUDE THE ADMINISTRATIVE AGENT OR ANY LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT IN THE COURTS OF ANY JURISDICTION WHERE THE BORROWER OR ANY GUARANTOR OR ANY OF THE BORROWER’S OR ANY GUARANTOR’S PROPERTY OR ASSETS MAY BE FOUND OR LOCATED. TO THE EXTENT PERMITTED BY THE APPLICABLE LAWS OF ANY SUCH JURISDICTION, THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH SUIT, ACTION OR PROCEEDING, OBJECTION TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY ANY SUCH OTHER COURT OR COURTS OF ANY GUARANTOR’S PROPERTY OR ASSETS MAY BE FOUND OR LOCATED.      (e) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES UNDER OR RELATED TO ANY LOAN DOCUMENT OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN CONNECTION THEREWITH, OR IN ANY WAY CONNECTED WITH OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, WHETHER NOW EXISTING OR HEREAFTER ARISING, THE BORROWER, THE ADMINISTRATIVE AGENT AND THE LENDERS HEREBY AGREE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY AND HEREBY IRREVOCABLY WAIVE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PERSON MAY HAVE TO TRIAL BY JURY IN ANY SUCH ACTION, SUIT OR PROCEEDING. ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.      (f) THE BORROWER HEREBY EXPRESSLY WAIVES ANY OBJECTION IT MAY HAVE THAT ANY COURT TO WHOSE JURISDICTION IT HAS SUBMITTED PURSUANT TO THE TERMS HEREOF IS AN INCONVENIENT FORUM.      11.15 Confidentiality. Each of the Administrative Agent and each Lender (together, the “Lending Parties”, and individually a “Lending Party”) agrees to keep confidential any information furnished or made available to it by the Borrower or any of its Subsidiaries pursuant   91 to this Agreement; provided that nothing herein shall prevent any Lending Party from disclosing such information (a) to any other Lending Party or any Affiliate of any Lending Party, or any officer, director, employee, agent, or advisor of any Lending Party or Affiliate of any Lending Party, (b) to any other Person if reasonably incidental to the administration of the credit facility provided herein so long as such Person is bound by the provisions of this Section 11.15, (c) as required by any law, rule, or regulation, (d) upon the order of any court or administrative agency, (e) upon the request or demand of any regulatory agency or authority, (f) that is or becomes available to the public or that is or becomes available to any Lending Party other than as a result of a disclosure by any Lending Party prohibited by this Agreement, (g) in connection with any litigation to which such Lending Party or any of its Affiliates may be a party, (h) to the extent necessary in connection with the exercise of any remedy under this Agreement or any other Loan Document, and (i) to any actual or proposed participant or assignee that is subject to provisions substantially similar to those contained in this Section 11.15.      11.16 Releases of Facility Guarantees. Notwithstanding anything to the contrary contained herein or in any other Loan Document, the Administrative Agent is hereby irrevocably authorized by each Lender (without requirement of notice to or consent of any Lender except as expressly required by Section 11.6) to take any action requested by the Borrower, at the Borrower’s expense, having the effect of releasing any Facility Guaranty to the extent necessary to permit consummation of any transaction not prohibited by any Loan Document or that has been consented to in accordance with Section 11.6.      11.17 MANUFACTURER CONSENTS. IT IS ACKNOWLEDGED, UNDERSTOOD AND AGREED THAT (EXCEPT TO THE EXTENT THE RESPECTIVE MANUFACTURER WAIVES ANY OF THE TERMS OF A MANUFACTURER CONSENT OR A MANUFACTURER CONSENT IS TERMINATED OR CEASES TO BE IN EFFECT): (A) THE EXERCISE BY THE ADMINISTRATIVE AGENT OR ANY LENDER (WHETHER THROUGH THE ADMINISTRATIVE AGENT OR OTHERWISE) OF REMEDIES UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT WILL BE SUBJECT TO THE TERMS OF THE MANUFACTURER CONSENTS, (B) IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THE MANUFACTURER CONSENTS AND THE TERMS OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, THE TERMS OF THE MANUFACTURER CONSENTS WILL CONTROL, (C) THE ADMINISTRATIVE AGENT AGREES TO FURNISH SUCH NOTICES AS IT IS REQUIRED TO FURNISH UNDER SUCH MANUFACTURER CONSENTS, AND (D) THE MANUFACTURERS PROVIDING SUCH MANUFACTURER CONSENTS SHALL BE THIRD PARTY BENEFICIARIES OF THIS SECTION. PARTICIPATION BY AN AFFILIATE OR SUBSIDIARY OF A MANUFACTURER AS A LENDER SHALL NOT CONSTITUTE A WAIVER OF THE TERMS OF ANY MANUFACTURER CONSENT GRANTED BY SUCH MANUFACTURER.      11.18 USA Patriot Act Notice. Each Lender and the Administrative Agent (for (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow   92 such Lender or the Administrative Agent, as applicable, to identify the Borrower in accordance with the Act.   made, executed and delivered by their duly authorized officers as of the day and                                 AUTONATION, INC.                       By:                           Name:         Its:         S-1                                   JPMORGAN CHASE BANK, N.A.,         as Administrative Agent for the Lenders                     By:                           Name:         Its:                             By:                           Name:         Its:                             By:                           Name:         Its:                           BNP PARIBAS                       By:                           Name:         Its:                           By:                           Name:         Its:                           TOYOTA MOTOR CREDIT CORPORATION                       By:                           Name:         Its:                             By:                           Name:         Its:         S-2                                   SOVEREIGN BANK                       By:                           Name:         Its:                           COMERICA BANK                       By:                           Name:         Its:                           SUMITOMO MITSUI BANKING         CORPORATION, NEW YORK                       By:                           Name:         Its:                           SUNTRUST BANK                       By:                           Name:         Its:                           WELLS FARGO BANK, N.A.                       By:                           Name:         Its:                           FIFTH THIRD BANK                       By:                           Name:         Its:         S-3                                     By:                           Name:         Its:                           GOLDMAN SACHS PARTNERS L.P.                       By:                           Name:         Its:         S-4

Exhibit 10.3       FIRST AMENDMENT TO LOAN AGREEMENT, RATIFICATION OF LOAN DOCUMENTS AND OMNIBUS AMENDMENT Dated as of November 2, 2011 Between EMPIRE STATE LAND ASSOCIATES L.L.C. and EMPIRE STATE BUILDING ASSOCIATES L.L.C., collectively, as Borrower, and as Agent, THE LENDERS NAMED HEREIN, as Lender, and HSBC BANK USA, NATIONAL ASSOCIATION and DEKABANK DEUTSCHE GIROZENTRALE, as Lead Arrangers Property: Empire State Building       DOCUMENTS AND OMNIBUS AMENDMENT THIS FIRST AMENDMENT TO LOAN AGREEMENT, RATIFICATION OF LOAN DOCUMENTS AND OMNIBUS AMENDMENT, dated as of November 2, 2011 (this “First Amendment”), between EMPIRE STATE LAND ASSOCIATES L.L.C., a New York limited liability company, having its principal place of business c/o Malkin Holdings LLC, One Grand Central Place, 60 East 42nd Street, New York, New York 10165 (“ESLA”), EMPIRE STATE BUILDING ASSOCIATES L.L.C., a New York limited liability company, having its principal place of business c/o Malkin Holdings LLC, One Grand Central Place, 60 East 42nd Street, New York, New York 10165 (“ESBA” and together with ESLA, collectively, “Borrower”), and HSBC BANK USA, NATIONAL ASSOCIATION, a bank organized under the laws of the United States of America (“HSBC”), having an address at 452 Fifth Avenue, New York, New York 10018, as administrative agent (including any of its successors and assigns, “Agent”) for itself and the other Lenders signatory hereto (collectively, together with such other co-lenders as may exist from time to time, “Lenders” and individually, each a “Lender”). WHEREAS, Agent, Lenders and Borrower entered into that certain Loan Agreement, dated as of July 26, 2011 (“Loan Agreement”), pursuant to which the Lenders made a loan to Borrower in the original principal amount of $235,000,000 (the “Original Loan Amount”). Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Loan Agreement; and WHEREAS, of even date herewith, (a) HSBC entered into that certain Assignment and Acceptance with Bank of America, N.A. (“BOA”) pursuant to which HSBC assigned a portion of its interest in the Loan to BOA, (b) HSBC entered into that certain Assignment and Acceptance with Capital One, National Association (“Capital One”) pursuant to which HSBC assigned a portion of its interest in the Loan to Capital One, (c) DekaBank entered into that certain Assignment and Acceptance with BOA pursuant to which DekaBank assigned a portion of its interest in the Loan to BOA, and (d) DekaBank entered into that certain Assignment and Acceptance with Capital One pursuant to which DekaBank assigned a portion of its interest in the Loan to Capital One ((a) through (d) being collectively referred to as the “Assignments”); and WHEREAS, Agent, Lenders and Borrower desire to amend the Loan Agreement to, among other things, increase the Original Loan Amount to $300,000,000 (the “Amended Loan Amount”). NOW, THEREFORE, in consideration of the covenants set forth in this First Amendment and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto hereby agree, represent and warrant as follows: 1. Definitions. (a) The definitions of “Loan”, “Loan Amount”, and “Note” are hereby deleted from Section 1.1 of the Loan Agreement in their entirety and the following definitions are hereby substituted therein in lieu thereof: ““Loan” shall mean the loan in the original principal amount of Three Hundred Million and 00/100 Dollars ($300,000,000.00) made by Lenders to Borrower “Loan Amount” shall mean Three Hundred Million and 00/100 Dollars ($300,000,000.00). “Note” shall mean that certain Consolidated, Amended and Restated Promissory Note, dated as of July 26, 2011, between Borrower and Lenders in the original principal amount of One Hundred Fifty-Nine Million and 00/100 Dollars ($159,000,000.00) (the “Original Note”), which Original Note was split pursuant to that certain Note Splitter and Modification Agreement, dated as of July 26, 2011, between Borrower and Lenders into the following Notes: that certain Promissory Note A-1, dated as of July 26, 2011, in the principal amount of $91,340,425.53 and that certain Promissory Note A-2, dated as of July 26, 2011, in the principal amount of $67,659,574.47 (collectively, the “Original Replacement Notes”), and which Original Replacement Notes were replaced as of November 1, 2011 with the following notes: that certain Replacement Promissory Note A-1, dated as of July 26, 2011, in the principal amount of $53,000,000.00, that certain Replacement Promissory Note A-2, dated as of July 26, 2011, in the principal amount of $42,400,000.00, that certain Replacement Promissory Note A-3, dated as of July 26, 2011, in the principal amount of $31,800,000.00, and that certain Replacement Promissory Note A-4, dated as of July 26, 2011, in the principal amount of $31,800,000.00 (as each of the same may be amended, supplemented, restated, increased, extended and consolidated, substituted or replaced from time to time, collectively, the “Replacement Notes”). The Replacement Notes shall as of November 2, 2011 replace and supersede in their entirety the Original Replacement Notes. In addition, the term Note shall include the Series Notes, as applicable.” (b) The following definition is hereby added to Section 1.1 of the Loan Agreement in the appropriate alphabetical order: ““First Amendment” shall have the meaning set forth in the Preamble hereof.”   2 2. Initial Advance; Subsequent Advances. Section 2.1.2 of the Loan Agreement is hereby amended to delete the reference to Two Hundred Thirty-Five Million and 00/100 Dollars ($235,000,000.00) therefrom and to replace the same with Three Hundred Million and 00/100 Dollars ($300,000,000.00). 3. Lenders’ Ratable Share. Schedule IV of the Loan Agreement is hereby deleted therefrom in its entirety and replaced with Schedule IV attached hereto. 4. Agent’s Register. Section 10.25(g) of the Loan Agreement is hereby amended to delete the parenthetical included therein in its entirety and replace the same with the following parenthetical: “(and, in the case of an Assignee that is not then an Eligible Assignee, a Lender or an Affiliate of a Lender, by Borrower and Agent)”. 5. Eligible Assignee. Capital One hereby represents and warrants that Capital One is an Eligible Assignee and BOA hereby represents and warrants that BOA is an Eligible Assignee. Borrower acknowledges that since Capital One and BOA are Eligible Assignees, Borrower had no consent rights with respect to the Assignments. 6. Credit Party Representations. Borrower represents and warrants that: (a) Each of the representations and warranties of the Credit Parties and Guarantor contained or incorporated in the Loan Agreement, as amended by this First Amendment or any of the other Loan Documents, is true and correct in all material respects on and as of the date hereof (except if any such representation or warranty is expressly stated to have been made as of a specific date, then as of such specific date); (b) As of the date hereof and immediately after giving effect to this First Amendment and the actions contemplated hereby, no Default or Event of Default has occurred and is continuing; (c) Each Credit Party and Guarantor has taken all necessary action to authorize the execution, delivery and performance of this First Amendment by it and has the power and authority to execute, deliver and perform under this First Amendment and all the transactions contemplated hereby. This First Amendment has been duly and validly executed and delivered by each Credit Party and Guarantor and constitutes a legal, valid and binding obligation of such Person, enforceable in accordance with its terms except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights and by general principles of in equity or at law); (d) No consent, approval authorization or order of any court or Governmental Authority or other Person is required for the execution, delivery and performance by a Credit Party or Guarantor or compliance by any such Person with this First Amendment, other than those which have been obtained by Borrower or such Person, as applicable; and   3 (e) The execution and delivery of this First Amendment by each Credit Party and Guarantor and the performance of its obligations hereunder will not conflict with any provision of any law or regulation to which such Person is subject, or conflict with, result in the breach of, or constitute a default under any of the terms, conditions or provisions of any such Person’s organizational documents or any agreement or instrument to which such Person is a party or by which it is bound, the result of which breach or default of any such agreement or instrument would reasonably be expected to have, or does have a Material Adverse Effect, or any order or decree applicable to such Person or result in the creation or imposition of any lien, in a material amount, on any of such Person’s assets or property (other than pursuant to the Loan Documents). 7. Acknowledgement by Agent. Pursuant to Section 10.25(g) of the Loan Agreement, Agent hereby acknowledges that it has received the Assignments and has recorded the information contained in the Assignments in Agent’s Register. Agent hereby gives notice to Borrower and the Lenders of Agent’s acceptance of the Assignments and the recordation of the Assignments in Agent’s Register. 8. Other References. All references in the Loan Documents to the Loan Agreement shall mean the Loan Agreement, as modified by this First Amendment, and as the same may hereafter be supplemented, amended, modified, extended, renewed, restated or replaced from time to time. 9. Omnibus Amendment to All Loan Documents. As of the date hereof, each reference in any of the Loan Documents to Two Hundred Thirty-Five Million and 00/100 Dollars ($235,000,000.00) shall be deemed to mean Three Hundred Million and 00/100 Dollars ($300,000,000.00). The parties hereby acknowledge and agree that no re-loan or re-advance have become secured by any of the Loan Documents. 10. Ratification of Loan Documents. Agent, Lenders and the Credit Parties hereby ratify and confirm the Loan Agreement and the other Loan Documents, as modified hereby. Except as modified and amended by this Amendment, the Loan, the Loan Agreement and the other Loan Documents and the respective obligations of Agent, Lenders and the Credit Parties thereunder shall be and remain unmodified and in 11. Ratification of Environmental Indemnity and Guaranty. Guarantor hereby ratifies and confirms the Environmental Indemnity and the Guaranty, as modified hereby. Except as modified and amended by this Amendment, the Environmental Indemnity and Guaranty and the obligations of Guarantor thereunder shall be and remain unmodified and in full force and effect. 12. Continued Force and Effect. This First Amendment is not intended to, and shall not be construed to, effect a novation, and except as expressly provided in this First Amendment, the Loan Agreement has not been modified, amended, cancelled, terminated, released, satisfied, superseded or otherwise invalidated by execution of this First Amendment. In the event of any conflict between the terms of this First Amendment and the terms of the Loan Agreement, the terms of this First Amendment shall control.   4 13. Governing Law. This First Amendment shall be governed by, and construed in accordance with, the laws of the State of New York pursuant to Section 5-1401 of the General Obligations Law without regard to its principles of conflicts of laws. 14. Successors and Assigns. This First Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective permitted successors and permitted assigns. 15. Further Assurances. From time to time, upon the request of Agent, Borrower shall promptly and duly execute, acknowledge and deliver any and all such further instruments and documents as Agent may deem reasonably necessary or desirable to confirm this First Amendment and the terms and conditions hereof, to carry out the purpose and intent hereof or to enable Agent to enforce any of its rights hereunder. 16. Modifications. No modification, amendment, extension, discharge, termination or waiver of any provision of this First Amendment shall in any event be effective unless the same shall be in a writing signed by the party against whom enforcement is sought, and then such waiver or consent shall be effective only in the specific instance, and for the specific purpose, for which given. 17. Entire Agreement. This First Amendment contains the entire agreement of the parties hereto in respect of the transactions contemplated hereby, and all prior agreements among or between such parties, whether oral or written are superseded by the terms of this First Amendment. 18. Interpretation. Wherever possible, each provision of this First Amendment applicable law, but if any provision of this First Amendment shall be prohibited such provision or the remaining provisions of this First Amendment. 19. Headings. The Section headings in this First Amendment are included herein for convenience of reference only and shall not constitute a part of this First 20. Counsel. Each party to this First Amendment understands that this is a legally binding agreement that may affect such party’s rights. Each party hereto represents to each other party hereto that it has obtained independent counsel and received legal advice about the meaning and legal significance of this First Amendment. 21. Construction. Should any provision of this First Amendment require judicial interpretation, it is agreed that a court interpreting or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against any party by reason of the rule of construction that a document is to be construed more strictly against the party who itself or through its agent prepared the same, it being agreed that all parties to this First Amendment participated in the preparation hereof.   5 22. Counterparts. This First Amendment may be executed in any number of when taken together, shall constitute one and the same instrument and shall become effective when copies hereof, when taken together, bear the signatures of each of the parties hereto and it shall not be necessary in making proof of this instrument to produce or account for more than one of such fully executed counterparts. Manually executed counterparts of this Agreement shall be delivered to all parties hereto; provided, that delivery of a signature of this Agreement by facsimile transmission or by .pdf, .jpeg, .TIFF or other form of electronic mail attachment shall be effective as delivery of a manually executed counterpart hereof prior to manual delivery thereof. duly executed by their duly authorized representatives, all as of the day and [SIGNATURE PAGES TO FOLLOW]   6   BORROWER: EMPIRE STATE LAND ASSOCIATES L.L.C., a New York limited liability Company By:   Empire State Building Associates L.L.C., its Sole Member     By:   /s/ Peter L. Malkin             Peter L. Malkin, Member     By:   /s/ Anthony E. Malkin             Anthony E. Malkin, Member     By:   /s/ Thomas N. Keltner             Thomas N. Keltner, Jr., Member   a New York limited liability company By:   By:   /s/ Peter L. Malkin           Peter L. Malkin, Member By:   /s/ Anthony E. Malkin           Anthony E. Malkin, Member By:   /s/ Thomas N. Keltner           Thomas N. Keltner, Jr., Member     AGENT: HSBC BANK USA, NATIONAL     ASSOCIATION, as Agent By:   /s/ Barbara Isaacman            Name: Barbara Isaacman   Title: Vice President     LENDER: ASSOCIATION   Vice President   Applicable Lending Office: 452 Fifth Avenue, 24th Floor New York, New York 10018 Attention: Commercial Mortgage Servicing Department   LENDER: DEKABANK DEUTSCHE GIROZENTRALE,   By:   /s/ Michael McAuliffe            Name: Michael McAuliffe   Title: Managing Director By:   /s/ Bjorn Kronsbein           Name: Bjorn Kronsbein   Title: Senior Associate   Applicable Lending Office: Mainzer Landstrasse 16 60325 Frankfurt am Main, Germany Attention: Bjoern Kronsbein   LENDER: BANK OF AMERICA, N.A. By:   /s/ Kimberly B. McKee            Name: Kimberly B. McKee   Title: Senior Vice President   Applicable Lending Office: One Bryant Park, 35th Floor Attention: Kimberly B. McKee, Senior Vice President   LENDER: CAPITAL ONE, NATIONAL ASSOCIATION By:   /s/ Laura B. Cohen   Name: Laura B. Cohen   Title: Vice President   Applicable Lending Office: 90 Park Avenue, 6th Floor Attention: Ellen R. Houghton, Vice President With respect to Section 10 only:   CREDIT PARTY: EMPIRE STATE BUILDING COMPANY         L.L.C., a New York limited liability         company By:   /s/ Anthony E. Malkin           Anthony E. Malkin, Authorized Signatory   ESB OBSERVATORY LLC, a New York limited         liability company With respect to Section 11 only: GUARANTOR: /s/ Anthony E. Malkin         Anthony E. Malkin, an individual SCHEDULE IV LENDERS’ RATABLE SHARE   September 30, September 30, Lender’s Name      Ratable Loan Amount        Percentage/Ratable Share   HSBC BANK USA, National Association      $ 100,000,000.00           33 1/3 %  DEKABANK DEUTSCHE GIROZENTRALE      $ 80,000,000.00           26 2/3 %       $ 60,000,000.00           20 %  CAPITAL ONE, National Association      $ 60,000,000.00           20 % 

Title: Brother with 2 small children given cease and desist letter in rental Question:My brother is married with 2 children under 4. They live in Wisconsin in a multi-unit rental. When they first moved in, they lived in a one bedroom first floor apartment. When they found out they were expecting a 2nd child, they asked to be moved to a larger apartment. They told the management that they wanted a bottom floor apartment because of the impending noise they knew would occur but the manager placed them in a 2 bedroom upper. Well, flash forward 2 years, they have received 2 noise complaints and the recent one was a cease-and-desist letter, asking them to remedy the situation (how do you tame in 2 young children?) or leave. Is this legal? The management placed them in an upper, knowing of the children and the request for a lower. It is also winter. Do they really have to go to court for this? They have one income for their 4 person household and if he missed work to go to court, this work hurt them financially. Answer #1: He doesn't have to go to court *yet*. The letter is just a warning/request. Was it from the landlord? If the landlord tried to evict he would bear the burden of proof to show unreasonable levels of noise were present. I am very skeptical to believe that normal children noises would meet that threshhold. One thing they may want to try through is getting rid of any noisy toys. Like for example those insufferable Go! Go! Smart Wheels.

Exhibit 10.9 ADDENDUM TO EMPLOYMENT AGREEMENT This Addendum to the December 10, 1999 Employment Agreement between Sierra Health Services, Inc., a Nevada Corporation (hereinafter referred to as "Employer"), and William R. Godfrey (hereinafter referred to as "Employee"), attached hereto and incorporated herein by reference is effective as of December 13, 2004 . This Addendum shall modify, amend and supersede any conflicting or inconsistent language contained in the previously executed Employment Agreement. ARTICLE II TERM OF EMPLOYMENT - TERM OF AGREEMENT Employee and Employer agree to extend the term of employment set forth in Article II of the Employment Agreement for a period of two (2) years from December 31, 2005 terminating December 31, 2007, subject, however, to prior termination as provided in Article VII of the Employment Agreement and all other terms of the Employment Agreement and this Addendum. ARTICLE XVIII EMPLOYEE'S CONSENT TO EMPLOYER'S RIGHT TO ASSIGN THE NONCOMPETITION AGREEMENT CONTAINED IN ARTICLE VI OF THE EMPLOYMENT AGREEMENT 1. Employee expressly acknowledges, understands and agrees that in exchange for the consideration described below, Employer has the unconditional right to assign all of its rights, entitlements, and obligations set forth in Article VI of the Employment Agreement. Employee expressly agrees that all the covenants contained in Article VI inure to the benefit of and are enforceable by Employer's successors or assigns. Employee acknowledges and understands that through this provision Employer has the right to assign the covenants contained in Article VI, including, but not limited to, those outlined in subsections (a) through (c) of section "2" of Article VI to an entity in the future that is unknown at this time. ' 2. Employer agrees to pay to Employee the amount of $25,000 in exchange for Employee's agreement to the provisions of section "1" of this Addendum. Employee agrees and acknowledges that this payment is in addition to the consideration Employee is entitled to receive under the terms of the Employment Agreement and that he/she would not be entitled to receive this payment but for his/her agreement to this Addendum. 3. Employee acknowledges that he has carefully considered the restrictions upon his post-employment activities set forth in Article VI of the Employment Agreement and this Addendum and that they are fair and reasonable as to their geographic scope and temporal duration, and do not unduly restrict his ability to engage in a lawful profession or business. Employee and Employer further agree that should a Court of competent jurisdiction find any of the covenants set forth in Article VI of the Employment Agreement or this Addendum to be unenforceable due to an unreasonable geographic scope, temporal limitation, or otherwise, the Court shall nevertheless enforce the covenants, but only to the extent the Court determines would be deemed reasonable under the law." 4. Employee understands and agrees that the provisions of this Addendum shall survive any termination of the Employment Agreement. 5. Employee agrees and acknowledges that this Addendum has been negotiated at arm's length and that Employee has been advised to consult an attorney prior to executing this Addendum and has had an opportunity to consult an attorney prior to executing this Addendum. This Addendum, and the companion Employment Agreement dated December 10, 1999 , contain all of the understandings and agreements between the parties concerning Employee's employment, and Employee acknowledges that this Addendum and the Employment Agreement may only be modified or amended in a writing signed by the parties hereto. IN WITNESS WHEREOF, the parties have executed this Agreement at Las Vegas, Nevada, on the 13th day of December , 2004.     SIERRA HEALTH SERVICES, INC.   By:       /s/ Anthony M. Marlon, M.D.               Anthony M. Marlon, M.D.        Chief Executive Officer         P.O. Box 15645         Las Vegas, NV 89114-5645   EMPLOYEE   By:       /s/ William R. Godfrey                William R. Godfrey         Executive Vice President, Administrative Services

Exhibit 10.2   PLEDGE AMENDMENT   This PLEDGE AMENDMENT, dated as of September 6, 2011, is delivered pursuant to Section 8.6 of the Guaranty and Security Agreement, dated as of November 30, 2010, among CCA Club Operations Holdings, LLC, a Delaware limited liability company (“Holdings”), ClubCorp Club Operations, Inc., a Delaware corporation (the “Borrower”), the undersigned Grantor and the other Affiliates of the Borrower from time to time party thereto as Grantors in favor of Citicorp North America, Inc., as administrative agent and collateral agent for the Secured Parties referred to therein (the “Guaranty and Security Agreement”).  Capitalized terms used herein without definition are used as defined in the Guaranty and Security Agreement.   The undersigned hereby agrees that this Pledge Amendment may be attached to the Guaranty and Security Agreement and that the Pledged Collateral listed on Schedule 1 to this Pledge Amendment shall be and become part of the Collateral referred to in the Guaranty and Security Agreement and shall secure all Obligations of the undersigned.   The undersigned hereby represents and warrants that each of the representations and warranties contained in Article IV of the Guaranty and Security Agreement is true and correct as of the date hereof as if made on and as of such date.     CLUBCORP USA, INC.           By: /s/Curtis D. McClellan   Name: Curtis D. McClellan   Title: Treasurer     ACKNOWLEDGED AND AGREED   as of the date first above written:           CITICORP NORTH AMERICA, INC.   as Administrative Agent       By: /s/John C. Rowland     Name: John C. Rowland     Title: Director       Schedule 1   PLEDGED EQUITY   ISSUER   CLASS   CERTIFICATE NO(S).   PAR VALUE   NUMBER OF SHARES, UNITS OR INTERESTS ClubCorp CGCC, Inc.   Common   2   $ 0.01   1000 ClubCorp Ridge Club, Inc.   Common   1   $ 0.01   1000 ClubCorp Hartefeld, Inc.   Common   1   $ 0.01   1000  

Exhibit 5.04 [MORGAN, LEWIS & BOCKIUS LLP LETTERHEAD] September 20, 2010 Entergy Gulf States Louisiana, L.L.C. 446 North Boulevard Baton Rouge, Louisiana 70802 Ladies and Gentlemen: We refer to Post-Effective Amendment No. 1 to the Registration Statement on Form S-3, including the exhibits thereto (as amended, the “Registration Statement”), which Entergy Gulf States Louisiana, L.L.C., a Louisiana limited liability company (the “Company”), proposes to file with the Securities and Exchange Commission on or shortly after the date hereof, for the registration under the Securities Act of 1933, as amended, of an indeterminate aggregate principal amount of its First Mortgage Bonds (the “Bonds”) to be issued in one or more new series, and for the qualification under the Trust Indenture Act of 1939, as amended, of the Indenture of Mortgage, dated as of September 1, 1926, as heretofore supplemented and modified and as proposed to be further supplemented (the “Indenture”), between the Company and The Bank of New York Mellon, successor trustee, under which the Bonds are to be issued. In connection therewith, we have reviewed such documents and records as we have deemed necessary to enable us to express an opinion on the matters covered hereby. We have assumed the genuineness of all signatures, the legal capacity of all natural persons, the authenticity of the documents submitted to us as originals, the conformity with the originals of all documents submitted to us as originals of the documents submitted to us as certified, facsimile or photostatic copies and the authenticity of the originals of all documents submitted to us as copies. Subject to the qualifications hereinafter expressed, we are of the opinion that the Bonds, when issued and delivered for the consideration contemplated by, and otherwise as contemplated in, the Registration Statement and the Indenture, will be legally issued and will be binding obligations of the Company. For purposes of the opinions set forth above, we have assumed (I) that the Bonds will be issued and delivered in compliance with appropriate action with regard to the issuance of the Bonds by and before the Federal Energy Regulatory Commission under the Federal Power Act and any other applicable regulatory body, and (II) that the Bonds will be issued and delivered in compliance with the due authorization of the Company’s Board of Directors or an authorized committee thereof or an authorized officer. This opinion is limited to the laws of the States of New York and Louisiana and to the federal laws of the United States of America. To the extent that the opinions relate to or are dependent upon matters governed by the laws of Louisiana, we have relied upon the opinion of Dawn A. Abuso, Esq., Senior Counsel - Corporate and Securities of Entergy Services, Inc., which is being filed as Exhibit 5.05 to the Registration Statement. We hereby consent to the filing of this opinion as Exhibit 5.04 to the Registration Statement. We also consent to the reference to us in the prospectus included in the Registration Statement under the caption “Legality.” In giving the foregoing consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations promulgated thereunder. Very truly yours, /s/ Morgan, Lewis & Bockius LLP

EXHIBIT PEOPLES BANCORP INC. ANNUAL REPORT ON FORM 10-K FOR FISCAL YEAR ENDED DECEMBER 31, 2008 PEOPLES BANCORP INC. Amended and Restated 2006 Equity Plan THIS PLAN was adopted on the 9th day of February, 2006, by the Board and approved by the shareholders of the Company on April 13, 2006. Section 12.1 of this Plan was amended by the Board on June 8, 2006.Section 5.7(b) of this Plan was amended by the Board on February 8, 2007.This Plan is hereby amended and restated effective December 11, 2008. ARTICLE I PURPOSE AND EFFECTIVE DATE 1.1PURPOSE. The purpose of the Plan is to provide financial incentives for selected Employees, Advisors and Non-Employee Directors, thereby promoting the long-term growth and financial success of the Company by (a) attracting and retaining Employees, Advisors and Non-Employee Directors of outstanding ability, (b) strengthening the Company's capability to develop, maintain, and direct a competent management team, (c) providing an effective means for selected Employees, Advisor and Non-Employee Directors to acquire and maintain ownership of Company Stock, (d) motivating Employees to achieve long-range Performance Goals and objectives, and (e) providing incentive compensation opportunities competitive with peer financial institution holding companies. 1.2EFFECTIVE DATE AND EXPIRATION OF PLAN. The Plan originally became effective on April 13, 2006.Unless earlier terminated by the Board pursuant to Section 12.2, the Plan shall terminate on the tenth anniversary of its Effective Date.

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) March 24, 2014 EARTH SCIENCE TECH, INC. (Exact name of registrant as specified in its charter) Nevada 333-179280 45-4267181 (State or other jurisdiction of Incorporation) (Commission File Number) (IRS Employer Identification No.) 2255 Clades Road, Suite 324A Boca Raton, Florida 33431 (Address of principal executive offices)(Zip Code) (561) 988-8424 (Registrant’s telephone number, including area code) Not applicable (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ]Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ]Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ]Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ]Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 1.01 Entry into a Material Definitive Agreement. On March 24, 2014, Ultimate Novelty Sports, Inc. entered into a Founders Agreement with Majorca Group, Ltd., a Marshall Islands Corporation.The Founder Agreement provides that in exchange for issuance of 25,000,000 of the Company’s common shares, that Majorca Group shall provide the following services: A. Securing an agreement with an established company in the nutritional and health care industry for product development including idea generation, preforming and designing formulations for products to be used in the health and nutrition market. B. Arranging for the development and formulation of two new products for the Company using FDA approved labs to produce the products. One product will be a body lotion which will include progesterone and/or collagen and the other will be an Oxygen based cleanser. C. Developing, implementing and launching a Nutritional, Formulation and Dietary Supplement ecommerce platform. D. Securing an agreement with an established hemp based Biotechnology Company that has developed proprietary cultivation and processing ability allowing for the accessibility & democratization of cannabinoid extracts for the neutraceutical market. E. Developing, implementing and launching an online portal and mobile app dealing with cannabis and hemp. Further, creating scale-able API that has a database of cannabis and cannabis related products, businesses, and opportunities. F. Securing an agreement with a leading supplier in the business of producing or otherwise procuring, distributing and/or selling electronic cigarette products. The initial Compensation to the Founder will be twenty five million (25,000,000) restricted shares of the company’s common stock. (c) Exhibits Exhibit No. Description Founder Agreement SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Ultimate Novelty Sports, Inc. Dated: December 11, 2014 By: /s/ Harvey Katz Harvey Katz Title: President

EXHIBIT 10.2 DECKERS OUTDOOR CORPORATION 2015 STOCK INCENTIVE PLAN STOCK UNIT AWARD AGREEMENT Unless otherwise defined herein, capitalized terms shall have the defined meaning set forth in the Deckers Outdoor Corporation 2015 Stock Incentive Plan. 1.    NOTICE OF STOCK UNIT GRANT You have been granted Restricted Stock Units (“Stock Units”), subject to the terms and conditions of the Plan and this Stock Unit Award Agreement (this “Agreement”), as follows: Name of Participant (“Awardee”): _______________________________________ Total Number of Stock Units Granted: _______________________________________ Date of Grant: _______________________________________ Vesting Schedule: August 15, 2020 33.33% August 15, 2021 33.33% August 15, 2022 33.34% Performance Period: Fiscal Year Ending March 31, 2020 (the “Performance Period”) Performance Criteria: The percentage of unvested Stock Units that may vest will be based on the value of FY 2020 EPS for the Performance Period as set forth in Exhibit A attached hereto (the “Performance Criteria”). 2.    AGREEMENT 2.1    Grant of Stock Units. Pursuant to the terms and conditions set forth in this Agreement (including Section 1 above) and the Plan, the Committee (“Administrator”) hereby grants to the Awardee named in Section 1, on the Date of Grant set forth in Section 1, the number of Stock Units set forth in Section 1. 2.2    Purchase of Stock Units. No payment of cash is required for the Stock Units. 2.3    Vesting/Delivery of Shares. The Award shall vest on the date or dates specified in the Vesting Schedule (“Vesting Date” or “Vesting Dates”) with respect to the number of Earned Stock Units (as defined below) specified for such Vesting Date (i) if, and to the extent, that the Administrator determines that at least the Threshold Performance Criteria has been attained, which determination shall be made no later than June 15 of the year subsequent to the fiscal year to which the Threshold Performance Criteria relates, as set forth in Section 1 above and Exhibit A attached hereto, and (ii) if the Awardee has remained in Continuous Service from the Date of Grant to the applicable Vesting Date. The “Earned Stock Units” shall mean the number of Stock Units earned pursuant to this Agreement based upon the achievement by the Company of the Performance Criteria as set forth in Exhibit A. Within ten (10) business days following the date on which the Award vests in a Stock Unit as set forth herein, the Company shall deliver to the Awardee one Share for each Stock Unit in which the Award becomes vested and such Stock Unit shall terminate. For purposes of this Agreement, the term “Continuous Service” means (i) Awardee’s employment by either the Company or any parent or subsidiary corporation of the Company, or by a corporation or a parent or subsidiary of a corporation assuming this Agreement or issuing New Incentives, as defined in Section 2.5 below, which is uninterrupted except for vacations, illness (except for permanent disability, as defined in Section 22(e)(3) of the Internal Revenue – 1 – Code of 1986, as amended (the “Code”)), or leaves of absence which are approved in writing by the Company or any of such other employer corporations, if applicable, or (ii) so long as Awardee is engaged as a Consultant or providing Service. 2.4    Effect of Termination of Continuous Service before August 15, 2022. If Awardee’s termination of Continuous Service occurs before August 15, 2022, all Stock Units that have not vested as of such date of termination shall automatically expire. 2.5    Vesting Upon Corporate Transaction. (a)    (i) In the event of a Corporate Transaction that is consummated prior to the end of the Performance Period, notwithstanding Section 2.3 above, if Awardee holds unvested Stock Units at the time a Corporate Transaction occurs, and the acquiring or successor entity (or parent thereof) does not agree to provide for the continuance or assumption of this Agreement or the substitution for this Agreement of a new agreement of comparable value covering shares of a successor corporation (“New Incentives”), if, and to the extent, that the Administrator determines (as of the date of the Corporate Transaction) that at least the Threshold Performance Criteria is likely to be attained by the end of the Performance Period determined by reference to Section 1 above and Exhibit A attached hereto, then all of the unvested Stock Units shall become immediately and unconditionally vested, and the restrictions with respect to all of the unvested Stock Units shall lapse, effective immediately prior to the consummation of such Corporate Transaction. (ii)    Notwithstanding subsection 2.5(a)(i) above, if the acquiring or successor entity (or parent thereof) provides for the continuance or assumption of this Agreement or the substitution for this Agreement of a new agreement of comparable value covering New Incentives, then vesting of the unvested Stock Units shall not accelerate in connection with such Corporate Transaction to the extent this Agreement is continued, assumed or substituted for New Incentives; provided, however, if there is a termination of Service of Awardee without Cause or pursuant to a Constructive Termination (as defined below) within 12 months following such Corporate Transaction, all unvested Stock Units or New Incentives shall vest effective upon such termination regardless of the Performance Criteria. (b)    (i) In the event of a Corporate Transaction that is consummated after the end of the Performance Period, notwithstanding Section 2.3 above, if the Awardee corporation (“New Incentives”), then all of the Earned Stock Units shall become immediately and unconditionally vested, and the restrictions with respect to all of the Earned Stock Units shall lapse, effective immediately prior to the (ii)    Notwithstanding subsection 2.5(a) above, if the acquiring or successor entity (or parent thereof) provides for the continuance or assumption of this Agreement or the substitution for this Agreement of a new agreement of or pursuant to a Constructive Termination (as defined below) within twelve (12) months following such Corporate Transaction, all Earned Stock Units or New Incentives shall vest effective upon such termination. (c)    For purposes of this Agreement, the following terms shall have the (i)    “Cause” means the termination by the Company of Awardee’s Service for any of the following reasons: (a) the continued, unreasonable refusal or omission by the Awardee to perform any material duties required of him or her by the Company if such duties are consistent with duties customary for the position held with the Company; (b) any material act or omission by the Awardee involving malfeasance or gross negligence in the performance of the Awardee’s duties to, or material deviation from, any of the policies or directives of, the Company; (c) conduct on the part of the Awardee which constitutes the breach of any statutory or common law duty of loyalty to the Company; including the unauthorized disclosure of material confidential information or trade secrets of the Company; or (d) any illegal act by the Awardee which materially and adversely affects the business of the Company or any felony committed by the Awardee, as evidenced by conviction thereof, provided that the Company – 2 – may suspend the Awardee with pay while any allegation of such illegal or felonious act is investigated. In the event that the Awardee is a party to an employment agreement or other similar agreement with the Company or any Affiliate that defines a termination on account of “Cause” (or a term having similar meaning), such definition shall apply as the definition of a termination on account of “Cause” for purposes hereof, but only to the extent that such definition provides the Awardee with greater rights. A termination on account of Cause shall be communicated by written notice to the Awardee, and shall be deemed to occur on the date such notice is delivered to the Awardee. (ii)    “Constructive Termination” shall mean a termination of the Awardee’s Service within sixty (60) days following the occurrence of any one or more of the following events without the Awardee’s written consent: (i) any material reduction in overall responsibilities, base compensation, annual incentive compensation opportunity, aggregate employee benefits or (ii) a change of the Awardee’s location of employment by more than fifty (50) miles. In the event that the Awardee is a party to an employment agreement or other similar agreement with the Company or any Affiliate (or a successor entity) that defines a termination on account of “Constructive Termination,” “Good Reason” or “Breach of Agreement” (or a term having a similar meaning), such definition shall apply as the definition of “Constructive Termination” for purposes hereof in lieu of the foregoing, but only to the extent that such definition provides the Awardee with greater rights. A Constructive Termination shall be communicated by written notice to the Administrator, and shall be deemed to occur on the date such notice is delivered to the Administrator, unless the circumstances giving rise to the Constructive Termination are cured within thirty (30) days of such notice. 2.6    Effect of Awardee’s attainment of age 62 and the completion of 10 years of Continuous Service. Notwithstanding Section 2.3 to the contrary, if, after March 31, 2020, and before August 15, 2022, Awardee both (i) attains age sixty-two (62) and (ii) completes ten (10) years of Continuous Service (“Retirement Event”), and if, and to the extent, that the Administrator determines that at least the Threshold Performance Criteria has been attained, which determination shall be made no later than June 15 of the year subsequent to the year to which the Threshold Performance Criteria relates, as set forth in Section 1 above and Exhibit A attached hereto, then, notwithstanding that there is a termination of Continuous Service following the Retirement Event, the number of unvested Stock Units determined according to the Performance Criteria and Performance Thresholds set forth in Exhibit A shall vest on the Vesting Dates set forth above, provided that the Awardee continues to comply with the covenants set forth in Section 3. 2.7    Adjustments to Stock Units. Upon or in contemplation of any reclassification, recapitalization, stock split, reverse stock split or stock dividend; any merger, combination, consolidation or other reorganization; any split-up, spin-off, or similar extraordinary dividend distribution in respect of the Common Stock (whether in the form of securities or property); any exchange of Common Stock or other securities of the Company, or any similar, unusual or extraordinary corporate transaction in respect of the Common Stock; or a sale of substantially all the assets of the Company as an entirety; then the Company shall, in such manner, make appropriate adjustments in the number of Stock Units subject to this Agreement and the number and kind of securities that may be issued in respect of such Stock Units, as provided in Section 3.5 of the Plan 2.8    No Rights as a Stockholder Before Delivery. The Awardee shall have no rights as a stockholder of the Company until shares of Common Stock are actually issued to and held of record by the Awardee. The rights of Awardee with respect to the Stock Units shall remain forfeitable at all times prior to the date on which such rights become vested, and the restrictions with respect to the Stock Units lapse, in accordance with Sections 2.3 or 2.5. 2.9    Compliance with Laws. The Award and the offer, issuance and delivery of securities under this Agreement are subject to compliance with all applicable federal and state laws, rules and regulations (including but not limited to state and federal securities laws) and to such approvals by any listing, regulatory or governmental authority as may, in the opinion of counsel for the Company, be necessary or advisable in connection therewith. The Awardee will, if requested by the Company, provide such assurances and representations to the Company as the Company may deem necessary or desirable to assure compliance with all applicable legal requirements. The Company will cause such action to be taken, and such filings to be made, so that the grant hereunder shall comply with the rules of the New York Stock Exchange or the principal stock exchange on which shares of the Company’s Common Stock are then listed for trading. 2.10    Tax Matters. (a)    In order to comply with all applicable federal or state income tax laws or regulations, the Company may take such action as it deems appropriate to ensure that all applicable federal or state – 3 – payroll, withholding, income or other taxes, which are the sole and absolute responsibility of Awardee, are withheld or collected from Awardee. (b)    The Company shall reasonably determine the amount of any federal, state, local or other income, employment, or other taxes which the Company or any of its affiliates may reasonably be obligated to withhold with respect to the grant, vesting, or other event with respect to the Stock Units. The Company may, in its sole discretion, withhold a sufficient number of shares of Common Stock in connection with the vesting of the Stock Units at the Fair Market Value of the Common Stock (determined as of the date of measurement of the amount of income subject to such withholding) to satisfy the minimum amount of any such withholding obligations that arise with respect to the vesting of such Stock Units. The Company may take such action(s) without notice to the Awardee, and the Awardee shall have no discretion as to the satisfaction of tax withholding obligations in such manner. If, however, any withholding event occurs with respect to the Stock Units other than upon the vesting of such Stock Units, or if the Company for any reason does not satisfy the withholding obligations with respect to the vesting of the Stock Units as provided above in this Section 2.10(b), the Company shall be entitled to require a cash payment by or on behalf of the Awardee and/or to deduct from other compensation payable to the Awardee the minimum amount of any such withholding obligations. (c)    The Stock Unit evidenced by this Agreement, and the issuance of shares of Common Stock to the Awardee in settlement of vested Stock Units, is intended to be taxed under the provisions of Section 83 of the Code, and is not intended to provide and does not provide for the deferral of compensation within the meaning of Section 409A(d) of the Code. Therefore, the Company intends to report as includible in the Awardee’s gross income for any taxable year an amount equal to the Fair Market Value of the shares of Common Stock covered by the Stock Units that vest (if any) during such taxable year, determined as of the date such Stock Units vest. In furtherance of this intended tax treatment, all vested Stock Units shall be automatically settled and payment to the Awardee shall be made as provided in Section 2.3 hereof, but in no event later than March 15th of the year following the calendar year in which such Stock Units vest. The Awardee shall have no power to affect the timing of such settlement or payment. The Company reserves the right to amend this Agreement, without the Awardee’s consent, to the extent it reasonably determines from time to time that such amendment is necessary in order to achieve the purposes of this Section. 2.11    Company “Clawback Policy.” The Company has developed a policy providing that, in the event the Company is required to prepare an accounting restatement due to noncompliance with any financial reporting requirements under the securities laws based upon and to the extent of such noncompliance or otherwise erroneous data or the Company determines there has been a significant misconduct that causes financial or reputational harm, the Company shall recover a portion or all of any incentive compensation (including stock grants) (the “Clawback Policy”).  Awardee agrees and acknowledges that the provision of the Company’s Clawback Policy, as the same may be amended from time to time, shall apply to Awardee.  The Stock Units granted under this Agreement shall be subject to the Company’s Clawback Policy, including, without limitation, the rights of the Company to enforce Awardee’s repayment obligation. 2.12    Conflict of Provisions. The terms contained in the Plan are incorporated into and made a part of this Agreement and this Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall be controlling and determinative. 2.13    Assignment. Awardee shall have no right, without the prior written consent of the Company, to (i) sell, assign, mortgage, pledge or otherwise transfer any interest or right created hereby, or (ii) delegate his or her duties or obligations under this Agreement. This Agreement is made solely for the benefit of the parties hereto, and no other person, partnership, association or corporation shall acquire or have any right under or by virtue of this Agreement. 2.14    Restrictions on Transfer. The Restricted Stock Units and any rights under this Award may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of by Awardee otherwise than by will or by the laws of descent and distribution, and any such purported sale, assignment, transfer, pledge, hypothecation or other disposition shall be void and unenforceable against the Company. Notwithstanding the foregoing, Awardee may, in the manner established by the Committee, designate a beneficiary or beneficiaries to exercise the rights of Awardee and receive any property distributable with respect to the Restricted Stock Units upon the death of Awardee. – 4 – 2.15    Restrictions on Resale. The Awardee agrees not to sell any shares that have been issued pursuant to the vested Stock Units at a time when applicable laws, company policies, or an agreement between the Company and its underwriters prohibit a sale. This restriction shall apply as long as the Awardee is providing Service and for such period after the Awardee’s termination of Service as the Administrator may specify. 2.16    Entire Agreement. This Agreement and the Plan constitute the entire Awardee with respect to the subject matter hereof, and may not be modified adversely to the Awardee’s interest except by means of a writing signed by the Company and the Awardee. Notwithstanding the foregoing, amendments made pursuant to Section 2.10(b) hereof may be effectuated solely by the Company. 2.17    No Guarantee of Continued Service. This Agreement, the transactions contemplated hereunder, and the vesting schedule set forth herein constitute neither an express nor implied promise of continued engagement of Awardee as a provider of Service for the vesting period, for any period, or at all, and shall not interfere with Awardee’s right or the Company’s right to terminate Awardee’s Service at any time, with or without Cause, subject to any other written employment agreement to which the Company and Awardee may be a party. 2.18    Severability. Should any provision or portion of this Agreement be held to be unenforceable or invalid for any reason, the remaining provisions and portions of this Agreement shall be unaffected by such holding. 2.19    Governing Law. This Agreement shall be construed in accordance with the laws of the State of Delaware without reference to choice of law principles, as to all matters, including, but not limited to, matters of validity, construction, effect or performance. 2.20    Notice. All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and effective (i) when delivered by hand, (ii) when otherwise delivered against receipt therefor, or (iii) three (3) business days after being mailed if sent by registered or certified mail, postage prepaid, return receipt requested. Any notice shall be addressed to the parties as follows or at such other address as a party may designate by notice given to the other party in the manner set forth herein: (a)    if to the Company: Deckers Outdoor Corporation 250 Coromar Drive Goleta, California 93117 (b)    if to the Awardee, at the address shown on the signature page of this Agreement or at his most recent address as shown in the employment or stock records of the Company. 2.21    Number and Gender. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders. 2.22    Section Headings. The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof. 2.23    Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver. 2.24    Counterparts. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one agreement and any party hereto may execute this Agreement by signing any such – 5 – counterpart. This Agreement shall be binding upon Awardee and the Company at such time as the Agreement, in counterpart or otherwise, is executed by Awardee and the Company. 3.    RESTRICTIVE COVENANTS. This Section shall apply if Awardee’s Continuous Service is terminated following a Retirement Event and any Stock Units of the Awardee continue to vest in accordance with Section 2.6. Nothing in this Section 3 shall in any way limit or eliminate any other restrictions or obligations to which Awardee may be subject following the termination of Awardee’s Continuous Service: 3.1    Non-Competition.  The Awardee shall not, without the Board’s prior written consent, directly or indirectly engage in, have any equity interest in, or assist, manage or participate in (whether as a director, officer, employee, agent, representative, security holder, consultant or otherwise) any Competitive Business; provided, however, that: (i) the Awardee shall be permitted to acquire a passive stock or equity interest in such a Competitive Business provided the stock or other equity interest acquired is not more than 5% of the outstanding interest in such a Competitive Business; and (ii) the Awardee shall be permitted to acquire any investment through a mutual fund, private equity fund or other pooled account that is not controlled by the Awardee and in which the Awardee has less than a 5% interest.  For purposes of this provision, the term “Competitive Business” a business or businesses activity which is the same as, substantially similar to, or in competition with, business of the Company. 3.2    Non-Solicitation.  The Awardee will not, directly or indirectly, recruit or otherwise solicit or induce any non-clerical employee, director, consultant, customer, vendor or supplier of the Company to terminate his, her or its employment or arrangement with the Company or otherwise change his, her or its 3.3    Confidentiality.  The Awardee shall maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for his or her benefit or the benefit of any person, firm, corporation or other entity, any confidential or proprietary information or trade secrets of or relating to the Company, including, without limitation, information with respect to the Company’s operations, processes, products, inventions, business practices, finances, principals, vendors, suppliers, customers, potential customers, marketing methods, costs, prices, contractual relationships, business plans, designs, marketing or other business strategies, compensation paid to employees or other terms of employment, or deliver to any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing any such confidential or proprietary information or trade secrets.  Notwithstanding anything herein to the contrary, nothing shall prohibit the Awardee from disclosing any information that is 3.4    Non-Disparagement. The Awardee will not criticize, defame, be derogatory toward or otherwise disparage the Company (or the Company’s past, present and future officers, directors, stockholders, attorneys, agents, representatives, employees or affiliates), or its or their business plans or actions, to any third party, either orally or in writing; provided, however, that this provision will not preclude the Awardee from giving testimony in response to a lawful subpoena or preclude any conduct protected under 18 U.S.C. Section 1514A(a) or any similar state or federal law providing “whistleblower” protection to the Awardee. – 6 – By the Awardee’s signature and the signature of the Company’s representative below, the Awardee and the Company agree that this Award is granted under and governed by the terms and conditions of this Agreement and the Plan. The Awardee has reviewed this Agreement and the Plan in their entirety, has had an opportunity to obtain the advice of counsel before executing this Agreement and fully understands all provisions of this Agreement and the Plan. The Awardee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to this The Awardee further agrees that the Company may deliver by email all documents relating to the Plan or this Award (including prospectuses required by the Securities and Exchange Commission) and all other documents that the Company is required to deliver to its security holders (including annual reports and proxy statements). The Awardee also agrees that the Company may deliver these documents by posting them on a web site maintained by the Company or by a third party under contract with the Company. AWARDEE: AWARDEE: _______________________________________ Signature By: ________________________________________ _______________________________________ Printed Name Its: ________________________________________ _______________________________________ Residence Address ________________________________________ Date _______________________________________ Date   – 7 –

Title: friend 20 [m] getting ddos'ed every single day, cannot stop the person doing it Question:[Rhode Island] Long story short this guy hates my friend and will DDOS his IP whenever he tries to do something on the computer. He has been having this for 2+ weeks and cannot stop this. We know where this person lives and his first and last name. What can we do to stop and punish the man doing this? Also he is harassing him and his girlfriend with death threats, saying he will commit suicide if they don't talk to him, just non stop harassment and it needs to stop this man is a psychopath. Edit: Have proof in texts of the person texting my friend telling him he is DDOSing him. Topic: Computer and Internet Answer #1: >Long story short this guy hates my friend and will DDOS his IP whenever he tries to do something on the computer. Renew the IP. Might have to login to the ISPs account admin or call them up. Report it to the relevant cybercrime unit for your police force. >Also he is harassing him and his girlfriend with death threats, saying he will commit suicide if they don't talk to him Oh that is even easier. Call non-emergency police/ambulance number and report him for a health and welfare check. He might even get involuntarily committed.

  Exhibit 10.3    AGREED FORM   [●] 2017   NATIONAL ENERGY SERVICES REUNITED CORP.   AL NOWAIS INVESTMENTS LLC        FORM OF RELATIONSHIP AGREEMENT      (FRESHFIELDS BRUCKHAUS DERINGER LOGO) [img002_v1.jpg]          CONTENTS   Clause Page 1. COMMENCEMENT AND DURATION 2 2. GOVERNANCE 2 3. LOCK UP 4 4. ELECTRONIC STOCK 4 5. CONFIDENTIALITY 4 6. ANNOUNCEMENTS 5 7. NOTICES 6 8. COSTS AND INTEREST 6 9. WHOLE AGREEMENT 6 10. ASSIGNMENT 7 11. VARIATIONS 7 12. INVALID TERMS 7 13. ENFORCEABILITY, RIGHTS AND REMEDIES 8 14. COUNTERPARTS 8 15. GOVERNING LAW 8 16. LCIA ARBITRATION 9 SCHEDULE 1 DEFINITIONS AND INTERPRETATION 10          AGREEMENT   dated _____ November 2017   PARTIES:   (1)NATIONAL ENERGY SERVICES REUNITED CORPORATION, a corporation existing under the laws of the British Virgin Islands with its registered address at 777 Post Oak Blvd., 7th Floor, Houston, Texas 77056, USA (the Company); and   (2)AL NOWAIS INVESTMENTS LLC, a company existing under the laws of the United Arab Emirates with its registered address at Al Nowais Building, PO Box 984, Abu Dhabi, United Arab Emirates (ANI).   Words and expressions used in this agreement (the Agreement) shall be interpreted in accordance with Schedule 1 (Definitions and Interpretation).   WHEREAS:   (A)The Company has entered into a stock purchase agreement (the SPA) on or around the date hereof with (amongst others) ANI pursuant to which ANI will sell, and the Company will purchase, such ordinary shares of $1 each of NPS Holdings Limited as are set forth against ANI’s name in Exhibit A of the SPA (ANI’s Company Shares).   (B)In consideration for the purchase of ANI’s Company Shares, the Company shall pay certain cash consideration and issue to the Reinvesting Stockholder common stock of the Company in the amounts set forth against the Reinvesting Stockholder’s names in Exhibit A of the SPA, on the terms and subject to the conditions set out in the SPA.   (C)The Company and ANI are entering into this Agreement in order to set out certain rights that ANI will be entitled as a member of the Company.   IT IS AGREED:   1.            Commencement and Duration   1.1          This clause  1 and clauses 5 (Confidentiality), 6 (Announcements), 7 (Notices), 8 (Costs and Interest), 9 (Whole Agreement), 10 (Assignment), 11 (Variations), 12 (Invalid Terms), 13 (Enforceability, Rights and Remedies), 15 (Governing Law), 16 (LCIA Arbitration) (and the Schedules referred to in those clauses) and Schedule 1 (Definitions and Interpretation) shall take effect from and including the date of this Agreement.   1.2          All clauses and schedules of this Agreement, other than those referred to in clause 1.1, shall take effect immediately upon NESR Closing.   1.3          Once in force, the provisions of this Agreement shall continue in force and to bind the parties to it from time to time until this Agreement is terminated.   2.            Governance   2.1          Immediately upon NESR Closing and for so long as ANI and/or its Affiliates hold 50% of the Consideration Equity Stock set out against its name in column (5), Part 1, Exhibit A of the Sale and Purchase Agreement, ANI shall have the right to nominate 1 (one) person as a Director (such Director, being the ANI Nominee), and to propose to remove any such ANI Nominee and nominate another person in his place. The first ANI Nominee shall be [●].   - 2 -     2.2          In addition, immediately upon NESR Closing and for so long as ANI and/or its Affiliates hold 50% of the Consideration Equity Stock set out against its name in column (5), Part 1, Exhibit A of the Sale and Purchase Agreement, the Company shall invite a representative of ANI (the ANI Observer), as designated by ANI in its own discretion, to attend all meetings of the Board in a non-voting observer capacity and, in this respect, shall give such ANI Observer copies of all notices, minutes, consents, and other materials that it provides to its directors at the same time and in the same manner as provided to such directors.   2.3          The Company shall procure that the appointment of the ANI Nominee to the Board is proposed to and recommended for approval by the Company’s shareholders at the 2018 annual general meeting of the Company (the 2018 AGM) or at any other general meeting of the Company held before the 2018 AGM and the Company shall procure that the appointment of the ANI Nominee to the Board is proposed to and recommended for approval by the Company’s shareholders at such subsequent annual general meeting of the Company as would ensure the appointment or re-appointment of the ANI Nominee nominated by ANI pursuant to the terms hereof.   2.4          If the ANI Nominee is not elected at the applicable annual general meeting of the Company referred to in clause 2.3 above, ANI may propose a replacement ANI Nominee for appointment to the Board. The Company shall propose and recommend the appointment of such replacement ANI Nominee at the next shareholders meeting of the Company. The process set out in this clause 2.4 shall be repeated until the replacement ANI Nominee proposed by ANI is appointed to the Board.   2.5          In addition, if ANI wishes to remove the ANI Nominee and nominate another person in his/her place pursuant to clause 2.1, the Company shall, subject to Law, appoint such replacement ANI Nominee to the Board as soon as possible and in any event shall propose and recommend the appointment of such replacement at the next annual general meeting of the Company following any such nomination.   2.6          During any period between NESR Closing and the appointment of the ANI Nominee to the Board, the ANI Nominee and the ANI Observer shall be entitled to attend meetings of the Board in the capacity of observers with the right to speak and participate in discussions of the Board, but without any voting rights, and the Company shall provide the ANI Nominee and the ANI Observer with written notice of all Board Meetings and all Board papers on the same basis as notices and Board papers are provided to the directors of the Company.   2.7          ANI acknowledges that the Company will require:   (a)the ANI Nominee appointed to the Board and any committee of the Board, to accept in writing, on substantially the same terms as accepted in writing by the other non-executive directors of the Company to be bound by and duly comply with applicable law and the Articles;   (b)the ANI Nominee appointed to the Board to accept in writing, on substantially the same terms as accepted in writing by the other non-executive members of the Board or such committees, to keep confidential all information regarding the Group of which they become aware in their respective capacities; and   - 3 -     (c)any ANI Nominee or ANI Observer that acts as an observer, to accept in writing, to keep confidential all information regarding the Group of which they become aware in their respective capacities.   2.8          If an ANI Nominee dies, resigns, retires or is incapacitated and is removed as a Director, ANI may appoint another Director in accordance with this clause 2.   2.9          The ANI Nominee may be appointed to committees of the Company as such Nominee may qualify, subject to Board approval.   2.10        The Company shall purchase and maintain with a reputable insurer, insurance effective from and including the NESR Closing Date, for or for the benefit of any person who is or was at any time a Director or director or officer of any member of the Company Group, including insurance against, subject to Law, any liability incurred by or attaching to him in respect of any act or omission in the actual or purported exercise of his powers, in each case from and including the NESR Closing Date (or, if later, the date of appointment of such Director or director or officer of any member of the Company Group), and otherwise in relation to his duties, powers or offices in relation to any member of the Company Group (and all costs, charges, losses, expenses and liabilities incurred by him in relation thereto).   3.            Lock Up   ANI agrees with the Company that from the date of NESR Closing until the date that is 6 months thereafter, ANI shall not, and will cause its Affiliates to which ANI transfers any Consideration Equity Stock not to, directly or indirectly (i) offer, sell, issue, contract to sell, pledge or otherwise dispose of, directly or indirectly, any Consideration Equity Stock; (ii) offer, sell, issue, contract to sell or grant any option, right or warrant to purchase the Consideration Equity Stock or securities convertible into or exchangeable for Consideration Equity Stock; or (iii) enter into a transaction which would have the same effect, or enter into any swap, hedge or other arrangement that any Consideration Equity, whether any such aforementioned transaction is to be settled by delivery of Consideration Equity Stock or such other securities, in cash or otherwise. The provisions of this clause 3 shall not prevent ANI granting security in respect of any Consideration Equity Stock to any provider of finance to ANI or any Affiliate of ANI, provided ANI shall remain entitled to vote in respect of the Consideration Equity Stock upon the grant of such security.   4.            Electronic Stock   4.1          The Company shall ensure that all Consideration Equity Stock (or other Equity Stock) issued to ANI shall at all times be issued in electronic form.   5.            Confidentiality   5.1          Each of ANI and the Company shall keep confidential any information which relates to the contents of, and negotiations leading to, this Agreement (or any agreement or arrangement entered into pursuant to this Agreement) (all such information being Confidential Information).   5.2          The obligations under clause 6.1 do not apply to:   (a)any disclosure of information which is expressly consented to in writing by each of the parties prior to such disclosure being made (or, if the information only relates to one party, which is expressly consented to in writing by such party);   - 4 -     (b)disclosure (subject to clause  5.3) in confidence by ANI or the Company to their Affiliates or to ANI’s, Company’s and their Affiliates’ directors, officers, employees, agents and advisers (together the Representatives and each a Representative);   (c)disclosure of information to the extent required by Law or by any stock exchange or Governmental Authority, or to the extent reasonably required for the purpose of managing the tax affairs of ANI (or any of its Affiliates) or any member of the Company Group.   (d)disclosure of information on a confidential basis to a bank or financial adviser of ANI or after the Lock-In Period one or more bona fide potential purchasers of Shareholder Instruments or any securities in ANI or in any of its Affiliates;   (e)disclosure of information which was lawfully in the possession of ANI or any of its Representatives or the Company or its Representatives (as applicable) without any obligation of secrecy prior to it being received or held;   (f)disclosure of any information which has previously become publicly available other than through ANI’s or the Company’s fault (or that of its Representatives)   (g)disclosure required for the purposes of any arbitral or judicial proceedings arising out of this Agreement;   (h)disclosure is required pursuant to the terms of this Agreement; or   (i)any announcement made in accordance with clause  6.   5.3         Each of the Company and ANI shall inform any Representatives to whom it provides Confidential Information that such information is confidential and shall instruct each such Representative:   (a)to keep it confidential;   (b)not to use it for its own business purposes; and   (c)not to disclose it to any third party (other than those persons to whom it has already been disclosed in accordance with this Agreement).   5.4          The disclosing party shall be responsible for any breach of this clause  5 by a Representative to whom it provides any Confidential Information as if the disclosing party were the party that had breached this clause 5.   6.            Announcements   6.1          Subject to clause 6.2, unless otherwise agreed in writing, no party (nor any of its Connected Persons) shall make any announcement or issue any communication in connection with the existence or subject matter of this Agreement.   6.2          The restriction in clause  6.1 shall not apply to the extent that the announcement or communication is required by Law, by any stock exchange or by any Governmental Authority. The Parties agree that this Agreement shall be disclosed in and attached with the Proxy Statement. In this case, the party making the announcement or issuing the communication shall, as far as reasonably practicable:   (a)use reasonable endeavours to consult with the other parties in advance as to what form it takes, what it contains and when it is issued;   - 5 -     (b)take into account the relevant parties’ reasonable requirements; and   (c)announce and/or disclose (as applicable) only the minimum amount of Confidential Information that is required to be announced and/or disclosed (as applicable) and use reasonable endeavours to assist the relevant parties in respect of any reasonable action that they may take to resist or limit such announcement and/or the issuance of such circular (as applicable), acknowledging that a copy of the Agreement will be submitted with the Proxy Statement.   7.            Notices   7.1          Any notice to be given by one party to another party in connection with this Agreement shall be in writing in English and signed by or on behalf of the party giving it. It shall be delivered by hand, email or courier using an internationally recognised courier company.   7.2          A notice shall be effective upon receipt and shall be deemed to have been received (i) at the time of delivery, if delivered by hand or courier or (ii) at the time of transmission if delivered by email. Where delivery occurs outside Working Hours, notice shall be deemed to have been received at the start of Working Hours on the next following Business Day.   7.3          The addresses and email addresses of the parties for the purpose of clause 7.1 are:   Company For the attention of: Sherif Foda Address: 777 Post Oak Blvd Suite 730, Houston, Texas 77056, USA Email: [email protected]       ANI For the attention of:   Chief Investment Officer   Address: Al Nowais Building, PO Box 984, Abu Dhabi, United Arab Emirates   Email: [●] 7.4          This clause 7 does not apply to the formal service of any [court / arbitration] proceedings.   8.            Costs and Interest   8.1          Each of the parties shall be responsible for its own costs, charges and expenses (including taxation) incurred in connection with negotiating, preparing and implementing this Agreement and the transactions contemplated by it.   9.            Whole Agreement   9.1          This Agreement sets out the whole agreement between the parties in respect of the subject matter of this Agreement and supersedes any previous draft, agreement, arrangement or understanding between them, whether in writing or not, relating to it. In particular it is agreed that:   (a)no party has relied on or shall have any claim or remedy arising under or in connection with any statement, representation, warranty or undertaking, made by or on behalf of any other party (or any of its Connected Persons) in relation to the subject matter of this Agreement that is not expressly set out in this Agreement;   - 6 -     (b)any terms or conditions implied by Law in any jurisdiction in relation to the subject matter of this Agreement are excluded to the fullest extent permitted by Law or, if incapable of exclusion, any rights or remedies in relation to them are irrevocably waived;   (c)the only right or remedy of a party in relation to any provision of this Agreement shall be for breach of this Agreement; and   (d)except for any liability in respect of a breach of this Agreement , no party (nor any of its Connected Persons) shall owe any duty of care or have any liability in tort or otherwise to any other party (or its respective Connected Persons) in relation to the subject matter of this Agreement.   9.2          Nothing in clause 9.1 shall limit any liability for (or remedy in respect of) fraud or fraudulent misrepresentation.   9.3          Each party agrees to the terms of this clause 9 on its own behalf and as agent for each of its Connected Persons.   10.          Assignment   No party may assign, transfer, charge or otherwise deal with any of its rights or obligations under this Agreement nor grant, declare, create or dispose of any right or interest in it, in whole or in part. Any purported assignment in contravention of this clause  10 shall be void.   11.          Variations   11.1        No variation of this Agreement shall be valid unless it is in writing and duly executed by or on behalf of all the parties to it.   11.2        If this Agreement is varied:   (a)the variation shall not constitute a general waiver of any provisions of this Agreement;   (b)the variation shall not affect any rights, obligations or liabilities under this Agreement that have already accrued up to the date of variation; and   (c)the rights and obligations of the parties under this Agreement shall remain in full force and effect, except as, and only to the extent that, they are so varied.   12.          Invalid Terms   12.1        Each of the provisions of this Agreement is severable.   12.2        If and to the extent that any provision of this Agreement:   (a)is held to be, or becomes, invalid or unenforceable under the Law of any jurisdiction; but   - 7 -     (b)would be valid, binding and enforceable if some part of the provision were deleted or amended,   12.3         then the provision shall apply with the minimum modifications necessary to make it valid, binding and enforceable. All other provisions of this Agreement shall remain in force.   12.4         The parties shall negotiate in good faith to amend or replace any invalid, void or unenforceable provision with a valid, binding and enforceable substitute provision or provisions, so that, after the amendment or replacement, the commercial effect of the Agreement is as close as possible to the effect it would have had if the relevant provision had not been invalid, void or unenforceable.   13.          Enforceability, Rights and Remedies   13.1         Any waiver of, or election whether or not to enforce, any right or remedy provided under or pursuant to this Agreement or by Law must be in writing , and no waiver or election shall be inferred from a party’s conduct. Any such waiver shall not be, or be deemed to be, a waiver of any subsequent breach or default.   13.2         Except as expressly provided in this Agreement, no failure or delay by any party in exercising any right or remedy relating to this Agreement or by Law shall impair such right or remedy or operate or be construed as a waiver or variation of it or be treated as an election not to exercise such right or remedy or preclude its exercise at any subsequent time. No single or partial exercise of any such right or remedy shall preclude any other or further exercise of it or the exercise of any other right or remedy.   13.3         A party that waives a right or remedy provided under this Agreement or by Law in relation to one party, or takes or fails to take any action against that party, does not affect its rights in relation to any other party.   13.4         The rights and remedies of each of the parties under or pursuant to this Agreement are cumulative, may be exercised as often as such party considers appropriate and are in addition to its rights and remedies under Law.   14.          Counterparts   This Agreement may be executed in any number of counterparts, and by each party on separate counterparts. Each counterpart is an original, but all counterparts shall together constitute one and the same instrument. Delivery of a counterpart of this Agreement by e-mail attachment shall be an effective mode of delivery.   15.          Governing Law   This Agreement and any non-contractual obligations arising out of, or in connection with, it shall be governed by, and interpreted in accordance with, the laws of the state of New York.   - 8 -     16.          LCIA Arbitration   Any controversy, dispute or claim arising under or in connection with this Agreement (including, without limitation, any non-contractual right or obligation arising in connection therewith or the existence, validity, interpretation or breach hereof and any claim based on contract, tort of statute) (a Dispute) shall be referred to and finally resolved by a binding arbitration, to be held in London, England pursuant to the rules (Rules) of the London Court of International Arbitration (LCIA). The seat or legal place of arbitration shall be London, United Kingdom. The Rules are incorporated by reference into this Section and capitalised terms used in this Section which are not otherwise defined in this Agreement have the meaning given to them in the Rules. The arbitration shall be conducted in the English language. Each party shall bear its own expenses incurred in connection with arbitration and the fees and expenses of the arbitrators shall be shared equally by the parties involved in the dispute and advanced by them from time to time as required. It is the mutual intention and desire of the parties that a tribunal of three arbitrators be constituted as expeditiously as possible following the submission of the dispute to arbitration. The Purchaser party to the Dispute shall appoint one arbitrator, the Selling Stockholders that are party to the Dispute shall appoint one arbitrator, and one arbitrator who shall serve as chairman shall be nominated by the agreement of the arbitrators appointed by such Purchaser and Selling Stockholders. Failing such agreement within 15 days of the nomination of the party-nominated arbitrators, the arbitrator shall be nominated by the LCIA. Once such tribunal is constituted and except as may otherwise be agreed in writing by the parties involved in such dispute or as ordered by the arbitrator upon substantial justification shown, the hearing for the dispute will be held within sixty (60) days after submission of the dispute to arbitration. The arbitrator shall render their final award within sixty (60) days, subject to extension by the arbitrator upon substantial justification shown of extraordinary circumstances, following conclusion of the hearing and any required post-hearing briefing or other proceedings ordered by the arbitrator. The arbitrator will state the factual and legal basis for the award. The decision of the arbitrator in any such proceeding will be final and binding and not subject to judicial review and final judgment may be entered upon such an award in any court of competent jurisdiction, but entry of such judgment will not be required to make such award effective. The parties hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection which they may now or hereafter have to the laying of venue of any such action brought in such court or any defense of inconvenient forum for the maintenance of such action. Each of the parties hereto agrees that a judgment in any such action may manner provided by law.   - 9 -     Schedule 1   Definitions and Interpretation   1.            Definitions. In this Agreement, the following words and expressions shall have the following meaning:   Affiliate means, in relation to any person or Undertaking (the relevant person):   (a)any person Controlled by the relevant person (whether directly or indirectly);   (b)any person Controlling (directly or indirectly) the relevant person;   (c)any person Controlled (whether directly or indirectly) by any person Controlling the relevant person,   but in respect of ANI and/or its other Affiliates, shall exclude the members of the Company Group;   ANI’s Company Shares has the meaning given in the Preamble;   ANI Nominee has the meaning given in clause 2.1;   ANI Observer has the meaning given in clause 2.2;   Articles means the Company articles of association, as amended from time to time;   Board means the board of directors of the Company;   Board Meeting means a meeting of the Board duly convened in accordance with the Articles;   Business Day means any day of the year except Friday, Saturday and Sunday on which national banking institutions in the UAE and New York, United States of America are open to the public for conducting general commercial business and are not required or authorized to close;   Company Group means the Company and all entities Controlled by the Company from time to time;   Confidential Information has the meaning given in clause 5.1;   Consideration Equity Stock has the meaning given in the SPA;   Connected Persons means, in relation to a party, any Affiliate of that party and any officer, employee, agent, adviser or representative of that party or any of its Affiliates, in each case, from time to time;   Control means, in relation to any Undertaking (being the Controlled Person), being:   (a)entitled to exercise, or control the exercise of (directly or indirectly) more than 50 per cent. of the voting power at any general meeting of the shareholders, members or partners or other equity holders (and including, in the case of a limited partnership, of the limited partners of) (or in the case of a trust, of the beneficiaries thereof) in respect of all or substantially all matters falling to be decided by resolution or meeting of such persons; or   - 10 -     (b)entitled to appoint or remove or control the appointment or removal of:   (i)directors on the Controlled Person’s board of directors or its other governing body (or, in the case of a limited partnership, of the board or other governing body of its general partner) who are able (in the aggregate) to exercise more than 50 per cent. of the voting power at meetings of that board or governing body in respect of all or substantially all matters; and/or   (ii)any managing member of such Controlled Person;   (iii)in the case of a limited partnership its general partner; or   (iv)in the case of a trust, its trustee and/or manager; or   (c)entitled to exercise a dominant influence over the Controlled Person (otherwise than solely as a fiduciary) by virtue of the provisions contained in its constitutional documents or, in the case of a trust, trust deed or pursuant to an agreement with other shareholders, partners, members or beneficiaries of the Controlled Person,   and Controller, Controlled, and Controlling shall be construed accordingly;   Directors means the directors of the Company from time to time;   Dispute has the meaning given in clause 16;   Equity Stock means common stock of the Company;   Law means any applicable statute, law, rule, regulation, guideline, ordinance, code, policy or rule of common law issued, administered or enforced by any Governmental Authority, or any judicial or administrative interpretation thereof including the rules of any stock exchange;   LCIA has the meaning given in clause 16;   NESR Closing has the meaning given to such term in the Sale and Purchase Agreement;   NESR Closing Date has the meaning given in the Sale and Purchase Agreement;   Parties means the parties to this Agreement from time to time (including any person who at the relevant time is a party to, or has agreed (by executing a Deed of Adherence) to be bound by, this Agreement);   Proxy Statement means the submission by Company to the Securities and Exchange Commission to request approval by the shareholders of the Company to approve the transaction contemplated by the Sale and Purchase Agreement.   relevant person has the meaning given in the definition of Affiliate;   Representative has the meaning given in clause 5.2(b);   Rules has the meaning given in clause 16;   - 11 -     Sale and Purchase Agreement means the stock purchase agreement dated on or about November 12, 2017, between the Company, Hana Investments WLL, NPS Holdings Limited and “the Selling Stockholders”;   Shareholder Instrument means:   (a)any Stock (including Equity Stock);   (b)any shares in the capital of any of the subsidiaries of the Company;   (c)any instrument, document or security granting a right of subscription for, or conversion into Shares or shares in the capital of any of the subsidiaries of the Company; and   (d)loan stock or any other instrument or security evidencing indebtedness issued by any member of the Company Group (excluding any third party debt financings);   Stock means stock in the capital of the Company, from time to time;   tax includes (a) taxes on gross or net income, profits and gains, and (b) all other taxes, levies, duties, imposts, charges and withholdings or any nature, including any excise, property, value added, sales, use, stamp, occupation, transfer, franchise or payroll taxes (including national insurance or social security contributions), and any payment whatsoever which the relevant person may be or become bound to make to any person as a result of the discharge by that person of any tax which the relevant person has failed to discharge, together with all penalties, charges, fees and interest relating to any of the foregoing or to any late or incorrect return in respect of any of them, and regardless of whether such taxes, levies, duties, imposts, charges, withholdings, penalties and interest are chargeable directly or primarily against or attributable directly or primarily to the relevant person or any other person and of whether any amount in respect of them is recoverable from any other person; and   Undertaking means a body corporate or partnership or unincorporated association or trust carrying on trade or business with or without a view to profit. In relation to an undertaking which is not a company, expressions in this Agreement appropriate to companies are to be construed as references to the corresponding persons, officers, documents or agents (as the case may be) appropriate to undertakings of that description.   1.           Interpretation. In this Agreement, unless the context otherwise requires:   (a)headings do not affect the interpretation of this Agreement; the singular shall include the plural and vice versa; and references to one gender include all genders;   (b)references to an English legal term or concept will, in respect of any jurisdiction other than England, be construed as references to the term or concept which most nearly corresponds to it in that jurisdiction;   (c)references to a person include any individual, firm, body corporate (wherever incorporated), government, state or agency of a state or any joint venture, association, partnership, works council or employee representative body (in any case, whether or not it has separate legal personality);   - 12 -     (d)except as otherwise expressly provided in this Agreement, any reference to an enactment (which includes any legislation in any jurisdiction) includes references to: (i) that enactment as amended, consolidated or re-enacted by or under any other enactment whenever made; (ii) any enactment that that enactment re-enacts (with or without modification); and (iii) any subordinate legislation (including regulations) whenever made under that enactment, as amended, consolidated or re-enacted as described at (i) or (ii), except to the extent that any of the matters referred to in (i) to (iii) occurs on or after the date of this Agreement and increases or alters the liability of a party under this Agreement;   (e)references to US$ are references to the lawful currency from time to time of the United States of America;   (f)any phrase introduced by the terms including, include, in particular or any sense of the words preceding those terms; and   (g)if there is any inconsistency between any definition set out in this Schedule and a definition set out in any clause or any other Schedule, then, for the purposes of construing that clause or Schedule, the definition set out in that clause or Schedule shall prevail.   2.           Where any obligation in this Agreement is expressed to be undertaken or assumed by any party, that obligation is to be construed as requiring the party concerned to exercise all rights and powers of control over the affairs of any other person which it is able to exercise (whether directly or indirectly) in order to secure performance of the obligation.   - 13 -     SIGNATURE   IN WITNESS WHEREOF this Agreement has been duly executed as a DEED on the date inserted on page 1 of this Agreement:   EXECUTED [and DELIVERED] )   as a DEED by     NATIONAL ENERGY SERVICES     REUNITED CORP. )   acting by two directors/a director and )   the secretary )     OR   REUNITED CORP. )   acting by [director], a )   director, in the presence of ) [Signature of director] [witness] )             Director   [Signature of witness]   Name:   Address:   Occupation:   - 14 -     EXECUTED [and DELIVERED] )   as a DEED by     Al Nowais Investments LLC )   acting by two directors/a director and )   the secretary )     OR   acting by [director], a )   director, in the presence of ) [Signature of director] [witness] )             Director     Name:   Address:   Occupation:   - 15 -

T. Rowe Price Growth & Income Fund, Inc. T. Rowe Price Growth & Income Fund The fund’s limit on investments in foreign securities was reduced from 25% to 10%.

  Exhibit 10.15 Execution Version      This Amended and Restated Employment Agreement (hereinafter referred to as the “Agreement”) is made and entered into as of the 21st day of March, 2007 by and between Ronald A. Lane (hereinafter referred to as the “Employee”) and Atlas Air, Inc., a Delaware corporation (hereinafter referred to as “Atlas” or the      WHEREAS, the Employee has been employed by the Company as Senior Vice President and Chief Marketing Officer pursuant to that Employment Agreement dated May 1,2003, as amended on January 24, 2004 and April 20, 2004 (the “Original Employment Agreement”); and      WHEREAS, the Employee and the Company wish to amend and restate the Original      Employment Agreement as of the date hereof, on the terms and subject to the conditions set forth in this Agreement. is hereby acknowledged, the parties hereto, intending to be legally bound hereby, covenant and agree as follows: 1. DEFINITIONS      1.1 “Employment Period” shall mean the period commencing on the date hereof and extending until December 31, 2007, subject to earlier termination as set forth in Section 4.1 below.      1.2 “Confidential or Proprietary Information” as used herein shall refer to all information relative to the plans, structure and practices, including information relating to its customers, contracts and aircraft of Atlas or any affiliate or subsidiary thereof, except:           (a) information that is or becomes a matter of public knowledge through no fault of the Employee; or           (b) information rightfully received by the Employee from a third party without a duty of confidentiality; or           (c) information disclosed to the Employee with Atlas’ prior approval for public dissemination. 2. OBLIGATIONS OF THE EMPLOYEE      Atlas and the Employee agree to the following rights, obligations and duties:      2.1 Obligations of the Employee. During the Employment Period, Atlas agrees to retain the Employee as Senior Vice President and Special Advisor. The scope of the Employee’s     responsibilities shall be determined by the Board of Directors, the Chief Executive Officer, the Chief Operating Officer and such other officers of Atlas as the Chief Executive Officer shall deem appropriate. The Employee shall, except when prevented by illness or permanent disability or during a period of vacation, devote sufficient Employee business time to ensure accomplishment of the transition projects set forth in Exhibit A and attention to the good faith performance of the other duties contemplated by this Agreement.      2.2 Principal Residence of the Employee. The Employee shall maintain his principal residence in the Long Beach, California area unless otherwise agreed.      2.3 New Position Provisions. Upon execution of this Agreement, the parties’ respective rights and obligations under the Original Employment Agreement shall be superseded by this Agreement. The Employee hereby resigns from his prior position as Senior Vice President and Chief Marketing Officer of the Company and its affiliates as of the commencement of the Employment Period. 3. COMPENSATION      During the Employment Period, Atlas will pay the Employee as follows:      3.1 Compensation. Atlas will pay the Employee at the rate of $350,720 per annum, payable in semi-monthly installments.      3.2 Incentive Bonus Payments. The Employee has received his annual incentive bonus for 2006, paid in accordance with the Company’s 2006 Annual Incentive Plan for Senior Executives (the “2006 AIP”). The Employee will not be entitled to any bonus for 2007 whether under the 2006 AIP or otherwise.      3.3 Benefits. During the Employment Period, the Employee and the Employee’s dependents shall be entitled to participate in the Atlas health insurance plans (major medical, dental and vision), and Atlas will contribute to the Employee’s monthly premium as provided by such plan. Atlas reserves the right to discontinue participation in any health insurance plan at any time with the understanding that Atlas will comply in full measure with all state and federal laws regarding the changes of insurance coverage by private employers and notification under the Consolidated Omnibus Budget Reconciliation Act. The Employee also shall be entitled, to the same extent and at a level commensurate with other employees of Atlas, to participate in any other benefit plans or arrangements of Atlas.      3.4 Restricted Shares and Options. During the Employment Period, all Company restricted shares and stock options will continue to vest in accordance with their terms.      3.5 Fringe Benefits. The Employee will be entitled to a car allowance in the amount of $700.00 per month. 4. TERMINATION OF THE EMPLOYMENT PERIOD      4.1 Termination. Employment hereunder shall be through the Employment Period; provided, however, that the Company may immediately terminate the Employment Period with 2   Cause (as defined below). “Cause” shall be defined as (i) a breach by the Employee of a material term of this Agreement; (ii) any act of misconduct or dishonesty by the Employee; or, (ii) the Employee’s failure to perform the transition projects set forth in Exhibit A, which may be amended from time to time by written agreement of the parties. Provisions of this Agreement shall survive any termination if so provided herein or if necessary or desirable to accomplish the purposes of other surviving provisions, including without limitation the obligations of the Company under Section 4.2 and the obligations of the Employee under Section 4.3      4.2 Rights Following Termination. Upon termination of the Employment Period by the Company without Cause or expiration of the Employment Period, the Employee shall be entitled to: (i) receive the Employee’s base salary and accrued benefits through December 31, 2007; (ii) receive, subject to the Employee’s execution of a separation agreement and general release (a true and correct copy of which is attached hereto as Exhibit B), (the “Release”), severance of $526,080 paid in a lump sum within ten (10) days of the Employee’s execution of the Release (and provided that the Employee does not revoke the Release); (iii) subject to “the Employee’s execution of the Release and compliance with the terms of Section 4.3, continued coverage and rights and benefits available under the Atlas health insurance plans as provided in Section 3.3 above for a period of twenty-four (24) months immediately following the date of termination subject to the Employee paying the same portion for the premiums for such coverage as he paid during the Employment Period; provided, however, that any such continued coverage shall cease in the event the Employee obtains comparable coverage in connection with subsequent consulting or employment arrangements, and to the extent Atlas is unable to continue such coverage, Atlas shall provide the Employee with economically equivalent benefits determined on an after-tax basis; (iv) Employee’s restricted shares and options that have vested or will vest pursuant to the terms and conditions of their related agreements; and (v) receive any retired employee benefits available to retired Company employees for which he is eligible pursuant to the terms of any applicable policies or plan documents, as amended from time to time. Upon termination of the Employment Period for any other reason (including, without limitation, by the Company with Cause or by the Employee for any reason), the Employee shall be entitled only to base salary and accrued benefits through the date the Employee’s employment terminates.      4.3 Restrictive Covenants.           (a) The Employee covenants and agrees that the Employee will not, at any time, reveal, divulge or make known to any third party any confidential or proprietary records, data, trade secrets, pricing policies, strategy, rate structure, personnel policy, management methods, financial reports, methods or practice of obtaining or doing business, or any other Confidential or Proprietary Information of Atlas or any of its subsidiaries or affiliates (collectively the “Atlas Companies” and each, an “Atlas Company”) which is not in the public domain.           (b) Acknowledging his duty of loyalty to the Atlas Companies, the Employee agrees that, while he is employed by the Company, he will not, directly or indirectly, whether as owner, partner, investor, consultant, agent, employee, co-venturer or otherwise, compete with any of the Atlas Companies anywhere in the world or undertake any planning for any business competitive with any of the Atlas Companies. Specifically, but without limiting the generality of the foregoing, the Employee agrees that, during his employment with the Company, he will not 3   provide advice, services or other assistance of any kind, whether with or without compensation, to any person or entity which competes, or is planning to compete., with any of the Atlas Companies. The Employee understands, however, that his passive ownership of one percent (1 %) or less of the voting stock of any publicly traded company will not be a breach of his obligations hereunder. After his employment ends, the Employee may compete with any of the Atlas Companies, but should he choose to so compete within the twelve (12) months immediately following termination of the Employment Period without first obtaining the express written consent of the Company, which consent shall not be unreasonably withheld, the Employee agrees that he will not be entitled to the payment and benefits provided in Sections 4.2(ii) and (iii) above, and if such payment and benefits have already been provided to the Employee, he shall return to the Company the payment under Section 4.2(ii) within five (5) days of written demand by the Company, or in the event of a dispute as to whether the Employee has breached any of his obligations under this Section 4.3, Employee shall return to the Company any payments received within five (5) days after determination of a breach and in accordance with Sections 5.1, 5.2, 5.3 or 5.5, as appropriate.           (c) The Employee acknowledges that his access to Confidential or Proprietary Information and to the Atlas Companies’ customers and his development of goodwill on behalf of the Atlas Companies with their customers during his employment would give him an unfair competitive advantage were he to leave employment and begin competing with the Atlas Companies for their existing customers and that he therefore is being granted access to Confidential or Proprietary Information and the customers of the Atlas Companies in reliance on his agreement hereunder. Therefore, the Employee covenants and agrees that, during the Employment Period and during the twelve-month period immediately following the termination of the Employment Period, the Employee will not engage in any of the following activities directly or indirectly, for any reason, whether for the Employee’s own account or for the account of any other person, firm, corporation or other organization;   (i)   solicit, employ or otherwise interfere with any of the Atlas Companies’ contracts or relationships with any officer, director, employee, independent contractor or with any individual who has been employed or associated with the Atlas Companies within the six (6) months prior to the Employee’s termination of his employment relationship with the Company; or     (ii)   solicit or encourage any customer of any of the Atlas Companies to terminate or diminish its relationship with any of the Atlas Companies or seek to persuade any such customer to conduct with, any other person or entity any business or activity which such customer conducts or could conduct with any of the Atlas Companies; provided, however, that these restrictions shall apply only with respect to those persons or entities who are customers of any of the Atlas Companies within the twelve (12) months prior to the Employee’s termination of his employment           (d) In the event the Employee breaches any of his obligations under this Section 4.3, he shall within five (5) days return to the Company any payments he received under 4   Section 4.2(ii) and any benefits under Section, 4.2(iii) shall immediately cease. In the event of a dispute as to whether the Employee has breached any of his obligations under this Section 4.3, Employee shall return to the Company any payments received within five (5) days after determination of a breach and in accordance with Sections 5.1, 5.2, 5.3 or 5.5, as appropriate.      4.4 Obligation to Cooperate. To the extent Employee is reasonably available to provide such cooperation to Company, during the twenty-four (24) month period immediately following the termination of the Employee’s employment, the Employee shall cooperate with the Company with respect to all matters arising during or related to his employment, including but not limited to all matters in connection with any governmental investigation, litigation or regulatory or other proceeding which may have arisen or which may arise following the signing of this Agreement. The Company will reimburse the Employee out-of-pocket expenses incurred in complying with Company requests hereunder, provided such expenses are authorized by the Company in advance. In the event that any single Company request hereunder requires a commitment from the Employee of more than five (5) hours, the Company and the Employee shall mutually agree on reasonable compensation for the Employee’s services on such matter. 5. DISPUTE RESOLUTION AND CHOICE OF LAW      5.1. Negotiation. If a dispute between the parties arises under this Agreement, the parties shall negotiate in good faith in an attempt to resolve shall commence immediately, and shall continue for a period of at least thirty (30) days (“Negotiation”).      If Negotiation fails to resolve a dispute between the parties within the first thirty (30) days, either party may proceed to demand mediation (“Mediation”). Upon agreement of both parties, arbitration may be initiated immediately, in lieu of Mediation.      5.2. Mediation. If a dispute between the parties arises under this Agreement and has not been resolved under the Negotiation procedures described herein, either party may require, by written notice to the other party, that Negotiation be facilitated by a single mediator, to be elected by the parties (the “Mediator”).      The parties shall select the Mediator within ten (10) days after receipt of notice. If the parties are unable to agree on the Mediator, the Mediator shall be selected by Atlas, but the selected Mediator shall be independent of Atlas and its affiliates. The fees of the Mediator shall be paid by the Company.      With the assistance of the Mediator, the parties shall continue Negotiation in good faith for a period not to exceed thirty (30) days. If the parties are unable to reach agreement during this period, the Mediator shall be discharged and the parties’ obligations under this Mediation section shall be deemed satisfied.      5.3. Arbitration. Subject to the duty to negotiate and mediate set forth above, all disputes, claims, or causes of action arising out of or relating to this Agreement or the validity, interpretation, breach, violation, or termination thereof not resolved by Mediation, shall be finally and solely determined and settled by arbitration, to be conducted in the State of New 5   York, USA, in accordance with the Commercial Arbitration Rules of the American Arbitration Association (“AAA”) in effect at the date of arbitration (“Arbitration”).      Any Arbitration commenced pursuant to this Agreement shall be conducted by a single neutral arbitrator, who shall have a minimum of three (3) years of commercial experience (the “Arbitrator”). The parties shall meet within ten (10) days of failure to resolve by Mediation to attempt to agree on an Arbitrator. Absent agreement at this meeting, the Arbitrator shall be selected by AAA. Such Arbitrator shall be free of any conflicts with Atlas and shall hold a hearing within thirty (30) days of the notice to the Employee.      If the terms and conditions of this Agreement are inconsistent with the Commercial Arbitration Rules of the AAA, the terms and conditions of this Agreement shall control.      The parties hereby consent to any process, notice, or other application to said courts and any document in connection with Arbitration may be served by (i) certified mail, return receipt requested; (ii) by personal service; or (iii) in such other manner as may be permissible under the rules of the applicable court or Arbitration tribunal; provided, however, a reasonable time for appearance is allowed. The parties further agree that Arbitration proceedings must be instituted within one (1) year after the occurrence of any dispute, and failure to initiate Arbitration proceedings within such time period shall constitute an absolute bar to the institution of any proceeding and a waiver of all claims.      The parties shall equally divide all costs and expenses incurred in such arbitration proceeding, provided, however, if the arbitrator rules in favor of the Employee on all or substantially all of his claims, the Company shall reimburse the Employee his reasonable attorney fees and costs associated with the arbitration proceedings.      The Judgment of the Arbitrator shall be final and either party may submit such decision to courts for enforcement thereof.      The parties agree that this Section 5 shall be specifically enforceable.      5.4. Choice of Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without reference to      5.5 Injunctive Relief. Notwithstanding the foregoing, Sections 5.1, 5.2 and 5.3 shall not preclude the Company from attempting to pursue a court action to enforce, determine the enforceability of, or seek injunctive relief due to a breach or threatened breach of the provisions of Section 4.3 of this Agreement. 6. SEVERABILITY AND ENFORCEABILITY      It is expressly acknowledged and agreed that the covenants and provisions hereof are separable; that the enforceability of one covenant or provision shall in no event affect the full enforceability of any other covenant or provision herein. Further, it is agreed that, in the event any covenant or provision of this Agreement is found by any court of competent jurisdiction or Arbitrator to be unenforceable, illegal or invalid, such invalidity, illegality or unenforceability 6   shall not affect the validity or enforceability of any other covenant or provision of this Agreement. In the event a court of competent jurisdiction or an Arbitrator would otherwise hold any part hereof unenforceable by reason of its geographic or business scope or duration, said part shall be construed as if its geographic or business scope or duration had been more narrowly drafted so as not to be invalid or unenforceable. 7. NOTICE given if delivered personally, if delivered by overnight courier service, if sent by facsimile transmission or if mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the respective addresses or sent via facsimile to the respective facsimile numbers, as the case may be, as set forth below, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt; provided, however, that: (i) notices sent by personal delivery or overnight courier shall be deemed given when delivered; (ii) notices sent by facsimile transmission shall be deemed given upon the sender’s receipt of confirmation of complete transmission; and (iii) notices sent by United States registered mail shall be deemed given, two days after the date of deposit in the United States mail. Atlas Air, Inc. 2000 Westchester Avenue Purchase, NY 10577 Attn: General Counsel Facsimile: 1 914 701-8333 If to Employee: Ronald A. Lane The address on file with the records of the Company 8. MISCELLANEOUS      8.1. No Mitigation. The Employee shall have no duty to mitigate..      8.2. Withholding. The Company shall be entitled to withhold from the payments and benefits described herein all income taxes and other amounts required to be withheld by applicable law.      8.3. Pro-Ration. In the event the Employment Period is terminated in the middle of any calendar month, the amount due for such month shall be pro-rated on a daily basis, 7        8.4. No Waiver Except in Writing. The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive such party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement. No waiver or modification of this Agreement or any of the terms and conditions set forth herein shall be effective unless submitted to a writing duly executed by the parties.      8.5. Drafting. Both parties have participated in the preparation of this Agreement, and no rules of construction or interpretation based upon which party drafted any portion of the Agreement shall be applicable or invoked.      8.6. No Representations. The parties agree and acknowledge that they have not relied upon any representation, whether written or oral, of the other party in connection with entering into this Agreement.      8.7. Successors and Assigns. This Agreement shall be binding on Atlas and any successor thereto, whether by reason of merger, consolidation or otherwise. The duties and obligations of the Employee may not be assigned, by the Employee.      8.8. Confidentiality of Terms. Atlas and the Employee agree that the terms and conditions of this Agreement are confidential and that they will not disclose the terms of this Agreement to any third parties, other than the Employee’s spouse, their attorneys, auditors, accountants or as required by law or as may be necessary to enforce this Agreement.      8.9. Full Understanding. The Employee declares and represents that the Employee has carefully read and fully understands the terms of this Agreement, has had the opportunity to obtain advice and assistance of counsel with respect thereto, and knowingly and of the Employee’s own free will, without any duress, being fully informed and after due deliberation, voluntarily accepts the terms of this Agreement and represents that the execution, delivery and performance of this Agreement does not violate any agreement to which the Employee is subject.      8.10. Entire Agreement. This Agreement sets forth the entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes all prior agreements, arrangements, and understandings between the parties with respect to the subject matter hereof, excluding only any option of restricted share agreements or other agreements related to a grant of equity or an option to purchase equity in the Company.      8.11. Counterparts. This Agreement may be executed in any number of separate counterparts, all of which taken together shall be deemed to constitute 8        IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Employment Agreement on the date and year first above written.           RONALD A. LANE     /s/ Ronald A. Lane                             ATLAS AIR, INC.     By:   /s/ Willliam J. Flynn     Name:   WILLLIAM J. FLYNN   Title:   PRESIDENT & CEO    9

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2011 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-33540 (Exact name of registrant as specified in its charter) Wisconsin 39-1987014 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) N93 W14475 Whittaker Way, Menomonee Falls, WI53051 (Address of principal executive offices) (262) 253-9800 (Registrant’s telephone number) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.þ Yeso No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).o Yesþ No Indicate by check whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)Yeso No þ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.(Check one): Large accelerated filero Accelerated filero Non-accelerated filer o Smaller reporting company þ (Do not check if a smaller reporting company) Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. Class Shares Outstanding as of November 14, 2011 Common Stock, $.01 par value per share ZBB Energy Corporation Form 10-Q TABLE OF CONTENTS PART I. FINANCIAL INFORMATION (*) Page Item 1. Condensed Consolidated Financial Statements 1 Condensed Consolidated Balance Sheets (unaudited), September 30, 2011 and June 30, 2011 1 Condensed Consolidated Statements of Operations (unaudited), Three Months Ended September 30, 2011 and 2010 2 Condensed Consolidated Statements of Changes in Shareholders' Equity (unaudited), Three Months Ended September 30, 2011 and year ended June 30, 2011 3 Condensed Consolidated Statements of Cash Flows (unaudited), Three Months Ended September 30, 2011 and 2010 4 Notes to Condensed Consolidated Financial Statements (unaudited) 5 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 26 Item 3. Quantitative and Qualitative Disclosures About Market Risk 33 Item 4. Controls and Procedures 34 PART II. OTHER INFORMATION Item 1. Legal Proceedings 35 Item 1A. Risk Factors 35 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 36 Item 3. Defaults upon Senior Securities 36 Item 4. (Removed and Reserved) 36 Item 5. Other Information 36 Item 6. Exhibits 36 Signatures 37 (*) All of the financial statements contained in this Quarterly Report are unaudited with the exception of the financial information at June 30, 2011, which has been derived from our audited financial statements at that date and should be read in conjunction therewith. Our audited financial statements as of June 30, 2011 and for the year then ended, and the notes thereto, can be found in our Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission on September 8, 2011. ZBB ENERGY CORPORATION Condensed Consolidated Balance Sheets September 30, (Unaudited) June 30, Assets Current assets: Cash and cash equivalents $ $ Accounts receivable, net Inventories Prepaid and other current assets Refundable income tax credit Total current assets Long-term assets: Property, plant and equipment, net Intangible assets, net Goodwill Total assets $ $ Liabilities and Shareholders' Equity Current liabilities: Bank loans and notes payable $ $ Accounts payable Accrued expenses Deferred revenues Accrued compensation and benefits Total current liabilities Long-term liabilities: Bank loans and notes payable Total liabilities Shareholders' equity Series A preferred stock ($0.01 par value, $10,000 face value) 10,000,000 authorized, 500.1280 and 355.4678 issued, preference in liquidation of $5,251,390 and $3,715,470 as of September 30, 2011 and June 30, 2011, respectively Common stock ($0.01 par value); 150,000,000 authorized 32,533,574 and 29,912,415 shares issued Additional paid-in capital Notes receivable - common stock ) ) Treasury stock - 13,833 shares ) ) Accumulated other comprehensive loss ) ) Accumulated deficit ) ) Total shareholders' equity Total liabilities and shareholders' equity $ $ See accompanying notes to condensed consolidated financial statements 1 ZBB ENERGY CORPORATION Condensed Consolidated Statements of Operations (Unaudited) Three months ended September 30, Revenues Product sales $ $ - Engineering and development - Total Revenues - Costs and Expenses Cost of product sales - Cost of engineering and development - Advanced engineering and development Selling, general, and administrative Depreciation and amortization Total Costs and Expenses Loss from Operations ) ) Other Income (Expense) Interest income Interest expense ) ) Other income (expense) - Total Other Income (Expense) ) ) Loss before provision (benefit) for Income Taxes ) ) Provision (benefit) for Income Taxes ) - Net Loss $ ) $ ) Net Loss per share- Basic and diluted $ ) $ ) Weighted average shares-basic and diluted: Basic Diluted See accompanying notes to condensed consolidated financial statements. 2 ZBB Energy Corporation Condensed Consolidated Statements of Changes in Shareholders' Equity (Unaudited) Number of Shares Series A Preferred Stock Number of Shares Common Stock Additional Paid-in Capital Notes Receivable - Common Stock Treasury Stock Accumulated Other Comprehensive (Loss) Accumulated Deficit Total Shareholders' Equity Comprehensive Loss Balance: July 1, 2010 $ $ $ ) $ ) $ ) $ $ ) Issuance of common stock, net of costs and underwriting fees $ ) Issuance of commitment feeshares Issuance of common stock foracquisition of net assets of Tier Electronics Equity issuance costs ) ) Conversion of debenture notes payable to preferred stock $ Issuance of preferred stock, net of issuance costs Conversion of cash settled RSU's to stock settled RSU's Stock-based compensation Interest on notes receivable - common stock ) - Accretion of dividends on preferred stock ) - Issuance of warrants Net loss ) ) ) Net translation adjustment ) ) ) Balance: June 30, 2011 ) Issuance of preferred and common stock, net of issuance costs ) Stock-based compensation Interest on notes receivable - common stock ) - Accretion of dividends on preferred stock ) - Net loss ) ) ) Net translation adjustment ) ) ) Balance: September 30, 2011 $ ) $ ) $ ) $ ) $ $ ) See accompanying notes to condensed consolidated financial statements. 3 ZBB ENERGY CORPORATION Condensed Consolidated Statements of Cash Flows (Unaudited) Three months ended September 30, Cash flows from operating activities Net loss $ ) $ ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation of property, plant and equipment Amortization of intangible assets - Stock-based compensation Changes in assets and liabilities Accounts receivable ) Inventories ) ) Prepaids and other current assets Refundable income taxes ) - Accounts payable Accrued compensation and benefits ) ) Accrued expenses ) Deferred revenues Net cash used in operating activities ) ) Cash flows from investing activities Expenditures for property and equipment ) ) Net cash used in investing activities ) ) Cash flows from financing activities Proceeds from bank loans and notes payable - Repayments of bank loans and notes payable ) ) Proceeds from issuance of debenture notes payable - Proceeds from issuance of Series A preferred stock - Common stock issuance costs ) ) Net cash provided by financing activities Effect of exchange rate changes on cash and cash equivalents ) Net decrease in cash and cash equivalents ) ) Cash and cash equivalents - beginning of period Cash and cash equivalents - end of period $ $ Cash paid for interest $ $ Supplemental non-cash investing and financing activities: Issuance of common stock for discounted notes receivable $ $ Issuance of common stock as consideration for equity issuance costs - See accompanying notes to condensed consolidated financial statements. 4 ZBB ENERGY CORPORATION Notes to Condensed Consolidated Financial Statements (unaudited) September 30, 2011 NOTE1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business ZBB Energy Corporation (“ZBB” or the “Company”) develops and manufactures distributed energy storage solutions based upon the Company’s proprietary zinc bromide rechargeable electrical energy storage technology.A developer and manufacturer of modular, scalable and environmentally friendly power systems (“ZBB Enersystem™”), ZBB Energy was founded in 1998 and is headquartered in Wisconsin, USA with offices also located in Perth, Western Australia. As described in Note 2 in January 2011 the Company acquired substantially all of the net assets of Tier Electronics LLC. The Company provides advanced electrical power management platforms targeted at the growing global need for distributed renewable energy, energy efficiency, power quality, and grid modernization.The Company and its power electronics subsidiary, Tier Electronics LLC, have developed a portfolio of intelligent power management platforms that directly integrate multiple renewable and conventional onsite generation sources with rechargeable zinc bromide flow batteries and other storage technology. The Company also offers advanced systems to directly connect wind and solar equipment to the grid and systems that can form various levels of micro-grids.Tier Electronics participates in the energy efficiency markets through its hybrid vehicle control systems, and power quality markets with its line of regulation solutions. Together, these platforms solve a wide range of electrical system challenges in global markets for utility, governmental, commercial, industrial and residential end customers. The consolidated financial statements include the accounts of the Company and those of its wholly-owned subsidiaries, ZBB Technologies, Inc. and Tier Electronics LLC which operate manufacturing facilities in Menomonee Falls, Wisconsin, and ZBB Technologies, Ltd. which has its advanced engineering and development facility in Perth, Australia. Interim Financial Data The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting only of adjustments of a normal and recurring nature) considered necessary for fair presentation of the results of operations have been included. Operating results for the three month period ended September 30, 2011 are not necessarily indicative of the results that might be expected for the year ending June 30, 2012. The condensed consolidated balance sheet at June 30, 2011 has been derived from audited financial statements at that date, but does not include all of the information and disclosures required by GAAP. For a more complete discussion of accounting policies and certain other information, refer to the Company’s annual report filed on Form 10-K for the fiscal year ended June 30, 2011. Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in accordance with GAAP. All significant intercompany accounts and transactions have been eliminated upon consolidation. Cash and Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less to be cash equivalents.The Company maintains its cash deposits at financial institutions predominately in the United States and Australia.At times such balances may exceed insurable limits.The Company has not experienced any losses in such accounts. Accounts Receivable The Company records allowances for doubtful accounts based on customer-specific analysis and general matters such as current assessments of past due balances and economic conditions.The Company writes off accounts receivable against the allowance when they become uncollectible.Accounts receivable are stated net of an allowance for doubtful accounts of $80,000, as of September 30, 2011 and June 30, 2011. 5 Inventories Inventories are stated at the lower of cost (first-in, first-out method) or market and consist of raw materials, work in progress and finished goods held for resale. Costs incurred in bringing each product to its present location and conditions are accounted for as follows: ● Raw materials – purchased cost of direct material ● Finished goods and work-in-progress – purchased cost of direct material plus direct labor plus a proportion of manufacturing overheads. The Company evaluates the recoverability of its slow moving or obsolete inventories at least quarterly. The Company estimates the recoverable cost of such inventory by product type while considering factors such as its age, historic and current demand trends, the physical condition of the inventory as well as assumptions regarding future demand. The Company’s ability to recover its cost for slow moving or obsolete inventory can be affected by such factors as general market conditions, future customer demand and relationships with suppliers. Property, Plant and Equipment Land, building, equipment, computers and furniture and fixtures are recorded at cost.Maintenance, repairs and betterments are charged to expense. Depreciation is provided for all plant and equipment on a straight line basis over the estimated useful lives of the assets.The estimated useful lives used for each class of depreciable asset is: Estimated Useful Lives Manufacturing equipment 3 - 7 years Office equipment 3 - 7 years Building and improvements 7 - 40 years Intangible Assets Intangible assets generally result from business acquisitions.The Company accounted for the January 21, 2011 acquisition of Tier Electronics LLC by assigning the purchase price to identifiable tangible and intangible assets and liabilities.Assets acquired and liabilities assumed were recorded at their estimated fair values.Intangible assets consist of a non-compete agreement, license agreement, and trade secrets. Amortization is recorded for intangible assets with determinable lives. Intangible assets are amortized using the straight line method over the three year estimated useful lives of the respective assets. Goodwill Goodwill is recognized as the excess cost of an acquired entity over the net amount assigned to assets acquired and liabilities assumed. Goodwill is not amortized but reviewed for impairment annually as of June 30 each year or more frequently if events or changes in circumstances indicate that its carrying value may be impaired.These conditions could include a significant change in the business climate, legal factors, operating performance indicators, competition, or sale or disposition of a significant portion of a reporting unit.The Company has determined that it has two reporting units – ZBB Energy Storage and Power Electronics Systems and Tier Electronics Power Conversion Systems. Testing for the impairment of goodwill involves a two-step process. The first step of the impairment test requires the comparing of a reporting units fair value to its carrying value. If the carrying value is less than the fair value, no impairment exists and the second step is not performed. If the carrying value is higher than the fair value, there is an indication that impairment may exist and the second step must be performed to compute the amount of the impairment. In the second step, the impairment is computed by estimating the fair values of all recognized and unrecognized assets and liabilities of the reporting unit and comparing the implied fair value of reporting unit goodwill with the carrying amount of that unit’s goodwill.Based on this method, the Company determined fair value as evidenced by market capitalization, and concluded that there was no need for an impairment charge as of September 30, 2011 and June 30, 2011. 6 Impairment of Long-Lived Assets In accordance with FASB ASC topic 360, "Impairment or Disposal of Long-Lived Assets," the Company assesses potential impairments to its long-lived assets including property, plant and equipment and intangible assets when there is evidence that events or changes in circumstances indicate that the carrying value may not be recoverable. If such an indication exists, the recoverable amount of the asset is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed in the statement of operations. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate.Management has determined that there were $0 and $219,213 long-lived assets impaired as of September 30, 2011 and June 30, 2011, respectively (see Note 6). Warranty Obligations The Company typically warrants its products for twelve months after installation or eighteen months after date of shipment, whichever first occurs. Warranty obligations are evaluated quarterly to determine a reasonable estimate for the replacement of potentially defective materials of all energy storage systems that have been shipped to customers. While the Company actively engages in monitoring and improving its evolving battery and production technologies, there is only a limited product history and relatively short time frame available to test and evaluate the rate of product failure.Should actual product failure rates differ from the Company’s estimates, revisions are made to the estimated rate of product failures and resulting changes to the liability for warranty obligations.In addition, from time to time, specific warranty accruals may be made if unforeseen technical problems arise. During the year ended June 30, 2010, battery stack manufacturing issues were discovered as a result of an internal test failure.As a result, the Company has implemented several manufacturing process changes to eliminate the potential for future failures and has adjusted its warranty obligations accordingly.We will adjust our warranty rates in future periods as these processes are implemented and tested. As of September 30, 2011 and June 30, 2011, included in the Company’s accrued expenses were $413,203 and $413,203, respectively, related to warranty obligations.Such amounts are included in accrued expenses in the accompanying consolidated balance sheets. The following is a summary of accrued warranty activity: Three Months and Year Ended September 30, 2011 June 30, 2011 Beginning balance $ $ Accruals for warranties during the period - Settlements during the perioid ) ) Adjustments relating to preexisting warranties - Ending balance $ $ Revenue Recognition Revenues are recognized when persuasive evidence of a contractual arrangement exits, delivery has occurred or services have been rendered, the seller’s price to buyer is fixed and determinable, and collectability is reasonably assured. The portion of revenue related to installation and final acceptance, is deferred until such installation and final customer acceptance are completed. For sales arrangements containing multiple elements (products or services), revenue relating to undelivered elements is deferred at the estimated fair value until delivery of the deferred elements. To be considered a separate element, the product or service in question must represent a separate unit under SEC Staff Accounting Bulletin 104, and fulfill the following criteria: the delivered item(s) has value to the customer on a standalone basis; there is objective and reliable evidence of the fair value of the undelivered item(s); and, if the arrangement includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in our control. If the arrangement does not meet all criteria above, the entire amount of the transaction is deferred until all elements are delivered. Revenue from time and materials based service arrangements is recognized as the service is performed. 7 The portion of revenue related to engineering and development is recognized ratably upon delivery of the goods or services pertaining to the underlying contractual arrangement or revenue is recognized as certain activities are performed by the Company over the estimated performance period. The Company charges shipping and handling fees when products are shipped or delivered to a customer, and includes such amounts in net revenues. The Company reports its revenues net of estimated returns and allowances. Revenues from government funded research and development contracts are recognized proportionally as costs are incurred and compared to the estimated total research and development costs for each contract. In many cases, the Company is reimbursed only a portion of the costs incurred or to be incurred on the contract. Government funded research and development contracts are generally multi-year, cost-reimbursement and/or cost-share type contracts. The Company is reimbursed for reasonable and allocable costs up to the reimbursement limits set by the contract. Total revenues of $1,637,857 and $0 were recognized for the three months ended September 30, 2011 and 2010, respectively, and were comprised of one significant customer (85% of total revenues).The Company had two significant customers with outstanding accounts receivable balances of $1,200,000 and $179,377 (83% and 12% of accounts receivable, respectively) at September 30, 2011. Engineering and Development Revenues On April 8, 2011, the Company entered into a Collaboration Agreement (the “Collaboration Agreement”) with Honam Petrochemical Corporation (“Honam”), a division of LOTTE Petrochemical, pursuant to which the Company agreed with Honam to collaborate on the further technical development of the Company’s third generation Zinc Bromide flow battery module (the “Version 3 Battery Module”).Pursuant to the Collaboration Agreement, Honam is required to pay us a total of $3,000,000 dollars as follows:(1) $1,000,000 within 10 days following the execution of the Collaboration Agreement (subsequently received on April 9, 2011); (2) $500,000 by June 30, 2011 (subsequently received on June 30, 2011); (3) $1,200,000 by October 10, 2011 (subsequently received on October 10, 2011) and (4) $300,000 within 10 days after a single V3 Battery Module is set up at Honam’s research and development center.The Company has recognized $2,100,000 as revenue as of September 30, 2011based on performance milestones achieved and deferred the balance of the $1,000,000 payment which is being recognized as certain activities are performed by the Company over the estimated 15 month performance period.The unamortized balance of deferred revenue will be recognized over the estimated remaining performance period (9 months).Pursuant to the Collaboration Agreement, the parties are required to negotiate a license agreement under which upon the completion of the collaboration project and the receipt by the Company of all payments due under the Collaboration Agreement, the Company shall grant to Honam: (1) a fully paid-up, exclusive and royalty-free license to sell and manufacture the Version 3 Battery Module in Korea and (2) non-exclusive rights to sell the Version 3 Battery Module in Japan, Thailand, Taiwan, Malaysia, Vietnam and Singapore.In connection with such non-exclusive rights, Honam is required to pay a royalty to the Company. On June 29, 2007, ZBB Technologies Ltd (“ZBB Technologies”), an Australian subsidiary of the Company, and the Commonwealth of Australia (the “Commonwealth”) represented by and acting through the Department of Environment and Water Resources (the “Department”), entered into an agreement for project funding under the Advanced Electricity Storage Technologies (“AEST”) program (the “AEST agreement”) whereby the Department agreed to provide funding to ZBB Technologies for the development of an energy storage system to be used to demonstrate the storage and supply of renewable energy generated from photovoltaic solar panels and wind turbines already operational at the Commonwealth Scientific and Industrial Research Organization’s (“CSIRO”) Newcastle Energy Centre in New South Wales, Australia. The AEST agreement provided for a three year term under which the Commonwealth provided $2.6 million (A$3.1 million) in project funding over several periods, totaling $1.35 million in year one, $1.01 million in year two and $0.24 million in year three, as certain development progress “milestones” were met by ZBB Technologies to the satisfaction of the Commonwealth. The Company owns any assets, including battery storage systems, acquired with the funding from the contract.The Company grants the government of Australia a free, non-exclusive license to intellectual property created in the project for their own internal use. The AEST project had total budgeted expenditure for operating and capital items of approximately $4.7 million (A$5.9 million) exclusive of any Australian taxes. The Company’s contribution of approximately $2.3 million (A$2.8 million) was the value of any cash and in-kind contributions provided to the project by the Company in undertaking the project activities. The Australian Government provided the project funding of approximately $2.6 million (A$3.1 million) that was paid in accordance with the completion of contracted project milestones and subject to the Company’s compliance with project reporting requirements and demonstrating that the funds already provided to it had been fully spent or would be fully spent in the near future.Management of the Company believes it has fulfilled its required contributions to the project in cash and in-kind contributions as of December 31, 2010.As of December 31, 2010, the Company had received the full $2.6 million of payments due from the Commonwealth under the Agreement. 8 Included in engineering and development revenues and costs were $1,400,000 and $481,107, respectively, for the year three months ended September 30, 2011 related to the Collaboration Agreement.The financial statements for the year ended June 30, 2011 included engineering and development revenue and costs of $700,000 and $536,715, respectively related to the Collaboration Agreement. As of September 30, 2011 and June 30, 2011, the Company had no unbilled amounts from engineering and development contracts. The Company had $684,448 and $800,000 in customer payments from engineering and development contract revenue, representing deposits in advance of performance of the allowable work, as of September 30, 2011 and June 30, 2011, respectively. Advanced Engineering and Development Expenses The Company expenses advanced engineering and development costs as incurred. These costs consist primarily of labor, overhead, and materials to build prototype units, materials for testing, develop manufacturing processes and include consulting fees and other costs. To the extent these costs are separately identifiable, incurred and funded by advanced engineering and development type agreements with outside parties; they will be shown separately on the consolidated statements of operations as a “cost of engineering and development revenues.” Stock-Based Compensation The Company measures all “Share-Based Payments", including grants of stock options, restricted shares and restricted stock units, to be recognized in its consolidated statement of operations based on their fair values on the grant date, consistent with FASB ASC topic 718, “Stock Compensation,” guidelines. Accordingly, the Company measures share-based compensation cost for all share-based awards at the fair value on the grant date and recognition of share-based compensation over the service period for awards that are expected to vest. The fair value of stock options is determined based on the number of shares granted and the price of the shares at grant, and calculated based on the Black-Scholes valuation model. The Company compensates its outside directors primarily with restricted stock units (“RSUs”) rather than cash.The RSUs were classified as liability awards as of June 30, 2010 because the RSUs were to be paid in cash upon vesting. As of November 10, 2010, the June 30, 2010 RSUs were converted to stock based RSUs and were credited to additional paid-in capital. The grant date fair value of the restricted stock unit awards was determined using the closing stock price of the Company’s common stock on the day prior to the date of the grant, with the compensation expense amortized over the vesting period of restricted stock unit awards, net of estimated forfeitures. The Company only recognizes expense to its statements of operations for those options or shares that are expected ultimately to vest, using two attribution methods to record expense, the straight-line method for grants with only service-based vesting or the graded-vesting method, which considers each performance period, for all other awards. See Note 10. Income Taxes The Company records deferred income taxes in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 740, “Accounting for Income Taxes.” This ASC requires recognition of deferred income tax assets and liabilities for temporary differences between the tax basis of assets and liabilities and the amounts at which they are carried in the financial statements, based upon the enacted tax rates in effect for the year in which the differences are expected to reverse. The Company establishes a valuation allowance when necessary to reduce deferred income tax assets to the amount expected to be realized.There were no net deferred income tax assets recorded as of September 30, 2011 and June 30, 2011. The Company applies a more-likely-than-not recognition threshold for all tax uncertainties as required under ASC Topic 740, which only allows the recognition of those tax benefits that have a greater than fifty percent likelihood of being sustained upon examination by the taxing authorities. The Company’s management has reviewed the Company’s tax positions and determined there were no outstanding or retroactive tax positions with less than a 50% likelihood of being sustained upon examination by the taxing authorities as of September 30, 2011 and June 30, 2011. The Company’s U.S. Federal income tax returns for the years ended June 30, 2008 through June 30, 2011 and the Company’s Wisconsin and Australian income tax returns for the years ended June 30, 2007 through June 30, 2011 are subject to examination by taxing authorities. 9 Foreign Currency The Company uses the United States dollar as its functional and reporting currency, while the Australian dollar is the functional currency of its foreign subsidiary. Assets and liabilities of the Company’s foreign subsidiary are translated into United States dollars at exchange rates that are in effect at the balance sheet date while equity accounts are translated at historical exchange rates. Income and expense items are translated at average exchange rates which were applicable during the reporting period. Translation adjustments are accumulated in Accumulated Other Comprehensive Loss as a separate component of Shareholders’ Equity in the consolidated balance sheets. No gain or loss on translation is included in the net loss. Loss per Share The Company follows the FASB ASC topic 260, “Earnings per Share,” provisions which require the reporting of both basic and diluted earnings (loss) per share.Basic earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common sharesoutstanding for the period.Diluted earnings (net loss) per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. In accordance with the FASB ASC topic 260, any anti-dilutive effects on net income (loss) per share are excluded.For the three months ended September 30, 2011 and September 30, 2010 there were 7,031,696 and 4,104,823 of underlying options, restricted stock units and warrants that are excluded, respectively. Concentrations of Credit Risk and Fair Value Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company maintains significant cash deposits primarily with three or four financial institutions, which at times may exceed insured limits. The Company has not previously experienced any losses on such deposits. Additionally, the Company performs periodic evaluations of the relative credit rating of these institutions as part of its investment strategy. Concentrations of credit risk with respect to accounts receivable are limited due to accelerated payment terms in current customer contracts and creditworthiness of the current customer base. The carrying amounts of cash and cash equivalents, accounts receivable, other current assets, accounts payable and accrued expenses approximate fair value due to the short-term nature of these instruments. The carrying value of bank loans and notes payable approximate fair value based on their terms which reflect market conditions existing as of September 30, 2011 and June 30, 2011. Comprehensive income (loss) The Company reports its comprehensive income (loss) in accordance with the FASB ASCtopic 220 “Comprehensive Income”, which requires presentation of the components of comprehensive earnings. Comprehensive income (loss) consists of net income (loss) for the period plus or minus any net currency translation adjustments applicable for the three months ended September 30, 2011 and September 30, 2010 is presented as follows: Three months ended September 30, Net loss $ ) $ ) Net translation adjustment ) ) Comprehensive loss $ ) $ ) Reclassifications Certain amounts previously reported have been reclassified to conform to the current presentation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. It is reasonably possible that the estimates we have made may change in the near future. Significant estimates underlying the accompanying consolidated financial statements include those related to: 10 ● the timing of revenue recognition; ● the allowance for doubtful accounts; ● provisions for excess and obsolete inventory; ● the lives and recoverability of property, plant and equipment and other long-lived assets, including goodwill and other intangible assets; ● contract costs and reserves; ● warranty obligations; ● income tax valuation allowances; ● stock-based compensation; and ● fair values of assets acquired and liabilities assumed in a business combination. Recent Accounting Pronouncements In September2011, the FASB issued an update to ASC 350, Intangibles — Goodwill and Other. This ASU amends the guidance in ASC 350-20 on testing for goodwill impairment. The revised guidance allows entities testing for goodwill impairment to have the option of performing a qualitative assessment before calculating the fair value of the reporting unit. The ASU does not change how goodwill is calculated or assigned to reporting units, nor does it revise the requirement to test annually for impairment. The ASU is limited to goodwill and does not amend the annual requirement for testing other indefinite-lived intangible assets for impairment. The ASU is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December15, 2011. We will adopt this ASU for our 2012 goodwill impairment testing. We do not expect this ASU to have a material impact, if any, on our consolidated condensed financial statements. In June2011, the Financial Accounting Standards Board (FASB)issued new accounting guidance related to the presentation of comprehensive income that eliminates the current option to report other comprehensive income and its components in the statement of changes in equity. Under this guidance, an entity can elect to present items of net income and other comprehensive income in one continuous statement or two consecutive statements. This guidance is effective for us beginning July 1, 2012. We do not believe the adoption of this guidance will have a material effect on our consolidated financial statements and related disclosures. In May2011, the FASB issued updated accounting guidance related to fair value measurements and disclosures that result in common fair value measurements and disclosures between U.S. GAAP and International Financial Reporting Standards. This guidance includes amendments that clarify the application of existing fair value measurements and disclosures, in addition to other amendments that change principles or requirements for fair value measurements or disclosures. This guidance is effective for us beginning January1, 2012. We do not believe the adoption of this guidance will have a material effect on our consolidated financial statements and related disclosures. NOTE 2 – BUSINESS ACQUISITION On January 21, 2011 (“Closing Date”), the Company entered into an Asset Purchase Agreement under which the Company acquired substantially all of the net assets of Tier Electronics LLC (“Seller”) used in connection with the Seller’s business of developing, manufacturing, marketing and selling power electronics products for and to original equipment manufacturers in various industries.The purchase price was comprised of (1) a $1.35 million promissory note issued by the Company, (2) 800,000 shares of the Company’s common stock, and (3) payment of approximately $245,000 of the Seller’s obligations.The promissory note is in the principal amount of $1,350,000 and bears interest at eight percent.The principal balance of the note is payable in three equal installments of $450,000 on the first, second and third anniversaries of the Closing Date.Accrued interest is payable monthly.If the federal capital gains tax rate exceeds 15% and or the State of Wisconsin capital gains tax rate exceeds 5.425% at any time prior to the payment in full of the unpaid principal balance and accrued interest on the promissory note, then the principal amount of the promissory note (retroactive to January 21, 2011) shall be increased by an amount equal to the product of (a) the aggregate amount of federal and state capital gain realized by the Seller or Seller’s sole member, as applicable, in connection with the acquisition, multiplied by (b) the difference between (i) the combined federal and State of Wisconsin capital gains tax rate as of the date of calculation, minus (ii) the combined federal and State of Wisconsin capital gains tax rate of 20.425% as of January 21, 2011.Any adjustment to the principal amount of the promissory note shall be effected by increasing the amount of the last payment due under the promissory note without affecting the next regularly scheduled payment(s) under the promissory note.The following table reconciles the purchase price to the cash consideration paid: 11 Total purchase price $ Less debt and equity issued to Seller: Note payable ) Common stock ) Total debt and equity issued to Seller ) Total cash paid Less cash acquired ) Acquisition of business, net of cash acquired $ The primary reason for the acquisition was to add a base of business so that the Company now offers a full range of energy storage, utilization, and management solutions that range from wind and solar converters to power quality, micro-grid systems, and hybrid electric drives for vehicles. The Company accounted for the acquisition using the purchase method under U.S. GAAP.The purchase method requires that assets acquired and liabilities assumed in a business combination be recognized at fair value.A summary of the preliminary allocation of the assets acquired and the liabilities assumed in connection with the acquisition based on their estimated fair values is as follows: Cash and cash equivalents $ Accounts receivable Inventories Property and equipment Other intangible assets Accounts payable ) Accrued expenses ) Deferred revenue ) Net assets acquired $ The Company expects to finalize the purchase price allocation during the three month period ended December 31, 2011. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of the assets and liabilities has been determined by management, with the assistance of an independent valuation firm, and are based on significant inputs that are generally not observable in the market (level 3 measurements).Key assumptions that were used by management are as follows: Financial Assets and Liabilities Accounts receivable, accounts payable and accrued expenses, were valued at stated value, which approximates fair value. Inventories were valued at fair value based on estimated net realizable value less costs to complete and sales costs.Deferred revenues were valued at fair value based on the amounts that will be applied as customer credits to future shipments. Property and Equipment Property and equipment were valued based on the estimated market value of similar equipment. Other Intangible Assets The Company acquired certain identifiable intangible assets as part of the transaction which included:$300,000 in a non-compete agreement, $278,000 in a license agreement, and $1,543,097 in a trade secrets agreement.The fair values of these intangibles were estimated based upon an income approach methodology. Critical inputs into the valuation model for these intangibles include estimations of expected revenue and attrition rates, expected operating margins and capital requirements.The other intangible assets were assigned an estimated useful life of three years. Acquisition Related Expenses Included in the consolidated statement of operations for the period from January 21, 2011 (date of acquisition) to June 30, 2011 were transaction expenses aggregating approximately $150,000 for advisory and legal costs incurred in connection with the business acquisition. 12 Tier Electronics LLC operates as a wholly owned subsidiary of the Company.Tier Electronics LLC leases its facility from the former owner of the Seller under a lease agreement expiring December 31, 2014.The first year rental is $84,000 per annum and is subject to an annual CPI adjustment.The Company is required to pay real estate taxes and other occupancy costs related to the facility. In connection with this acquisition the Company awarded inducement options to purchase a total of 750,000 shares of the Company’s common stock at an exercise price of $1.15 to certain members of management of Tier Electronics, LLC.The options vest as follows: (1) 420,000 will vest in three equal annual installments beginning on December 31, 2011 based on achievement of certain revenue targets and (2) 330,000 vest in three equal annual installments beginning on January 21, 2012. Unaudited Pro Forma Information The following unaudited pro forma financial information summarizes the results of operations for the period indicated as if the acquisition had been completed as of July 1, 2010. These pro forma amounts do not purport to be indicative of the results that would have actually been obtained if the acquisition occurred as of July 1, 2010 or that may be obtained in the future. Three Months Ended September 30, 2010 Revenues $ Loss from Operations ) Net loss ) Net Loss per share- Basic and diluted $ ) Weighted average shares-basic and diluted: Basic Pro forma information primarily reflects adjustments relating to interest on the promissory note and the amortization of the intangible assets acquired in the acquisition. NOTE 3 – CHINA JOINT VENTURE On August 30, 2011, the Company entered into agreements providing for establishment of a joint venture to develop, produce, sell, distribute and service advanced storage batteries and power electronics in China (the “Joint Venture”).Joint venture partners include PowerSav, Inc., AnHui Xinlong Electrical Co. and Wuhu Huarui Power Transmission & Transformation Engineering Co.The Joint Venture will be established upon receipt of certain governmental approvals from China which are anticipated to be received in November 2011. The Joint Venture will operate through a jointly-owned Chinese company located in Wuhu City, Anhui Province named Anhui Meineng Store Energy Co., Ltd. (the “JV Company”).The JV Company intends to initially assemble and ultimately manufacture the Company’s products for sale in the power management industry on an exclusive basis in mainland China and on a non-exclusive basis in Hong Kong and Taiwan. In connection with the Joint Venture, on August 30, 2011 the Company and certain of its subsidiaries entered into the following agreements: ● Joint Venture Agreement of Anhui Meineng Store Energy Co., Ltd. (the “China JV Agreement”) by and between ZBB PowerSav Holdings Limited, a Hong Kong limited liability company (“Hong Kong Holdco”), and Anhui Xinrui Investment Co., Ltd, a Chinese limited liability company; and ●Limited Liability Company Agreement of ZBB PowerSav Holdings Limited by and between ZBB Cayman Corporation and PowerSav, Inc. (the “Holdco Agreement”). In connection with the Joint Venture, upon establishment of the JV Company, the Company and certain of its subsidiaries will enter into the following agreements: 13 ● Management Services Agreement by and between the JV Company and Hong Kong Holdco (the “Management Services Agreement”); ● License Agreement by and between Hong Kong Holdco and the JV Company (the “License Agreement”); and ● Research and Development Agreement by and between the Company and the JV Company (the “Research and Development Agreement”). Pursuant to the China JV Agreement, it is anticipated that the JV Company will be capitalized with approximately $13.4 million of equity capital.The Company’s only capital contributions to the Joint Venture will be a contribution of technology to the JV Company via the License Agreement valued at approximately $4.0 million.The Company’s indirect interest in the JV Company will equal approximately 33%. The Company’s investment in the JV Company will be made through Hong Kong Holdco, a holding company being formed with PowerSav and to which the Company is required to make a cash capital contribution of $200,000.The Company will own 60% of Hong Kong Holdco’s equity interests.The Company will have the right to appoint a majority of the members of the Board of Directors of Hong Kong Holdco and Hong Kong Holdco will have the right to appoint a majority of the members of the Board of Directors of the JV Company. Pursuant to the Management Services Agreement Hong Kong Holdco will provide certain management services to the JV Company in exchange for a management services fee equal to five percent of the JV Company’s net sales for the first five years and three percent of the JV Company’s net sales for the subsequent three years. Pursuant to the License Agreement, Hong Kong Holdco will grant to the JV Company (1) an exclusive royalty-free license to manufacture and distribute the Company’s ZBB Enerstore™, Zinc Bromide flow battery, version three (v3) battery (50KW) and ZBB Enersection™, POWR PECC (up to 250KW) (the “Products”) in mainland China in the power supply management industry and (2) a non-exclusive royalty-free license to manufacture and distribute the Products in Hong Kong and Taiwan in the power supply management industry. Pursuant to the Research and Development Agreement, the JV Company may request the Company to provide research and development services upon commercially reasonable terms and conditions.The JV Company would pay the Company’s fully-loaded costs and expense incurred in providing such services. NOTE 4 - GOING CONCERN The consolidated financial statements as of September 30, 2011 and for the three months then ended have been prepared on the basis of a going concern which contemplates that the Company will be able to realize assets and discharge liabilities in the normal course of business. Accordingly, they do not give effect to adjustments that would be necessary should the Company be required to liquidate its assets. The Company incurred a net loss of $1,675,488 for the three months ended September 30, 2011 and as of September 30, 2011 has an accumulated deficit of $57,019,131 and shareholders’ equity of $4,140,720.The ability of the Company to meet its total liabilities of $9,041,570 and to continue as a going concern is dependent upon the availability of future funding and achieving profitability.The accompanying financial statements do not include any adjustments that might result from the outcome of these uncertainties. The Company believes, with the financing sources in place and with other potential financing sources, that it will be able to raise the capital necessary to fund operations through at least June 30, 2012.The Company’s sources of additional capital in the year ending June 30, 2012 include the raising of additional capital pursuant to an agreement with Socius CG II, Ltd. (“Socius”), as described in Note 12. As of September 30, 2011, there was approximately $5.1 million of availability under this facility.However, this facility places certain restrictions on our ability to draw on it.For example, our ability to submit a tranche notice under the Socius Agreement is subject to certain conditions including that: (1) a registration statement covering our sale of shares of common stock to Socius in connection with the tranche is effective and (2) the issuance of such shares would not result in Socius and its affiliates beneficially owning more than 9.99% of our common stock.These limitations have been carefully considered by the Company and notwithstanding such limitations management has successfully utilized this facility and believes it will continue to be able to do so.As described in Note 12, during the three months ended September 30, 2011, the Company delivered two tranche notices to Socius pursuant to which Socius purchased $1,477,240 of Series A preferred stock.However, there can be no assurances that unforeseen circumstances will not jeopardize the Company’s ability to draw on this and other potential financing sources. Accordingly, the Company is currently exploring various alternatives including debt and equity financing vehicles, strategic partnerships, and/or government programs that may be available to the Company, as well as trying to generate additional sales and increase margins.As described in Note 1, in April 2011, the Company entered into a Collaboration Agreement with Honam Petrochemical Corporation (“Honam”), a division of LOTTE Petrochemical, pursuant to which through September 30, 2011 Honam paid the Company a total of $1.5 million.Pursuant to the Collaboration Agreement Honam is required to pay an additional (1) $1.2 million by October 10, 2011 (subsequently received on October 10, 2011) and (2) $300,000 within 10 days after a V3 single stack is set up at Honam’s research and development center. 14 As described in Note 12, in the year ended June 30, 2011 the Company raised approximately $5.5 million through the sale of shares of Company common stock to certain investors.However, the Company has no commitments to obtain any additional funds, and there can be no assurance such funds will be available on acceptable terms or at all.If the Company is unable to obtain additional funding and improve its operations, the Company’s financial condition and results of operations may be materially adversely affected and the Company may not be able to continue operations. NOTE 5 - INVENTORIES Inventories are comprised of the following as of September 30, 2011 and June 30, 2011: September 30, 2011 June 30, 2011 Raw materials $ $ Work in progress Total $ $ NOTE 6– PROPERTY, PLANT & EQUIPMENT Property, plant, and equipment are comprised of the following as of September 30, 2011 and June 30, 2011: September 30, 2011 June 30, 2011 Land $ $ Building and improvements Manufacturing equipment Office equipment Construction in process Total, at cost Less, accumulated depreciation ) ) Property, Plant & Equipment, Net $ $ During the year ended June 30, 2011, manufacturing equipment previously used in production and development activities were identified as impaired or had reached the end of their respective useful lives due to changing product and manufacturing technologies.Upon write-down the manufacturing equipment and accumulated depreciation accounts were adjusted accordingly and $219,213 was charged to operations during the years ended June 30, 2011.The adjustments were reported as impairment and other equipment charges.For the three months ended September 30, 2011 the Company has not identified any equipment as impaired or having reached the end of its respective life. NOTE 7– INTANGIBLE ASSETS Intangible assets are comprised of the following as of September 30, 2011 and June 30, 2011: September 30, 2011 June 30, 2011 Non-compete agreement $ $ License agreement Trade secrets Total, at cost Less, accumulated amortization ) ) Intangible Assets, Net $ $ 15 Estimated amortization expense for fiscal periods subsequent to September 30, 2011 are as follows: $ $ NOTE 8 – GOODWILL The Company acquired ZBB Technologies, Inc., a wholly-owned subsidiary, through a series of transactions in March 1996.The goodwill amount of $1.134 million, the difference between the price paid for ZBB Technologies, Inc. and the net assets of the acquisition, amortized through fiscal 2002, resulted in the net goodwill amount of $803,079 as of September 30, 2011 and June 30, 2011. The Company accounts for goodwill in accordance with FASB ASC topic 350-20, “Intangibles - Goodwill and Other - Goodwill” under which goodwill and other intangible assets deemed to have indefinite lives are not amortized but are subject to annual impairment tests. The implied fair value of goodwill is the amount determined by deducting the estimated fair value of all tangible and identifiable intangible net assets of the reporting unit to which goodwill has been allocated from the estimated fair value of the reporting unit. If the recorded value of goodwill exceeds its implied value, an impairment charge is recorded for the excess. NOTE 9 – BANK LOANS AND NOTES PAYABLE The Company's debt consisted of the following as of September 30, 2011 and June 30, 2011: September 30, 2011 June 30, 2011 Bank loans and notes payable-current $ $ Bank loans and notes payable-long term Total $ $ On January 21, 2011 the Company entered into a promissory note for $1,350,000 with TE Holdings Group, LLC in connection with the acquisition of the net assets of Tier Electronics LLC.The promissory note is in the principal amount of $1,350,000 and bears interest at eight percent.The principal balance of the note is payable in three equal installments of $450,000 on the first, second and third anniversaries of the promissory note.Accrued interest is payable monthly. If the federal capital gains tax rate exceeds 15% and or the State of Wisconsin capital gains tax rate exceeds 5.425% at any time prior to the payment in full of the unpaid principal balance and accrued interest on the promissory note, then the principal amount of the promissory note (retroactive to January 21, 2011) shall be increased by an amount equal to the product of (a) the aggregate amount of federal and state capital gain realized by the Seller or Seller’s sole member, as applicable, in connection with the acquisition, multiplied by (b) the difference between (i) the combined federal and State of Wisconsin capital gains tax rate as of the date of calculation, minus (ii) the combined federal and State of Wisconsin capital gains tax rate of 20.425% as of January 21, 2011.Any adjustment to the principal amount of the promissory note shall be effected by increasing the amount of the last payment due under the promissory note without affecting the next regularly scheduled payment(s) under the promissory note The outstanding principal balance was $1,350,000 at September 30, 2011 and June 30, 2011. On April 7, 2010 the Company entered into a loan agreement for $1,300,000 with the Wisconsin Department of Commerce.Payments of principal and interest under this loan are deferred until May 31, 2012.The interest rate is 2%.Payments of $22,800 per month are required starting June 1, 2012 with a final payment due on May 1, 2017.Borrowings were not received until July 2010.The loan is collateralized by the equipment purchased with the loan proceeds and substantially all assets of the Company not otherwise collateralized.The Company is required to maintain and increase a specified number of employees, and the interest rate is increased in certain cases for failure to meet this requirement.The outstanding principal balance was $1,300,000 at September 30, 2011 and June 30, 2011 respectively. On July 1, 2009 the Company entered into a loan agreement to finance new production equipment.The $156,000 bank note was collateralized by specific equipment, interest at 5.99%.The note with a balance of $107,155 as of June 30, 2010 was paid off during June 2011. On May 14, 2008 the Company entered into two loan agreements to refinance its building and land in Menomonee Falls, Wisconsin: The first loan requires a fixed monthly payment of principal and interest at a rate of .25% below the prime rate, subject to a floor of 5% as of June 30, 2011 and 2010 with any principal balance due at maturity on June 1, 2018 and collateralized by the building and land.The outstanding principal balance was $752,645 and $763,338 at September 30, 2011 and June 30, 2011, respectively. 16 The second loan is a secured promissory note guaranteed by the U.S. Small Business Administration, requiring monthly payments of principal and interest at a rate of 5.5% until May 1, 2028.The outstanding principal balance was $786,951and $794,074 at September 30, 2011 and June 30, 2011, respectively.The loan is collateralized by a mortgage on the building and land. On November 28, 2008 the Company entered into a loan agreement with a bank.The note is collateralized by specific equipment, requiring monthly payments of $21,000 of principal and interest; rate equal to the prime rate subject to a floor of 4.25%; maturity date of July 1, 2012. The outstanding principal balance was $451,045and $508,733 at September 30, 2011 and June 30, 2011, respectively. An equipment loan with a balance of $48,900 as of June 30, 2010 was paid in full in November 2010. Maximum aggregate annual principal payments for periods subsequent to September 30, 2011 are as follows: $ 2017 and thereafter $ The loan agreements with the bank require the Company to meet certain operating ratios.The Company was not in compliance with such covenants as of September 30, 2011, for which a waiver was obtained from the bank on June 27, 2011 which waived the covenants through June 29, 2012. NOTE 10 – EMPLOYEE/DIRECTOR EQUITY INCENTIVE PLANS During the three months ended September 30, 2011 and 2010, the Company’s results of operations include compensation expense for stock options granted and restricted shares vested under its equity incentive plans. The amount recognized in the financial statements related to stock-based compensation was $300,228 and $103,598, based on the amortized grant date fair value of options during the three months ended September 30, 2011 and 2010, respectively. At the annual meeting of shareholders held on November 10, 2010, the Company’s shareholders approved the Company’s 2010 Omnibus Long-Term Incentive Plan (the “Omnibus Plan”). The Omnibus Plan authorizes the board of directors or a committee thereof, to grant the following types of equity awards under the Omnibus Plan:Incentive Stock Options (“ISOs”), Non-qualified Stock Options (“NSOs”), Stock Appreciation Rights (“SARs”), Restricted Stock, Restricted Stock Units (“RSUs”), cash- or stock-based Performance awards (as defined in the Omnibus Plan) and other stock-based awards. Four million shares of common stock are reserved for issuance under the Omnibus Plan.In connection with the adoption of the Omnibus Plan the Company’s Board of Directors froze the Company’s other stock option plans and no further grants may be made under those plans. On November 10, 2010, (1) a total of 511,143 RSUs were granted to the Company’s directors in payment of directors fees through November 2011 pursuant to the Company’s Director Compensation Policy, (2) a total of 574,242 RSUs previously issued to the Company’s directors pursuant to this policy and which provided for cash settlement were converted to stock settled RSUs, and (3) 315,000 RSUs were granted in total to a consultant and to the Company’s President and CEO. During the three months ended September 30, 2011 options to purchase 543,000 shares were granted to employees exercisable at prices from $0.59 to $1.16 and exercisable at various dates through September 2019.As of September 30, 2011, an additional 1,650,615 shares are available to be issued under the Omnibus Plan. On January 21, 2011, the Compensation Committee of the Company’s Board of Directors awarded inducement options to purchase a total of 750,000 shares of the Company’s common stock at an exercise price of $1.15 to certain members of management of Tier Electronics LLC.The options vest as follows: (1) 420,000 will vest in three equal annual installments beginning on December 31, 2011 based on achievement of certain revenue targets, (2) 330,000 vest in three equal annual installments beginning on the one-year anniversary of the grant date. During March 2011, the expiration date of 75,000 options held by a former director of the Company was extended from March 31, 2011 to April 30, 2011, and the expiration date of 125,000 options was extended from March 31, 2011 to December 31, 2011.The Company recorded an expense of $45,676 in connection with these extensions. 17 During 2007 the Company established the 2007 Equity Incentive Plan (the “2007 Plan”) that authorized the Board of Directors or a committee thereof to grant options to purchase up to a maximum of 1,500,000 shares to employees and directors of the Company.No options were issued under the 2007 Plan during the 3 months ended September 30, 2011.During the year ended June 30, 2011, 74,500 options were granted to employees at exercise prices from $0.46 to $0.64 and expiration dates from August 2018 to October 2018 and 150,189 options were forfeited.As of September 30, 2011, there were no options available to be issued under the 2007 Plan. During 2005, the Company established an Employee Stock Option Scheme (the “2005 Plan”) that authorized the board of directors or a committee thereof to grant options to employees and directors of the Company. The maximum number of options available to be granted in aggregate at any time under the 2005 Plan was the number equivalent to 5% of the total number of issued shares of the Company including all shares in underlying options under the Company’s stock option and incentive plans. No options were issued under the 2005 Plan during the three months ended September 30, 2011 and 2010.At September 30, 2011, options to purchase 50,000 shares with an exercise price of $3.82 and an expiration date of June 20, 2012 were outstanding.As of September 30, 2011, there were no options available to be issued under the 2005 Plan. In 2002 the Company established the 2002 Stock Option Plan (the “SOP”) whereby a stock option committee was given the discretion to grant up to 579,107 options to purchase shares to key employees of the Company.No options were issued under the 2005 Plan during the three months ended September 30, 2011 and 2010.During the year ended June 30, 2011 there were 100,000 options forfeited.At September 30, 2011 there were 375,000 options outstanding with exercise prices from $0.49 to $3.59 and exercise dates up to June 2018.As of September 30, 2011, there were no options available to be issued under the SOP. The Compensation Committee of the Company’s Board of Directors awarded two inducement option grants covering a total of 500,000 shares to the Company’s new President and CEO in January 2010.The first grant is an option to purchase 400,000 shares of common stock with the following vesting terms: one third of the shares vested on January 7, 2011 and the balance vest in 24 monthly installments beginning on January 31, 2011 and ending on December 31, 2012.The second grant is an option to purchase 100,000 shares of common stock whichvested in two equal installments on June 30, 2010 and December 31, 2010, respectively, based on the satisfaction of certain performance targets for the six-month periods then ended.Both options have an exercise price of $1.33 per share which was equal to the closing price of the Company’s common stock on January 7, 2010 and are not exercisable as to any portion of the option after the fifth anniversary of the date on which that portion vests.The options are subject to other terms and conditions specified in the related option agreements. In aggregate for all plans, at September 30, 2011, the Company has a total of 3,865,303 options outstanding, 1,400,385 RSUs outstanding, and 1,650,615 shares available for future grant under the Omnibus Plan. Information with respect to stock option activity under the employee and director plans is as follows: Number of Options Weighted-Average Exercise Price Per Share Balance at July 1, 2010 $ Options granted Options forfeited ) Options exercised ) Balance at June 30, 2011 Options granted Balance at September 30, 2011 $ 18 The following table summarizes information relating to the stock options outstanding at September 30, 2011: Outstanding Exercisable Range of Exercise Prices Number of Options Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number of Options Weighted Average Exercise Price $0.49 to $1.69 $3.59 to $3.82 Balance at September 30, 2011 During the three months ended September 30, 2011 options to purchase 543,000 shares were granted to employeesexercisable at prices from $0.59 to $1.16 per share based on various service and performance based vesting terms from July 2011 through September 2014 and exercisable at various dates through September 2019. During the three months ended September 30, 2010 options to purchase 60,000 shares were granted to employees exercisable at prices from $0.60 to $0.64 per share based on various service and performance based vesting terms from August 2010 through August 2013 and exercisable at various dates through August 2018. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing method. The Company uses historical data to estimate the expected price volatility, the expected option life and the expected forfeiture rate. The Company has not made any dividend payments nor does it have plans to pay dividends in the foreseeable future. The following assumptions were used to estimate the fair value of options granted during the three months ended September 30, 2011 using the Black-Scholes option-pricing model: Expected life of option (years) .001 - 2.5 Risk-free interest rate .24 - .55 .24 - 1.34% Assumed volatility 106 - 107% 53 - 153% Expected dividend rate 0 0 Expected forfeiture rate 6.3 - 6.8% 0 - 7.760% Time-vested and performance-based stock awards, including stock options, restricted stock and restricted stock units, are accounted for at fair value at date of grant.Compensation expense is recognized over the requisite service and performance periods. A summary of the status of unvested employee stock options as of September 30, 2011 and June 30, 2011 and changes during the year ended, is presented below: Numberof Options Weighted-Average GrantDate FairValuePer Share Balance at July 1, 2010 $ Granted Vested ) Forfeited ) Balance at June 30, 2011 Granted Vested ) Balance at September 30, 2011 $ Total fair value of options granted in the three months ended September 30, 2011 and 2010 was $292,759 and $22,305, respectively.At September 30, 2011 there was $673,816 in unrecognized compensation cost related to unvested stock options, which is expected to be recognized over the next 3 years. 19 During the fourth quarter of fiscal 2010 the Company agreed to compensate its directors with restricted stock units (“RSUs”) rather than cash.As a result included in accrued compensation and benefits at June 30, 2010 was $182,500 related to these awards. The RSUs were classified as liability awards because the RSUs were expected to be paid in cash upon vesting. These RSUs were converted to 574,242 stock settled RSUs in November 2010 and $182,500 was transferred from accrued compensation and benefits to additional paid-in capital.The cash settled RSUs that were converted to stock settled RSUs were 100% vested upon conversion.There were also $89,450 in directors’ fees expense and $7,000 in consulting fees expense settled with RSUs for the three months ended September 30, 2011.As of September 30, 2011 there were 275,000 unvested RSUs outstanding which will vest through May 6, 2014.At September 30, 2011 there was $278,500 in unrecognized compensation cost related to unvested RSUs, which is expected to be recognized through May 6, 2014.Vested RSUs are payable six months after the holder’s separation from service with the Company. The table below summarizes the status of restricted stock unit balances: Number of Restricted Stock Units Weighted-Average Valuation Price Per Unit Conversion of cash settled RSUs $ RSUs granted RSUs forfeited - - Balance at June 30, 2011 RSUs granted - - RSUs forfeited - - Balance at September 30, 2011 $ NOTE 11 - NON RELATED PARTY WARRANTS At September 30, 2011 there were outstanding warrants to purchase 40,000 common shares issued by the Company to an equipment supplier in November 2010 exercisable at $0.56 per share and which expire in January 2014.The fair value of the warrants was $11,834 and is included in the cost of the equipment. At September 30, 2011 there were outstanding warrants to purchase 1,121,875 common shares acquired by certain purchasers of Company shares in March 2010 exercisable at $1.04 per share and which expire in September 2015. At September 30, 2011 there were outstanding warrants to purchase 358,333 common shares acquired by certain purchasers of Company shares in August 2009 exercisable at $1.33 per share and which expire in August 2015. At September 30, 2011 there were outstanding warrants to purchase 50,000 shares acquired by Empire Financial Group, Ltd. as part of the underwriting compensation in connection with our United States public offering which are exercisable at $7.20 per share and which expire in September 2012. At September 30, 2011 there are warrants to purchase 195,800 shares issued and outstanding to Strategic Growth International in connection with capital raising activities in 2006 and 2007, with expiration dates between September 2011 and September 2012 and with exercise prices of between $3.75 and $7.20. Warrants to purchase 120,023 common shares acquired by Empire Financial Group, Ltd. in 2006 exercisable at $3.23 per share expired during September 2011. 20 The table below summarizes non-related party warrant balances: Number of Warrants Weighted-Average Exercise Price Per Share Balance at July 1, 2010 $ Warrants granted Warrants expired - - Warrants exercised ) ) Balance at June 30, 2011 Warrants granted (See Note 12) Warrants expired ) Warrants exercised (See Note 12) ) ) Balance at September 30, 2011 $ NOTE 12 – SHAREHOLDERS’ EQUITY On August 30, 2010, the Company entered into an amended and restated securities purchase agreement (“Socius Agreement”) with Socius CG II, Ltd. (“Socius”). Pursuant to the Socius Agreement the Company has the right over a term of two years, subject to certain conditions, to require Socius to purchase up to $10 million of redeemable subordinated debentures and/or shares of redeemable Series A preferred stock in one or more tranches.The debentures bear interest at an annual rate of 10% and the shares of Series A preferred stock accumulate dividends at the same rate.Both the debentures and the shares of Series A preferred stock are redeemable at the Company’s election at any time after the one year anniversary of issuance.Neither the debentures nor the Series A preferred shares are convertible into common stock. On November 10, 2010, the Company’s Board of Directors approved a certificate of designation of preferences, rights and limitations to authorize shares of Series A preferred stock in accordance with the terms of the Socius Agreement.Upon the authorization of Series A preferred stock and in accordance with the terms of the Socius Agreement, the $517,168 of outstanding debentures issued by the Company to Socius CG II, Ltd. on September 2, 2010, and $7,510 of accrued interest were exchanged into 52.468 shares of Series A preferred stock.In addition, in accordance with the Socius Agreement, any future tranches under the Socius Agreement will involve shares of Series A preferred stock instead of debentures. Under the Socius Agreement, in connection with each tranche Socius is obligated to purchase that number of shares of our common stock equal in value to 135% of the amount of the tranche at a per share price equal to the closing bid price of the common stock on the trading day preceding our delivery of the tranche notice.Socius may pay for the shares it purchases at its option, in cash or a collateralized promissory note.Any such promissory note will bear interest at 2.0% per year and is collateralized by securities owned by Socius with a fair market value equal to the principal amount of the promissory note. The entire principal balance and interest on the promissory note is due and payable on the later of the fourth anniversary of the date of the promissory note or when we have redeemed all the Series A preferred stock issued by us to Socius under the Socius Agreement, and may be applied by us toward the redemption of the shares of Series A preferred stock held by Socius. Our ability to submit a tranche notice is subject to certain conditions including that: (1) a registration statement covering our sale of shares of common stock to Socius in connection with the tranche is effective and (2) the issuance of such shares would not result in Socius and its affiliates beneficially owning more than 9.99% of our common stock. Under the terms of the Socius Agreement, the Company was obligated to pay Socius a commitment fee in the form of shares of common stock or cash, at the option of the Company, in the amount of $500,000 if it is paid in cash and $588,235 if it is paid in shares of common stock. Payment of the commitment fee occurred 50% at the closing of the first tranche and 50% at the closing of the second tranche. On September 2, 2010 the Company delivered the first tranche notice under the Socius Agreement pursuant to which on September 20, 2010 Socius purchased $517,168 of debentures.In connection with this tranche, (1) Socius purchased 1,163,629 shares of common stock for a total purchase price of $698,177 and at a per share purchase price of $0.60 and (2) the Company issued to Socius 490,196 shares of common stock in payment of the commitment fee payable in connection with the tranche. As consideration for the common stock it purchased, Socius issued a collateralized promissory note maturing, the later of September 2, 2014 or when the Series A preferred shares are redeemed by the Company.Management expects to redeem the Series A preferred stock on September 20, 2014.The promissory note was recorded at a discount of $183,922 determined by discounting the promissory note at a rate of 10%.The promissory note is included in the stockholders equity section of the Company’s condensed consolidated balance sheets because the promissory note was received in exchange for the issuance of common stock. 21 On November 12, 2010 the Company delivered the second tranche notice under the Socius Agreement pursuant to which on November 29, 2010 Socius purchased $490,000 of Series A preferred stock.In connection with this tranche, (1) Socius purchased 906,165 shares of common stock for a total purchase price of $661,500 and at a per share purchase price of $0.73 and (2) the Company issued to Socius 402,901 shares of common stock in payment of the commitment fee payable in connection with the tranche. As consideration for the common stock it purchased, Socius issued a collateralized promissory note maturing, the later of November 15, 2014 or when the Series A preferred shares are redeemed by the Company.Management expects to redeem the Preferred Shares on November 29, 2014.The promissory note was recorded at a discount of $173,872 determined by discounting the promissory note at a rate of 10%.The promissory note is included in the stockholders equity section of the Company’s condensed consolidated balance sheets because the promissory note was received in exchange for the issuance of common stock. On January 12, 2011 the Company delivered the third tranche notice under the Socius Agreement pursuant to which on January 27, 2011 Socius purchased from the Company $2,020,000 of Series A preferred stock.In connection with the tranche, (1) Socius purchased 1,934,042 shares of common stock for a total purchase price of $2,727,000 and at a per share purchase price of $1.41. As consideration for the Common Stock Socius purchased, Socius issued a collateralized promissory note maturing, the later of January 14, 2015 or when the Series A preferred shares are redeemed by the Company.Management expects to redeem the Preferred Shares on January 27, 2015. The promissory note was recorded at a discount of $716,777 determined by discounting the promissory note at a rate of 10%.The promissory note is included in the stockholders equity section of the Company’s condensed consolidated balance sheets because the promissory note was received in exchange for the issuance of common stock. On March 16, 2011 the Company delivered the fourth tranche notice under the Socius Agreement pursuant to which on March 31, 2011 Socius purchased from the Company $520,000 of Series A preferred stock.In connection with the tranche, (1) Socius purchased 557,142 shares of common stock for a total purchase price of $702,000 and at a per share purchase price of $1.26. As consideration for the Common Stock Socius purchased, Socius issued a collateralized promissory note maturing, the later of March 16, 2015 or when the Series A preferred shares are redeemed by the Company.Management expects to redeem the Preferred Shares on March 31, 2015. The promissory note was recorded at a discount of $184,461determined by discounting the promissory note at a rate of 10%.The promissory note is included in the stockholders equity section of the Company’s condensed consolidated balance sheets because the promissory note was received in exchange for the issuance of common stock. On September 8, 2011 the Company delivered the fifth and sixth tranche notices under the Socius Agreement pursuant to which on September30, 2011 Socius purchased from the Company $1,447,240 of Series A preferred stock.In connection with the tranches, Socius purchased 2,621,359 shares of common stock for a total purchase price of $1,953,775 and at an average per share purchase price of $0.75. As consideration for the Common Stock Socius purchased, Socius issued a collateralized promissory notes maturing, the later of September 8, 2015 or when the Series A preferred shares are redeemed by the Company.Management expects to redeem the Preferred Shares on September 30, 2015. The promissory notes were recorded at a discount of $512,815 determined by discounting the promissory notes at a rate of 10%.The promissory notes are included in the stockholders equity section of the Company’s condensed consolidated balance sheets because the promissory notes were received in exchange for the issuance of common stock. The Company’s accounting for the 2% notes receivable – common stock is to accrue interest on the discounted notes receivable at 10% as a credit to additional paid in capital.The Company’s accounting for the Series A preferred stock is to accrete dividends at 10% as a charge to additional paid in capital. In the event of liquidation, dissolution or winding up (whether voluntary or involuntary) of the Company, the holders of shares of Series A preferred stock shall be entitled to be paid the full amount payable on such shares upon the liquidation, dissolution or winding up of the corporation fixed by the Board of Directors with respect to such shares, if any, before any amount shall be paid to the holders of the Common Stock.The liquidation preference of the outstanding Series A preferred stock was $5,251,390 and $3,715,470 as of September 30, 2011 and June 30, 2011, respectively.Redemption or liquidation may be paid by application of the Socius notes receivable. On June 14 and 15, 2011 we entered into Stock Purchase Agreements with certain investors providing for the issuance of a total of 3,049,463 shares of the Company’s common stock for an aggregate purchase price of $2,527,000 at a weighted average price per share of $0.83.The closing took place on June 17, 2011.The net proceeds to the Company, after deducting $153,000 of offering costs, were $2,374,000. On December 29, 2010 and January 3, 2011 the Company entered into Stock Purchase Agreements with certain investors providing for the issuance of a total of 2,103,532 shares of the Company’s common stock for an aggregate purchase price of $2,000,000 at a weighted average price per share of $0.95.The closing took place on January 12, 2011.The net proceeds to the Company, after deducting $57,000 of offering costs, were $1,943,000. 22 On October 12, 2010, the Company entered into Stock Purchase Agreements with certain investors providing for the sale of a total of 3,329,467 shares of the Company’s common stock for an aggregate purchase price of $1,435,000 at a price per share of $0.431.The closing took place on October 15, 2010.The net proceeds to the Company after deducting $60,000 of offering costs, were $1,375,000. NOTE 13 – COMMITMENTS Leasing Activities The Company leases its Australian research and development facility from a non-related Australian company under the terms of a lease that expired October 31, 2011.The rental rate was $75,596 per annum (A$72,431) and is subject to an annual CPI adjustment. Rent expense was $20,193 and $20,592 for the three months ended September 30, 2011 and September 30, 2010, respectively.The Company renewed the lease on its Australian research and development facility through October 31, 2016 at rental rate of $95,855 per annum (A$95,000) subject to an annual CPI adjustment.The Company also leases a building from an officer of its subsidiary, Tier Electronics LLC, who is also a shareholder and director, under a lease agreement expiring December 31, 2014.The first year rental is $84,000 per annum and is subject to an annual CPI adjustment.The rent expense for the three months ended September 30, 2011 was $21,000.The Company is required to pay real estate taxes and other occupancy costs related to the facility.The future payments required under the terms of the leases for fiscal periods subsequent to September 30, 2011are as follows: $ $ Employment Contracts The Company has entered into employment contracts with executives and management personnel. The contracts provide for salaries, bonuses and stock option grants, along with other employee benefits. The employment contracts generally have no set term and can be terminated by either party. There is a provision for payments of nine months to eighteen months of annual salary as severance if we terminate a contract without cause, along with the acceleration of certain unvested stock option grants. NOTE 14 - RETIREMENT PLANS All Australian based employees are entitled to varying degrees of benefits on retirement, disability, or death.The Company contributes to an accumulation fund on behalf of the employees under an award which is legally enforceable.For U.S. employees, the Company has a 401(k) plan.All active participants are 100% vested immediately.Expenses under these plans were $15,460 and $9,855 for the three months ended September 30, 2011 and September 30, 2010 respectively. NOTE 15— INCOME TAXES The provision (benefit) for income taxes consists of the following: Three months ended September 30, Current $ ) $

Exhibit 32.2 Certification required under Section 906 of the Sarbanes‑Oxley Act of 2002 PISMO COAST VILLAGE, INC. CERTIFICATION PURSUANT TO 18 U.S.C. Subsection 1350 of the CHIEF EXECUTIVE OFFICER In connection with the Quarterly Report on Form 10‑Q (the "Report") of Pismo Coast Village, Inc. (The "Company") for the third quarter ended June 30, 2012, the undersigned, Jay Jamison, Chief Executive Officer of the Company, hereby certifies pursuant to 18 U.S.C. Subsection 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, that, to the best of the undersigned's knowledge and belief: 1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: August 10, 2012 /S/ JAY JAMISON Jay Jamison, Chief Executive Officer (principal executive officer)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ————— FORM 10-Q ————— þ Quarterly Report Pursuant to Section13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended September 30, 2012 Or ¨ Transition Report Pursuant to Section13 or 15(d) of the Securities Exchange Act of 1934 For the Transition Period From to ————— CROSS COUNTRY HEALTHCARE, INC. (Exact name of registrant as specified in its charter) ————— Delaware 0-33169 13-4066229 (State or other jurisdiction of Incorporation or organization) Commission file number (I.R.S. Employer Identification Number) 6551 Park of Commerce Blvd, N.W. Boca Raton, Florida 33487 (Address of principal executive offices)(Zip Code) (561) 998-2232 (Registrant’s telephone number, including area code) Not Applicable (Former name, former address and former fiscal year, if changed since last report) ————— Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.Yesþ No¨ Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule405 of RegulationS-T during the preceding 12months (or for such shorter period that the registrant was required to submit and post such files).þYes oNo Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule12b-2 of the Exchange Act: Largeaccelerated filer¨ Acceleratedfilerþ Non-acceleratedfiler¨(Do not check if a smaller reporting company) Smaller Reporting Company¨ Indicate by checkmark whether the registrant is a shell company (as defined in Rule12b-2 of the Exchange Act). Yes¨ Noþ The registrant had outstanding 30,902,314 shares of Common Stock, par value $0.0001 per share, as of October 31, 2012. INFORMATION RELATING TO FORWARD-LOOKING STATEMENTS In addition to historical information, this Form10-Q contains statements relating to our future results (including certain projections and business trends) that are “forward-looking statements” within the meaning of Section27A of the Securities Act of 1933, as amended, and Section21E of the Securities Exchange Act of 1934, as amended (the Exchange Act), and are subject to the “safe harbor” created by those sections. Words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, “suggests”, “seeks”, “will” and variations of such words and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results and performance to be materially different from any future results or performance expressed or implied by these forward-looking statements. These factors include, but are not limited to, the following: our ability to attract and retain qualified nurses, physicians and other healthcare personnel, costs and availability of short-term housing for our travel healthcare professionals, demand for the healthcare services we provide, both nationally and in the regions in which we operate, the functioning of our information systems, the effect of existing or future government regulation and federal and state legislative and enforcement initiatives on our business, our clients’ ability to pay us for our services, our ability to successfully implement our acquisition and development strategies, the effect of liabilities and other claims asserted against us, the effect of competition in the markets we serve, our ability to successfully defend the Company, its subsidiaries, and its officers and directors on the merits of any lawsuit or determine its potential liability, if any, and other factors set forth in Item 1.A. “Risk Factors” in the Company’s Annual Report on Form10-K for the year ended December31, 2011, as filed and updated in our Quarterly Reports on Form10-Q and other filings with the Securities and Exchange Commission. Although we believe that these statements are based upon reasonable assumptions, we cannot guarantee future resultsand readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s opinions only as of the date of this filing. There can be no assurance that (i)we have correctly measured or identified all of the factors affecting our business or the extent of these factors’ likely impact, (ii)the available information with respect to these factors on which such analysis is based is complete or accurate, (iii)such analysis is correct or (iv)our strategy, which is based in part on this analysis, will be successful. The Company undertakes no obligation to update or revise forward-looking statements. All references to “we”, “us”, “our”, or “Cross Country” in this Quarterly Report on Form10-Q mean Cross Country Healthcare, Inc., its subsidiaries and affiliates. CROSS COUNTRY HEALTHCARE, INC. INDEX FORM 10-Q SEPTEMBER 30, 2012 PAGE PART I. – FINANCIAL INFORMATION 1 Item 1. Condensed Consolidated Financial Statements 1 Condensed Consolidated Balance Sheets (Unaudited) 1 Condensed Consolidated Statements of Operations (Unaudited) 2 Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) 3 Condensed Consolidated Statements of Cash Flows (Unaudited) 4 Notes to Condensed Consolidated Financial Statements (Unaudited) 5 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 18 Item 3. Quantitative and Qualitative Disclosures About Market Risk 34 Item 4. Controls and Procedures 34 PART II. – OTHER INFORMATION 35 Item 1. Legal Proceedings 35 Item 1A. Risk Factors 35 Item 6. Exhibits 36 Signatures 37 i PART I. – FINANCIAL INFORMATION ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Cross Country Healthcare, Inc. Condensed Consolidated Balance Sheets (Unaudited, amounts in thousands) September30, December 31, Assets Current assets: Cash and cash equivalents $ $ Short-term cash investments Accounts receivable, less allowance for doubtful accounts of $2,005 in 2012 and $2,180 in 2011 Deferred tax assets Income taxes receivable Prepaid expenses Debt issuance costs, net – current - Other current assets Total current assets Property and equipment, net of accumulated depreciation of $45,327 in 2012 and $41,657 in 2011 Trademarks, net Goodwill, net Other identifiable intangible assets, net Debt issuance costs, net - Non-current deferred tax assets - Other long-term assets Total assets $ $ Liabilitiesand Stockholders' Equity Current liabilities: Accounts payable and accrued expenses $ $ Accrued employee compensation and benefits Current portion of long-term debt Other current liabilities Total current liabilities Long-term debt Non-current deferred tax liabilities - 58 Other long-term liabilities Total liabilities Commitments and contingencies Stockholders' equity: Common stock 3 3 Additional paid-in capital Accumulated other comprehensive loss ) ) (Accumulated deficit) retained earnings ) Total stockholders' equity Total liabilities and stockholders' equity $ $ See accompanying notes to the condensed consolidated financial statements 1 Cross Country Healthcare, Inc. Condensed Consolidated Statements of Operations (Unaudited, amounts in thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, Revenue from services $ Operating expenses: Direct operating expenses Selling, general and administrative expenses Bad debt expense Depreciation Amortization Impairment charges - - Total operating expenses (Loss) income from operations ) ) Other expenses (income): Foreign exchange loss (gain) ) 32 ) Interest expense Debt financing costs - - Loss on modification of debt 82 - 82 - Other (income) expense, net ) ) 79 ) (Loss) income before income taxes ) ) Income tax (benefit) expense ) ) Net (loss) income $ ) $ $ ) $ Net (loss) income per common share: Basic $ ) $ $ ) $ Diluted $ ) $ $ ) $ Weighted average common shares outstanding: Basic Diluted See accompanying notes to the condensed consolidated financial statements 2 Cross Country Healthcare, Inc. Consolidated Statements of Comprehensive (Loss) Income (Unaudited, amounts in thousands) Three Months Ended Nine Months Ended September 30, September 30, Net (loss) income $ ) $ $ ) $ Other comprehensive income (loss), before tax: Foreign currency translation adjustments ) ) Write-down of marketable securities - - 39 - Net change in fair value of marketable securities - (2

Law Offices of Joseph L. Pittera 1308 Sartori Avenue Suite 109 Torrance, California 90501 Telephone (310) 328-3588 Facsimile (310) 328-3063 E-mail: [email protected] August07, 2015 Go-Page Corporation 500 North Rainbow Road, Suite 300 Las Vegas, Nevada 89107 Re: 2014 Shares Incentive Plan (the "Plan") Ladies and Gentlemen: We have acted as counsel to Go-Page Corporation, a Nevada corporation (the "Company") in connection with the preparation and filing with the Securities and Exchange Commission under the Securities Act of 1933 of the Company's Registration Statement on Form S-8 relating to 5,000,000 shares of the Company's common stock, par value $.001 (the "Shares"). In connection with that registration, we have reviewed the proceedings of the Board of Directors of the Company relating to the registration and proposed issuance of the Shares, the Amended and Restated Certificate of Incorporation of the Company and all amendments thereto, the Bylaws of the Company, and such other documents and matters as we have deemed necessary to the rendering of the following opinion. Based upon that review, it is our opinion that the Shares, when issued in conformance with the terms and conditions of the Plan, will be validly issued, fully paid, and non-assessable under the Nevada Revised Statutes. We do not find it necessary for the purposes of this opinion to cover, and accordingly we express no opinion as to, the application of the securities or blue sky laws of the various states as to the issuance and sale of the Shares. We consent to the use of this opinion in the registration statement filed with the Securities and Exchange Commission in connection with the registration of the Shares. Law Offices of Joseph L. Pittera /s/JosephL.Pittera JosephL.Pittera

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): December 4, 2012 ROBERTSON GLOBAL HEALTH SOLUTIONS CORPORATION (Name of registrant in its charter) Nevada 0-6428 88-0105586 (State or other jurisdiction of incorporation) (Commission File Number) (IRS Employer Identification No.) 3555 Pierce Road Saginaw, Michigan 48604 (Address of principal executive offices) Registrant's telephone number: (989) 799-8720 Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act Item 7.01 Regulation FD Disclosure On December 4, 2012, Dr. Joel Robertson, our CEO, communicated with shareholders and investors update information regarding the Company’s strategy and financial requirements: “We have all witnessed the election and understand at some level how Obama’s “Affordable Healthcare Act” will impact the healthcare market. This and national healthcare spurring up in other parts of the world has given us reason to use the latter half of 2012 to restructure our strategic advantage and focus our business development efforts with a very clear design and intent. Let me provide you with a high level overview of our redefined strategic approach developed by us and our strategic consultants and advisors. First, we have clarified our message of why RHealth Advisor is different and the benefits it will provide. RHealth Advisor at its core is a clinical reasoning program (meaning an intelligent/intuitive system that provides inferences and argumentation while forming conclusions) that can read and write into any existing system which can be effective in lowering costs, managing more patients and improving outcomes. This is contrary to the standard, data collection, clinical decision support, chronic disease management and follow-up programs in the market today. Moreover, these technologies are forced and have not only shown to be disruptive in providing care and educating patients but have been unable to help the increasing costs that the market is undergoing. Technology is the answer to this equation but it needs to be designed by the provider to help them enhance revenue streams, incentivized by the payer due to internal cost savings or market differentiation and ultimately enhance the patient experience. Second, we have filed for patent coverage within five areas with experienced counsel. We have filed these patent applications to leverage the sophisticated clinical reasoning and proprietary database that we have developed. What that means for RGHS is that we have significant disruptive advantages in four use case areas; all of which point directly to our refined business strategy and product differentiation: 1. Pre-admission Screening – streamline patient throughput at the primary care level. For example, patient receives initial impression via RHealth Advisor approved by the physician and is directed to complete necessary laboratory tests prior to seeing the physician; eliminating unnecessary patient visits within the system and allowing the provider to see more patients with higher return on investment for each appointment. Market Payoff - If, in the USA, this saved ½ of the 3.5 visits per patient per year of 100 Million people, RGHS would save the system $3 Billion annually. 1 2. Predictive Medicine – identify unnecessary tests and provide argumentation for testing that is statistically relevant to form a conclusion. RHealth Advisor providesthe physician, nurse practitioner and physician assistant the statistical likelihood that a given test will change the diagnostic confidence of a disease; eliminating unnecessary, or provide for less expensive tests, to get to the same conclusion thus saving the payer significant money. This allows them to incentivize providers to operate in a new fashion. Market Payoff - If, in the US, this saved ½ a test per person per year RGHS would save the system $50 Billion annually. In 2008, healthcare economist estimated that the USA spends $700 Billion on tests and procedures that do not actually improve health outcomes. 3. Diagnostic Support – providing differential diagnostic support. For example, RHealth Advisors’ prominent award winning diagnostic engine would provide diagnostic support to assist in reducing misdiagnosis and medical errors.In 2011, healthcare economist stated that misdiagnosis and medical errors cost the system 17 Billion dollars. Market Payoff - If, in the US, this improved diagnosis accuracy by only 1%, RGHS would save the system $170 Million annually. 4. Chronic Disease Management and Treatment Adherence- improving patient monitoring and follow-up using sophisticated clinical reasoning and established technology. For example, a patient’s current status, the progression of their disease and any complications that may arise are monitored by RHealth Advisor with automated daily care management, reminders about appointments and diet and activity recommendations. Using our physician portal a physician can quickly evaluate and manage each of their patients which contain red, yellow, and green indicators based on their patient’s current condition and monitoring statistics. The engine tailors specific treatment plans for each patient allowing the physician to direct the patients care quickly and effectively. Market Payoff - If, in the US, this improved the management of chronic disease by 1% RGHS would save the system $97.2 Billion annually. Chronic diseases, such as heart disease, stroke, cancer, diabetes, and arthritis are among the most common, costly, and preventable of all health problems in the USA.In total, they cost an estimated $972 Billion per year. · Center for Disease Control and Prevention reported that the treatment of cardiovascular disease account for about $1 of every $6 spent on health care in the USA.In 2010, the total costs of cardiovascular disease (according to the CDC) were estimated to be $444 Billion. · In April 2012, National Institute of Health reported that diabetes cost the nation an estimated $174 Billion. · According to the American Cancer Society, the National Institutes of Health estimated the 2007 overall annual costs of cancer were $226.8 Billion. · The Center for Disease Control and Prevention reported that in 2003, the total cost of arthritis was $128 billion. Each year, arthritis results in 992,100 hospitalizations and 44 million outpatient visits. 2 Third, determine whether the healthcare system will want to adopt the software and why they would. Let’s examine each group. 1. Healthcare providers (physicians) view these use cases as a way to lower their cost of providing care, manage more patients with a greater reach and influence and provide care to a knowledgeable consumer. Together, this will ultimately extend their revenue stream. 2. Payers (Insurance Companies) view this as a way to improve the quality, affordability and access of care by reducing unnecessary testing and doctor visits. Together, these ultimately extend their profit margin and differentiate them in a very competitive market. 3. Patients view this whole process of simplifications as a way to improve their patient and provider experience byreceiving better health care and saving them time and out-of-pocket spending and unnecessary time in waiting rooms. Now that we have shared the refined strategy and payoffs within the market; what does this mean for RGHS? First, patent applications have now put us in a position to show specific outcomes and return on investment in the market for commercialization and aggressively approach healthcare stakeholders. Second, demands to decrease costs in the healthcare market have put the pressure on healthcare stakeholders to search out novel solutions and contact us to discuss RHealth Advisor due to our reputation and standards of data integrity. Out of these recent discussions we have found a big appetite and our strategy has shown to be more attractive and relevant than other less robust and “one off” solutions. We are presently discussing possible business relationships with health care insurance companies and others. Over the next 30-60 days our strategy is simple: 1. Continue negotiations and due diligence required to define possible arrangements and therefore continue to pay business development staff 50% wages in order to preserve cash and minimize dilution to shareholders. 2. Continue to pay infrastructure costs to allow for demonstrations to be presented and maintain web presence. Our current budget is approximately $80,000 per month.” ### The information under this Item 7.01 is being furnished, and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any other filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing. 3 SIGNATURES In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Robertson Global Health Solutions Corporation Dated: December 5, 2012 By: /s/ Melissa A. Seeger Name: Melissa A. Seeger Title: Chief Financial Officer (Principal Financial and Accounting Officer) 4

FORM 6-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C.20549 Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16 under the Securities Exchange Act of 1934 For the month of July, 2007 Commission File Number 001-13896 Elan Corporation, plc (Translation of registrant's name into English) Treasury Building, Lower Grand Canal Street, Dublin 2, Ireland (Address of principal executive offices) Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F: Form 20 F x Form 40Fo Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): Yes o No x Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders. Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): Yes o No x Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR. Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes o No x If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): This Report of Foreign Issuer on Form 6-K is incorporated by reference into the Post-Effective Amendments on Forms F-3 and S-8 to Form F-4 Registration Statement of Elan Corporation, plc (Registration No. 333-12756), the Registration Statement on Form F-3 of Elan Corporation, plc and Athena Neuroscience Finance, LLC (Registration No. 333-13130), and the Registration Statements on Form S-8 of Elan Corporation, plc (Registration Nos. 333-13996, 333-12344, 333-11940, 333-09644, 333-09284, 333-09048, 333-08384, 333-07361, 333-07136, 333-14240, 33-27506, 333-100252 and 333-121021). EXHIBIT LIST Exhibit Description 99.1 Press release dated July 3, 2007 titled: TYSABRI® RECOMMENDED BY NICE FOR USE IN HIGHLY ACTIVE RELAPSING REMITTING MULTIPLE SCLEROSIS IN THE FINAL APPRAISAL DETERMINATION. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. ELAN CORPORATION, plc By: /s/ William F. Daniel William F. Daniel EVP, Company Secretary Date: July 3, 2007 Exhibit 99.1

FORM 6-K SECURITIES AND EXCHANGE COMMISSION
 Washington D.C. 20549 Report of Foreign Issuer Pursuant to Rule 13a-16 or 15d-16 of
 the Securities Exchange Act of 1934 For period endingJuly 2012 GlaxoSmithKline plc (Name of registrant)
 980 Great West Road, Brentford, Middlesex, TW8 9GS (Address of principal executive offices)
 Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F
 Form 20-F x Form 40-F
 
 Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
 Yes No x  Notification of Transactions of Directors, Persons Discharging Managerial Responsibility or Connected Persons I give below details of changes in the interests of Directors, Persons Discharging Managerial Responsibility or Connected Persons in the Ordinary Shares of GlaxoSmithKline plc in respect of the under-mentioned persons arising from the purchase of Ordinary Shares at a price of 1466.93 pence per Ordinary Share on 10 July 2012 through the Company's ShareReward Plan ("the Plan"): Sir Andrew Witty Acquisition of 8 Ordinary Shares under the personal contribution element of the Plan Acquisition of 8 Ordinary Shares under the matching element of the Plan (Company contribution) Mr S Dingemans Acquisition of 8 Ordinary Shares under the personal contribution element of the Plan Acquisition of 8 Ordinary Shares under the matching element of the Plan (Company contribution) Mr S M Bicknell Acquisition of 8 Ordinary Shares under the personal contribution element of the Plan Acquisition of 8 Ordinary Shares under the matching element of the Plan (Company contribution) Mr E J Gray Acquisition of 8 Ordinary Shares under the personal contribution element of the Plan Acquisition of 8 Ordinary Shares under the matching element of the Plan (Company contribution) Mr D S Redfern Acquisition of 8 Ordinary Shares under the personal contribution element of the Plan Acquisition of 8 Ordinary Shares under the matching element of the Plan (Company contribution) Ms C Thomas Acquisition of 8 Ordinary Shares under the personal contribution element of the Plan Acquisition of 8 Ordinary Shares under the matching element of the Plan (Company contribution) Mr P C Thomson Acquisition of 7 Ordinary Shares under the personal contribution element of the Plan Acquisition of 7 Ordinary Shares under the matching element of the Plan (Company contribution) Dr P J T Vallance Acquisition of 9 Ordinary Shares under the personal contribution element of the Plan Acquisition of 9 Ordinary Shares under the matching element of the Plan (Company contribution) Mrs V A Whyte Acquisition of 8 Ordinary Shares under the personal contribution element of the Plan Acquisition of 8 Ordinary Shares under the matching element of the Plan (Company contribution) The Company and the above-mentioned persons were advised of this information on 11 July 2012. This notification relates to transactions notified in accordance with Disclosure and Transparency Rule 3.1.4R(1)(a). V A Whyte Company Secretary 11 July 2012 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorised.
 GlaxoSmithKline plc (Registrant)
 Date:July11,2012 By: VICTORIA WHYTE Victoria Whyte Authorised Signatory for and on behalf of GlaxoSmithKline plc

Exhibit AMENDED AND RESTATED BYLAWS OF TEMPLE-INLAND INC. (Incorporated under the Laws of the State of Delaware) (As Amended and Restated November2009) ARTICLE I OFFICES Section1. Registered Office. The registered office of Temple-Inland Inc. (hereinafter called the Company) in the State of Delaware shall be at 2711 Centerville Road, Suite 400, in the City of Wilmington, County of New Castle, and the registered agent in charge thereof shall be Corporation Service Company. Section2. Other Offices. The Company may also have an office or offices, and keep the books and records of the Company, except as may otherwise be required by law, at such other place or places, either within or without the State of Delaware, as the Board of Directors may from time to time determine or the business of the Company require. ARTICLE II MEETINGS OF STOCKHOLDERS Section1. Place of Meeting. All meetings of the stockholders of the Company shall be held at the office of the Company or at such other places, within or without the State of Delaware, as may from time to time be fixed by the Board of Directors or the Chairman of the Board. Section2. Annual Meeting. The annual meeting of the stockholders of the Company for the election of directors and for the transaction of such other business as may properly come before the meeting shall be held on the first Friday in May in each year, if not a legal holiday under the laws of the place where the meeting is to be held, and, if a legal holiday, then on the next succeeding day not a legal holiday under the laws of such place, or on such other date and at such hour as may from time to time be fixed by the Board of Directors or the Chairman of the Board. Section3. Special Meetings. Except as otherwise required by law and subject to the rights of the holders of any class or series of stock having a preference over the Common Stock as to dividends or upon liquidation, special meetings of the stockholders for any purpose or purposes may be called only by (i)the Chairman of the Board or (ii) the Secretary of the Company at the request in writing of a majority of the entire Board of Directors. Special meetings of the stockholders may be called at such place and on such date and at such time as fixed by the appropriate person calling such special meeting of the stockholders. Only such business as is specified in the notice of any special meeting of the stockholders shall come before such meeting. Section4. Notice of Meetings. Except as otherwise provided by law, written notice of each meeting of the stockholders, whether annual or special, shall be given by any means -5- permitted by law and the rules of any exchange on which the Common Stock is traded, including electronic transmission, not less than 10 nor more than 60days before the date of the meeting to each stockholder of record entitled to notice of the meeting. If mailed, such notice shall be deemed given when deposited in the United States mail, postage prepaid, directed to the stockholder at such stockholder’s address as it appears on the records of the Company. Each such notice shall state the place, date and hour of the meeting, and the purpose or purposes for which the meeting is called. Notice of any meeting of stockholders shall not be required to be given to any stockholder who shall attend such meeting in person or by proxy without protesting, at the commencement of the meeting, the lack of proper notice to such stockholder, or who shall waive notice thereof as provided in ArticleX of these Bylaws.For purposes of these bylaws, “electronic transmission” means any form of communication not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved, and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such recipient through an automated process, and includes, without limitation, telegraph, facsimile, electronic mail, and posting to electronic networks. Section5. Quorum. Except as otherwise provided by law or by the Certificate of Incorporation of the Company, the holders of a majority of the votes entitled to be cast by the stockholders entitled to vote, which if any vote is to be taken by classes shall mean the holders of a majority of the votes entitled to be cast by the stockholders of each such class, present in person or by proxy, shall constitute a quorum for the transaction of business at any meeting of the stockholders. A quorum, once established, shall not be broken by the withdrawal of enough votes to leave less than a quorum. Section6. Adjournments. In the absence of a quorum, the holders of a majority of the votes entitled to be cast by the stockholders, present in person or by proxy, may adjourn the meeting from time to time, without notice to the stockholders, until a quorum is present, if the time and place to which it is adjourned are announced at such meeting, unless the adjournment is for more than 30days or, after adjournment, a new record date is fixed for the adjourned meeting. At any such adjourned meeting at which a quorum may be present, any business may be transacted which might have been transacted at the meeting as originally called. Section7. Order of Business. At each meeting of the stockholders, one of the following persons, in the order in which they are listed (and in the absence of the first, the next, and so on), shall serve as chairman of the meeting: Chairman of the Board, Vice Chairmen of the Board (in the order of their seniority if more than one), Vice Presidents (in the order of their seniority if more than one) and Secretary. The order of business at each such meeting shall be as determined by the chairman of the meeting. The chairman of the meeting shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts and things as are necessary or desirable for the proper conduct of the meeting, including, without limitation, the establishment of procedures for the maintenance of order and safety, limitations on the time allotted to questions or comments on the affairs of the Company, restrictions on entry to such meeting after the time prescribed for the commencement thereof, and the opening and closing of the voting polls. -6- Section8. List of Stockholders Entitled to Vote. The officer of the Company who has charge of the stock ledger of the Company shall prepare and make, at least 10 days before every meeting of the stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder.Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least 10 days prior to the meeting (i) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (ii) during ordinary business hours, at the principal place of business of the Company.If the Company determines to make the list available on an electronic network, the Company may take reasonable steps to ensure that such information is available only to stockholders of the Company.If the meeting is to be held at a place, then the list shall be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.If the meeting is to be held solely by means of remote communication, then the list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting. Section9. Voting. Except as otherwise provided by law or by the Certificate of Incorporation of the Company, each stockholder of record of any class or series of stock having a preference over the Common Stock of the Company as to dividends or upon liquidation shall be entitled on each matter submitted to a vote at each meeting of stockholders to such number of votes for each share of such stock as may be fixed in the Certificate of Incorporation or in the resolution or resolutions adopted by the Board of Directors providing for the issuance of such stock, and each stockholder of record of Common Stock shall be entitled at each meeting of stockholders to one vote for each share of such stock, in each case, registered in such stockholder’s name on the books of the Company: (1) on the date fixed pursuant to Section6 of ArticleVII of these Bylaws as the record date for the determination of stockholders entitled to notice of and to vote at such meeting; or (2) if no such record date shall have been so fixed, then at the close of business on the day next preceding the day on which notice of such meeting is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. At each meeting of the stockholders, all corporate actions to be taken by vote of the stockholders (except as otherwise required by law and except as otherwise provided in the Certificate of Incorporation) shall be authorized by a majority of the votes cast by the stockholders entitled to vote thereon, present in person or represented by proxy, and where a separate vote by class is required, a majority of the votes cast by the stockholders of such class, present in person or represented by proxy, shall be the act of such class. Unless required by law or determined by the chairman of the meeting to be advisable, the vote on any matter, including the election of directors, need not be by written ballot. In the case -7- of a vote by written ballot, each ballot shall be signed by the stockholder voting, or by such stockholder’s proxy, and shall state the number of shares voted. Section10. Proxies.Each stockholder entitled to vote at a meeting of the stockholders may authorize not in excess of three persons to act for such stockholder as proxy, but no such proxy shall be voted upon after three years from its date, unless such proxy provides for a longer period.Without limiting the manner in which a stockholder may authorize another person or persons to act for such stock holder as proxy, the following shall constitute a valid means by which a stockholder may grant such authority: (i) A stockholder may execute a writing authorizing another person or persons to act for such stockholder as proxy.Execution may be accomplished by the stockholder or such stockholder's authorized officer, director, employee or agent signing such writing or causing such person's signature to be affixed to such writing by any reasonable means, including, electronic transmission. (ii) A stockholder may authorize another person or persons to act for such stockholder as proxy by telephone or electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such telephone or electronic transmission must either set forth or be submitted with information from which it can be determined that the telephone or electronic transmission was authorized by the stockholder.If it is determined that such telephone or electronic transmissions are valid, the inspectors or, if there are no inspectors, such other persons making that determination shall specify the information on which they relied. Any copy or other reliable reproduction of the writing or electronic transmission authorizing another person or persons to act as proxy for a stockholder may be substituted or used in lieu of the original writing or electronic transmission for any and all purposes for which the original writing or electronic transmission could be used; provided, however, that such copy or other reproduction shall be a complete reproduction of the entire original writing or electronic transmission. Section 11. Inspectors of Election. In advance of any meeting of the stockholders, the Board of Directors, by resolution or the Chairman shall appoint one or more inspectors to act at the meeting and make a written report thereof.One or more other persons may be designated as alternate inspectors to replace any inspector who fails to act.If no inspector or alternate is able to act at a meeting of the stockholders, the chairman of the meeting shall appoint one or more inspectors to act at the meeting.Unless otherwise required by applicable law, inspectors may be officers, employees or agents of the Company.Each inspector, before entering upon the discharge of the duties of inspector, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of such inspector's ability.The inspector shall have the duties prescribed by law and shall take charge of the polls and, when the -8- vote is completed, shall make a certificate of the result of the vote taken and of such other facts as may be required by applicable law. Section 12. Notice of Stockholder Business and Nominations. (A)

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the reference to our firm under the captions “Financial Highlights” and “Independent Registered Public Accounting Firm” and to the use of our reports dated June 26, 2007 and October26,2007, which are incorporated by reference in this Registration Statement (Form N-1A) of Direxion Funds, to be filed with the Securities and Exchange Commission in this Post-Effective Amendment No. 81 to the Registration Statement under the Securities Act of 1933 (File No. 333-28697). /s/ Ernst & Young LLP Chicago,

Exhibit k.5. SECOND AMENDMENT TO CREDIT AGREEMENT This Second Amendment to Credit Agreement (the “Amendment”) is made as of October 13, 2009, by and among TORTOISE POWER AND ENERGY INFRASTRUCTURE FUND, INC., a Maryland corporation (the “Borrower”); U.S. BANK NATIONAL ASSOCIATION, a national banking association, BANK OF AMERICA, N.A., a national banking association, STIFEL BANK & TRUST, a Missouri charter bank, and each other lender from time to time identified as having a Commitment on Exhibit A hereto or who becomes a party hereto (each a “Bank” and, collectively, the “Banks”); and U.S. BANK NATIONAL ASSOCIATION as the lender for Swingline Loans (in such capacity, the “Swingline Lender”), as agent for the Banks hereunder (in such capacity, the “Agent”), and as lead arranger hereunder (in such capacity, the “Lead Arranger”).Capitalized terms used and not defined in this Amendment have the meanings given to them in the Credit Agreement referred to below. Preliminary Statements (a)The Banks and the Borrower are parties to a Credit Agreement dated as of September 14, 2009, as amended by the First Amendment to Credit Agreement dated as of October 7, 2009 (as the same may be further amended, renewed, restated, replaced, consolidated or otherwise modified from time to time, the “Credit Agreement”). (b)The Borrower has requested an increase in the total amount of the credit facility pursuant to Section 2.2(a) of the Credit Agreement. (c)Stifel Bank & Trust has agreed to increase its Revolving Credit Loan Commitment under the Credit Agreement from $5,000,000 to $7,500,000; and (d)Subject to the terms, conditions, and agreements set forth below, the Borrower and the Banks wish to amend the Credit Agreement. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Banks and the Borrower agree as follows: 1.Modification to Exhibit A.Exhibit A as attached to the Credit Agreement is deleted and is hereby replaced with Exhibit A, attached to this Amendment. 2.Total Credit Facility.Section 2.1 and Section 2.2(a) of the Credit Agreement are modified to reflect that upon this Amendment becoming effective, the total credit facility referenced in Section 2.1 is in an amount up to $35,000,000 and Borrower’s right to increase the total amount of the credit facility pursuant to Section 2.2 is limited to an amount up to $15,000,000 (for a total credit facility in an aggregate principal amount of up to $50,000,000), subject to the terms and conditions of the Credit Agreement. 3.New Note.Contemporaneously with the execution and delivery of this Amendment, the Borrower, as maker, shall execute and deliver a new revolving credit note, in the stated principal amount of $7,500,000, in favor of Stifel Bank & Trust, as payee (the “New Note”), which New Note shall amend, restate and replace the Note dated as of September 14, 2009, from the Borrower, as maker, to Stifel Bank & Trust, as payee, in the stated principal amount of $5,000,000 (the “Old Note”), and which New Note, as the same may be amended, renewed, restated, replaced or consolidated from time to time, shall be a “Revolving Credit Note” referred to in the Credit Agreement. 4.Reaffirmation of Credit Documents.The Borrower reaffirms its obligations under the Credit Agreement, as amended hereby, and the other Credit Documents to which it is a party or by which it is bound, and represents, warrants and covenants to the Agent and the Banks, as a material inducement to the Agent and the Banks to enter into this Amendment, that (a) the Borrower has no and in any event waives any, defense, claim or right of setoff with respect to its obligations under, or in any other way relating to, the Credit Agreement, as amended hereby, or any of the other Credit Documents to which it is a party, or the Agent’s or the Banks’ actions or inactions in respect of any of the foregoing, and (b) all representations and warranties made by or on behalf of the Borrower in the Credit Agreement and the other Credit Documents are true and complete on the date hereof as if made on the date hereof. 5.Conditions Precedent to Amendment.Except to the extent waived in a writing signed by the Agent and delivered to the Borrower, the Agent and the Banks shall have no duties under this Amendment until the Agent shall have received fully executed originals of each of the following, each in form and substance satisfactory to the Agent: (a)Amendment.This Amendment; (b)New Note.The New Note; (c)Form U-1.A Form U-1 for the Borrower whereby, among other things, (i) the maximum principal amount of Revolving Credit Loans that may be outstanding from time to time under the Credit Agreement is noted as being $35,000,000, and (ii) the Borrower concurs (and the Borrower does hereby concur) with the assessment of the market value of the margin stock or other investment property described in the attachment to such Form U-1 as of the date provided in such attachment; and (d)Other Documents.Such other documents as the Agent may reasonably request to further implement the provisions of this Amendment or the transactions contemplated hereby. 6.No Other Amendments; No Waiver of Default.Except as amended hereby, the Credit Agreement and the other Credit Documents shall remain in full force and effect and be binding on the parties in accordance with their respective terms.By entering into this Amendment, the Agent and the Banks are not waiving any Default or Event of Default which may exist on the date hereof. 7.Expenses.The Borrower agrees to pay and reimburse the Agent for all out-of-pocket costs and expenses incurred in connection with the negotiation, preparation, execution, delivery, operation, enforcement and administration of this Amendment, including the reasonable fees and expenses of counsel to the Agent. 8.Counterparts; Fax Signatures.This Amendment and any documents contemplated hereby may be executed in one or more counterparts and by different parties thereto, all of which counterparts, when taken together, shall constitute but one agreement.This Amendment and any documents contemplated hereby may be executed and delivered by facsimile or other electronic transmission and any such execution or delivery shall be fully effective as if executed and delivered in person. 9.Governing Law.This Amendment shall be governed by the same law that governs the Credit Agreement. [Remainder of Page Intentionally Left Blank] Second Amendment to Credit Agreement - Page 2 K.S.A. §16-118 Required Notice.This statement is provided pursuant to K.S.A. §16-118:“THIS AMENDMENT TO CREDIT AGREEMENT IS A FINAL EXPRESSION OF THE AMENDMENT TO CREDIT AGREEMENT BETWEEN THE BANKS (AS CREDITORS) AND THE BORROWER (AS DEBTOR) AND SUCH WRITTEN AMENDMENT TO CREDIT AGREEMENT MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY PRIOR ORAL AMENDMENT TO CREDIT AGREEMENT OR OF A CONTEMPORANEOUS ORAL AMENDMENT TO CREDIT AGREEMENT BETWEEN THE BANKS AND THE BORROWER.”THE FOLLOWING SPACE CONTAINS ANY NON-STANDARD TERMS, INCLUDING THE REDUCTION TO WRITING OF ANY PREVIOUS ORAL AMENDMENT TO CREDIT AGREEMENT: NONE. The creditors and debtor, by their respective initials or signatures below, confirm that no unwritten amendment to credit agreement exists between the parties: Creditor: Creditor: Creditor: Debtor: [signature page to follow] Second Amendment to Credit Agreement - Initial Page IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first above written. TORTOISE POWER AND ENERGY INFRASTRUCTURE FUND, INC., the Borrower By: Name: Title: U.S. BANK NATIONAL ASSOCIATION, as Agent, Swingline Lender, Lead Arranger and a Bank By: Name: Shelly Ungles Title: Vice President BANK OF AMERICA, N.A., a Bank By: Name: Jeffrey P. Yoakum Title: Senior Vice President STIFEL BANK & TRUST, a Bank By: Name: John H. Phillips Title: Senior Vice President Second Amendment to Credit Agreement EXHIBIT A (Banks and Commitments) (A) Bank Revolving Credit Loan Commitment Amount Swingline Loan Commitment Amount* Bank’s Total Commitment Amount Bank’s Pro-Rata Percentage U.S. Bank National Association Bank of America, N.A. $0 Stifel Bank & Trust $0 TOTALS: * As more particularly described in the Agreement, the Swingline Loan Commitment is a subcommitment under the Revolving Credit Loan Commitments.Accordingly, extensions of credit under the Swingline Loan Commitment act to reduce, on a dollar-for-dollar basis, the amount of credit otherwise available under the Revolving Credit Loan Commitments. Second Amendment to Credit Agreement

EXECUTION COPY   SEPARATION AGREEMENT AND RELEASE OF CLAIMS THIS AGREEMENT is made and entered into by and between NexCen Brands, Inc. (the “Company”) and Charles A. Zona (the “Executive”).   All capitalized terms used herein unless otherwise defined in this Agreement shall have the meaning assigned to them in the Employment Agreement.   WHEREAS, the Company and Executive entered into an employment agreement made as of December 11, 2006 (the “Employment Agreement”);   WHEREAS, Executive’s employment was terminated by the Company without Cause effective as of May 30, 2008 (“Termination Date”), and as of such date Executive ceased to hold any position as an officer of the Company or any affiliate; and   WHEREAS, Executive desires to receive separation pay and benefits, and the Company is willing to provide separation pay and benefits on the condition that Executive enters into this Agreement.   THEREFORE, in consideration of the mutual agreements and promises set forth acknowledged, the Company and Executive agree as follows:   1. Consideration   In consideration of Executive's agreements and promises set forth below, the the Employment Agreement:     a. Base Salary, Accrued Paid Time Off. The Company shall pay to Executive any unpaid Base Salary through and including the Termination Date. Executive acknowledges that there is no declared but unpaid Annual Bonus or any other bonus during the Employment Period that is due and owing to the Executive as of the Termination Date.   The Company shall pay to Executive all accrued but unused paid time during the Employment Period through and including the Termination Date. The parties acknowledge and agree that as of Termination Date, Executive has accrued $29,000.00 of paid time off and has received $24,615.38 of that amount, less deductions for federal and/or state income tax withholding, FICA and any other deduction from wages required by law or regulation. The Company shall pay the remaining $4,384.62 of accrued paid time off, less deductions for federal and/or state income tax withholding, FICA and any other deduction from wages required by law or regulation, by including such net amount in the next semi-monthly installment payment to be made pursuant to subparagraph 1.b. below, following         EXECUTION COPY       b. Semi-Monthly Installment Payment. The Company shall pay to Executive payments totaling One Hundred Fifty Thousand Dollars ($150,000.00) (less deductions for federal and/or state income tax withholding, FICA and any other deduction from wages required by law or regulation), which shall be paid in substantially equal semi-monthly installments over a period of six months, beginning no later than June 16, 2008, in accordance with the Company’s normal payroll practices.     c. Continued Participation in Company’s Group Medical Plan. The Company shall continue Executive’s participation in the Company’s group medical plan on the same basis as he previously participated, until the earlier of May 30, 2009 or the date Executive is provided with health insurance coverage by a successor employer. Executive shall promptly inform Sue Nam, General Counsel of the Company, if and when he is provided with health insurance coverage by a successor employer. After May 30, 2009, Executive may continue to participate in the Company’s group health plans to the extent permitted under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”).      d. Reimbursable Expenses. Executive acknowledges and agrees that as of the date of this agreement, he has received all reimbursable expenses or other entitlements then due and owing to the Executive.     e. Stock Options. The parties hereby agree that (i) Executive vested as of December 11, 2007 in (i) 83,334 shares of his initial Option Grant to purchase a total of 250,000 shares of the Company’s common stock; (ii) Executive vested as of the Termination Date in all of his additional stock option grant to purchase a total of 25,000 shares of the Company’s common stock; and (iii) Executive voluntarily surrendered 166,666 shares of his unvested initial Option Grant. Executive’s 108,334 vested stock options shall be exerciseable as of the Termination Date and shall remain exercisable by Executive (or his estate, in the event of his death) until December 31, 2009, following which time any unexercised stock options shall terminate.     f. Other Benefits. Executive shall receive any vested benefits to which Executive is entitled in accordance with the terms of any of the Company's employee benefit plans or programs, including without limitation the Company's 401(k) plan.   The terms of Paragraph 1 shall have no force if Executive revokes his acceptance of this Agreement pursuant to Paragraph 11 (Special Provisions for Age Discrimination).     2   EXECUTION COPY     2. No Further Payments   Except as provided for in Paragraph 1, Executive is not entitled to and will not receive any further salary, wages, benefits, severance or separation payments from the Company.   3. General Release   Executive on behalf of himself and his heirs, successors and assigns, in consideration of the performance by the Company of its material obligations under the Employment Agreement and this Agreement, do hereby release and forever discharge as of the date hereof the Company, its Subsidiaries, its Affiliates, each such Person’s respective successors and assigns and each of the foregoing Persons’ respective present and former directors, officers, partners, stockholders, members, managers, agents, representatives, employees (and each such Person’s respective successors and assigns) (collectively, the “Released Parties”) to the extent provided below.   a. Executive understands that payments or benefits paid or granted to him under this Agreement represent, in part, consideration for signing this Agreement and are not salary, wages or benefits to which he was already entitled. Executive understands and agrees that he will not receive the payments and benefits specified in Paragraph 1 (other than the payments and benefits in subparagraphs 1.a and 1.f) of this Agreement unless he executes this Agreement and does not revoke this Agreement within the time period permitted hereafter or breach this Agreement.   b. Executive knowingly and voluntarily releases and forever discharges the Company and the other Released Parties from any and all claims, controversies, actions, causes of action, cross-claims, counter-claims, demands, debts, compensatory damages, liquidated damages, punitive or exemplary damages, other damages, claims for costs and attorneys’ fees, or liabilities of any nature whatsoever in law and in equity, both past and present (through the date of this Agreement), whether under the laws of the United States or another jurisdiction and whether known or unknown, suspected or claimed against the Company or any of the Released Parties which Executive, his spouse, or any of his heirs, executors, administrators or assigns, have or may have, which arise out of or are connected with his employment with, or his separation from, the Company (including, but not limited to, any allegation, claim or violation, arising under: Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967, as amended (including the Older Workers Benefit Protection Act); the Equal Pay Act of 1963, as amended; the Americans with Disabilities Act of 1990; the Family and Medical Leave Act of 1993; the Civil Rights Act of 1866, as amended; the Worker Adjustment Retraining and Notification Act; the Employee Retirement Income Security Act of 1974; any applicable Executive Order Programs; the Fair Labor Standards Act; or their state or local counterparts; or under any other federal, state or local civil or human rights law, or under any other local, state, or federal law, regulation or ordinance; or under any public policy, contract or tort, or under common law; or arising under any policies, practices or procedures of the Company or any of the Released Parties; or any claim for wrongful discharge, breach of contract, infliction of emotional distress, or defamation; or any claim for costs, fees, or other expenses, including attorneys’ fees incurred in these matters (all of the foregoing collectively referred to herein as the “Claims”); provided, however, that nothing contained in this Agreement shall apply to, or release the Company from, (i) any obligation of the Company contained in the Employment Agreement or this Agreement to be performed after the date hereof, (ii) any vested or accrued benefits pursuant to any employee benefit plan, program or policy of the Company, (iii) any right Executive has to indemnification by the Company (under the Employment Agreement or otherwise), and (iv) any claims Executive may have as a member of a class in connection with any securities derivative class action against the Company.     3   EXECUTION COPY     c. Executive represents that he has made no assignment or transfer of any right, claim, demand, cause of action, or other matter covered by paragraph 3.b. above.   d. Executive agrees that this Agreement does not waive or release any rights or claims that he may have under the Age Discrimination in Employment Act of 1967 which arise after the date he executes this Agreement. Executive acknowledges and agrees that his separation from employment with the Company in compliance with the terms of the Employment Agreement and this Agreement shall not serve as the basis for any claim or action (including, without limitation, any claim under the Age Discrimination in Employment Act of 1967).     e. In signing this Agreement, Executive acknowledges and intends that the Agreement shall be effective as a bar to each and every one of the Claims hereinabove mentioned or implied. Executive expressly consents that this General Release shall be given full force and effect according to each and all of its express terms and provisions, including those relating to unknown and unsuspected Claims (notwithstanding any state statute that expressly limits the effectiveness of a general release of unknown, unsuspected and unanticipated Claims), if any, as well as those relating to any other Claims hereinabove mentioned or implied. Executive acknowledges and agrees that this waiver is an essential and material term of this Agreement and that without such waiver the Company would not have agreed to the terms of the Agreement. Executive covenants that he shall not directly or indirectly, commence, maintain or prosecute or sue any of the Released Persons either affirmatively or by way of cross-complaint, indemnity claim, defense or counterclaim or in any other manner or at all on any Claim covered by this General Release. Executive further agrees that in the event he should bring a Claim seeking damages against the Company, or in the event he should seek to recover against the Company in any Claim brought by a governmental agency on his behalf, this Agreement shall serve as a complete defense to such Claims. Executive further agree that he is not aware of any pending charge or complaint of the type described in paragraph 3.b. as of the     4   EXECUTION COPY     4. No Admission of Liability.   Executive agrees that neither this Agreement, nor the furnishing of the consideration for this Agreement, shall be deemed or construed at any time to be an admission by the Company, any Released Party or Executive of any improper or unlawful conduct.   5. Confidentiality.   Executive agrees that this Agreement is confidential and agree not to disclose any information regarding the terms of this Agreement, except to his immediate family and any tax, legal or other counsel he has consulted regarding the meaning or effect hereof or as required by law, and Executive will instruct each of the foregoing not to disclose the same to anyone. Any non-disclosure provision in this Agreement does not prohibit or restrict Executive (or his attorney) from responding to any inquiry about this Agreement or its underlying facts and circumstances by the Securities and Exchange Commission, the National Association of Securities Dealers, Inc. or any other self-regulatory organization or governmental entity. 6. Affirmation of Employment Agreement.   Except as otherwise provided in this Agreement, the parties hereby expressly re-affirm the Employment Agreement, including but not limited to the Executive’s obligations under Sections 1.5, 1.6, 1.7, 1.8, 1.9 1.10 and 3.1 of the Employment Agreement and the Company’s obligations under Section 1.3(g) of the Employment Agreement. Notwithstanding anything to the contrary in the Employment Agreement, the parties agree that (i) for purposes of Sections 1.8 and 2.1 of the Employment Agreement, the definition of “Business” shall be limited to the licensing- businesses of Iconix and Cherokee only; (ii) Section 1.8(a) of the Employment Agreement shall not preclude Executive from participating in or otherwise being employed by or providing services to any Person that purchases the Company’s licensing business or other successor to the Company; (iii) in the event Executive participates in or otherwise is employed by or provides services to any Person that purchases the Company’s licensing business or is a successor to the Company, Section 1.5 of the Employment Agreement shall not preclude Executive from using or disclosing any Confidential Information or Third Party Information to the extent such disclosure or use is consistent with Executive’s service with such purchaser or other successor; and (iv) Section 1.3(g) of the Employment Agreement shall survive and continue in full force in accordance with its terms as though Executive continued to be an executive officer of the Company, notwithstanding Executive’s termination of employment with, and service as an officer of, the Company on the Termination Date. 7. Validity.   Whenever possible, each provision of this Agreement shall be interpreted in such of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had     5   EXECUTION COPY   8. Successors and Assigns   This Agreement shall inure to and be binding upon the parties hereto and to their respective heirs, legal representatives, successors, and assigns.   9. Governing Law   This Agreement shall be construed in accordance with the laws of the state of New York and any applicable federal laws.   10. Special Notification   Because this Agreement includes a waiver and release of claims arising under the Age Discrimination in Employment Act, federal law provides that Executive may have twenty-one (21) days from receipt of the Agreement to review and consider this Agreement before executing it. Federal law also provides that the Employer must advise Executive to consult with an attorney before signing this Agreement. Executive understands that it is Executive’s decision whether or not to consult an attorney.   Pursuant to federal law, Executive is further advised that the release and covenant not to sue contained herein do not apply to claims that arise after the execution of this Agreement. Executive further understands and agrees that Executive is receiving additional consideration that Executive would not be entitled to receive under the Employment Agreement, any Company policy, practice or plan of if Executive did not execute this Agreement which includes the waiver and release of claims under the Age Discrimination in Employment Act.   Executive represents and warrants that he has had ample opportunity to consider this Agreement and has had an opportunity to consult an attorney before executing this Agreement.   11. Revocation of Agreement   Federal law also provides that, because this Agreement waives and releases claims arising under the Age Discrimination in Employment Act, that Executive may revoke this Agreement within seven (7) days after Executive executes it. For this revocation to be effective, written notice must be received by Sue Nam, General Counsel, no later than the close of business on the seventh day after Executive has executed this Agreement. If Executive revokes the Agreement, it will not be effective or enforceable, and Executive will not receive the payments described in Paragraph 1 (other than the payments and benefits in subparagraphs 1.a and 1.f).     6   EXECUTION COPY     12. Acknowledgement.   BY SIGNING THIS AGREEMENT, EXECUTIVE REPRESENTS AND AGREES THAT: (a) EXECUTIVE HAS READ IT CAREFULLY; (b) EXECUTIVE UNDERSTANDS ALL OF ITS TERMS AND KNOWS THAT HE IS GIVING UP IMPORTANT RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED; (c) EXECUTIVE VOLUNTARILY CONSENTS TO EVERYTHING IN THE AGREEMENT; (d) EXECUTIVE HAS BEEN ADVISED TO CONSULT WITH AN ATTORNEY (VIA THIS AGREEMENT) BEFORE EXECUTING IT AND EXECUTIVE HAS DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION, EXECUTIVE HAS CHOSEN NOT TO DO SO OF HIS OWN VOLITION; (e) EXECUTIVE HAS HAD AT LEAST 21 DAYS FROM THE DATE OF HIS RECEIPT OF THE LANGUAGE OF THE GENERAL RELEASE SUBSTANTIALLY IN ITS FINAL FORM ON DECEMBER 11, 2006 TO CONSIDER IT; AND THE CHANGES MADE SINCE THE DECEMBER 11, 2006 VERSION OF THE GENERAL RELEASE ARE NOT MATERIAL AND WILL NOT RESTART THE REQUIRED 21-DAY PERIOD; (f) THE CHANGES TO THE LANGUAGE OF THE GENERAL RELEASE SINCE DECEMBER 11, 2006 EITHER ARE NOT MATERIAL OR WERE MADE AT HIS REQUEST. (g) EXECUTIVE HAS SIGNED THIS AGREEMENT KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE HIM WITH RESPECT TO IT; AND (h) EXECUTIVE AGREES THAT THE PROVISIONS OF THIS AGREEMENT MAY NOT BE AMENDED, WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY EXECUTIVE.     7   EXECUTION COPY   indicated below.     /s/ Charles A. Zona                                                       CHARLES A. ZONA Date: June 20, 2008       NEXCEN BRANDS, INC.     By: /s/ Kenneth J. Hall                                                 Name: Kenneth J. Hall Date: June 26, 2008       8  

EXHIBIT 13.2 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION -OXLEY ACT OF 2002 In connection with the Annual Report of R.V.B. Holdings Ltd. (the “Company”) on Form 20-F/A for the year ended December 31, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Annual Report”), I, Ofer Naveh, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: 1. This Annual Report fully complies with the requirements of section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and 2. The information contained in this Annual Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date:July 26, 2012 /s/ Ofer Naveh Ofer Naveh Chief Financial Officer

Exhibit 10.41 EXECUTION COPY CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. MASTER AGREEMENT dated as of July 23, 2017 by and among: OCWEN LOAN SERVICING, LLC, HLSS HOLDINGS, LLC, HLSS MSR – EBO ACQUISITION LLC, and NEW RESIDENTIAL MORTGAGE LLC Section 1. Definitions; Interpretation. 3 Section 2. Consent to Transfer Agreement. 11 Section 3. Lump-Sum Payments. 12 Section 4. Sale Supplements. 13 Section 5. Servicer Ratings Increased Costs. 19 Section 6. Escrow Accounts and Custodial Accounts. 19 Section 7. Investment Income Earned on Amounts on Deposit in any Custodial Account or Escrow Accounts. 20 Section 8. Third Party Consents for Transfers to NRM Pursuant to the Transfer Agreement. 20 Section 9. Consent Non-Delivery Determination Dates. 21 Section 10. Standstill; Conditional Waivers of Specified Termination Events. 25 Section 11. Sale of Rights to MSRs and Transferred Receivables Assets in Respect of the Designated Servicing Agreements. 26 Section 12. Conditions Precedent to Effectiveness of this Agreement. 26 Section 13. Representations and Warranties of Seller to the Purchasers and NRM. 26 Section 14. Representations and Warranties of the Purchasers and NRM to Seller 27 Section 15. Termination. 28 Section 16. Miscellaneous. 29 Schedules, Exhibits and Annexes Schedule 1: Previously Executed Amendments Schedule 2: Lump-Sum Payment Percentages Schedule 3: Wire Transfer Instructions Exhibit 1: Group Selection Procedures Exhibit 2: Form of Sale Supplement Exhibit 3A: Form of RMSR Transfer Agreement Exhibit 3B: Form of Sale Agreement Exhibit 4: Specified Termination Events Exhibit 5: Third Party Purchase Agreement Documentation Principles Exhibit 6: [RESERVED] Exhibit 7: Major Shelf Groups Exhibit 8: New RMSR Agreement Documentation Principles Exhibit 9: Exhibit 10: Designated Servicing Agreements Annex I: Schedules I through and including VI to the Sale Supplement, dated as of February 10, 2012 Annex II: Schedules I through and including VI to the Sale Supplement, dated as of May 1, 2012 Annex III: Schedules I through and including VI to the Sale Supplement, dated as of August 1, 2012 Annex IV: September 13, 2012 Annex V: September 28, 2012 Annex VI: December 26, 2012 Annex VII: Schedules I through and including VI to the Sale Supplement, dated as of March 13, 2013 Annex VIII: Schedules I through and including VI to the Sale Supplement, dated as of May 21, 2013 Annex IX: Schedules I through and including VI to the Sale Supplement, dated as of July 1, 2013 Annex X: Schedules I through and including VI to the Sale Supplement, dated as of October 25, 2013 MASTER AGREEMENT This Master Agreement (this “Agreement”), dated as of July 23, 2017 (the “Effective Date”), is executed within the United States Virgin Islands (the “USVI”) by and among: (i)    OCWEN LOAN SERVICING, LLC, a Delaware limited liability company (“Seller”); (ii)    HLSS HOLDINGS, LLC, a Delaware limited liability company (“Holdings”); (iii)    HLSS MSR – EBO ACQUISITION LLC, a Delaware limited liability company (“MSR – EBO” and together with Holdings, the “Purchasers”); and (iv)    NEW RESIDENTIAL MORTGAGE LLC, a Delaware limited liability company (“NRM”). WITNESSETH: WHEREAS, Seller, Holdings, and MSR – EBO (as assignee of Home Loan Servicing Solutions, Ltd.) are parties to the Master Servicing Rights Purchase Agreement, dated as of October 1, 2012 (as amended prior to the Effective Date pursuant to the amendments described on Schedule 1 hereto and as otherwise amended or modified prior to the Effective Date, the “MSR Purchase Agreement”); Solutions, Ltd.) are parties to the Sale Supplements to the MSR Purchase Agreement, dated as of February 10, 2012, May 1, 2012, August 1, 2012, September 13, 2012, September 28, 2012, December 26, 2012, March 13, 2013, May 21, 2013, July 1, 2013, and October 25, 2013 (each, as amended prior to the Effective Date pursuant to the amendments described on Schedule 1 hereto and as otherwise amended or modified prior to the Effective Date, each a “Sale Supplement” and, collectively, the “Sale Supplements”); WHEREAS, pursuant to the MSR Purchase Agreement and the Sale Supplements, Seller sold to the Purchasers (without recourse, except as otherwise provided therein) the Rights to MSRs, the Excess Servicing Fees, and the Transferred Receivables Assets, and the Purchasers assumed the Assumed Liabilities with respect to all Servicing Agreements described or otherwise referenced on Schedule I to any Sale Supplement (the “MSRPA Servicing Agreements”); WHEREAS, as the owners of the Rights to MSRs in respect of the MSRPA Servicing Agreements, the Purchasers are the owners of, among other things, all existing and future accruing and payable Servicing Fees under the MSRPA Servicing Agreements; WHEREAS, in connection with the transactions contemplated hereby, Seller will transfer to NRM all of Seller’s right, title and interest in, and all of Seller’s obligations and liabilities under, each MSRPA Servicing Agreement pursuant to the Transfer Agreement dated as of the Effective Date among NRM, Seller, Ocwen Financial Corporation and New Residential Investment Corp. 1 “Transfer Agreement”) and after the Transfer Date (as defined in the Transfer Agreement) such servicing rights will be “Transferred Servicing Rights; WHEREAS, upon the Transfer Date, the related MSRPA Servicing Agreement shall cease to be a “Deferred Servicing Agreement” for purposes of the Sale Supplements (but such transfer will not otherwise impair or affect any prior transfer of Excess Servicing Fee, Rights to MSRs, or any other Transferred Receivables Assets or prior assumption of Assumed Liabilities in respect of such MSRPA Servicing Agreement); WHEREAS, in connection with any MSRPA Servicing Agreement ceasing to be a Deferred Servicing Agreement as contemplated above, Holdings will make a Lump-Sum Payment (as defined herein) to Seller in accordance with the terms hereof; WHEREAS, NRM and Seller will enter into a Subservicing Agreement with respect to the Transferred Servicing Rights (as amended, restated, supplemented or otherwise modified from time to time, the “NRM Subservicing Agreement”); WHEREAS after the transfer of the Transferred Servicing Rights to NRM pursuant to the Transfer Agreement, Seller will subservice the related Mortgage Loans in accordance with the NRM Subservicing Agreement; WHEREAS, in connection with the transactions contemplated hereby, the Purchasers have agreed not to exercise certain contracted rights during a “Standstill Period” (as defined herein) associated with specified types of Termination Events; WHEREAS, if Servicing Rights are sold to a third party pursuant to Section 9.3 of this Agreement, Seller will receive the related Rights to MSRs and the related Transferred Receivable Assets from Purchasers, which Seller will immediately transfer to the third party acquirer, as an accommodation for the Purchasers, in accordance with a Third Party Purchase Agreement (as defined herein); WHEREAS, Ocwen Mortgage Servicing, Inc. (“OMS”), the parent corporation of Seller, (i) has reviewed, analyzed, and approved this transaction, (ii) has authorized and caused Seller to enter into this Agreement, and (iii) has not delegated any authority to any person outside the USVI to negotiate or agree to terms on its behalf; and WHEREAS, the Seller, Purchasers, and NRM shall each execute this Agreement in the USVI. NOW, THEREFORE, in connection with the foregoing, in consideration of the premises and the mutual covenants herein contained, the parties hereto hereby agree as follows: 2   Section 1.Definitions; Interpretation. 1.1    Capitalized terms used but not defined herein shall have the meaning set forth in the MSR Purchase Agreement, or, if not defined therein, in the Sale Supplements. 1.2    As used in this Agreement, the following terms shall have the following meanings: “Account Cost True-Up Payment” is defined in Section 6.3 of this Agreement. “Adjusted Total UPB” means, as of any date of determination, an amount equal to the following: (i) the aggregate Specified Condition UPB in respect of all MSRPA Servicing Agreements as of March 31, 2017; minus (ii) the aggregate Specified Condition UPB as of March 31, 2017 in respect of all MSRPA Servicing Agreements for which the parties mutually agreed not to pursue obtaining any applicable Third Party Consents; minus (iii) MSRPA Servicing Agreements for which Seller is terminated other than because of an exercise of a Clean Up Call Right; minus (iv) MSRPA Servicing Agreements that are not Major Shelf Servicing Agreements for which the Transfer Date did not occur and such MSRPA Servicing Agreements were terminated prior to such date of determination because of the exercise of a Clean Up Call Right. “Agreement” is defined in the preamble to this Agreement. “Amendment No. 2” means Amendment No. 2 to Master Servicing Rights Purchase Agreement and Sale Supplements, dated as of April 6, 2015, among Seller, the Purchasers and Home Loan Servicing Solutions, Ltd. “Approved Third Party Appraisers” means the following parties and any other residential mortgage servicing appraisal service provider as mutually agreed upon by Seller and Holdings as an “Approved Third Party Appraiser” for purposes of this Agreement: (i) Phoenix Analytic Services, Inc., (ii) Mortgage Industry Advisory Corporation, and (iii) MountainView Financial Solutions. “Assignment Agreement” has the meaning set forth in the Transfer Agreement. 3   “Average Third Party Mark” means, in respect of any Group, the average of two appraisals from two Approved Third Party Appraisers engaged by NRM or its affiliates for the related Servicing Rights (inclusive of the Rights to MSRs and deferred servicing fees) for such Group. If any particular appraisal is a range of values, then such appraisal shall be the mean of such range of values for purpose of this definition. “Change of Control” means a “Change of Control” as defined in and determined in accordance with the provisions of the NRM Subservicing Agreement. “Clean Up Call Right” has the meaning set forth in Amendment No. 2 and includes, for the avoidance of doubt, any optional termination, or clean-up call right held by any relevant transaction party (and not merely those in the name of Seller). “Consent Non-Delivery Determination Date” means, in respect of any Group, the earlier of (i) the one-year anniversary of the Effective Date and (ii) the Designation Date immediately following the date upon which Seller and NRM mutually agree that any necessary Third Party Consent to cause a transfer of the related Seller Servicing Rights to NRM will not be received. “Designated Servicing Agreements” means the MSRPA Servicing Agreements described on Exhibit 10 hereto. “Designated Servicing Agreements Price” means, for any Designated Servicing Agreement, the “Designated Servicing Agreement Price” listed opposite the reference to such Designated Servicing Agreement on Exhibit 10 hereto. “Designation Date” means each of October 23, 2017, January 23, 2018 and April 23, 2018. “Fee Restructuring Payment” means, as of any date in respect of any Group, an amount equal to the Lump-Sum Payment or Lump-Sum Payments, as applicable, that Holdings would pay Seller if the Transfer Date or Transfer Dates, as applicable, occurred on such date, as adjusted in accordance with Exhibit 1 hereto. “Fee Restructuring Payment Option” is defined in Section 9.1 of this Agreement. “Final Increased Cost Payment” is defined in Section 5 of this Agreement. “Float Payment Right” is defined in Section 7.1 of this Agreement. “Float True-Up Payment” is defined in Section 7.1 of this Agreement. “Full Waiver Eligibility Period” means the period commencing on the Effective Date and ending at the earliest of: (i) January 23, 2019; (ii) the Seller’s failure to observe or perform in any material respect its obligations under Section 8 hereof and both (a) such failure continues 4   unremedied for a period of thirty (30) days after the date on which written notice of such failure shall have been given to Seller by either Purchaser or NRM and (b) the Purchasers and NRM are in compliance in all material respects with their respective obligations under Section 8 hereof and all prior material non-compliance shall have been cured; (iii) the later of (a) the one-year anniversary of this Agreement and (b) the date on which Sections 9.1, 9.2, 9.3, and 9.4 have been applied as set forth herein for all MSRPA Servicing Agreements for which the Consent Non-Delivery Determination Date has occurred on or prior to the one-year anniversary of this Agreement (such that the time at which Seller may exercise the Purchase Option for such Group in accordance with clause (ii) of the first sentence of Section 9.4 hereof has expired for any such MSRPA Servicing Agreement); (iv) the termination of this Agreement in accordance with Section 15.1 hereof (including any termination of this Agreement occurring because of any termination of the NRM Subservicing Agreement because of the occurrence of a Change of Control); and (v) the date upon which Seller terminates the NRM Subservicing Agreement in accordance with Section 5.1(a) thereof; provided that such termination shall be the result of a determination that the Subservicer’s duties under the NRM Subservicing Agreement are no longer permissible under applicable law. time in the United States of America. “Group” means any group of MSRPA Servicing Agreements for which the Consent Non-Delivery Determination Date has occurred. The selection of any MSRPA Servicing Agreements for any “Group” shall be either (i) determined by mutual agreement of Holdings and Seller, or (ii) in accordance with the procedures set forth on Exhibit 1. “Holdings” is defined in the preamble to this Agreement. “Internal Mark” means, at any time in respect of any Group, the Purchasers’ internal valuation of the related Servicing Rights (inclusive of the Rights to MSRs and deferred servicing fees) for such Group, as of the last day of the calendar month then most recently ended. Such valuation shall be determined consistently (i) with GAAP and (ii) in the manner in which the internal valuations of the Rights to MSRs are calculated in the Purchasers’ books and records. “Investment Rights Expiration Date” means, in respect of any MSRPA Servicing Agreement, the earliest of (i) the Transfer Date in respect thereof, (ii) the date on which Holdings exercises its Fee Restructuring Payment Option in respect thereof, or (iii) the date on which Seller exercises the Purchase Option in respect thereof. “Lump-Sum Payment” means, in respect of any MSRPA Servicing Agreement, an amount equal to the product of (i) the unpaid interest bearing principal balance of the Primary Mortgage 5   Loans in respect of such MSRPA Servicing Agreement on the first day of the month in which the related Transfer Date occurs and (ii) the applicable Lump-Sum Payment Percentage. “Lump-Sum Payment Percentage” means, with respect to any MSRPA Servicing Agreement, the applicable “Lump-Sum Payment Percentage” (in basis points) set forth on Schedule 2 hereto opposite the reference to the month in which the applicable Transfer Date for such MSRPA Servicing Agreement occurs. “Major Shelf Group” means the groupings of Major Shelf Servicing Agreements, as set forth on Exhibit 7 hereto. “Major Shelf Servicing Agreement” means any MSRPA Servicing Agreement included in a Major Shelf Group. “Major Shelf Specified Condition UPB” means, for any Major Shelf Servicing Agreement, the aggregate unpaid interest bearing principal balance of the Primary Mortgage Loans under such Major Shelf Servicing Agreement as of the close of business on March 31, 2017. “MSR Purchase Agreement” is defined in the recitals to this Agreement. “MSR – EBO” is defined in the preamble to this Agreement. “MSRPA Servicing Agreements” is defined in the recitals to this Agreement. “New RMSR Agreement” means the New RMSR Agreement among Seller and the Purchasers to be entered into after the Effective Date pursuant to Section 8.7 hereof, which shall be drafted and entered into in accordance with the documentation principles set forth on Exhibit 8. “Non-Consented Servicing Rights” means any Seller Servicing Rights with respect to which the Required Consent (as defined in the Transfer Agreement) has not been obtained by the Consent Non-Delivery Determination Date. “NRM Subservicing Agreement” is defined in the recitals to this Agreement. “OMS” is defined in the recitals to this Agreement. “Option #1 Exercise Deadline” means, for any Group, unless otherwise mutually agreed in writing by Holdings and Seller, either: (i) close of business on the tenth (10th) Business Day after the Consent Non-Delivery Determination Date for such or Group; or (ii) such earlier date as may be specified in writing by Holdings to Seller. “Option #2 Exercise Deadline” means, for any Group, unless otherwise mutually 6   (i) the close of business on the later of (a) the tenth (10th) Business Day after the Option #1 Exercise Deadline for such Group, and (b) the tenth (10th) Business Day after the related Valuation Package has been delivered to Seller; or (ii) such earlier date as may be specified in writing by Seller to Holdings. “Primary Mortgage Loan” means any Mortgage Loan (including REO and loans in foreclosure) with respect to which Seller or an affiliate thereof is the “primary” servicer or subservicer performing the traditional mortgage servicing functions with respect to the related Mortgagor. “Purchase Option” is defined in Section 9.2 of this Agreement. “Purchasers” is defined in the preamble to this Agreement. “Related Agreements” means the Transfer Agreement, New RMSR Agreement, and NRM Subservicing Agreement. “Reconciliation Date” means, with respect to any Transfer Date, the fifth (5th) Business Day thereafter. “Reconciliation Report” is defined in Section 3.2 of this Agreement. “Remaining UPB” means, as of any date, an amount equal to the following: (i) MSRPA Servicing Agreements that are Deferred Servicing Agreements under the Sale Supplements as of such date; minus (ii) to the extent included in clause (i) above, the aggregate Specified Condition UPB as of March 31, 2017 in respect of all MSRPA Servicing Agreements (a) to be transferred pursuant to Section 8 and for which Third Party Consents have been obtained, and (b) to be transferred pursuant to Section 9.2, 9.3, or 9.4 hereof, but, in the case of either (a) or (b) Purchasers were unable to obtain any necessary financing consents for the transfer; minus (iii) UPB as of March 31, 2017 in respect of all MSRPA Servicing Agreements to be transferred pursuant to Section 8 and for which all Third Party Consents have been obtained and Seller is prepared to transfer but the related Servicing Rights have not been transferred by Seller because NRM has chosen not to transfer because NRM has terminated the NRM Subservicing Agreement for cause; 7   minus (iv) UPB as of March 31, 2017 in respect of all MSRPA Servicing Agreements for which the parties mutually agreed not to pursue obtaining any applicable Third Party Consents; plus (v) for each Major Shelf Servicing Agreement not included in clause (i) due to being Clean Up Call Right, the product of (x) the Major Shelf Specified Condition UPB as of March 31, 2017 in respect of such Major Shelf Servicing Agreement, and (y) the ratio of (a) the aggregate Major Shelf Specified Condition UPB as of March 31, 2017 in respect of all Major Shelf Servicing Agreements in the related Major Shelf Group that are Deferred Servicing Agreements under the Sale Supplements as of such date to (b) the positive difference between (1) the aggregate Major Shelf Specified Condition UPB as of March 31, 2017 in respect of all Major Shelf Servicing Agreements in the related Major Shelf Group as of March 31, 2017, and (2) the aggregate Major Shelf Specified Condition UPB as of Major Shelf Group that were terminated prior to such date of determination because of the exercise of a Clean Up Call Right. “Reservation Price” means, in respect of any Group, the reservation price established by Holdings, which shall be an amount no greater than the greater of (i) the Average Third Party Mark for such Group and (ii) the Internal Mark for such Group. “SAF” means any servicer advancing financing facility in place from time to time in connection with any of the Transferred Receivables Assets. “Sale Supplements” is defined in the recitals to this Agreement. “Seller” is defined in the preamble to this Agreement. “Seller Servicing Rights” means, in respect of any MSRPA Servicing Agreement, all of Seller’s rights, title, and interest in respect thereof other than Rights to MSRs (including the Excess Servicing Fees) and Transferred Receivables Assets previously sold to the Purchasers pursuant to the MSR Purchase Agreement and the related Sale Supplements. “Shared Costs” is defined in Section 8.4 of this Agreement. “Specified Condition” means a condition that shall be satisfied on any date determination if, and only if, the ratio of Remaining UPB to Adjusted Total UPB is less than or equal to 20% prior 8   to the end of the Full Waiver Eligibility Period. If the Specified Condition is satisfied as of any date of determination, it will be deemed to be satisfied at all times going forward. “Specified Condition UPB” means, for any MSRPA Servicing Agreement, the aggregate unpaid interest bearing principal balance of the Primary Mortgage Loans under such MSRPA Servicing Agreement as of the close of business on March 31, 2017. “Specified Termination Events” is defined on Exhibit 4. “Standstill Period” means the period commencing on the Effective Date and ending at the earliest of: (i) (ii) (iii) (iv) the occurrence of a Change of Control with respect to Seller or Ocwen Financial Corporation, unless NRM consents to such Change of Control in accordance with the procedures set forth in the NRM Subservicing Agreement; (v) the termination of this Agreement in accordance with Section 15.1 hereof; and (vi) “Third Party Consents” shall mean any consent, authorization, approval, statement, waiver, order, license, certificate or permit or act of or from, or notice to any Rating Agency or any party 9   to or referenced in any MSRPA Servicing Agreement or any amendment to any MSRPA Servicing Agreement that is required under such Servicing Agreement in order to duly transfer the servicing of the Mortgage Loans and the Seller Servicing Rights to NRM pursuant to the Transfer Agreement (or any third party as contemplated by Section 9.3 hereof) and consummate the transactions contemplated by this Agreement and the related Related Agreements, in each case in form and substance reasonably satisfactory to Seller and NRM. “Third Party Purchase Agreement” means a purchase and sale agreement with representations, warranties, covenants and indemnifications to purchasers of the related Servicing Rights (including with respect to the Rights to MSRs and the Transferred Receivables Assets) that are no less favorable to a purchaser or transferee of mortgage servicing rights than those set forth in the Transfer Agreement (but taking into account the entire set of Servicing Rights in respect of any Mortgage Loan and/or Servicing Agreement and not merely Seller Servicing Rights as contemplated by the Transfer Agreement) except to the extent (i) set forth on Exhibit 5 hereto or (ii) otherwise mutually agreed in writing by Holdings and Seller. “Transfer Agreement” is defined in the recitals to this Agreement. “Transfer Date” means, in respect of any MSRPA Servicing Agreement, the date upon which all necessary Third Party Consents related to Seller Servicing Rights are obtained and become Transferred Servicing Rights to NRM pursuant to the Transfer Agreement. For the avoidance of doubt, any Seller Servicing Rights related to MSRPA Servicing Agreements for which Third Party Consents have not been obtained shall remain subject to the MSR Purchase Agreement and applicable Sale Supplement. The initial Transfer Date shall not occur until the earlier of (i) September 1, 2017, and (ii) the date on which Holdings has amended the existing SAF transactions to permit the financing of monthly advances and servicing advances arising under the related MSRPA Servicing Agreements currently subject to such SAFs after giving effect to the related Transfer Dates (or such earlier date as agreed to by Holdings); provided that the failure to obtain any such consents or amendments on or after September 1, 2017 shall not affect or waive the parties’ obligations under the Agreement. “Transferred Servicing Rights” is defined in the recitals to this Agreement. “USVI” is defined in the recitals to this Agreement. “Valuation Package” means, in respect of any Group, the following information: (i) the Average Third Party Mark for such Group (including reasonable supporting assumptions and valuation inputs); (ii) the Internal Mark for such Group; and (iii) the Reservation Price for such Group. 1.3    The headings preceding the text of Articles and Sections included in this Agreement and the headings to Annexes, Exhibits and Schedules attached to this Agreement are for convenience 10   only and shall not be deemed part of this Agreement or be given any effect in interpreting this Agreement. The use of the masculine, feminine or gender neutral or the singular or plural form of words herein shall not limit any provision of this Agreement. The use of the terms “including” or “include” shall in all cases herein mean “including, without limitation” or “include, without limitation,” respectively. Reference to any Person shall include such Person’s successors and assigns to the extent such successors and assigns are permitted by the terms of any applicable agreement. Reference to a Person in a particular capacity shall exclude such Person in any other capacity or individually. Reference to any agreement (including this Agreement), document or instrument shall mean such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof and, if applicable, the terms hereof. Underscored references to Articles, Sections, paragraphs, clauses, Annexes, Exhibits or Schedules shall refer to those portions of this Agreement unless otherwise specified. The use of the terms “hereunder,” “hereof,” “hereto” and words of similar import shall refer to this Agreement as a whole and not to any particular Article, Section, paragraph or clause of, or Annex, Exhibit or Schedule to, this Agreement. References to “dollars” or “$” shall mean United States dollars. Reference to any statute or statutory provision shall include any consolidation, reenactment, amendment, modification or replacement of the same and any subordinate legislation in force under the same from time to time. Accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP. 1.4    In the event of any inconsistency between this Agreement and the MSR Purchase Agreement or the Sale Supplements, this Agreement shall control. Section 2.    Consent to Transfer Agreement. 2.1    Each of Holdings and MSR – EBO hereby consents to the transfers of Seller Servicing Rights contemplated by the Transfer Agreement and, upon the Transfer Date, the subservicing of the related Mortgage Loans pursuant to the NRM Subservicing Agreement. Notwithstanding any provision in this Agreement to the contrary, all rights, title (including any document of title), interest, beneficial ownership, and risk of loss in the Seller Servicing Rights that are sold, transferred, assigned, set over, and conveyed to NRM upon the transfer of the Transferred Servicing Rights shall pass by Seller to NRM in the USVI on the Transfer Date within the USVI. 2.2    Upon the Transfer Date, the related Servicing Agreement shall be neither a “Deferred Servicing Agreement” nor a “Transferred Servicing Agreement” for purposes of the MSR Purchase Agreement and the related Sale Supplement. For the avoidance of doubt, under no circumstance shall the unpaid principal balance on any Mortgage Loan subserviced under the NRM Subservicing Agreement (as primary servicer or subservicer, but not merely master servicer) be utilized for purposes of calculating the Retained Fee, the Performance Fee and/or the Seller Monthly Servicing Fee under any Sale Supplement from and after the date such Mortgage Loan is initially subserviced under the NRM Subservicing Agreement. 2.3    The occurrence of the Transfer Date will not in any way modify any prior sales and assignments of Rights to MSRs; equity interests in Advance SPEs and Transferred Receivables Assets pursuant to the MSR Purchase Agreement and the Sale Supplements. The Purchasers and their assignees (as applicable) will not assign, transfer or otherwise reconvey any portion of the 11   applicable Rights to MSRs, Advance SPEs and Transferred Receivables Assets in respect of any MSRPA Servicing Agreement to Seller in connection with any such transfer. Section 3.    Lump-Sum Payments. 3.1    Payment of Lump-Sum Payments by Holdings. Subject to the terms and conditions in the Transfer Agreement, on each Transfer Date, the related Lump-Sum Payment(s) shall be paid by Holdings to Seller as follows: (a)    No later than five (5) Business Days before any Transfer Date, Seller shall provide to Holdings a draft settlement statement which shall include a written estimated calculation of the Lump-Sum Payment (or Lump-Sum Payments) in respect of such Transfer Date based on data from the last day of the prior month (or as otherwise agreed by the parties). With respect to each Transfer Date and the applicable Servicing Rights, Holdings shall pay to Seller’s account in the USVI an amount equal to the applicable Lump-Sum Payment (or Lump-Sum Payments), in immediately available funds on such Transfer Date. (b)    On or prior to the fifth (5th) Business Day following the applicable Reconciliation Date, the Lump-Sum Payment with respect to any transfer of Servicing Rights shall be adjusted as set forth on the related Reconciliation Report. To the extent that a Lump-Sum Payment paid by Holdings to Seller pursuant to Section 3.1(a) hereof exceeds the actual Lump-Sum Payment as reconciled, Seller shall refund such excess amount to Holdings by the end of the following Business Day. To the extent that the aggregate Lump-Sum Payment set forth on the applicable Reconciliation Report exceeds the corresponding Lump-Sum Payment paid by Holdings to Seller pursuant to Section 3.1(a), Holdings shall pay such excess amount to the Seller by the end of the following Business Day. (c)    No payment under this Section 3.1 shall constitute a waiver by NRM, any Purchaser or the Seller, as applicable, of, or otherwise limit or reduce, any of the parties’ respective indemnification or refund obligations under the Transfer Agreement, this Agreement, the MSR Purchase Agreement or any Sale Supplement. (d)    Notwithstanding anything contained herein to the contrary, Holdings shall not shall have any obligation to make any payment under any subsection of this Section 3.1 with respect to any Non-Consented Servicing Rights. (e)    Further, notwithstanding anything contained herein to the contrary, the Lump-Sum Payment may be paid in such percentages and at such times upon which Seller and Holdings (or NRM on behalf of Holdings) may otherwise mutually agree in writing. 3.2    Reconciliation Report. On each Reconciliation Date, Seller shall furnish to Holdings a final settlement report (each, a “Reconciliation Report”) which includes, among other things, the final unpaid principal balance of each related Mortgage Loan as of the applicable Transfer Date and the corresponding final Lump-Sum Payment for the related Servicing Rights transferred on such Transfer Date, in each case after application of adjustments to be made pursuant to Sections 3.1(a) and (b) of this Agreement. In the event the Reconciliation Report shows an error in the Lump- 12   Sum Payment, it shall be accompanied with sufficient supporting detail that an error has occurred. In such a case, the party benefiting from the error shall (i) pay an amount sufficient to correct and reconcile the Lump-Sum Payment or such other amounts, and (ii) provide a reconciliation statement and such other documentation sufficient to satisfy the other party (in such other party’s exercise of its reasonable discretion) concerning the accuracy of such reconciliation. 3.3    Form of Payment to be Made. Unless otherwise agreed to by the parties, all payments to be made by a party to another party, or such other party’s designee, shall be made by wiring immediately available funds in United States dollars to the accounts designated by the receiving party in accordance with such party’s written instructions as set forth in Schedule 3 attached hereto or such other instructions as a party may require after written notice hereunder. Section 4.    Sale Supplements. Each Sale Supplement (other than the Schedules thereto) is amended in the as the Sale Supplement in the form attached as Exhibit 2, subject to the following: 4.1    For each Sale Supplement, the following bracketed terms shall have the meanings set forth opposite the date of such Sale Supplement as set forth below: Sale Supplement Date “[Servicing Fee Reset Date]” where such reference appears in the definition of “Servicing Fee Reset Date” “[Date]” wherever such term appears “[x]” in “Cut-Off Date” “[x]” in “Excess Servicing Fees” “[x]” in “Retained Servicing Fee Shortfall” February 10, 2012 March 5, 2020; provided, that if, as of March 5, 2018, there then exists an uncured Termination Event with respect to any affected Servicing Agreement in this Sale Supplement that is due to a servicer rating downgrade to “Below Average” or lower by S&P or to “SQ4” or lower by Moody’s, then the Servicing Fee Reset Date is March 5, 2018. February 10, 2012* *Other than the term “[Date]”in the definition of Closing Date, which shall be “March 5, 2012”. February 29, 2012 21.0 February 2012 13   Sale Supplement Date May 1, 2012 April 30, 2020; provided, that if, as of May 1, 2018, there then exists an Reset Date is May 1, 2018. May 1, 2012 April 30, 2012 19.5 May 2012 August 1, 2012 April 30, 2020; provided, that if, as of August 1, 2018, there then exists an Reset Date is August 1, 2018. August 1, 2012 July 31, 2012 17.0 August 2012 14   Sale Supplement Date September 13, 2012 April 30, 2020; provided, that if, September 13, 2018, there then exists an Reset Date is September 13, 2018. September 13, 2012 September 12, 2012 18.5 September 2012 September 28, 2012 April 30, 2020; provided, that if, as of September 28, 2018, there then exists an uncured Termination Event with respect to any affected Servicing Agreement in Reset Date is September 28, 2018. September 28, 2012 September 27, 2012 13.5 October 2012 15   Sale Supplement Date December 26, 2012 April 30, 2020; provided, that if, as of December 26, 2018, there then exists an Reset Date is December 26, 2018. December 26, 2012 December 24, 2012 16.0 January 2013 March 13, 2013 April 30, 2020; provided, that if, as of March 13, 2019, there then exists an Reset Date is March 13, 2019. March 13, 2013 March 12, 2013 15.0 March 2013 16   Sale Supplement Date May 21, 2013 April 30, 2020; provided, that if, as of May 21, 2019, there then exists an Reset Date is May 21, 2019. May 21, 2013 May 20, 2013 11.0 May 2013 July 1, 2013 April 30, 2020; provided, that if, as July 1, 2019, there then exists an uncured Termination Event with respect to any affected Servicing Agreement in this Sale Supplement that is due to a servicer rating downgrade to “Below Average” or lower by S&P or to “SQ4” or lower by Moody’s, then the Servicing Fee Reset Date is July 1, 2019. July 1, 2013 June 30, 2013 10.5 July 2013 17   Sale Supplement Date October 25, 2013 April 30, 2020; provided, that if, as October 25, 2019, there then exists an Reset Date is October 25, 2019. October 25, 2013 October 24, 2013 11.0 November 2013 4.2    Schedules I through and including VI to the Sale Supplement, dated as of February 10, 2012 are as set forth on Annex I hereto. 4.3    Schedules I through and including VI to the Sale Supplement, dated as of May 1, 2012 are as set forth on Annex II hereto. 4.4    Schedules I through and including VI to the Sale Supplement, dated as of August 1, 2012 are as set forth on Annex III hereto. 4.5    Schedules I through and including VI to the Sale Supplement, dated as of September 13, 2012 are as set forth on Annex IV hereto. 4.6    Schedules I through and including VI to the Sale Supplement, dated as of September 28, 2012 are as set forth on Annex V hereto. 4.7    Schedules I through and including VI to the Sale Supplement, dated as of December 26, 2012 are as set forth on Annex VI hereto. 4.8    Schedules I through and including VI to the Sale Supplement, dated as of March 13, 2013 are as set forth on Annex VII hereto. 4.9    Schedules I through and including VI to the Sale Supplement, dated as of May 21, 2013 are as set forth on Annex VIII hereto 18   4.10    Schedules I through and including VI to the Sale Supplement, dated as of July 1, 2013 are as set forth on Annex IX hereto. 4.11    Schedules I through and including VI to the Sale Supplement, dated as of October 25, 2013 are as set forth on Annex X hereto. Section 5.    Servicer Ratings Increased Costs. Pursuant to Section 3 of Amendment No. 2, Seller agreed to pay to Holdings certain amounts in respect of “Increased Costs” (as defined in Amendment No. 2) resulting from any “SAF Downgrade Event” (as defined in Amendment No. 2). Seller hereby agrees to pay to Holdings, and Holdings hereby agrees to accept from Seller, $1,028,000 in immediately available funds on the Effective Date (such amount, the “Final Increased Cost Payment”) in full satisfaction of Seller’s past and future obligations in respect of Increased Costs pursuant to Section 3 of Amendment No. 2. Section 6.    Escrow Accounts and Custodial Accounts. 6.1    Commencing as of the Effective Date until the Investment Rights Expiration Date, Seller shall exercise any rights under each MSRPA Servicing Agreement to direct the investment of amounts in any Custodial Account or Escrow Account (including the depositary institution where any such Custodial Account or Escrow Account is maintained) in accordance with Holdings’ directions subject to the terms of such MSRPA Servicing Agreement, the related Mortgage Loan Documents and Applicable Law. 6.2    Commencing as of the Effective Date until the Investment Rights Expiration Date, Seller shall (i) cooperate with NRM and the Purchasers to renegotiate the terms of Seller’s existing bank escrow and custodial contracts related to the MSRPA Servicing Agreements and (ii) provide Holdings and NRM such information as Holdings or NRM may reasonably request with respect to the existing Custodial Accounts and Escrow Accounts including, but not limited to, the following information: interest rates, rate reset frequency, interest rate fixed versus floating, if floating, formula to calculate floating rate, earnings credits, account maintenance fees, wiring fees, FDIC fees, volume of ACH payments, and escrow/custodial reconciliations. 6.3    As of the Effective Date, Holdings shall be responsible for all future costs of establishing and maintaining the Custodial Accounts and Escrow Accounts for the related MSRPA Servicing Agreement in accordance with the provisions of the related MSRPA Servicing Agreement. Holdings hereby agrees to pay to Seller, and Seller hereby agrees to accept from Holdings, $7,474,735 in immediately available funds on the Effective Date (such amount, the “Account Cost True-Up Payment”) in full satisfaction of the amount of the costs payable by the Purchasers or any affiliate thereof to Seller or any affiliate thereof on account of establishing and maintaining the Custodial Accounts and Escrow Accounts from the period commencing on the applicable Closing Dates to and including the Effective Date, including but not limited to, payment of all mortgagor interest payments related to the Escrow Accounts from and after the Effective Date. 19   Section 7.    Investment Income Earned on Amounts on Deposit in any Custodial Account or Escrow Accounts. 7.1    The Rights to MSRs held by Holdings include the right to receive any investment income earned on amounts on deposit in any Custodial Account or Escrow Account related to the MSRPA Servicing Agreements as of or after the applicable Closing Date pursuant to Section 2.5(a) of each Sale Supplement, but only to the extent the servicer is permitted to retain such investment income under the related MSRPA Servicing Agreement and under Applicable Law (such right, the “Float Payment Right”). Seller hereby agrees to pay to Holdings, and Holdings hereby agrees to accept from Seller, $13,011,836 in immediately available funds on the Effective Date (such amount, the “Float True-Up Payment”) in full satisfaction of the amount of the Float Payment not previously paid to Holdings in respect of the period from applicable Closing Dates to and including the Effective Date. 7.2    As of the Effective Date, the Purchasers shall be responsible for the payment of all future interest at the applicable stated rate on the funds on deposit in any Escrow Account that is payable to any Mortgagor under such MSRPA Servicing Agreement or under Applicable Law. Section 8.    Third Party Consents for Transfers to NRM Pursuant to the Transfer Agreement. 8.1    The parties hereto hereby agree to use best efforts to obtain all Third Party consents necessary or desirable to transfer the Seller Servicing Rights in respect of each MSRPA Servicing Agreement to NRM pursuant to the Transfer Agreement as quickly as possible. NRM shall not be required, however, to obtain ratings from any rating agencies to comply with its obligations under this Section 8.1. The parties agree to act in a coordinated manner in obtaining such Third Party Consents such that the purposes of this Agreement are not frustrated. 8.2    Seller will fully involve NRM and its representatives and advisors in the diligence plan and processes relating to obtaining Third Party Consents. Seller will provide ongoing updates to NRM and its representatives and advisors as to the progress of obtaining such Third Party Consents including, but not limited to, written weekly progress reports detailing the following, among other fields to be determined, (i) the “Shared Costs” (as defined below) incurred to date, (ii) estimated future “Shared Costs” and the estimated timing of incurring such Shared Costs, (iii) an updated count of diligenced MSRPA Servicing Agreements, (iv) an updated “consent tracker” showing consents received and the status of consents that have been requested but not yet delivered, (v) a description of the MSRPA Servicing Agreements in respect of which the Transfer Date has occurred. Seller will consult with NRM and its representatives and advisors regarding the framework for obtaining Third Party Consents (including, but not limited to, the determination of any applicable due diligence fields and the methodology to the preparation, negotiation and distribution of applicable consents and notices), the budgeting expenses and any potential changes in the methodology of the project and the policies and procedures for obtaining Third Party Consents. 20   8.3    Seller will instruct the holders of any Third Party Consents, any rating agencies, Custodians, Trustees and their representatives and advisors to (i) recognize NRM as a full, interested party in the relevant servicing transaction, (ii) include NRM in correspondence, and (iii) provide NRM and its advisors and representatives with full access to all documentation and permit communications, in each case, regarding servicing transfers in respect of the MSRPA Servicing Agreements. 8.4    Seller will pay the first $5.0 million of costs relating to Servicing Agreement diligence and other costs related to (i) mutually beneficial aspects of the Third Party Consent process for transfers to NRM pursuant to the Transfer Agreement and (ii) the Third Party Consent process for transfers to third parties pursuant to Section 9.3 hereof. Thereafter, Seller and NRM will equally share in the reasonable, documented out-of-pocket costs in excess thereof. The $5.0 million of costs paid by Seller and the shared costs contemplated by the preceding sentence are referred to herein as the “Shared Costs”. The “Shared Costs” do not include legal expenses of Seller and its affiliates or NRM and its affiliates for any particular matter, event or issue in connection with obtaining the Third Party Consents or the transfers of servicing to NRM if both Seller (and/or any affiliate) and NRM (and/or any affiliate) determine it is reasonably necessary or appropriate to for such parties to separately incur legal expenses for such matter, event or issue (including, without limitation, the negotiation and execution of the Related Agreements). 8.5    Seller and NRM shall consult with each other prior to the payment of any fees (other than legal fees and expenses) payable to any third party in connection with the delivery of any Third Party Consent. Either Seller or NRM may instruct the other party to cease incurring any particular type of future Shared Costs on reasonable advance written notice to such other party; provided, however that no party may prevent any Seller Servicing Right from becoming a Transferred Servicing Right by refusing to allow the incurrence of Shared Costs constituting customary fees, expenses or costs of a trustee or rating agency in respect of any Securitization Transaction related to any such MSRPA Servicing Agreement necessary to complete such transfer. 8.6    The provisions of this Section 8 shall govern the allocation of costs of obtaining Third Party Consents in connection with the transfer of servicing to NRM pursuant to the Transfer Agreement notwithstanding any provision in the contrary in the MSR Purchase Agreement or Sale Supplements. 8.7    The Seller and the Purchasers agree to use best efforts to enter into the New RMSR Agreement promptly following the execution hereof but, in any event, no later than the expiration of the Option #1 Exercise Deadline for the initial Group. The New RMSR Agreement shall be drafted and entered into in accordance with the documentation principles set forth on Exhibit 8 attached hereto. Section 9.    Consent Non-Delivery Determination Dates. 9.1    If the Consent Non-Delivery Determination Date occurs in respect of any Group, Holdings may, in its sole and absolute discretion, pay Seller an amount equal to the Fee Restructuring Payment in respect of such Group on or before the Option #1 Exercise Deadline for such Group. In such a circumstance, Holdings shall pay the Fee Restructuring Payment by wire transfer of 21   immediately available funds prior to the end of the Option #1 Exercise Deadline to Seller’s account in the USVI pursuant to written instructions to be provided by Seller. Upon Holdings’ payment of the Fee Restructuring Payment in respect of any Group to Seller: (i) Seller shall service the related Mortgage Loans and perform its obligations under such Group, in accordance with the New RMSR Agreement and (ii) each MSRPA Servicing Agreement in such Group shall cease to be a “Deferred Servicing Agreement” for purposes of the MSR Purchase Agreement and Sale Supplements (although nothing shall impair the prior valid transfers of the Rights to MSRs, equity interests in Advance SPEs and Transferred Receivables Assets thereunder). Holdings’ option to pay Seller an amount equal to the Fee Restructuring Payment in respect of any Group as described above is referred to herein as the “Fee Restructuring Payment Option”. 9.2    If Holdings has not exercised the Fee Restructuring Payment Option for any Group before the Option #1 Exercise Deadline for such Group, Seller may, at its option in its sole and absolute discretion, purchase the following from the Purchasers in respect of such Group: (i) the Rights to MSRs at a purchase price in cash or other immediately available funds equal to (A) the greater of the related Average Third Party Mark and the related Internal Mark minus (B) an amount equal to the Fee Restructuring Payment for such Group and (ii) all related Transferred Receivables Assets at a purchase price in cash or other immediately available funds equal to the outstanding balance of such Transferred Receivables Assets. Seller’s option to purchase the Rights to MSRs and Transferred Receivables Assets in respect of any Group as described above is referred to herein as the “Purchase Option”. In order to exercise the Purchase Option for any Group, (i) Seller shall give written notice in respect thereof on before the Option #2 Exercise Deadline for such Group and (ii) Seller and Purchasers shall work in good faith to consummate such Purchase Option as soon as practicable (but, in any event, within fifteen (15) days (or, if Seller needs to obtain financing, thirty (30) days)) after the Purchasers’ receipt of such written notice from Seller. 9.3    If (x) Holdings has not exercised the Fee Restructuring Payment Option for any Group before the related Option #1 Exercise Deadline, and (y) Seller has not exercised the Purchase Option for any Group before the related Option #2 Exercise Deadline, the Purchasers and their affiliates may, at their option, in their sole and absolute discretion, market the related Servicing Rights for such Group (including the Rights to MSRs and any Transferred Receivables Assets) to any third parties. The following shall apply in the event of any such marketing: (a)    Purchasers shall deliver to Seller (i) all written term sheets, written offers submitted by third parties (including, in each case, those submitted in electronic form) and any non-disclosure agreements, in each case, in connection with such marketing promptly following its receipt thereof, and (ii) on a weekly basis, a written report (which may be delivered via email) generally describing the marketing process and any other written indications of interest that the Purchasers have received in connection with such marketing. (b)    Before the execution of the definitive documentation for any such sale in accordance with clause (f) below, so long as such winning bid is greater than or equal to the related Reservation Price, Seller will have the option to purchase the related Rights to MSRs in respect of such Group at the highest third party bid obtained minus the applicable Fee Restructuring Payment. If the winning bid is less than the related Reservation Price and the 22   Purchasers desire, in their sole and absolute discretion, to proceed with the sale, Seller shall have the option to purchase the related Rights to MSRs in respect of such Group at the highest third party bid obtained. If Seller does purchase such Rights to MSRs for such Group, Seller will also be required to purchase the related Transferred Receivables Assets for a price equal to the outstanding balance thereof. Holdings shall select the winning bid for any particular potential sale. (c)    If the Servicing Rights (including the Rights to MSRs and any Transferred Receivables Assets) are instead sold to a third party, Holdings shall (i) pay Seller an amount equal to the Fee Restructuring Payment in respect of such MSRPA Servicing Agreement on the related closing date and (ii) use reasonable efforts to encourage such third party to engage Seller as a subservicer in respect of such MSRPA Servicing Agreement. The Purchasers are entitled to all proceeds of such sale so long as Holdings pays to Seller the Fee Restructuring Payments in respect of the applicable MSRPA Servicing Agreements as contemplated by the preceding sentence. (d)    Immediately before any such sale to any third party or to Seller pursuant to this Section 9.3(b), Purchasers and any applicable affiliates will transfer to Seller the related Rights to MSRs and the related Transferred Receivables Assets. Each of the parties hereto acknowledges and agrees that any such transfer to Seller before a transfer to a third party is effectuated by Seller merely as an accommodation party in order to facilitate the transfer of such Rights to MSRs and related Transferred Receivables Assets to a third party in accordance with this Section 9.3, and as a result Seller will not acquire beneficial economic ownership of such Rights to MSRs or related Transferred Receivables Assets for tax purposes. (e)    In order to exercise the purchase option under Section 9.3(b), (i) Seller shall give written notice in respect thereof within three (3) Business Days after the date bids are provided to Seller, and (ii) Seller and Purchasers shall work in good faith to consummate such Purchase Option as soon as practicable (but, in any event, within fifteen (15) days (or, if Seller needs to obtain financing, thirty (30) days)) after the Purchasers’ receipt of such written notice from Seller. (f)    In the case of marketing and sale of Servicing Rights to a third party pursuant to this Section 9.3, Seller shall (and shall cause its applicable affiliates to) cooperate in connection with such marketing and sale. The definitive documentation for any such sale shall be in the form of a Third Party Purchase Agreement. Seller shall, promptly following Holdings’ request therefor, execute and deliver a Third Party Purchase Agreement in connection with such any sale to a third party. In addition, Seller shall use the same level of efforts to obtain any consents to effect any transfer of Servicing Rights to any third party as contemplated by this Section 9.3 as it is required to use pursuant to Sections 8.1, 8.2, and 8.3 hereof in connection with any proposed transfers to NRM. (g)    Seller and Holdings will equally share in the out-of-pocket costs of marketing any Servicing Rights and transferring such Servicing Rights to any third party as contemplated by this Section 9.3 (including legal fees associated with negotiation of a Third 23   Party Purchase Agreement with a third party buyer, Third Party Consent fees, and broker fees). Seller and Holdings shall consult with each other regarding the incurrence of any costs prior to incurring such costs. 9.4    If, after the Option #2 Exercise Deadline for any Group, the Purchasers and their affiliates market the related Servicing Rights for any Group as contemplated by Section 9.3 above and the Purchasers determine that such marketing is not satisfactory for any reason (or if the Purchasers otherwise determine that such marketing will not be satisfactory), (i) Holdings may, on notice to Seller, exercise the Fee Restructuring Payment Option for such Group on or before the second (2nd) Business Day (or such earlier time as designated by Holdings to Seller) after such determination (or (ii) if Holdings does not exercise the Fee Restructuring Payment Option on or before such second (2nd) Business Day (or such earlier time as designated by Holdings to Seller), Seller may, on notice to Holdings, exercise the Purchase Option for such Group at any time during the next six (6) Business Days. Seller and Purchasers shall work in good faith to consummate such Purchase Option as soon as practicable (but, in any event, within fifteen (15) days (or, if Seller needs to obtain financing, thirty (30) days)) after the Purchasers’ receipt of such written notice from Seller. 9.5    Holdings may exercise the Fee Restructuring Payment Option in respect of any Group (i) at any time during the period commencing at the related Consent Non-Delivery Determination Date for such MSRPA Servicing Agreement and ending at the Option #1 Exercise Deadline for such Group and (ii) otherwise in accordance with Section 9.4. 9.6    Seller may exercise the Purchase Option in respect of any Group (i) at any time during the period commencing after the related Option #1 Exercise Deadline for such Group and ending at the Option #2 Exercise Deadline for such Group and (ii) otherwise in accordance with Section 9.4. 9.7    In the event of any transfer of Rights to MSRs and any Transferred Receivables Assets by any Purchaser or any affiliate of any Purchaser pursuant to Section 9.3(d), such transfer will be made pursuant to a transfer agreement substantially in the form attached hereto as Exhibit 3A. In the event of any sale of Rights to MSRs and any Transferred Receivables Assets by any Purchaser or any affiliate of any Purchaser pursuant to Section 9.2, 9.3(b) or 9.4 hereof, such sale will be made pursuant to a sale agreement substantially in the form attached hereto as Exhibit 3B. 9.8    The Purchasers shall not have any obligation (i) to sell any Rights to MSRs or any Transferred Receivables Assets or (ii) permit the sale of the related Servicing Rights, as applicable, pursuant to Section 9.2, 9.3 or 9.4 hereof unless and until the Purchasers and any applicable affiliates have received all necessary consents under any applicable SAF or mortgage servicing fee financing transaction. The Purchasers will use best efforts to obtain such necessary consents but shall not be required to refinance any indebtedness in connection with using such best efforts. 9.9    Upon any sale of Rights to MSRs or any Transferred Receivables Assets in accordance with this Section 9.2, 9.3 or 9.4, the related MSRPA Servicing Agreement shall cease to be a Deferred Servicing Agreement or otherwise subject to the MSR Purchase Agreement and Sale Supplements. 24   9.10    Holdings and Seller shall each pay 50% of the costs of any appraisals from Approved Third Party Appraisers in connection with this Section 9. Holdings or its affiliates shall engage the Approved Third Party Appraisers in good faith for purposes of any delivery of third party appraisals for purposes of this Section 9. 9.11    Until the earliest of the applicable closing date upon which (x) Holdings exercises the Fee Restructuring Payment Option for any MSRPA Servicing Agreement, (y) the parties have caused such MSRPA Servicing Agreement to cease to be a Deferred Servicing Agreement or otherwise subject to the MSR Purchase Agreement and Sale Supplements pursuant to Section 9.2, 9.3 or 9.4 above or (z) the Transfer Date for such MSRPA Servicing Agreement occurs, such MSRPA Servicing Agreement shall continue to be a “Deferred Servicing Agreement” for purposes of the MSR Purchase Agreement and the applicable Sale Supplement. Section 10.    Standstill; Conditional Waivers of Specified Termination Events. 10.1    Each of the Purchasers agrees that from the Effective Date until the end of the Standstill Period, it will not exercise any contractual rights or remedies under the MSR Purchase Agreement or any Sale Supplement in respect of any Specified Termination Event unless, with respect to a continuing Termination Event in an affected Servicing Agreement, Purchaser determines in good faith that a trustee (or other party entitled to terminate) intends to terminate Seller or its related affiliate as servicer under such affected MSRPA Servicing Agreement. In the case of such a good faith determination of termination, the Purchasers may exercise all contractual rights under the MSR Purchase Agreement and the relevant Sale Supplements with respect to such affected MSRPA Servicing Agreement. Seller agrees to promptly notify Holdings (and to deliver to Holdings a copy of any written notification) of any communication received by Seller from a trustee (or other party entitled to terminate) under an affected Servicing Agreement relating to a solicitation of holders for a vote or request for direction or any communication from or on behalf of a trustee under any Deferred Servicing Agreement that such trustee (or other party entitled to terminate) has an intention to terminate Seller’s appointment as servicer under such Deferred Servicing Agreement provided that a solicitation of holders for a vote or request for direction regarding termination of Seller’s appointment as servicer shall not necessarily evidence, but could evidence depending on the language and the circumstances, intent of such trustee (or other party entitled to terminate) to terminate. 10.2    If the Specified Condition is satisfied prior to the end of the Full Waiver Eligibility Period, each Specified Termination Event shall be automatically waived by each of the Purchasers without any further action by the Purchasers.  10.3    Each of the Purchasers further agrees that, from the Effective Date until the end of the Standstill Period, it will not exercise any rights to cause a Servicing Rights Transfer to Holdings as contemplated by Section 2.2 of the Sale Supplements. 25   10.4    Nothing in this Section 10 shall in any way limit the right of the Purchasers to exercise any contractual rights or remedies at any time under the MSRPA Purchase Agreement or any Sale Supplement in respect of any Termination Event other than the Specified Termination Events. Section 11.    Sale of Rights to MSRs and Transferred Receivables Assets in Respect of the Designated Servicing Agreements. 11.1    Seller has agreed to buy and Purchaser has agreed to sell, transfer and assign (or cause the its applicable Affiliate(s) to sell, transfer and assign) to Seller all right title and interest of such Person in and to the Rights to MSRs and Transferred Receivables Assets in respect of each Designated Servicing Agreements promptly following the date on which the Purchasers have received all necessary consents under any applicable SAF or mortgage servicing fee financing transaction for such sale at a purchase price in cash or other immediately available funds equal the sum of (i) the related Designated Servicing Agreement Price, (ii) the outstanding balance of the related Transferred Receivables Assets, and (iii) the outstanding balance of all deferred and unpaid Servicing Fees under such Designated Servicing Agreement. 11.2    In the event of any sale of Rights to MSRs or any Transferred to Section 11.1 above, such sale will be made pursuant to a sale agreement substantially in the form attached hereto as Exhibit 3B. 11.3    Upon any sale of Rights to MSRs or any Transferred Receivables Assets in accordance with this Section 11, the related MSRPA Servicing Agreement shall cease to be a Deferred Servicing Agreement or otherwise subject to the MSR Purchase Agreement and Sale Supplements. Section 12.    Conditions Precedent to Effectiveness of this Agreement. This Agreement shall become effective on the date first set forth above upon the latest to occur of the following: 12.1    Seller’s, the Purchasers’ and NRM’s receipt of a copy of this Agreement duly executed by each of the parties hereto; 12.2    Seller’s, the Purchasers’ and NRM’s receipt of a copy of the Transfer Agreement and the NRM Subservicing Agreement duly executed by each of the parties thereto; 12.3    New Residential Investment Corp. and Ocwen Financial Corporation have entered into a mutually acceptable Transaction Agreement, dated as of the Effective Date, relating to New Residential Investment Corp.’s acquisition of certain common stock of Ocwen Financial Corporation; and 12.4    Holdings’ receipt of an amount equal to $6,565,101 (an amount equal to (i) the Float True-Up Payment payable to Holdings, plus (ii) the Final Increased Cost Payment payable to Holdings minus (iii) the amount of the Account Cost True-Up payable to Seller). Section 13.    Representations and Warranties of Seller to the Purchasers and NRM. Seller hereby represents and warrants to the Purchasers and NRM as follows as of the Effective Date: 26   13.1    It is duly organized and validly existing under the laws of the State of Delaware and has all requisite power and authority to execute, deliver and perform this Agreement, the Related Agreements and each other document contemplated hereby to which it is a party and to consummate the transactions herein and therein contemplated. 13.2    The execution, delivery and performance of this Agreement, the Related Agreements and each such other document contemplated hereby, and the consummation of such transactions have been duly authorized by it and this Agreement and each such other document contemplated hereby constitute its legal, valid and binding obligation, enforceable in accordance with its terms (subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law). 13.3    The execution, delivery and performance of this Agreement, the Related Agreements and the consummation of the transactions contemplated hereby do not and will not conflict with the provisions of its governing instruments and will not violate any provisions of applicable law or regulation or any order of any court or regulatory body and will not result in the breach of, or constitute a default, or require any consent, under any material agreement, instrument or document to which it is a party or by which it or any of its property may be bound or affected. 13.4    As of the Effective Date, the Seller is not “insolvent” (as such term is defined in Section 101(32)(A) of the U.S. Bankruptcy Code). 13.5    Seller is not entering into the transactions contemplated by this Agreement with any intent to hinder, delay or defraud any of its creditors. 13.6    The aggregate consideration received by Seller pursuant to the transactions contemplated by this Agreement is fair consideration having reasonably equivalent value to the value of the rights and interests transferred hereunder and thereunder. 13.7    Purchasers have a perfected security interest in the Collateral (as defined in the Sale Supplements). 13.8    Seller has not created or granted a Lien or other adverse claim in the Rights to MSRs in respect of any MSRPA Servicing Agreement to any Person since the Sale Date under the applicable Sale Supplement. Section 14.    Representations and Warranties of the Purchasers and NRM to Seller. Each of the Purchasers and NRM hereby represents and warrants to Seller as follows as of the Effective Date: 14.1    It is duly organized and validly existing under the laws of the State of perform this Agreement, the Related 27   Agreements and each other document contemplated hereby to which it is a party, as applicable, and to consummate the transactions herein and therein contemplated. 14.2    The execution, delivery and performance of this Agreement, the Related Agreements and each such other document contemplated hereby and the consummation of such transactions, as applicable, have been duly authorized by it and this Agreement, the Related Agreements and each such other document contemplated hereby constitute its legal, valid and binding obligation, enforceable in accordance with its terms (subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in 14.3    The execution, delivery and performance of this Agreement, the Related Agreements and the consummation of the transactions contemplated hereby, as applicable, do not and will not conflict with the provisions of its governing instruments and will not violate any provisions of applicable law or regulation or any order of any court or regulatory body and will not result in the breach of, or constitute a default, or require any consent, under any material agreement, instrument or document to which it is a party or by which it or any of its property may be bound or affected. 14.4    Holdings represents that it may amend, under the terms of the applicable agreements, the existing SAF transactions to permit the financing of monthly advances and servicing advances arising under the related MSRPA Servicing Agreements currently subject to such SAFs after giving effect to the related Transfer Dates. 14.5    As of the Effective Date, each Purchaser and NRM are not “insolvent” (as such term is defined in Section 101(32)(A) of the U.S. Bankruptcy Code). 14.6    Neither NRM nor any Purchaser is entering into the transactions contemplated by this Agreement with any intent to hinder, delay or defraud any of its creditors. 14.7    The aggregate consideration received by NRM and each Purchaser pursuant to the transactions contemplated by this Agreement is fair consideration having hereunder and thereunder. Section 15.    Termination. 15.1    This Agreement shall terminate in full upon the earliest of (i) the occurrence of the Transfer Date in respect of all MSRPA Servicing Agreements, (ii) the date on which either NRM or Seller gives written notice the other party that it is terminating the NRM Subservicing Agreement in accordance with the terms thereof (provided that, solely in the case of a notice of termination of the NRM Subservicing Agreement from NRM to Seller delivered in connection with Section 5.1(b) of the NRM Subservicing Agreement, (x) this Agreement will not terminate if NRM provides simultaneous notice to Seller to the effect that both this Agreement and the Transfer Agreement are not also terminated, and (y) if no notice under prior clause (x) is given, this Agreement and the Transfer Agreement will terminate on the last Successor Transfer Date (as defined in the NRM 28   Subservicing Agreement), (iii) the written agreement of each of the parties hereto to terminate this Agreement, and (iv) January 23, 2019. Except as provided in Section 15.2, the termination of this agreement shall not terminate or otherwise alter the parties’ rights and obligations under the MSR Purchase Agreement and the Sale Supplements. 15.2    If the NRM Transfer Date occurs in respect of all MSRPA Servicing Agreements, each of the MSR Purchase Agreement and each Sale Supplement shall be terminated. The termination of the MSR Purchase Agreement and each Sale Supplement in accordance with this clause (b) shall not modify any prior sales Sale Supplements. All rights and obligations of the parties to the MSR Purchase Agreement and the Sale Supplements that expressly survive the termination of any such agreement shall survive any termination contemplated by this clause (b). 15.3    The agreements, rights and obligations of the parties hereto under the following provisions of this Agreement shall survive termination of this Agreement: Section 1, Section 2, Section 3, Section 4, Section 5, Section 6, Section 7, Section 8.4, Section 9.10, Section 10.2, Section 13, Section 14, and Section 16. Section 16.    Miscellaneous. 16.1    Cooperation with Financings. Seller hereby agrees to cooperate with the Purchasers, the Purchasers’ subsidiaries, NRM, their respective financing sources, any applicable underwriters, any applicable auditors, any applicable rating agencies and any applicable third parties (for example valuation agents and/or trustees) as applicable and consistent with past practices, in the execution, delivery and performance of servicing advance facility agreements and mortgage servicing right financing facility agreements reasonably requested by Purchasers, the Purchasers’ subsidiaries and NRM, as applicable, (including, without limitation, the execution, delivery and performance of servicing advance financings substantially similar to the existing servicing advance financing facilities related to the MSRPA Servicing Agreements) in connection with the transactions contemplated by the MSR Purchase Agreement and Sale Supplements (including any amendments related to the financing facilities (i) as contemplated by Section 9 in connection with any transfer) hereunder and (ii) the other transactions contemplated by the Related Agreements. Seller shall not be required to provide covenants, representations or agreements except those that are substantially the same as Seller has provided in connection with existing servicing advance facilities and mortgage servicing rights financing facilities related to the MSRPA Servicing Agreement. Neither Seller nor any affiliate thereof shall be entitled to additional compensation in connection with the execution, delivery and performance of such servicer advance financing facility agreements. [***] 16.2    Limited Effect. Except as expressly set forth above or in the attachments hereto, the execution, delivery and effectiveness of this Agreement shall not operate as a waiver of any right, claim, cause of action, power or remedy of any party hereto, whether arising before or after the Effective Date, or constitute a waiver of any provision of any other agreement. 29   16.3    Counterparts. This Agreement may be executed in any number of an original and all of which counterparts, taken together, shall constitute but the same instrument. Any signature page to this Agreement containing a manual signature may be delivered by facsimile transmission or other electronic communication device capable of transmitting or creating a printable written record, and when so delivered shall have the effect of delivery of an original manually signed signature page. 16.4    GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 AND SECTION 5-1402 OF THE GENERAL OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. 16.5    Headings. The descriptive headings of the various sections of this Agreement are inserted for convenience of reference only and shall not be deemed to affect the meaning or construction of any of the provisions thereof. 16.6    Severability. The failure or unenforceability of any provision hereof shall not affect the other provisions of this Agreement. Whenever possible each ineffective to the extent of such prohibition or invalidity, without Agreement. 16.7    Further Assurances. Each party hereto shall execute and deliver in a reasonable timeframe such reasonable and appropriate additional documents, instruments or agreements and take such reasonable actions as may be necessary or appropriate to effectuate the purposes of this Agreement at the request of any other party hereto. 16.8    Exhibits and Schedules. The exhibits and schedules to this Agreement are hereby incorporated and made a part hereof and are an integral part of this Agreement. 16.9    No Offset. No party hereto shall have any right to offset against any amount payable hereunder or other agreement to any other party, or otherwise reduce any amount payable hereunder as a result of, any amount owing by any other party hereto or any of its Affiliates to such party or any of its Affiliates. 16.10    Notices. All communications, notices, consents, waivers, and other communications under this Agreement, the MSR Purchase Agreement and the Sale Supplements must be in writing and be given in person or by means of facsimile or email (with request for assurance of receipt in a manner typical with respect to communications of that type), by overnight courier or by mail, and shall become effective: (a) on delivery if given in person; (b) on the date of transmission if sent by facsimile or email; (c) one (1) Business Day after delivery to the overnight service; or (d) four (4) Business Days after being mailed, with proper postage and documentation, for first-class registered or certified mail, prepaid. 30   Notices shall be addressed as follows: Ocwen Loan Servicing, LLC 1661 Worthington Road, Suite 100 West Palm Beach, FL 33409 Attention: Secretary Telecopy Number: [***] Confirmation Number: [***] If to Holdings, to: HLSS Holdings, LLC c/o New Residential Investment Corp. Telephone: [***] Email: [***] If to MSR – EBO, to: HLSS MSR – EBO Acquisition LLC 1345 Avenue of the Americas, 26th Floor If to NRM, to: New Residential Mortgage LLC provided, however, that if any party shall have designated a different address by notice to the others, then to the last address so designated. 16.11    Entire Agreement. This Agreement sets forth the entire agreement and understanding of the parties hereto with respect to the transactions contemplated hereby and thereby and supersedes 31   any and all prior agreements, arrangements and understandings, both written and oral, between the parties relating to the subject matter hereof and thereof. 16.12    Submission to Jurisdiction. EACH OF THE PARTIES HERETO IRREVOCABLY (I) SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY MATTERS CONTEMPLATED HEREBY; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT; (III) CONSENTS TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER OR BY ANY OTHER MANNER IN ACCORDANCE WITH LAW; AND (IV) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. 16.13    Waiver of Jury Trial. EACH PARTY HERETO IRREVOCABLY AND ABSOLUTELY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW THE RIGHT TO A TRIAL BY JURY IN ANY DISPUTE IN CONNECTION WITH, ARISING UNDER OR RELATING TO THIS AGREEMENT OR ANY MATTERS CONTEMPLATED HEREBY, AND AGREES TO TAKE ANY AND ALL ACTION NECESSARY OR APPROPRIATE TO EFFECT SUCH WAIVER. 16.14    No Strict Construction. The parties agree that the language used in this Agreement and the Related Agreements is the language chosen by the parties to express their mutual intent and that no rule of strict construction is to be applied against either party. The parties and their respective counsel have reviewed and negotiated the terms of this Agreement and the Related Agreements. 16.15    Costs and Expenses. Except as otherwise expressly set expressly in this Agreement or the Related Agreements, each party hereto shall be responsible for its own costs and expenses incurred in connection with the negotiation and execution of this Agreement and all documents relating thereto. 16.16    Assignment; No Third−Party Beneficiaries. parties hereto and their respective successors and permitted assigns. (b)    This Agreement may not be assigned or otherwise transferred by operation of law or otherwise by any Purchaser or Seller without the express written consent of all parties to this Agreement and any such assignment or attempted assignment without such consent shall be void; provided, however, that (i) a Purchaser may pledge its rights to any Person providing financing to 32   such Purchaser or its Affiliates without the express written consent of Seller, and (ii) without limiting any other transfers that otherwise do not require the consent of Seller, following a Transfer Date, a Purchaser or any assignee or transferee thereof may transfer all or any interest in the Rights to MSRs or any Transferred Receivables Assets to any Person without the express written consent of Seller. (c)    This Agreement may not be assigned by NRM without the express written consent of Seller and any such assignment or attempted assignment without such consent shall be void except that NRM may assign or otherwise transfer any of its rights and obligations hereunder without the consent of Seller to any direct or indirect wholly-owned subsidiary of New Residential Investment Corp. that has been approved by and is in good standing with Fannie Mae, Freddie Mac and each applicable State Agency (as defined in the Transfer Agreement), as necessary, in order to acquire the Servicing Rights (as defined in the Transfer Agreement) pursuant to the Transfer Agreement, in any case, so long as such assignment and transfer does not materially delay the occurrence of the Transfer Dates contemplated by this Agreement and the Transfer Agreement. (d)    This Agreement is otherwise solely for the benefit of the parties hereto, and no provision of this Agreement shall be deemed to confer upon any other Person any remedy, claim, liability, reimbursement, cause of action or other right. 16.17    Specific Performance. The parties agree that irreparable damage would All parties hereto are entitled, without limiting their other remedies and without the necessity of proving actual damages or posting any bond, to equitable relief, including the remedy of specific performance or injunction, with respect to any breach or threatened breach of such covenants. Such relief shall be in addition to, and not in lieu of, all other remedies available at law or in equity to each party under this Agreement, the MSR Purchase Agreement, the Sale Supplements, the Transfer Agreement, the New RMSR Agreement or any agreement related thereto. 16.18    Amendment; Waivers. No amendment or modification of this Agreement, and no waiver hereunder, shall be valid or binding unless set forth in writing and duly executed by the party against whom enforcement of the amendment, modification, discharge or waiver is sought. Any such waiver shall constitute a waiver only with respect to the specific matter described in such writing and shall in no way impair the rights of the party granting such waiver in any other respect or at any other time. Neither the waiver by any of the parties hereto of a breach of or a default under any of the provisions of this Agreement, nor the failure by any of the parties, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right or privilege hereunder, shall be construed as a waiver of any other breach or default of a similar nature, or as a waiver of any of such provisions, rights or privileges hereunder. The failure of a party hereto at any time or times to require performance of any provision hereof or claim damages with respect thereto shall in no manner affect its right at a later time to enforce the same. All rights and remedies existing under this Agreement are cumulative to, and not exclusive 33   34   IN WITNESS WHEREOF, each party hereto has caused this Agreement to be executed and delivered by its respective signatory thereunto duly authorized as of the date above written.   OCWEN LOAN SERVICING, LLC               By: /s/ John P Kim   Name: John P Kim   Title: Senior Vice President Signature Page to Master Agreement   HLSS HOLDINGS, LLC         By: HLSS Roswell, LLC, its sole     member               By:  /s/ Matthew Gabriel Hoffman-Johnson   Name: Matthew Gabriel Hoffman-Johnson   Title: Attorney-In-Fact, Agent and Authorized     Signatory   HLSS MSR – EBO ACQUISITION LLC          By: New Residential Investment Corp., its sole     member               By:   Name:   Title:     Signatory   NEW RESIDENTIAL MORTGAGE LLC          By:     member               By:   Name:   Title:     Signatory SCHEDULE 1 Previously Executed Amendments 1. Amendment to Master Servicing Rights Purchase Agreement and Sale Supplements, dated as of December 26, 2012, among Ocwen Loan Servicing, LLC, as Seller, HLSS Holdings, LLC, as a Purchaser, and Home Loan Servicing Solutions, Ltd., as a Purchaser. 2. Amendment to Sale Supplements, dated as of July 1, 2013 among Ocwen Loan Servicing, LLC, as Seller, HLSS Holdings, LLC, as a Purchaser, and Home Loan Servicing Solutions, Ltd., as a Purchaser. 3. Amendment to Sale Supplement, dated as of September 30, 2013 among Ocwen Loan 4. Amendment to Sale Supplements, dated as of February 4, 2014 among Ocwen Loan 5. Amendment No. 2 to Master Servicing Rights Purchase Agreement and Sale Supplements, dated as of April 6, 2015, among Ocwen Loan Servicing, LLC, as Seller, HLSS Holdings, LLC, as a Purchaser, and Home Loan Servicing Solutions, Ltd., as a Purchaser, and HLSS MSR – EBO Acquisition LLC, as Buyer. 6. February 2017 Amendment dated as of February 17, 2017 among Ocwen Loan Servicing, LLC, as Seller, HLSS Holdings, LLC, as a Purchaser, and HLSS MSR – EBO Acquisition LLC, as a Purchaser. SCHEDULE 2 LUMP-SUM PAYMENT PERCENTAGES Transfer Date Month Lump-Sum Payment Percentages, in basis points Apr-2017 37.2 May-2017 36.6 Jun-2017 36.1 Jul-2017 35.5 Aug-2017 34.9 Sep-2017 34.4 Oct-2017 33.9 Nov-2017 33.3 Dec-2017 32.8 Jan-2018 32.2 Feb-2018 31.5 Mar-2018 30.8 Apr-2018 30.1 May-2018 29.4 Jun-2018 28.6 Jul-2018 27.8 Aug-2018 27.0 Sep-2018 26.2 Oct-2018 25.3 Nov-2018 24.4 Dec-2018 23.5 Jan-2019 22.7 Feb-2019 21.9 Mar-2019 21.1 Apr-2019 20.3 May-2019 19.5 Jun-2019 18.7 Jul-2019 17.8 Aug-2019 16.8 Sep-2019 15.8 Oct-2019 14.6 Nov-2019 13.3 Dec-2019 12.0 Jan-2020 10.6 Feb-2020 8.9 Mar-2020 7.1 Apr-2020 5.2 Schedule 3 Wire Instructions In the case of any payment to Seller: Name of Bank:        [***] ABA Number:         [***] Name of Account:    [***] Account Number:     [***] Reference:         [***] In the case of any payment to Holdings: Acct Name: [***] ABA #: [***] Bank Name: [***] In the case of any payment to MSR-EBO: In the case of any payment to NRM: EXHIBIT 1 Group Selection Procedures Unless otherwise agreed in writing between Seller and Holdings, each “Group” • On each Designation Date, Holdings shall designate a “Group” which shall consist of all of the MSRPA Servicing Agreements for which the Consent Non-Delivery Determination Date occurred on or after the most recent Designation Date (or, in the case of the initial Designation Date, on or after the Effective Date) and prior to such Designation Date. • On the one-year anniversary of the Effective Date, Holdings shall designate additional Groups in accordance with the following procedures: o The number of Groups designated on such date will be equal to the quotient (rounded up to the next whole number) of (i) the Grouping UPB (as defined below) divided by (ii) $15.0 billion. For example, if the Grouping UPB is $33.0 billion, there will be three (3) Groups. § If the number of Groups is two (2) or greater, the Fee Restructuring Payments allocable to such Groups shall be determined as set forth below. o Holdings will then determine the MSRPA Servicing Agreements allocated to each Group based on the related Delinquency Rates (as defined below) for such MSRPA Servicing Agreements such that: § the amount of the Grouping UPB allocated to any particular Group is substantially the same (it being understood that each such allocated amount of the Grouping UPB may vary by Groups by up to 10%); and § the MSRPA Servicing Agreements allocated to any particular Group are allocated based on the related Delinquency Rates of such MSRPA Servicing Agreement. By way of example, if there are three Groups, (i) the MSRPA Servicing Agreements (by Grouping UPB) with the lowest Delinquency Rates will be allocated to one Group, (ii) the MSRPA Servicing Agreements (by Grouping UPB) with the middle Delinquency Rates will be allocated to one Group and (iii) the MSRPA Servicing Agreements (by Grouping UPB) with the highest Delinquency Rates will be allocate to one Group. For purposes hereof, the following terms shall have the following meanings: “Delinquency Rate” means, for any MSRPA Servicing Agreement, the percentage (based on interest bearing principal balances) of Primary Mortgage Loans that are Delinquent as of June 30, 2018. “Delinquent” means for any Mortgage Loan, any monthly payment due thereon is not made by the close of business on the day such monthly payment is required to be paid and remains unpaid for more than 30 days. “Grouping UPB” means, for all MSRPA Servicing Agreements in respect of which the Consent Non-Delivery Determination Date occurs on the one-year anniversary of this Agreement or otherwise on or after the Designation Date occurring in April 2018, the aggregate unpaid interest bearing principal balance of the Primary Mortgage Loans under such MSRPA Servicing Agreements as of the close of business on June 30, 2018. Unless otherwise agreed in writing between Seller and Holdings, if two (2) or more Groups are designated on the one-year anniversary of the Effective Date pursuant to the second bullet point in these Group Selection Procedures, the Fee Restructuring Payments for each such Group shall be determined as follows:   1. Step 1:  Holdings shall engage two Approved Third Party Appraisers to determine the Average Third Party Marks for each such Group.    2. Step 2:  Holding shall determine the Allocation Percentage for each such Group. The “Allocation Percentage” for each such Group shall mean the quotient of (i) the Average Third Party Mark for such Group divided by (ii) the aggregate of all Average Third Party Marks for all such Groups. The sum of the Allocation Percentages for all such Groups shall equal 100%.   3. Step 3:  Holdings shall then:   a. determine the aggregate Lump-Sum Payments that Holdings would pay Seller if the Transfer Dates for all MSRPA Servicing Agreements in such Groups occurred on the one-year anniversary of the Effective Date. Such amount is the “Gross Amount”; and b. determine the Fee Restructuring Payment for each such Group, which shall equal the product of (i) the Gross Amount and (ii) the Allocation Percentage for such Group. EXHIBIT 2 Form of Sale Supplement [attached] SALE SUPPLEMENT1  dated as of [Date] among OCWEN LOAN SERVICING, LLC, as Seller, HLSS HOLDINGS, LLC, as Purchaser and HLSS MSR – EBO ACQUISITION LLC, as Purchaser ________________ 1 As amended by Section 4 of the Master Agreement, dated as of July 23, 2017, among Ocwen Loan Servicing, LLC, HLSS Holdings, LLC, HLSS MSR-EBO Acquisition LLC and New Residential Mortgage LLC (the “Master Agreement”). TABLE OF CONTENTS     Page Article 1 DEFINITIONS; REFERENCE TO MASTER SERVICING RIGHTS PURCHASE AGREEMENT 1 Section 1.1 Definitions 1 Section 1.2 Reference to the Master Servicing Rights Purchase Agreement 8 Article 2 PURCHASE AND SALE OF SERVICING RIGHTS AND RIGHTS TO MSRS; ASSUMED LIABILITIES 8 Section 2.1 Assignment and Conveyance of Rights to MSRs 8 Section 2.2 Automatic Assignment and Conveyance of Servicing Rights. 8 Section 2.3 MSR Purchase Price. 9 Section 2.4 Assumed Liabilities and Excluded Liabilities. 9 Section 2.5 Remittance of Excess Servicing Fees, Servicing Advance Receivables Fees and Related Amounts. 11 Section 2.6 Payment of Estimated Purchase Price. 11 Section 2.7 Refinancing of Mortgage Loans.. 11 Article 3 PURCHASE AND SALE OF SERVICING ADVANCE RECEIVABLES 12 Section 3.1 Assignment and Conveyance of Servicing Advance Receivables 12 Section 3.2 Servicing Advance Receivables Purchase Price 12 Section 3.3 Servicing Advances 13 Section 3.4 Reimbursement of Servicing Advances 13 Article 4 13 Section 4.1 General Representations 13 Section 4.2 Title to Transferred Assets 13 Section 4.3 Right to Receive Servicing Fees 14 Section 4.4 Servicing Agreements and Underlying Documents. 14 Section 4.5 Mortgage Pool Information, Related Matters 14 Section 4.6 Enforceability of Servicing Agreements 14 Section 4.7 Compliance With Servicing Agreements 15 Section 4.8 No Recourse 16 Section 4.9 The Mortgage Loans 16 Section 4.10 Servicing Advance Receivables 17 Section 4.11 Servicing Agreement Consents and Other Third Party Approvals 18 Section 4.12 Servicing Advance Financing Agreements 18 Section 4.13 Anti‑Money Laundering Laws 19 Section 4.14 Servicer Ratings 19 Section 4.15 Eligible Servicer 19 Section 4.16 HAMP 19 Article 5 CONDITIONS PRECEDENT 19 Section 5.1 Conditions to the Purchase of Certain Servicing Advance Receivables 19 Section 5.2 Conditions to the Purchase of the Rights to MSRs 19 -i- TABLE OF CONTENTS (Continued) Page Article 6 SERVICING MATTER 20 Section 6.1 Seller as Servicer 20 Section 6.2 Servicing 20 Section 6.3 Collections from Obligors and Remittances 20 Section 6.4 Servicing Practices 21 Section 6.5 Servicing Reports 21 Section 6.6 Escrow Accounts 21 Section 6.7 Notices and Financial Information. 21 Section 6.8 Defaults under Deferred Servicing Agreements 21 Section 6.9 Continuity of Business 21 Section 6.10 Clean Up Call Rights 22 Section 6.11 Amendments to Deferred Servicing Agreements; Transfer of Servicing Rights 22 Section 6.12 Assumption of Servicing Duties; Transfer of Rights to MSRs and Servicing Rights 23 Section 6.13 Termination Event 23 Section 6.14 Servicing Transfer 23 Section 6.15 Incorporation of Provisions from Subservicing Agreement 23 Article 7 SELLER SERVICING FEES; COSTS AND EXPENSES 23 Section 7.1 Seller Monthly Servicing Fee 23 Section 7.2 Performance Fee 24 Section 7.3 Costs and Expenses 24 Section 7.4 Ancillary Income 25 Section 7.5 Calculation and Payment 25 Section 7.6 No Offset 25 Section 7.7 Servicing Fee Reset Date 25 Article 8 INDEMNIFICATION 25 Section 8.1 Seller Indemnification of Purchasers 25 Section 8.2 Purchasers Indemnification of Seller 26 Section 8.3 Indemnification Procedures 26 Section 8.4 Tax Treatment 27 Section 8.5 Survival 27 Section 8.6 Additional Indemnification 28 Section 8.7 Specific Performance 28 Article 9 GRANT OF SECURITY INTEREST 28 Section 9.1 Granting Clause 28 Article 10 MISCELLANEOUS PROVISIONS 30 Section 10.1 Further Assurances 30 Section 10.2 Compliance with Applicable Laws; Licenses 30 Section 10.3 Merger, Consolidation, Etc 30 Section 10.4 Annual Officer’s Certificate 30 Section 10.5 Accounting Treatment 31 Section 10.6 Incorporation 31 Section 10.7 Third Party Beneficiaries 31 -ii- TABLE OF CONTENTS (Continued) Page Exhibit A    Form of Monthly Remittance Report Schedule I    Servicing Agreements Schedule II    Underlying Documents Schedule III    Retained Servicing Fee Percentage Schedule IV    Target Ratio Schedule V    Valuation Percentage Schedule VI    Amortization Percentage -iii- SALE SUPPLEMENT This Sale Supplement, dated as of [Date] (this “Sale Supplement”), is among Ocwen Loan Servicing, LLC, a Delaware limited liability company (“Seller”), HLSS Holdings, LLC, a Delaware limited liability company (“Holdings”), and HLSS MSR – EBO Acquisition LLC, a Delaware limited liability company (as assignee of Home Loan Servicing Solutions, Ltd., “MSR – EBO”, each of MSR-EBO and Holdings, a “Purchaser”, and together, the “Purchasers”). WITNESSETH: WHEREAS, Seller and the Purchasers are parties to that certain Master Servicing Rights Purchase Agreement, dated as of February 10, 2012 (as amended, supplemented and modified from time to time), and that certain Master Servicing Rights Purchase Agreement, dated as of October 1, 2012 (as amended, supplemented and modified from time to time, the “Agreement”), in each case with respect to the sale by Seller and the purchase by the Purchasers of the Servicing Rights and other assets; and WHEREAS, Seller and the Purchasers desire to enter into the transactions described in the Agreement as supplemented by this Sale Supplement; herein contained, the parties hereto hereby agree as follows: Article 1 Section 1.1    Definitions. (a) For purposes of this Sale Supplement, the following capitalized terms shall have the respective meanings set forth or referenced below: “Additional Servicing Advance Receivable”: As defined in Section 3.1. “Advance SPEs”: Each of (i) HLSS Servicer Advance Facility Transferor II, LLC, HLSS Servicer Advance Facility Transferor MS3 LLC, NRZ Advance Facility Transferor 2015-ON1 LLC, NRZ Servicer Advance Facility Transferor (ON) JPMC LLC, Delaware limited liability companies, HLSS Servicer Advance Receivables Trust II, HLSS Servicer Advance Receivables Trust MS3, NRZ Advance Receivables Trust 2015-ON1, and NRZ Servicer Advance Receivables Trust (ON) JPMC and (ii) such other special purpose subsidiaries of Holdings established from time to time in connection with a Servicing Advance Financing Agreement. “Amortization Percentage”: For each calendar month following the Closing Date, the percentage set forth on Schedule VI to this Sale Supplement for such calendar month. “Assumed Liabilities”: As defined in Section 2.4. “Closing Date”: [Date]; provided that, with respect to Section 5.3 of the Agreement, the Closing Date shall be the related Servicing Transfer Date. “Closing Statement”: The statement delivered by Seller to the Purchasers on the Closing Statement Delivery Date setting forth the good faith calculation of the Estimated Purchase Price. “Closing Statement Delivery Date”: The Closing Date, unless otherwise agreed by Seller and the Purchasers. “Consent Period”: For each Deferred Servicing Agreement and each related Deferred Servicing Right, the period, if any, from and including the Closing Date to and including the related Servicing Transfer Date. “Cut‑off Date”: [x], or such other date as is agreed by Seller and the Purchasers. “Deferred Mortgage Loan”: A mortgage loan subject to a Deferred Servicing Agreement. “Deferred Servicing Agreement”: As of any date of determination, each Servicing Agreement that is not a Transferred Servicing Agreement on such date. For avoidance of doubt, on the Closing Date each Servicing Agreement is a Deferred Servicing Agreement. “Deferred Servicing Right”: As of any date of determination, each Servicing Right arising under a Servicing Agreement that is a Deferred Servicing Agreement on such date. “Excess Servicing Advances”: For any calendar month, the amount, if any, by which the outstanding Servicer Advances with respect to the Servicing Agreements as of the last day of such calendar month exceeds an amount equal to (a) the Target Ratio for such calendar month multiplied by (b) the unpaid principal balance of the Mortgage Loans subject to the Servicing Agreements as of the last day of such calendar month. “Excess Servicing Fees”: For any calendar month, an amount equal to the product of (i) [x] annualized basis points and (ii) the aggregate unpaid principal balance of the Mortgage Loans underlying the Rights to MSRs as of the close of business on the last Business Day of the prior calendar month. “Excluded Liabilities”: As defined in Section 2.4(c). “Fannie Mae”: means the Federal National Mortgage Association, or any successor thereto. “Freddie Mac”: Means the Federal Home Loan Mortgage Corporation, or any successor thereto. “Indemnified Person”: A Purchaser Indemnified Party or a Seller Indemnified Party, as the case may be. “Indemnifying Person”: The Seller pursuant to Section 8.1 or the Purchasers pursuant to Section 8.2, as the case may be. 2 “Initial Servicing Advance Receivable”: As defined in Section 3.1. “Investor”: With respect to any Securitization Transaction, any holder or other beneficial owner of any securities issued by the related Trust. “Liability”: As defined in Section 8.1. “Monthly Remittance Report”: With respect to each Deferred Servicing Agreement, a report substantially in the form attached as Exhibit A to this Sale Supplement or in such other form as may be agreed to by Seller and the Purchasers from time to time. “Monthly Servicing Fee”: For each calendar month, the Base Subservicing Fee (as defined in the Subservicing Supplement) for such calendar month together with the Seller Monthly Servicing Fee for such calendar month. “Monthly Servicing Oversight Report”: A report with respect to all of the Deferred Servicing Agreements and related Mortgage Loans in such form as may be agreed to by Seller and the Purchasers from time to time. “MSR Purchase Price”: For each Servicing Agreement, an amount equal to the product of (i) the Valuation Percentage for such Servicing Agreement and (ii) the aggregate unpaid principal balance of the Mortgage Loans subject to such Servicing Agreement as of the Closing Date. “P&I Advance”: As defined in the Subservicing Agreement. “Performance Fee”: As defined in Section 7.2. “Purchaser Indemnified Party”: As defined in Section 8.2. “Purchase Price”: The sum of (a) the aggregate MSR Purchase Price for all of the Servicing Agreements and (b) the aggregate Servicing Advance Receivables Purchase Price for any Initial Servicing Advance Receivables. “Retained Servicing Fee”: For any calendar month, an amount equal to the sum of (a) the product of the Retained Servicing Fee Percentage for such calendar month and the average unpaid principal balance of all Mortgage Loans subject to the Deferred Servicing Agreements and the Transferred Servicing Agreements during such calendar month and (b) the Retained Servicing Fee Shortfall, if any, for the immediately prior calendar month. “Retained Servicing Fee Percentage”: For any calendar month, the percentage set forth on Schedule III to this Sale Supplement. “Retained Servicing Fee Shortfall”: For any calendar month, beginning in [x], an amount equal to the excess, if any, of (a) the Retained Servicing Fee for such calendar month over (b) the excess, if any, of (x) the aggregate Servicing Advance Receivables Fees actually received by Holdings with respect to the Deferred Servicing Agreements and pursuant to the Transferred Servicing Agreements during such calendar month (whether directly pursuant to such Transferred 3 Servicing Agreements or pursuant to this Sale Supplement) over (y) the Monthly Servicing Fee for such calendar month. “Rights to MSRs”: For each Servicing Agreement, each of the following assets: (a)all Servicing Fees payable to Seller as of or after the Closing Date under such Servicing Agreement and the right to receive all Servicing Fees accruing and payable as of or after the Closing Date under such Servicing Agreement; (b)the right to receive any investment income earned on amounts on deposit in any Custodial Account or Escrow Account related to such Servicing Agreements as of or after the Closing Date; (c)the right to purchase the Servicing Rights pursuant to Section 2.2 of this Sale Supplement; and (d)any proceeds of any of the foregoing. “Sale Date”: For each Servicing Advance Receivable, the date on which such Servicing Advance Receivable is transferred to Holdings pursuant to Section 3.1. “Seller Indemnified Party”: As defined in Section 8.1. “Seller Monthly Servicing Fee”: As defined in Section 7.1. “Servicing Advance Financing Agreements”: Each of: (a)    that certain Fifth Amended and Restated Indenture, dated as of December 22, 2015, among HLSS Servicer Advance Receivables Trust II, as issuer, Deutsche Bank National Trust Company, as indenture trustee, calculation agent, paying agent and securities intermediary, Holdings, as administrator and servicer, Seller, as servicer and as a subservicer, and Barclays Bank PLC, as administrative agent, and each other “Transaction Document” as such term is defined therein, in each case as the same may be amended from time to time; (b)    that certain Indenture, dated as of May 14, 2015, among HLSS Servicer Advance Receivables Trust MS3, as issuer, Deutsche Bank National Trust Company, as indenture trustee, calculation agent, paying agent and securities intermediary, Holdings, as administrator and servicer, Seller, as servicer and as a subservicer, and Morgan Stanley Bank, N.A., as administrative agent, and each other “Transaction Document” as such term is defined therein, in each case as the same may be amended from time to time; (c)    that certain Indenture, dated as of August 28, 2015, among NRZ Advance Receivables Trust 2015-ON1, as issuer, Deutsche Bank National Trust Company, as indenture trustee, calculation agent, paying agent and securities intermediary, Holdings, as administrator and servicer, Seller, as servicer and as a subservicer, and Credit Suisse AG, New York Branch, as administrative agent, and 4 (d)    that certain Indenture, dated as of December 11, 2015, among NRZ Servicer Advance Receivables Trust (ON) JPMC, as issuer, Deutsche Bank National Trust Company, as indenture trustee, calculation agent, paying agent and securities as a subservicer, and JPMorgan Chase Bank, N.A., as administrative agent, and as the same may be amended from time to time; and (e)    any other agreement agreed to from time to time by Seller and Holdings as a “Servicing Advance Financing Agreement” for purposes of the Agreement. “Servicing Advance Payment Date”: (a) For any Initial Servicing Advance Receivable, the Closing Date and (b) for any Additional Servicing Advance Receivable, the Funding Date (as defined in the Servicing Advance Financing Agreement) for such Additional Servicing Advance Receivable. “Servicing Advance Receivable”: For each Servicer Advance, the right to receive reimbursement for such Servicer Advance under the Servicing Agreement pursuant to which such Servicer Advance was made. “Servicing Advance Receivables Fees”: For any calendar month, an amount equal to the excess of the aggregate amount of Servicing Fees paid to Seller for such calendar month under each Servicing Agreement over the Excess Servicing Fees for such calendar month. “Servicing Advance Receivable Purchase Price”: With respect to each Servicing Advance Payment Date, for each Servicing Advance Receivable, the outstanding amount that is reimbursable under the related Servicing Agreement with respect to such Servicing Advance Receivable as of such Servicing Advance Payment Date. “Servicing Agreement”: Each of the servicing agreements described on Schedule I and each of the Underlying Documents described on Schedule II governing the rights, duties and obligations of Seller as servicer under such agreements. “Servicing Fee Reset Date”: [Servicing Fee Reset Date as defined in each Sale Supplement in the Master Agreement]. “Servicing Rights Assets”: As defined in Section 2.2. “Servicing Transfer Date”: With respect to each Servicing Agreement, the date on which all of the Third Party Consents related to such Servicing Agreement necessary to transfer the related Servicing Rights to the Purchasers are received or such later date mutually agreed to by Seller and the Purchasers, which date shall not occur until the end of the Standstill Period as defined in the Master Agreement. “Special Damages”: As defined in Section 8.3(d). 5 “Subservicing Agreement”: That certain Master Subservicing Agreement, dated as of October 1, 2012, between the Seller, as subservicer, and Holdings, as servicer, as the same may be amended, amended and restated, supplemented or “Subservicing Supplement”: That certain Subservicing Supplement, dated as of [Date], between the Seller, as subservicer, and Holdings, as servicer, as the same may be amended, amended and restated, supplemented or otherwise modified “Summary Schedule”: As defined in Section 4.5(a). “Target Ratio” for each calendar month shall mean the amount specified in Schedule IV with respect to such month. “Termination Event” means the occurrence of any one or more of the following events (whatever the reason for the occurrence of such event and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (a)Seller fails to remit any payment required to be made under the terms of this Sale Supplement (to the extent not resulting solely from Holdings failing to purchase a Servicing Advance Receivable required to be purchased by Holdings under this Sale Supplement), which continues unremedied for a period of one (1) Business Day after the date on which written notice of such failure shall have been given by Holdings to Seller; (b)Seller fails to deliver any required information or report that is complete in all material respects as required pursuant to this Sale Supplement in the manner and time frame set forth herein, which failure continues unremedied for a period of two (2) Business Days after the date on which written notice of such failure shall have been given to Seller by Holdings; (c)Seller fails to observe or perform in any material respect any other covenant or agreement of Seller set forth in the Agreement or this Sale Supplement, which failure continues unremedied for a period of thirty (30) days after the date on which written notice of such failure shall have been given to Seller by Holdings; provided, however, in the event that any such default is incurable by its own terms, a Termination Event shall be deemed to occur immediately hereunder without regard to the thirty (30) day cure period set forth above; (d)a material breach by Seller of any representation and warranty made by it in the Agreement or this Sale Supplement, which breach continues unremedied for a period of thirty (30) days after the date on which written notice of such failure shall have been given to Seller by Holdings; provided, however, in the event that any such default is incurable by its own terms, a Termination Event shall be deemed to occur immediately hereunder without regard to the thirty (30) day cure period set forth above; (e)Seller fails to maintain residential primary servicer ratings for subprime loans of at least “Average” by Standard & Poor’s Rating Services, a division of Standards & Poor’s Financial 6 Services LLC (or its successor in interest), “SQ3” by Moody’s Investors Service, Inc. (or its successor in interest) and “RPS4” and “RSS4” by Fitch Ratings (or its successor in interest); (f)Seller ceases to be a Fannie Mae, Freddie Mac or FHA approved servicer; (g)the occurrence of a Material Adverse Event; (h)any of the conditions specified in the applicable “Servicer Default”, “Servicer Event of Default,” “Event of Default,” “Servicing Default” or “Servicer Event of Termination” or similar sections of any Deferred Servicing Agreement or any related Underlying Document shall have occurred with respect to Seller for any reason not caused by the Purchasers (other than as a result of any delinquency or loss trigger which was already triggered as of the Closing Date with respect to such Deferred Servicing Agreement); provided that Seller shall be entitled to any applicable cure period set forth in such Deferred Servicing Agreement or Underlying Document; (i)a decree or order of a court or agency or supervisory authority having jurisdiction for the appointment of a conservator or receiver or liquidator in any insolvency, bankruptcy, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding‑up or liquidation of its affairs, shall have been entered against Seller and such decree or order shall have remained in force undischarged or unstayed for a period of thirty (j)Seller shall consent to the appointment of a conservator or receiver or liquidator in any insolvency, bankruptcy, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to Seller or of or relating to all or substantially all of its property; or (k)Seller shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations. “Third‑Party Claim”: As defined in Section 8.3(b). “Transferred Assets”: The Rights to MSRs and the Transferred Servicing Rights. “Transferred Receivables Assets”: As defined in Section 3.1. “Transferred Servicing Agreement”: As of any date of determination, a Servicing Agreement with respect to which the related Servicing Rights have been transferred to the Purchasers pursuant to Section 2.2 of this Sale Supplement or to its designee in accordance with the terms of this Sale Supplement on or prior to such date. For the avoidance of doubt, on the Closing Date no Servicing Agreement is a Transferred Servicing Agreement. “Transferred Servicing Rights”: As of any date of determination, any Servicing Rights that have been transferred to Holdings pursuant to Section 2.2 of this Sale Supplement on or prior to such date. “UCC”: As defined in Section 3.1. 7 “Valuation Percentage”: For each Servicing Agreement, the valuation percentage for such Servicing Agreement as set forth in Schedule V hereto. (b)    Any capitalized term used but not defined in this Sale Supplement shall have the meaning assigned to such term in the Agreement. Section 1.2    Reference to the Master Servicing Rights Purchase Agreement. Each of Seller and Purchasers agrees that (a) this Sale Supplement is a “Sale Supplement” executed pursuant to Section 2.1 of the Agreement, (b) the terms of this Sale Supplement are hereby incorporated into the Agreement with respect to the Servicing Agreements and the related Mortgage Loans to the extent set forth therein and herein, and (c) the terms of this Sale Supplement apply to the Servicing Agreements specified herein and not to any other “Servicing Agreement” as that term is used in the Agreement. In the event of any conflict between the provisions of this Sale Supplement and the Agreement, the terms of this Sale Supplement shall prevail; provided, that in the event of any conflict between the provisions of this Sale Supplement and the Master Agreement, the terms of the Master Agreement shall prevail. ARTICLE 2     PURCHASE AND SALE OF SERVICING RIGHTS AND RIGHTS TO MSRS; ASSUMED LIABILITIES Section 2.1    Assignment and Conveyance of Rights to MSRs. (a)    As of the Closing Date, subject to the terms and conditions set forth in the Agreement and this Sale Supplement, Seller does hereby sell, convey, assign and transfer, in each case, without recourse except as provided herein, free and clear of any Liens, (i) to MSR – EBO all of its right, title and interest in and to all of the Excess Servicing Fees for each of the Servicing Agreements, and (ii) to Holdings, any and all other right, title and interest in and to all of the Rights to MSRs for each of the Servicing Agreements. (b)    On and after the Closing Date, Holdings shall be obligated to maintain a complete and accurate list of Servicing Agreements that are Deferred Servicing Agreements and Transferred Servicing Agreements, as the same shall be amended and modified from time to time in connection with Deferred Servicing Agreements becoming Transferred Servicing Agreements as contemplated by the terms and provisions of this Sale Supplement. The list of Deferred Servicing Agreements and Transferred Servicing Agreements maintained by the Purchasers under this Section 2.1(b) shall be (x) available for inspection by Seller at any time during normal business hours and (y) presumed to be accurate absent manifest error on the part of the Purchasers. Section 2.2    Automatic Assignment and Conveyance of Servicing Rights. As of the Servicing Transfer Date with respect to each Servicing Agreement, Seller does hereby sell, convey, assign and transfer to Holdings, without recourse except as provided herein, free and clear of any Liens, without further action by any Person, all of its right, title and interest in and to the following assets (the “Servicing Rights Assets”): 8 (a)    the Servicing Rights in respect of all of the Mortgage Loans and REO Properties related to such Servicing Agreement, in each case together with all related security, collections and payments thereon and proceeds of the conversion, voluntary or involuntary of the foregoing, other than the Excess Servicing Fees previously conveyed to Home Loan Servicing Solutions, Ltd. (and then assigned its interests therein to MSR – EBO) pursuant to Section 2.1; (b)    all Ancillary Income and Prepayment Interest Excess received as of or after the related Servicing Transfer Date under such Servicing Agreements and any rights to exercise any optional termination or clean-up call provisions under such Servicing Agreements; (c)    all Custodial Accounts and Escrow Accounts related to such Servicing Agreement and amounts on deposit therein; (d)    all files and records in Seller’s possession or control, including the related Database, relating to the Servicing Rights Assets specified in clauses (a), (b) and (c); (e)    all causes of action, lawsuits, judgments, claims, refunds, choses in action, rights of recovery, rights of set-off, rights of recoupment, demands and any other rights or claims of any nature, whether arising by way of counterclaim or otherwise, available to or being pursued by Seller to the extent related exclusively to such Servicing Rights Assets and/or the Assumed Liabilities; and (f)    any proceeds of any of the foregoing. Section 2.3    MSR Purchase Price. Subject to the conditions set forth in this Sale Supplement and the Agreement, as consideration for the purchase of the Rights to MSRs and the Servicing Rights Assets, MSR – EBO shall pay the portion of the MSR Purchase Price attributable to the value of the Excess Servicing Fees for each Servicing Agreement, and Holdings shall pay the portion of the MSR Purchase Price attributable to the value of the remainder of the Rights to MSRs and the Servicing Rights Assets, in each case for each Servicing Agreement, to Seller. Section 2.4    Assumed Liabilities and Excluded Liabilities. (a)    Upon the terms and subject to the conditions set forth herein and in the Agreement, Holdings shall assume, (i) prior to the Servicer Transfer Date for each Servicing Agreement, and solely as between Holdings and Seller, all of the duties, obligations and liabilities of Seller (other than the Excluded Liabilities), as servicer but subject to such Servicing Agreements, and provided that Seller will continue to act as the servicer as set forth herein and in no event shall Holdings be a subservicer, subcontractor or servicer within the meaning of a Servicing Agreement prior to the related Servicing Transfer Date and (ii) as of or after the Servicing Transfer Date for each Servicing Agreement, all of the duties, obligations, and liabilities of Seller (other than the Excluded Liabilities) as servicer accrued and pertaining solely to the period from and after such Servicing Transfer Date relating to the Servicing Rights that are subject to such Servicing Agreement (the “Assumed Liabilities”). (b)    Holdings hereby agrees to act as servicer under each Servicing Agreement following the related Servicing Transfer Date and assumes responsibility for the due and punctual performance 9 and observance of each covenant and condition to be performed or observed by the servicer under the applicable Servicing Agreement, including the obligation to service each Mortgage Loan in accordance with the terms of the related Servicing Agreement and to pay any Excess Servicing Fees to MSR – EBO on and after such Servicing Transfer Date; provided, however, that the parties hereto acknowledge and agree that neither the Purchasers nor any successor servicer assumes any liabilities of Seller, or any obligations of Seller relating to any period of time prior to the applicable Servicing Transfer Date. Seller hereby acknowledges that neither this Sale Supplement nor the Agreement limits or otherwise releases it from its liabilities for its acts or omissions as the servicer under the Servicing Agreements prior to the related Servicing Transfer Date. Holdings hereby acknowledges that Seller shall have no further obligation as servicer under any of the Servicing Agreements on and after the related Servicing Transfer Date, except to the extent set forth in this Sale Supplement, the Agreement, the Subservicing Agreement and the Subservicing Supplement. (c)    Notwithstanding anything to the contrary contained herein, the Purchasers do not assume any duties, obligations or liabilities of any kind, whether known, unknown, contingent or otherwise, (i) not relating to the Transferred Servicing Rights or the Assumed Liabilities, (ii) attributable to any acts or omissions to act taken or omitted to be taken by Seller (or any of its Affiliates, agents, contractors or representatives, including, without limitation, any subservicer of the Mortgage Loans) prior to the applicable Servicing Transfer Date, (iii) attributable to any actions, causes of action, claims, suits or proceedings or violations of law or regulation attributable to any acts or omissions to act taken or omitted to be taken by Seller (or any of its Affiliates, agents, contractors or representatives, including, without limitation, any subservicer of the Mortgage Loans) prior to the applicable Servicing Transfer Date or (iv) relating to any representation and warranty made by Seller or any of its Affiliates with respect to the related Mortgage Loans or the Transferred Assets (the “Excluded Liabilities”). Without limiting the generality of the foregoing, it is not the intention that the assumption by the Purchasers of the Assumed Liabilities shall in any way enlarge the rights of any third parties relating thereto. Nothing contained in the Agreement or this Sale Supplement shall prevent any party hereto from contesting matters relating to the Assumed Liabilities with any third party obligee. (d)    From and after the related Servicing Transfer Date, except as otherwise provided for in Section 8.3 of this Sale Supplement, (i) Holdings shall have complete control over the payment, settlement or other disposition of the Assumed Liabilities and the right to commence, control and conduct all negotiations and proceedings with respect thereto, subject to the terms of the related Servicing Agreements and (ii) Seller shall have complete control over the payment, settlement or other disposition of the Excluded Liabilities and the right to commence, control and conduct all negotiations and proceedings with respect thereto. Except as otherwise provided in this Sale Supplement, (i) Seller shall promptly notify Holdings of any claim made against Seller with respect to the Assumed Liabilities or the Transferred Assets and shall not voluntarily make any payment of, settle or offer to settle, or consent or compromise or admit liability with respect to, any Assumed Liabilities or Transferred Assets without the prior written consent of Holdings and (ii) Holdings shall promptly notify Seller of any claim made against the Purchasers with respect to the Excluded Liabilities and shall not voluntarily make any payment of, settle or offer to settle, or consent or compromise or admit liability with respect to, any Excluded Liabilities without the prior written consent of Seller. 10 Section 2.5    Remittance of Excess Servicing Fees, Servicing Advance Receivables Fees and Related Amounts. (a)    Seller shall, to the extent permitted under any Deferred Servicing Agreement cause(i)any Excess Servicing Fees to be deposited directly into MSR – EBO’s account in accordance with MSR – EBO’s written directions and (ii) any Servicing Advance Receivables Fees, any investment income earned on any amounts or deposit in any Custodial Accounts and Escrow Accounts that are payable to Seller on or after the Closing Date under such Deferred Servicing Agreement, to be deposited directly into Holdings’ account in accordance with Holdings’ written directions. In any case, Seller shall within one (1) Business Day of the receipt thereof, remit to the related Purchaser any such amounts and, to the extent Seller is permitted to retain such amounts under the related Servicing Agreement, any investment income earned on any amounts or deposit in any Custodial Accounts and Escrow Accounts that are received by Seller under any Deferred Servicing Agreement after the Closing Date. Any such amounts shall be remitted in accordance with such Purchaser’s written directions. (b)    Seller shall exercise any rights under any Deferred Servicing Agreement to direct the investment of amounts in any Custodial Account or Escrow Account in accordance with Holdings’ directions and the terms of the related Deferred Servicing Agreement, the related Mortgage Loan Documents and Applicable Law. Section 2.6    Payment of Estimated Purchase Price. Subject to the conditions set forth in this Sale Supplement and the Agreement, MSR – EBO and Holdings shall pay the Estimated Purchase Price to Seller at the Closing. The Estimated Purchase Price shall be reconciled to the final Purchase Price in accordance with Section 2.5 of the Agreement. Section 2.7    Refinancing of Mortgage Loans. If any mortgage loan (“Refinanced Mortgage Loan”) included in the sale of Rights to MSRs for any Servicing Agreement listed in Schedule 1 of the Sale Supplements is refinanced by Ocwen Financial Corporation, its affiliates or its vendors, the Seller hereby sells, assigns, transfers and conveys, in each case, without recourse except as provided herein, free and clear of any Liens, (the “Transfer of New Mortgage Loans”) to (i) MSR – EBO all of its rights, title and interest in and to all of the Excess Servicing Fees for the related mortgage loan (“New Mortgage Loan”), and (ii) to Holdings, any and all right, title and interest in and to all of the Rights to MSRs for the related New Mortgage Loan. The Transfer of New Mortgage Loans will be effective on the date on which a Refinanced Mortgage Loan is prepaid by the related New Mortgage Loan. On such date, the Seller shall execute and deliver an agreement, with a schedule of mortgage loans, documenting the Transfer of the Excess Servicing Fees and Rights to MSRs of New Mortgage Loans to the Purchaser. For the avoidance of doubt, any New Mortgage Loan shall be deemed to be included in the list of servicing agreements listed in Schedule I of the related Sale Supplement. The above Section 2.7 Refinancing of Mortgage Loans shall only apply when the aggregate unpaid principal balance of all Refinanced Mortgage Loans refinanced by Ocwen Financial Corporation, its affiliates or its vendors, exceeds 0.50% of the aggregate unpaid principal balance, as measured at the beginning of the most recent calendar year plus the weighted average of the unpaid principal balance of any Rights to MSRs sold to the Purchasers during the calendar year, of 11 all mortgage loans for which the Rights to MSRs have been sold to the Purchasers under the Master Servicing Rights Purchase Agreement. ARTICLE 3     Section 3.1    Assignment and Conveyance of Servicing Advance Receivables. Commencing on the Closing Date, and continuing until the close of business on the earlier of the related Servicing Transfer Date or date of Seller’s termination as servicer pursuant to such Servicing Agreement, subject to the terms and conditions set forth in the Agreement and this Sale Supplement, Seller hereby sells, conveys, assigns and transfers to Holdings, and Holdings acquires from Seller, without recourse except as provided herein, free and clear of any Liens, all of Seller’s right, title and interest, whether now owned or hereafter acquired, in, to and under each Servicing Advance Receivable (i) in existence on the Closing Date that arose under the Servicing Agreements and is owned by Seller as of the Closing Date, if any (the “Initial Servicing Advance Receivables”), (ii) in existence on any Business Day on or after the Closing Date that arises under any Servicing Agreement prior to the earlier of the related Servicing Transfer Date or date of Seller’s termination as servicer pursuant to such Servicing Agreement (“Additional Servicing Advance Receivables”), and (iii) in the case of both Initial Servicing Advance Receivables and Additional Servicing Advance Receivables, all monies due or to become due and all amounts received or receivable with respect thereto and all proceeds (including “proceeds” as defined in the Uniform Commercial Code in effect in all applicable jurisdictions (the “UCC”)), together with all rights of Seller to enforce such Initial Servicing Advance Receivables and Additional Servicing Advance Receivables (collectively, the “Transferred Receivables Assets”). Until the related Servicing Transfer Date, Seller shall, automatically and without any further action on its part, sell, assign, transfer and convey to Holdings, on each Business Day, each Additional Servicing Advance Receivable not previously transferred to Holdings and Holdings shall purchase each such Additional Servicing Advance Receivable. The parties acknowledge and agree that so long as the Servicing Advance Receivables with respect to a Servicing Agreement are being sold by Holdings to the Advance SPEs pursuant to the Servicing Advance Financing Agreements, the sale of such Servicing Advance Receivables by Seller to Holdings shall be made pursuant to and in accordance with the provisions of the Servicing Advance Financing Agreements, and Seller covenants and agrees to comply with the provisions of such Servicing Advance Financing Agreements with respect to such Servicing Advance Receivables. Section 3.2    Servicing Advance Receivables Purchase Price. In consideration of the sale, assignment, transfer and conveyance to Holdings of the Servicing Advance Receivables and related Transferred Receivables Assets, on the terms and subject to the conditions set forth in this Sale Supplement, Holdings shall, on each related Servicing Advance Payment Date, pay and deliver to Seller, in immediately available funds, a purchase price equal to the Servicing Advance Receivables Purchase Price for such Servicing Advance Receivables sold on such date; provided that Seller shall have complied with the terms of Section 3.1 and Section 3.3 with respect to the related Servicing Advance Receivable. Subject to the proviso of the immediately preceding sentence, to the extent any P&I Advances are required to be made under the terms of the Deferred Servicing Agreements, as determined by Seller and set forth in the applicable Monthly Remittance 12 Report, Holdings shall, on the date the related P&I Advance is required to be made under the related Deferred Servicing Agreement, deposit the Servicing Advance Receivable Purchase Price for such P&I Advances into either the applicable Custodial Account or other applicable account held by the related trustee, master servicer, securities administrator, or trust administrator, as the case may be, in accordance with the requirements of the related Deferred Servicing Agreement (which may be done directly by Holdings or though an account established in connection with the Servicing Advance Facility Agreements) in consideration for such P&I Advance. Section 3.3    Servicing Advances. Seller covenants and agrees that each Servicer Advance made by Seller under the Servicing Agreements prior to the related Servicing Transfer Date shall (a) be required to be made pursuant to the terms of the related Deferred Servicing Agreement and comply with the terms of such Deferred Servicing Agreement and Applicable Law, (b) comply with Seller’s advance policies and stop advance policies and procedures and not constitute a nonrecoverable Servicer Advance as of the date Seller made such Servicer Advance and (c) be supported by customary backup documentation. Seller agrees to provide prompt notice to Holdings of any Servicer Advance made by Seller under the Deferred Servicing Agreements and deliver to Holdings such customary backup documentation relating to any Servicer Advance promptly upon request by Holdings. In the event Seller cannot provide, or cause to be provided to Holdings any customary backup documentation, and Holdings is unable to be reimbursed for such Servicer Advance solely as a result of such failure, Seller shall reimburse Holdings fortheamountofsuch unreimbursed Servicer Advanceswithinfive (5)Business Days of Holdings’ written request, to the extent Holdings paid Seller for such amounts. Section 3.4    Reimbursement of Servicing Advances. Seller shall, to the extent permitted under any Deferred Servicing Agreement cause the reimbursement of any Servicer Advances under the Deferred Servicing Agreements to be made directly into Holdings’ account in accordance with Holdings’ written directions. In any case, Seller shall within one (1) Business Day of the receipt thereof, remit to Holdings any amounts that are received by Seller under any Deferred Servicing Agreement after the Closing Date as reimbursement of any Servicer Advance. Any such amounts shall be remitted in accordance with Holdings’ written directions. ARTICLE 4     Seller makes the following representations and warranties to the Purchasers as of (a) each of the Closing Date and each Sale Date or (b) as of such other dates specified below: Section 4.1    General Representations. Each of the representations and warranties set forth in Article 3 of the Agreement are true and correct. Section 4.2    Title to Transferred Assets. From and including the Closing Date until such Servicing Rights Assets are transferred to Holdings under Section 2.2, Seller shall be the sole holder and owner of such Servicing Rights Assets and shall have good and marketable title to the Servicing Rights Assets, free and clear of any Liens. Upon the sale of such Servicing Rights Assets pursuant to Section 2.2, Seller will transfer to Holdings good and marketable title to the Servicing Rights Assets free and clear of any Liens. Seller is the sole holder and owner of the Rights 13 to MSRs and the sale and delivery to the Purchasers of the Rights to MSRs pursuant to the provisions of this Sale Supplement will transfer to the Purchasers good and marketable title to the Rights to MSRs free and clear of any Liens. Section 4.3    Right to Receive Servicing Fees. Seller is entitled to receive Servicing Fees, Ancillary Income and Prepayment Interest Excess as servicer under each Servicing Agreement, and the New York Uniform Commercial Code permits the Seller to transfer the Excess Servicing Fees to MSR – EBO and the remainder of the Rights to MSRs to Holdings under the Agreement and this Sales Supplement without violation of any applicable Servicing Agreement. Section 4.4    Servicing Agreements and Underlying Documents. Schedule I hereto contains a list of all Servicing Agreements (other than the Underlying Documents) related to the Servicing Rights that are subject to this Sale Supplement and Schedule II hereto contains a list of all Underlying Documents related to such Servicing Agreement, in each case with all amendments and modifications thereto,orsupplementstheretowithrespecttosuch Servicing Rights. Section 4.5    Mortgage Pool Information, Related Matters. (a)    Seller has delivered to the Purchasers one or more summary schedules which set forth information with respect to each Mortgage Pool relating to the Servicing Rights (the “Summary Schedules”). Seller acknowledges that the Purchasers have relied on such Summary Schedules to determine the Purchase Price it was willing to pay for the Transferred Assets. (b)    The Summary Schedules, the Mortgage Loan Schedule and the Database are true, accurate and complete in all material respects as of the related Cut‑off Date or such other date specified thereon. (c)    The Mortgage Loan Schedule indicates, by code reference, which of the Mortgage Loans have been converted into REO Properties as of the Cut‑off Date. Section 4.6    Enforceability of Servicing Agreements. (a)    Seller has delivered to Purchasers on or prior to the related Closing Date, true and complete copies of all Servicing Agreements listed on Schedule I hereto and all amendment thereto and all Underlying Documents listed on Schedule II hereto and all amendments thereto. There are no other written or oral agreements binding upon Seller or Purchasers thatmodify,supplementoramendanysuchServicingAgreementorUnderlying Document. (b)    Seller has not received written notice of any pending or threatened cancellation or partial termination of any Servicing Agreement or Underlying Document or any written notice of any pending or threatened termination of Seller as servicer of any of the Mortgage Loans. (c)    On and prior to the related Servicing Transfer Date, each Servicing Agreement and each of the Underlying Documents is or was a valid and binding obligation of Seller, is or was in full force and effect and enforceable against Seller in accordance with its terms, except 14 as such enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors rights generally and general principles of equity (regardless of whether considered in a proceeding of law or in equity). Section 4.7    Compliance With Servicing Agreements. (a)    Seller has serviced the Mortgage Loans subject to the Servicing Agreements and has kept and maintained complete and accurate books and records in connection therewith, all in accordance with Applicable Requirements, has made all remittances required to be made by it under each Servicing Agreement and is otherwise in compliance in all material respects with all Servicing Agreements and the Applicable Requirements. (b)    (i) No early amortization event, servicer default, servicer termination event, event of default or other default or breach has occurred under any Servicing Agreement or any Underlying Document (except with respect to the delinquency or loss performance triggers identified in the Summary Schedules), and (ii) no event has occurred, which with the passage of time or the giving of notice or both would: (A) constitute a material default or breach by Seller under any Servicing Agreement, Underlying Document or under any Applicable Requirement; (B) permit termination, modification or amendment of any such Servicing Agreement or Underlying Document by a third party without the consent of Seller; (C) enable any third party to demand that Seller or either Purchaser incur any repurchase obligations pursuant to a Servicing Agreement or an Underlying Document or provide indemnification for any amount of losses relating to a breach of a loan representation or warranty; (D) impose on Seller or either Purchaser sanctions or penalties in respect of any Servicing Agreement or Underlying Document; or (E) rescind any insurance policy or reduce insurance benefits in respect of any Servicing Agreement or Underlying Document which would result in a material breach or trigger a default of any obligation of Seller under any Servicing Agreement or Underlying Document. (c)    There are no agreements currently in place with any subservicers to perform any of Seller’s duties under the Servicing Agreements. (d)    Each report and officer’s certification prepared by Seller as servicer pursuant to a Servicing Agreement is true and correct in all material respects. Seller has previously made available to the Purchasers a correct and complete description of the policies and procedures used by Seller in connection with servicing the Mortgage Loans related to the Servicing Agreements. (e)    In the preceding twelve (12) month period, no Governmental Authority, Investor, Insurer, rating agency, trustee, master servicer or any other party to a Servicing Agreement has provided written notice to Seller claiming or stating that Seller has violated, breached or not complied with any Applicable Requirements in connection with the servicing of the related Mortgage Loans which has not been resolved by Seller. (f)    All Custodial Accounts and Escrow Accounts have been established and continuously maintained in accordance with Applicable Requirements. All Custodial Account and Escrow Account balances required by the Mortgage Loans and paid for the account of the Mortgagors under the related Mortgage Loans have been credited properly to the appropriate account and have 15 been retained in and disbursed from the appropriate account in accordance with Applicable Requirements. Section 4.8    No Recourse. None of the Servicing Agreements or other contracts to be assumed by the Purchasers hereunder provide for Recourse to Seller. Section 4.9    The Mortgage Loans. (a)    Each of the Mortgage Loans and REO Properties related to each Servicing Agreement has been serviced in accordance with Applicable Requirements in all material respects. (b)    Except as disclosed on the Mortgage Loan Schedule, in the related Database and in the related Loan File and consistent with the requirements of the related Servicing Agreement, Seller has not waived any default, breach, violation or event of acceleration under any Mortgage Loan, except to the extent that any such waiver is permitted under the related Servicing Agreement and reflected in the Mortgage Loan Schedule, the related Database and the related Loan File and the disclosure relating to such waiver is reflected consistently in all material respects among the related Mortgage Loan Schedule, the related Database and the related Loan File. The Mortgage related to each Mortgage Loan related to the Servicing Agreements has not been satisfied, cancelled or subordinated, in whole or in part, and except as permitted under the related Servicing Agreement, the related Mortgaged Property has not been released from the lien of the Mortgage, in whole or in part, nor has any instrument been executed that would effect any such release, cancellation, or subordination. (c)    There is in force with respect to each Mortgaged Property and REO Property related to a Servicing Agreement a hazard insurance policy (including any policy in effect under a forced place insurance policy) and, if applicable, a flood insurance policy that provides, at a minimum, for the coverage as required by the applicable Servicing Agreement. Seller and any prior servicer or subservicer under the Servicing Agreements has taken all necessary steps to maintain any hazard insurance policy, flood insurance policy, primary mortgage insurance policy, and title insurance policy as required under the Servicing Agreements. (d)    Seller is not aware of any repurchase requests or demands being made or threatened to be made with respect to any Mortgage Loans related to the Servicing Agreements in excess of $10 million with respect to any Servicing Agreement. (e)    Except as disclosed in the related Database, Seller has not received notice from any Mortgagor with respect to the Mortgage Loans related to the Servicing Agreements of a request for relief pursuant to or invoking any of the provisions of the Servicemembers Civil Relief Act or any similar law which would have the effect of suspending or reducing the Mortgagor’s payment obligations under a Mortgage Loan or which would prevent such loan from going into foreclosure. (f)    With respect to each adjustable rate Mortgage Loan, Seller and each prior servicer has complied in all material respects with all Applicable Requirements regarding interest rate and payment adjustments. 16 (g)    Each first lien Mortgage Loan is covered by a valid and freely assignable, life of loan, tax service contract, and flood tracking services contract, in full force and effect. All flood zone determination information provided to the Purchasers is true and correct in all material respects. (h)    There are no actions, claims, litigation or governmental investigations pending or, to the knowledge of Seller, threatened, against Seller, or with respect to any Servicing Agreement or any Mortgage Loan, which relate to or affect Seller’s rights with respect to the Servicing Rights or Seller’s right to sell, assign and transfer the Servicing Rights or the Rights to MSRs or to receive any Servicing Fee, which could reasonably be expected to have a Material Adverse Effect individually or in the aggregate. (i)    Payments received by Seller with respect to any Mortgage Loans related to the Servicing Agreements have been remitted and properly accounted for as required by Applicable Requirements in all material respects. All funds received by Seller in connection with the satisfaction of Mortgage Loans, including foreclosure proceeds and insurance proceeds from hazard losses, have been deposited in the appropriate Custodial Account or Escrow Account and all such funds have been applied to pay accrued interest on the Mortgage Loans, to reduce the principal balance of the Mortgage Loans in question, or for reimbursement of repairs to the Mortgaged Property or as otherwise required by Applicable Requirements or are on deposit in the appropriate Custodial Account or Escrow Account. (j)    Seller is not aware of any Person that has issued any notice or written intention to exercise the optional call or optional redemption provisions under any of the related Servicing Agreements. (k)    No fraudulent action has taken place on the part of Seller in connection with its servicing of any Mortgage Loan related to the Servicing Agreement. (l)    Except with respect to partial releases, actions required by a divorce decree, assumptions, or as otherwise permitted under Applicable Requirements and documented in the Loan File and the Database, (i) the terms of each Mortgage Note and Mortgage have not been modified by Seller or any prior servicer, (ii) no party thereto has been released in whole or in part by Seller or any prior servicer and (iii) no part of the Mortgaged Property has been released by Seller or any prior servicer. Section 4.10    Servicing Advance Receivables. (a)    From and including the Closing Date until such Servicing Advance Receivable is transferred to Holdings under Section 3.1, Seller is the sole holder and owner of each Servicing Advance Receivable and has good and marketable title to such Servicing Advance Receivable. Seller has not previously assigned, transferred or encumbered the Servicing Advance Receivables other than pursuant to the Agreement, this Sale Supplement and the Servicing Advance Financing Agreements. The sale and delivery to Holdings of the Servicing Advance Receivables pursuant to the provisions of this Sale Supplement will transfer to Holdings good and marketable 17 title to the Servicing Advance Receivables free and clear of any Liens (other than the Liens created pursuant to the Servicing Advance Financing Agreements). (b)    Each Servicing Advance Receivable transferred to Holdings under Section 3.1, is at the time of such transfer a valid and existing account owing to Seller and is carried on the books of Seller at or less than the amount actually advanced or accrued net of any charge‑offs or other adjustments by Seller. Seller has not received any notice from a master servicer, securities administrator, trustee, Insurer, Investor or any other Person, which disputes or denies a claim by Seller for reimbursement in connection with any such Servicing Advance Receivable. Each Servicer Advance made by Seller (and each trailing invoice received by Holdings on or after the related Servicing Transfer Date for services rendered prior to such Servicing Transfer Date) that is reimbursed or paid by Holdings to Seller or a third party service provider is fully reimbursable to Holdings as a Servicer Advance under the terms of the related Servicing Agreement. (c)    Each Servicer Advance made by Seller was made in accordance with Applicable Requirements and Seller’s advance policies and stop advance policies and procedures in all material respects, and is not subject to any set‑off or claim that could be asserted against Holdings. No Servicer Advance made by Seller or any prior servicer under a Servicing Agreement and not reimbursed or paid to Seller prior to the related Sale Date is a Non‑Qualified Servicer Advance. Seller has not received any written notice from any Person in which such Person disputes or denies a claim by Seller for reimbursement in connection with a specifically identified Servicer Advance. Section 4.11    Servicing Agreement Consents and Other Third Party Approvals. None of the execution, delivery and performance of the Agreement and this Sale Supplement by Seller, the transfers of Servicing Rights under Section 2.2, the transfer of Rights to MSRs under Section 2.1, the transfers of Servicing Advance Receivables under Section 3.1 and the other transactions contemplated hereby require any consent, approval, waiver, authorization, penalties, notice or filing to be obtained by Seller or the Purchasers from, or to be given by Seller or the Purchasers to, or made by Seller or the Purchasers with, any Person, except for, with respect to the Servicing Rights Assets, the Third Party Consents. Section 4.12    Servicing Advance Financing Agreements. (a)    Except as otherwise disclosed to the Purchasers, all of the Servicing Agreements are “Facility Eligible Servicing Agreements,” and each Servicer Advance to be owned by an Advance SPE is a “Facility Eligible Receivable,” each as defined under the Servicing Advance Financing Agreements. (b)    All of the representations and warranties of Seller in the Servicing Advance Financing Agreements are true and correct, and no early amortization event, default, event of default or similar event has occurred under the Servicing Advance Financing Agreements. (c)    Each of Seller and its Affiliates have complied in all material respects with the terms of the existing Servicing Advance Financing Agreements. 18 Section 4.13    Anti‑Money Laundering Laws. Seller has complied with all applicable anti‑money laundering laws and regulations. Section 4.14    Servicer Ratings. Seller has a residential primary servicer rating for the servicing of subprime residential mortgage loans issued by S&P, Fitch or Moody’s at or above “Above Average,” “RPS3” and “SQ2‑”, respectively. Section 4.15    Eligible Servicer. Seller meets the eligibility requirements of a servicer and a subservicer under the terms of each Servicing Agreement and Underlying Document. Section 4.16    HAMP. Seller has entered into a Commitment to Purchase Financial Instrument and Servicer Participation Agreement with Fannie Mae, as financial agent of the United States, which agreement is in full force and effect. ARTICLE 5     CONDITIONS PRECEDENT Section 5.1    Conditions to the Purchase of Certain Servicing Advance Receivables. Holdings’ obligations to purchase any Servicing Advance Receivable pursuant to Section 3.1 and to pay the related Servicing Advance Receivables Purchase Price pursuant to Section 3.2 are subject to the satisfaction or Holdings’ waiver of the condition that, on the date of the financing of such Servicing Advance Receivable pursuant to the Servicing Advance Financing Agreements, any required written confirmation from a national statistical rating organization that the rating of the related notes will not be reduced, withdrawn or downgraded shall have been obtained. Section 5.2    Conditions to the Purchase of the Rights to MSRs. . The Purchasers’ obligations to make their respective purchases pursuant to Section 2.1, Holdings’ obligations to purchase the Servicing Rights pursuant to Section 2.2, and the Purchasers’ obligations to pay the Purchase Price (and the Estimated Purchase Price) pursuant to Section 2.3 and Section 2.6 are subject to the satisfaction or the Purchasers’ waiver of each of the conditions set forth in Section 6.1 and Section 6.3 of the Agreement (except the requirement to deliver the Third Party Consents necessary to transfer the Servicing Rights pursuant to Section 2.2) with respect to each of the Servicing Agreements and each of the Servicing Rights, as applicable, on the Closing Date and the satisfaction of each of the following conditions: (a)    Seller shall have obtained all consents or approvals required to be obtained to consummate the transfers to the Purchasers pursuant to Section 2.1; (b)    The Servicing Advance Facility Agreements shall have been executed and delivered by each of the parties thereto and all of the conditions precedent to the effectiveness of the Servicing Advance Facility Agreements set forth therein have been satisfied; and (c)    The Subservicing Agreement and the Subservicing Supplement shall have been executed and delivered by each of the parties thereto and all of the conditions precedent to the 19 effectiveness of the Subservicing Agreement and the Subservicing Supplement set forth therein have been satisfied. ARTICLE 6     SERVICING MATTERS Section 6.1    Seller as Servicer. Except as expressly set forth in this Sale Supplement, Seller shall perform all of its duties and obligations of under each Servicing Agreement until the related Servicing Transfer Date and shall at all times until the related Servicing Transfer Date meet any standards and fulfill any requirements applicable to Seller under each Servicing Agreement. Section 6.2    Servicing. Except as otherwise specifically provided in this Sale Supplement, Seller covenants and agrees to service and administer each Mortgage Loan related to a Servicing Agreement from and after the Closing Date until the related Servicing Transfer Date in accordance with Applicable Law, the terms of the related Mortgage Loan Documents and any applicable private mortgage insurance or pool insurance, the standards, requirements, guidelines, procedures, restrictions and provisions of the related Servicing Agreement and Underlying Documents governing the duties of Seller thereunder, this Sale Supplement and any other Applicable Requirements. Without limiting the foregoing, Seller covenants and agrees that it shall perform its obligations pursuant to this Sale Supplement in a manner that will not cause the termination of Seller as servicer under any Deferred Servicing Agreement, including any termination based on Seller’s management of delinquency or loss performance with respect to Mortgage Loans related to such Deferred Servicing Agreement. The parties acknowledge and agree that any termination of Seller as servicer with respect to a Servicing Agreement pursuant to a delinquency or loss performance trigger or for any other reason, other than as a result of a failure by Holdings to purchase Servicing Advance Receivables pursuant to Section 3.1, shall be deemed to be the result of a breach by Seller of its obligations under this Sale Supplement and the Agreement. In the event of a conflict between a Servicing Agreement and this Article 6, the Servicing Agreement shall control. Section 6.3    Collections from Obligors and Remittances. Seller shall direct the obligors on the Deferred Mortgage Loans to remit payment on the Deferred Mortgage Loans to the Clearing Account (as defined in the Servicing Agreement) and shall within one (1) Business Day of receipt promptly deposit any amounts Seller receives with respect to the Deferred Mortgage Loans in the Clearing Account. Seller shall promptly remit all amounts received by Seller with respect to the Mortgage Loans to the applicable Custodial Account or Escrow Account, but no later than the earlier of two (2) Business Days after receipt thereof or the date required pursuant to the applicable Deferred Servicing Agreement; provided, that Seller shall, subject to the terms of the related Servicing Agreement, remit any such amounts that constitute recovery of a Servicer Advance to the applicable account, if any, specified by Holdings pursuant to Section 3.4 within one (1) Business Day of receipt thereof; provided, further, that Seller shall, subject to the terms of the related Servicing Agreement, remit any such amounts that constitute Servicing Fee to the applicable account, if any, specified by Holdings pursuant to Section 2.5 within one (1) Business Day of receipt thereof. Seller shall also making any compensating interest payments or prepayment interest shortfall payments required to be made by Seller with respect to the Mortgage Loans under the 20 Deferred Servicing Agreements, and shall remit any such payments to the applicable Custodial Account no less than one (1) Business Day prior to the applicable remittance date for such Servicing Agreement. Section 6.4    Servicing Practices. Seller shall not make any material change to its servicing practices with respect to the Deferred Mortgage Loans after the date hereof, including, any material changes to its cash collection and sweep processes or its advance policies or stop advance policies, without Holdings’ prior written consent, which consent shall not be unreasonably withheld or delayed. Holdings shall have the right to direct Seller to implement reasonable changes to Seller’s servicing practices applicable with respect to all or a portion of the Mortgage Loans, including any changes necessary to ensure compliance with any Applicable Laws or governmental programs or directions received pursuant to the applicable Servicing Agreements. Section 6.5    Servicing Reports. Seller shall simultaneously deliver a copy of any reports delivered by Seller to any Person pursuant to the Deferred Servicing Agreements to Holdings. Section 6.6    Escrow Accounts. Subject to the terms of the related Deferred Servicing Agreement, Seller shall be entitled to withdraw funds from any Escrow Account related to a Deferred Servicing Agreement only for the purposes permitted in the applicable Servicing Agreement. Section 6.7    Notices and Financial Information. Until the last Servicing Transfer Date, Seller will furnish, or will cause to be furnished, to the Purchasers: (a)    within two (2) Business Days after the occurrence of a breach by Seller of the Agreement or this Sale Supplement or any Termination Event or other event that would give MSR – EBO the right to direct Seller to transfer the Servicing Rights with respect to any Deferred Servicing Agreement, notice of such event; (b)    any information required to be delivered by Seller pursuant to Section 5.10 of the Subservicing Agreement, which information shall be delivered at such times as specified in Section 5.10 of the Subservicing Agreement, provided that any reference to a “Subject Servicing Agreement” in Section 5.10 of the Subservicing Agreement shall be deemed to be a reference to a “Deferred Servicing Agreement,” for the purposes of this Section 6.7; and (c)    such other information regarding the condition or operations, financial or otherwise, of Seller or any of its subsidiaries as MSR – EBO may from time to time reasonably request. Section 6.8    Defaults under Deferred Servicing Agreements. Seller covenants and agrees to use its reasonable best efforts to cure any breach, default or notice of default with respect to its obligations under any Deferred Servicing Agreement within the timeframe for cure set forth in such Deferred Servicing Agreement. Section 6.9    Continuity of Business. (a) Seller will maintain a disaster recovery plan in support of the services it performs pursuant to this Sale Supplement and each Deferred 21 Servicing Agreement. Seller’s disaster recovery plan shall include, at a minimum, procedures for back-up/restoration of operating and loan administration computer systems; procedures and third‑party agreements for replacement equipment (e.g. computer equipment), and procedures and third‑party agreements for off‑site production facilities. Seller will provide Holdings information regarding its disaster recovery plan upon reasonable request. Seller agrees to annually test its disaster recovery plan to ensure compliance with this Section 6.9. If such test results identify a material failure, Seller shall advise Holdings of the steps Seller will be taking to remedy such failure and shall notify Holdings when Seller has remedied such failure and retested. Seller will notify Holdings anytime Seller’s disaster recovery plan is activated. In the event of an activation of the disaster recovery plan, Seller shall use best efforts to provide redundancy capabilities for a majority of the critical systems within 48 hours in at least one of Seller’s other servicing facilities unaffected by the disaster to ensure servicing of the Mortgage Loans will be re‑established within such 48 hours. Section 6.10    Clean Up Call Rights. Seller shall exercise its rights under any optional termination or clean up call rights provided for in the Servicing Agreements and the Underlying Documents (the “Clean Up Call Rights”) only at the prior written direction of MSR – EBO specifying the date of exercise, which shall be at least thirty (30) days after the date of such notice from MSR – EBO. In connection with such exercise of Clean Up Call Rights, Seller hereby sells and transfers to MSR – EBO (or its designee) on an exclusive and “as is” basis the right to all economic beneficial rights to such Clean Up Call Rights (including the right to cause Seller to exercise such Clean Up Call Rights), which include the economic beneficial interest in the right to purchase from the related trust for each Deferred Servicing Agreement all of the assets of such trust, including the mortgage loans and REO properties (collectively, the “Mortgage Loans”) for a payment of 0.50% of the unpaid principal balance of all Performing Mortgage Loans of such trust (which payment is due upon the exercise of any Clean Up Call Rights). Any purchase and exercise of such Clean Up Call Rights shall be subject to customary “as is” documentation, which MSR – EBO and Seller will negotiate in good faith. Seller shall give MSR – EBO at least thirty (30) days’ notice prior to the date on which Seller would have to notify the trustee for the related trust of its intent to exercise the related Clean Up Call Rights and will work in good faith with MSR – EBO and the related trustee with respect to the exercise the Clean Up Call Rights. For the avoidance of doubt, MSR – EBO (or its designee) shall fund the exercise of the Clean Ups Call Rights acquired and pay any expenses associated with such exercise (including any of Seller’s reasonable out‑of‑pocket expenses and any customary transfer expenses and deboarding fees, if applicable) and pay all unreimbursed Servicer Advances and other amounts owed to Holdings with respect to such Servicing Agreement under this Sale Supplement. For purposes of this Section 6.10, “Performing Mortgage Loan” means any Mortgage Loan that is current or thirty (30) days or less delinquent (MBA method). The rights of Seller to payment in respect of any exercise of Clean Up Call Rights under this Section 6.10 by MSR – EBO or its designee shall survive any transfer of servicing pursuant to Section 6.12. Section 6.11    Amendments to Deferred Servicing Agreements; Transfer of Servicing Rights. Seller hereby covenants and agrees not to amend the Servicing Agreements without the Purchasers’ prior written consent. Seller shall not sell or otherwise voluntarily transfer servicing under any of the Deferred Servicing Agreement during the Consent Period except as 22 expressly provided in this Sale Supplement or take any other actions inconsistent with Holdings’ right to acquire ownership of Servicing Rights with respect to a Servicing Agreement upon receipt of the required Third Party Consents. Section 6.12    Assumption of Servicing Duties; Transfer of Rights to MSRs and Servicing Rights. Holdings may from time to time designate any of Seller’s servicing obligations under a Deferred Servicing Agreement and assume the performance of such obligations so long as such assumption is permitted pursuant to such Deferred Servicing Agreement and does not limit Seller’s right to receive the Servicing Fees pursuant to such Deferred Servicing Agreement. Notwithstanding anything in the Agreement or this Sale Supplement to the contrary, either Purchaser may transfer the Rights to MSRs to any third party and/or may direct Seller to transfer the Servicing Rights to a third party that can obtain the required Third Party Consents, subject to the right of the Seller to receive the Seller Monthly Servicing Fee, the Performance Fee, the Ancillary Income and, if applicable, the Prepayment Interest Excess owed to Seller with respect to such Deferred Servicing Agreement pursuant to Article 7. For the avoidance of doubt, MSR – EBO shallbe entitled to receive all proceeds of such transfer. Section 6.13    Termination Event. In the case that any Termination Event occurs with respect to any Servicing Agreement during the Consent Period, Seller shall, upon MSR – EBO’s written direction to such effect, use commercially reasonable efforts to transfer the Servicing Rights relating to any affected Servicing Agreement to a third party servicer identified by MSR – EBO with respect to which all required Third Party Consents with respect to such Servicing Agreement can be obtained. MSR – EBO shall be entitled to receive all proceeds of such transfer. Section 6.14    Servicing Transfer. Seller and the Purchasers shall, prior to the Servicing Transfer Date with respect to each Servicing Agreement,workingoodfaith to determine and agreeuponapplicableservicing transfer procedures with respect to such Servicing Agreement. Section 6.15    Incorporation of Provisions from Subservicing Agreement. The provisions of each of Sections 5.3, 5.4, 5.5, 5.6, 5.7, 5.8 (excluding the first sentence thereof), 5.17 and 5.18, and Exhibit A of the Subservicing Agreement are hereby incorporated into this Sale Supplement by reference, mutatis mutandis, as if its provisions were fully set forth herein; provided that any reference therein to the defined terms “Ocwen,” “Servicer,” “Mortgage Loan,” “Subject Servicing Agreement” and “Agreement,” shall be deemed for purposes of this Sale Supplement to be references to the terms “Seller,” “Holdings,” “Deferred Mortgage Loan,” “Deferred Servicing Agreement” and “Sale Supplement,” respectively and any reference therein to the phrase “during the term of this Agreement” shall be deemed for purposes of this Sale Supplement to be references to the phrase “until the last Servicing Transfer Date.” ARTICLE 7     Section 7.1    Seller Monthly Servicing Fee. As consideration for Seller servicing the Mortgage Loans pursuant to the Deferred Servicing Agreements during the applicable Consent Period but prior to the earlier of the date on which the Servicing Rights are transferred from Seller 23 with respect to a Deferred Servicing Agreement or Servicing Fee Reset Date, Holdings shall pay to Seller a monthly base servicing fee for each calendar month during such period during which Seller is servicing Mortgage Loans with respect to Deferred Servicing Agreements pursuant to this Sale Supplement equal to 12% of the aggregate Servicing Fees actually received by the Purchasers under this Sale Supplement during such calendar month with respect the Deferred Servicing Agreements (the “Seller Monthly Servicing Fee”). Section 7.2    Performance Fee. In addition to the Seller Monthly Servicing Fee, Holdings shall pay to Seller for each calendar month during which Seller is servicing Mortgage Loans with respect to Deferred Servicing Agreements pursuant to this Sale Supplement a performance fee (“Performance Fee”) equal to the greater of (a) zero and (b) (x) the excess, if any, of the aggregate of all Servicing Fees actually received by the Purchasers with respect to the Deferred Servicing Agreements and pursuant to the Transferred Servicing Agreements (whether directly pursuant to such Transferred Servicing Agreements or pursuant to this Sale Supplement) during such calendar month over the sum of (i) the Monthly Servicing Fee for such calendar month and (ii) the Retained Servicing Fee for such calendar month multiplied by (y) a fraction, (i) the numerator of which is the average unpaid principal balance of all Mortgage Loans subject to the Deferred Servicing Agreements during such calendar month and (ii) the denominator of which is equal to the sum of the average unpaid principal balance of all Mortgage Loans subject to the Deferred Servicing Agreements during such calendar month and the average unpaid principal balance of all Mortgage Loans subject to the Transferred Servicing Agreements during such calendar month, or such other allocation percentage which is agreed by Seller and Holdings (the “Allocation Percentage”). The Performance Fee, if any, for any calendar month will be reduced by an amount equal to One‑Month LIBOR (calculated using the arithmetic mean of daily rates for the period published by British Bankers’ Association) plus 2.75% of the Excess Servicing Advances, if any, for such month multiplied by the Allocation Percentage, and the amount of any such reduction in the Performance Fee shall be retained by Holdings. If the Closing Date does not occur on the first day of a calendar month, the Performance Fee for the period from the Closing Date to the last of the calendar month in which the Closing Date occurs shall be calculated in a pro rata manner based on the number of days in such period. Notwithstanding any provision in this Sale Supplement to the contrary, in the event Holdings has failed to pay Seller any Seller Monthly Servicing Fee or Performance Fees that are past due after ten (10) Business Days of Holdings receiving notice of such failure, Seller shall not be required to continue to act as servicer until such time as Holdings has fully paid such past due Seller Monthly Servicing Fee or Performance Fee; provided that Holdings shall not have notified Seller that it disputes the occurrence or amount of such past due Seller Monthly Servicing Fee or Performance Fee. Section 7.3    Costs and Expenses. Except as otherwise expressly provided inthe Agreement or this Sale Supplement, each party hereto shall be responsible for execution of the Agreement, this Sale Supplement and all documents relating thereto. Seller shall be required to pay all expenses incurred by it in connection with its obligations hereunder to the extent such expenses do not constitute Servicer Advances and shall not be entitled to reimbursement therefor except as specifically provided for herein or in the applicable Deferred Servicing Agreement. Seller shall reimburse the Purchasers for any reasonable out‑of‑pocket costs, including legal fees, incurred 24 by the Purchasers in connection with obtaining any required Third Party Consents; provided, however, thatneither Purchaser shall incur such costs without the prior written approval of Seller. Section 7.4    Ancillary Income. Seller shall be entitled to retain as additional compensation any Ancillary Income and any Prepayment Interest Excess received by Seller with respect to the Deferred Mortgage Loans, to the extent such Ancillary Income or Prepayment Interest Excess is permitted to be retained by Seller pursuant to the related Deferred Servicing Agreement. Section 7.5    Calculation and Payment. No later than the second Business Day following the receipt by the Purchasers of the Monthly Servicing Oversight Report for a calendar month, Holdings will remit to Seller in immediately available funds the Seller Monthly Servicing Fee and Performance Fees payable by Holdings to Seller for the related calendar month, along with a report showing in reasonable detail the calculation of such Seller Monthly Servicing Fees and Performance Fees. Section 7.6    No Offset. Neither party shall have any right to offset against any amount payable hereunder or other agreement to the other party, or otherwise reduce any amount payable hereunder as a result of, any amount owing by the other party or any of its Affiliates to such party or any of its Affiliates. Section 7.7    Servicing Fee Reset Date. No later than six (6) months prior to the Servicing Fee Reset Date, Holdings shall commence negotiating in good faith an extension of the Servicing Fee Reset Date and the servicing fees payable to Seller. If Seller and Holdings are unable to agree to such servicing fees prior to the Servicing Fee Reset Date, Seller shall, upon Holdings’ written direction to such effect, transfer the Servicing Rights relating to all of the Deferred Servicing Agreements to a third party servicer (including any affiliate of Holdings) identified by Holdings with respect to which all required Third Party Consents with respect to the Deferred Servicing Agreements can be obtained. Notwithstanding anything to the contrary in this Sale Supplement, after the Servicing Fee Reset Date and prior to any transfer of servicing under this section, all fees payable to Seller under this Sale Supplement shall continue to be paid and the Servicing Agreement shall continue to be deemed a Deferred Servicing Agreement hereunder. Upon any transfer of servicing pursuant to this Section 7.7, an amount equal to the consideration for the transfer of related accrued and unpaid servicing fees for such Deferred Servicing Agreement shall be paid to Seller so long as Holdings receives the amount of the accrued and unpaid Retained Servicing Fee and Retained Servicing Fee Shortfall, if any, owing Holdings at the date of transfer (whether or not then due and payable hereunder). MSR-EBO shall be entitled to receive all proceeds of such transfer other than the amounts Seller is entitled to in accordance with the immediately preceding sentence. ARTICLE 8     INDEMNIFICATION Section 8.1    Seller Indemnification of Purchasers. Seller agrees to indemnify and hold harmless each Purchaser and each officer, director, agent, employee or Affiliate of each Purchaser (each, a “Seller Indemnified Party”) from and against any and all claims, losses, damages, liabilities, judgments, penalties, fines, forfeitures, legal fees and expenses, and any and all related 25 costs and/or expenses of litigation, administrative and/or regulatory agency proceedings, and any other costs, fees and expenses (each, a “Liability”) suffered or incurred by a Purchaser or any such other Person (whether or not resulting from a third party claim) arising directly or indirectly out of or resulting from (a) any event relating to Transferred Assets occurring prior to the related Servicing Transfer Date, (b) a breach of any of Seller’s representations and warranties contained in the Agreement, this Sale Supplement or any other Related Agreement or Seller’s failure to observe and perform any of Seller’s duties, obligations, covenants or agreements contained in the Agreement, this Sale Supplement or any other Related Agreement, (c) acts or omissions of Seller, any other servicer of any Mortgage Loans, or any subservicer, contractor or agent engaged by Seller or any other servicer, in each case prior to the related Servicing Transfer Date, relating to the Transferred Assets, including any failure by Seller, any other servicer or any subservicer, contractor or agent engaged by Seller or any other servicer prior to the related Servicing Transfer Date to comply with the Applicable Requirements, (d) the Excluded Liabilities or (e) any acts or omissions by Seller or its employees or agents in performance of its duties or obligations pursuant to this Sale Supplement. Section 8.2    Purchasers Indemnification of Seller. The Purchasers agree, jointly and severally, to indemnify and hold harmless Seller and each officer, director, agent, employee or Affiliate of Seller (each, a “Purchaser Indemnified Party”) from and against any and all Liability suffered or incurred by Seller or any such other Person arising out of or resulting from (a) a breach of any of the Purchasers’ representations and warranties or covenants contained in the Agreement, the Sale Supplement or any other Related Agreement or (b) acts or omissions of a Purchaser or any subservicer, contractor or agent (other than Seller or any of Seller’s Affiliates) engaged by the Purchasers, in each case after the related Servicing Transfer Date, relating to the Transferred Assets. Section 8.3    Indemnification Procedures. (a)    As promptly as is reasonably practicable after becoming aware of a claim for indemnification under the Agreement or this Sale Supplement not involving a Third‑Party Claim, but in any event no later than fifteen (15) Business Days after first becoming aware of such claim, the Indemnified Person shall give notice to the Indemnifying Person of such claim, which notice shall specify the facts alleged to constitute the basis for such claim and the amount that the Indemnified Person seeks hereunder from the Indemnifying Person; provided, however, that the failure of the Indemnified Person to give such notice shall not relieve the Indemnifying Person of its obligations under this Section 8.3 except to the extent (if any) that the Indemnifying Person shall have been prejudiced thereby. (b)    The Indemnified Person shall give notice as promptly as is reasonably practicable, but in any event no later than ten (10) Business Days after receiving notice thereof, to the Indemnifying Person of the assertion of any claim, or the commencement of any action, suit, claim or proceeding, by any unaffiliated third Person (a “Third‑Party Claim”) in respect of which indemnity may be sought under the Agreement or this Sale Supplement (which notice shall specify in reasonable detail the nature and amount of such claim); provided, prejudiced thereby. The Indemnifying Person may, at its own expense, (i) participate in the defense 26 of any such Third‑Party Claim, and (ii) upon notice to the Indemnified Person, at any time during the course of any such Third‑Party Claim, assume the defense thereof with counsel of its own choice and, in the event of such assumption, shall have the exclusive right, subject to clause (i) in the proviso in Section 8.3(c), to settle or compromise such Third‑Party Claim. If the Indemnifying Person assumes such defense, the Indemnified Person shall have the right (but not the duty) to participate in the defense thereof and to employ counsel, at its own expense, separate from the counsel employed by the Indemnifying Person. Whether or not the Indemnifying Person chooses to defend or prosecute any such Third‑Party Claim, all of the parties hereto shall cooperate in the defense or prosecution thereof. (c)    Any settlement or compromise made or caused to be made by the Indemnified Person (unless the Indemnifying Person has the exclusive right to settle or compromise under clause (ii) of Section 8.3(b) or the Indemnifying Person, as the case may be), of any such Third‑Party Claim shall also be binding upon the Indemnifying Person or the Indemnified Person, as the case may be, in the same manner as if a final judgment had been entered by a court of competent jurisdiction in the amount of such settlement or compromise; provided, however, that (i) no obligation, restriction, loss or admission of guilt or wrongdoing shall be imposed on the Indemnified Person as a result of such settlement or compromise without its prior written consent and (ii) the Indemnified Person will not compromise or settle any Third Party Claim without the prior written consent of the Indemnifying Person. (d)    Except as specifically provided for in the Agreement or this Sale Supplement, no claim may be made by an Indemnified Person for any special, indirect, punitive or consequential damages (“Special Damages”) in respect of any breach or wrongful conduct (whether the claim therefor is based on contract, tort or duty imposed by law) in connection with, arising out of, or in any way related to the transactions contemplated, or relationship established, by this Agreement or any Sale Supplement, or any act, omission or event occurring in connection herewith or therewith, and to the fullest extent permitted by law, Seller and each Purchaser hereby waives, releases and agrees not to sue upon any such claim for Special Damages, whether or not accrued or whether or not known or suspected to exist in its favor. Section 8.4    Tax Treatment. (a)    Seller and the Purchasers agree that all payments made by any of them to or for the benefit of the other under this Article 8, under other indemnity provisions of the Agreement or this Sale Supplement and for any misrepresentations or breaches of warranties or covenants, shall be treated as adjustments to the Purchase Price for tax purposes and that such treatment shall govern for purposes hereof except to the extent that the Applicable Laws of a particular jurisdiction provide otherwise. (b)    All payments made pursuant to this Agreement shall be made free and clear and without deductions of any kind for taxes. Section 8.5    Survival. The parties’ obligations under this Article 8 shall survive any termination of the Agreement and/or this Sale Supplement. 27 Section 8.6    Additional Indemnification. (a)    Without limiting Seller’s obligations under Article 8 of this Sale Supplement, it is agreed by the parties that if Seller is terminated as servicer under any Deferred Servicing Agreement as a result of any action described in clauses (a) through (e) of Section 8.1 above, Seller shall also pay to the Purchasers, as reasonable and just compensation for such termination, an amount equal to the product of (i) the Purchase Price for such Deferred Servicing Agreement and (ii) the Amortization Percentage for the calendar month in which Seller received notice of such termination, and the Purchasers shall accept such sum as liquidated damages, and not as penalty, in the event of such a termination. Section 8.7    Specific Performance. Notwithstanding any other provision of the Agreement or this Sale Supplement, (i) it is understood and agreed that the remedy of indemnity payments pursuant to this Article 8 and other remedies at law would be inadequate in the case of any actual or threatened breach of the Agreement or this Sale Supplement by Seller and (ii) the Purchasers shall be entitled, without limiting its other remedies and without the necessity of proving actual damages or posting any bond, to equitable relief, including the remedy of specific performance or injunction, with respect to any breach or threatened breach of such covenants. Such relief shall be in addition to, and not in lieu of, all other remedies available at law or in equity to such party under the Agreement and this Sale Supplement. ARTICLE 9     GRANT OF SECURITY INTEREST Section 9.1    Granting Clause. To secure its performance of its obligations under the Agreement and this Sale Supplement, Seller hereby grants to the Purchasers a security interest in all of its right, title and interest in and to the following, whether now owned or hereafter acquired, and all monies “securities,” “instruments,” “accounts,” “general intangibles,” “payment intangibles,” “goods,” “letter of credit rights,” “chattel paper,” “financial assets,” “investment property,” (each as defined in the applicable UCC) and other property consisting of, arising from or relating to any of the following: Properties related to the Deferred Servicing Agreements, in each case together with all related security, collections and payments thereon and proceeds of the conversion, voluntary or involuntary of the foregoing; (b)    the Rights to MSRs with respect to each Servicing Agreement; (c)    all Servicing Fees, Ancillary Income and Prepayment Interest Excess received under the Deferred Servicing Agreements and subject to Section 6.10 of this Sale Supplement any rights to exercise any optional termination or clean‑up call provisions under the Deferred Servicing Agreements; 28 (d)    all income from amounts on deposit in Custodial Accounts and Related Escrow Accounts related to the Deferred Servicing Agreements; (e)    all files and records in Seller’s possession or control, including the related Database, relating to the assets specified in clauses (a) through (c); (f)    all causes of action, lawsuits, judgments, claims, refunds, choses in action, rights of recovery, rights of set‑off, rights of recoupment, demands and exclusively to any of the foregoing and/or the Assumed Liabilities; and (g)    any proceeds of any of the foregoing (collectively, the “Collateral”). This Sale Supplement shall constitute a security agreement under applicable law. Seller agrees that from time to time it shall promptly execute and deliver all additional instruments and documents and take all additional action that the Purchasers may reasonably request in order to perfect the interests of the Purchasers in, to and under, or to protect, the Collateral or to enable the Purchasers to exercise or enforce any of its rights or remedies hereunder. To the fullest extent permitted by applicable law, Seller hereby authorizes the Purchasers to file financing statements and amendments thereto in connection with the grant of a security interest pursuant to this Section 9.1. Seller covenants and agrees to take all necessary action to prevent the creation or imposition of any Lien upon any of the Collateral, and to maintain the Collateral free and clear of all Liens, other than the Lien securing the obligations of Seller arising under this Sale Supplement. Seller agrees to give the Purchasers prior written notice of any change in its legal name or jurisdiction of organization.  29 ARTICLE 10     MISCELLANEOUS PROVISIONS Section 10.1    Further Assurances. Without limiting Section 5.7 of the Agreement, each party hereto shall execute and deliver in a reasonable timeframe such reasonable and appropriate additional documents, instruments or agreements and take such reasonable actions as may be necessary or appropriate to effectuate the purposes of this Sale Supplement at the request of the other party. Without limiting the foregoing, the Seller agrees that it will promptly at the Purchasers’ request execute and deliver an one or more assignment and assumption agreements, in form mutually agreed to by the parties, one or more equity interest assignments, in form mutually agreed to by the parties, or such other documents, instruments or agreements as the Purchasers may reasonably request to evidence the transfers of Rights to MSRs pursuant to Section 2.1, Servicing Rights pursuant to Section 2.2 and Transferred Receivables Assets pursuant to Section 3.1. Section 10.2    Compliance with Applicable Laws; Licenses. Seller will comply with all Applicable Laws in connection with the performance of its obligations under the Agreement and this Sale Supplement. Seller shall maintain all necessary licenses and approvals in each jurisdiction where the failure to do so would materially and adversely affect the ability of Seller to perform its obligations under the Agreement and this Sale Supplement. Section 10.3    Merger, Consolidation, Etc. Seller will keep in full effect its existence, rights and franchises as a limited liability company, and will obtain and preserve its qualification to do business as a foreign organization in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of the Agreement, this Sale Supplement, each Deferred Servicing Agreement or any of the Deferred Mortgage Loans, or to perform its duties under the Agreement or this Sale Supplement. Seller may be merged or consolidated with or into any Person, or transfer all or substantially all of its assets to any Person, in which case any Person resulting from any merger or consolidation to which Seller shall be a party or acquiring all or substantially all of the assets of Seller, or any Person succeeding to the business of Seller shall be the successor of Seller hereunder and under the Agreement, without the execution or filing of any paper or any further act on the part of any of the parties hereto; provided, however, that the successor or surviving Person shall be an institution whose deposits are insured by FDIC or a company whose business includes the servicing of mortgage loans and shall have a tangible net worth not less than $25,000,000. Section 10.4    Annual Officer’s Certificate. Not later than March 15 of each calendar year commencing in 2014, Seller shall deliver to the Purchasers an Officer’s Certificate stating, as to each signatory thereof, that (i) a review of the activities of Seller during the preceding year and of performance under the Agreement and this Sale Supplement has been made under such officers’ supervision and (ii) to the best of such officer’s knowledge, based on such review, Seller has fulfilled all of its obligations under the Agreement and this Sale Supplement in all material respects throughout such year, or, if there has been a default in the fulfillment of any such obligation 30 in any material respect, specifying each such default known to such officer and the nature and status thereof. Section 10.5    Accounting Treatment. Notwithstanding Section 8.14 of the Agreement, the parties acknowledge that until such time as the Third Party Consents with respect to a Servicing Agreement are obtained, the parties shall treat the transaction hereunder with respect to such Servicing Agreement as a financing for accounting purposes. Section 10.6    Incorporation. The provisions of Article 8 of the Agreement are hereby incorporated into this Sale Supplement by reference, mutatis mutandis, as if its provisions were fully set forth herein. Section 10.7    Third Party Beneficiaries. Seller and each Purchaser acknowledge and agree that the indenture trustee, on behalf of the holders of related notes, with respect to any Servicing Advance Financing Agreements pursuant to which such Purchaser has transferred Servicer Advances made pursuant to a Deferred Servicing Agreement is an express third party beneficiary of this Sale Supplement and the Agreement solely with respect to the Deferred Servicing Agreements related to such Servicing Advance Financing Agreement. 31 IN WITNESS WHEREOF, the parties hereto have caused this Sale Supplement to be executed and delivered by its respective officer thereunto duly authorized as of the date above written.           By: Ocwen Mortgage Servicing, Inc., as its sole member            By:       Name:       Title:     HLSS HOLDINGS, LLC                  By:       Name:       Title:                     By:       Name:       Title:   EXHIBIT A Form of Monthly Remittance Report Ocwen Loan Servicing, LLC    xxx Deal Name Remittance Summary    [Month] [Year] Particulars Amount ($) Scheduled Principal Payments 0.00 Curtailments 0.00 Interest on curtailment 0.00 Pool to Security 0.00 Payoff Principal 0.00 Neg Amt Prin 0.00 Deferred Principal Paid 0.00 Total Principal remitted 0.00 Gross Scheduled Interest 0.00 Less: Service fee amount 0.00 Less: LPMI Premium 0.00 Add: INT on STA Reinstatement 0.00 Add: INT on STA Paid‑in‑full 0.00 Less: STA PI Recoveries 0.00 Total Interest remitted 0.00 Less: Realized Loss 0.00 Less: Trailing expenses 0.00 Add: Trailing income 0.00 +/‑ Collection on released loans 0.00 Interest on curtailment 0.00 Add: Prepayment penalty 0.00 +/‑ Prior period PPP 0.00 Add: Collection on STA loans 0.00 Add: Non recoverable Credits 0.00 Less: Non recoverable advances 0.00 Less: Non Loan level expense 0.00 A‑1 Particulars Amount ($) Less: Jr Lien Blanket Policy Fee 0.00 Less: Pre‑approved legal expense 0.00 +/‑ ‑Reconciliation adjustments 0.00 + / ‑ Arrearage remittance   Add: Principal Arrearage 0.00 Add: Interest Arrearage 0.00 + / ‑: Modification Forgiveness of Debt   Principal Forgiveness 0.00 Interest Forgiveness 0.00 Expense Forgiveness 0.00 Scheduling Difference 0.00 Deferred Principal Loss 0.00 SAM waived balance loss 0.00 Investor Incentives 0.00 Less: Compensating Interest adjustment 0.00 Total Remittance 0.00 Beg Sch Balance 0.00 Ending Principal Balance 0.00 Beg Actual Balance 0.00 Ending Actual Principal Balance 0.00 Beg Deferred Principal Balance 0.00 Ending Deferred Principal Balance 0.00 Beg Loan count 0.00 Payoffs 0.00 End Loan count 0.00 Principal Roll Test 0.00 Loan Count Test 0.00 Non Supporting Compensating Interest 0.00 Wire of sub ‑ Investor 0.00 Grand Total for PI Wire 0.00 A‑2 SCHEDULE I SERVICING AGREEMENTS I‑1 SCHEDULE II UNDERLYING DOCUMENTS None II‑1 SCHEDULE III RETAINED SERVICING FEE PERCENTAGE III‑1 SCHEDULE IV TARGET RATIO SCHEDULE IV‑1 SCHEDULE V VALUATION PERCENTAGE V‑1 SCHEDULE VI AMORTIZATION PERCENTAGE VI‑1 EXHIBIT 3A RMSR Transfer Agreement [date] Reference is made to that certain Master Agreement (as amended, restated, supplemented or otherwise modified from time to time, the “Master Agreement”) dated as of July 23, 2017 by and among Ocwen Loan Servicing, LLC, as seller (“Ocwen”), HLSS Holdings, LLC, as a purchaser (“Holdings”), HLSS MSR – EBO Acquisition LLC, as a purchaser (“MSR – EBO”) and New Residential Mortgage LLC. to such terms in the Master Agreement. Section 1.    Sale of Rights to MSRs and Transferred Receivables Assets. 1.1    Pursuant to Section 9.3 of the Master Agreement, Holdings and MSR – EBO wish to transfer the Rights to MSRs and Transferred Receivables Assets in respect of the MSRPA Servicing Agreements set forth on Schedule 1 hereto (such MSRPA Servicing Agreements, the “Specified Servicing Agreements”), to Ocwen so that such Rights to MSRs and Transferred Receivables Assets can be immediately sold to a third party, [___] (the “Third Party Purchaser”), with the proceeds of such sale (the “Third Party Sale”) to be paid to Holdings and MSR – EBO, as appropriate. THE REMAINDER OF THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE TREATMENT. Section 2.    Representations and Warranties of Holdings and MSR – EBO. Each of Holdings and MSR – EBO hereby represents and warrants to Ocwen as follows as of the date hereof: 2.1    It is duly organized and validly existing under the laws of the State of perform this RMSR Transfer Agreement (this “Agreement”) and to consummate the transactions herein contemplated. 2.2    The execution, delivery and performance of this Agreement and the consummation of the transactions herein contemplated, have been duly authorized by it and this Agreement constitutes its legal, valid and binding obligation, enforceable in accordance with its terms (subject to applicable bankruptcy, considered in a proceeding in equity or at law). 2.3    The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not and will not conflict with the provisions of its governing instruments and will not violate any provisions of applicable law or regulation or any order of any court or regulatory body and will not result in the breach of, or constitute a default, or require any consent, under any material agreement, instrument or document to which it is a party or by which it or any of its property may be bound or affected. 2.4    [***]         2.5    Each of Holdings and MSR – EBO has complied in all material respects with all applicable anti-money laundering Laws (the “Anti-Money Laundering Laws”), and has established an anti-money laundering compliance program as required by the Anti-Money Laundering Laws. Section 3.    [***]                         Section 4.    [***] 5.1    Limited Effect. Except as expressly set forth above or in the attachments hereto, the execution, delivery and effectiveness of this Agreement shall not operate as a waiver of any right, claim, cause of action, power or remedy of any party hereto, whether arising before or after the date of this Agreement, or constitute a waiver of any provision of any other agreement. 5.2    Further Assurances. Each party hereto shall execute and deliver in a instruments or agreements, including without limitation documents in connection with the SAF related to any Specified Servicing Agreement, and take such reasonable actions as may be necessary or appropriate to effectuate the purposes of this Sale Agreement at the request of any other party. 5.3    Counterparts. This Agreement may be executed in any number of 5.4    GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN 5.5    SUBMISSION TO JURISDICTION. EACH OF THE PARTIES HERETO IRREVOCABLY (I) SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY MATTERS CONTEMPLATED HEREBY; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT; (III) CONSENTS TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER OR BY ANY OTHER MANNER IN ACCORDANCE WITH LAW; AND (IV) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. 5.6    WAIVER OF TRIAL BY JURY. EACH PARTY HERETO IRREVOCABLY AND ABSOLUTELY 5.7    Exhibits and Schedules. The exhibits and schedules to this Agreement are Agreement. 5.8    No Offset. No party shall have any right to offset against any amount payable hereunder or other agreement to another party, or otherwise reduce any amount payable hereunder as a result of, any amount owing by another party or   HLSS HOLDINGS, LLC                 By:       Name:       Title:             By: New Residential Investment Corp., as its sole member         By:       Name:       Title:     [NRZ ADVANCE RECEIVABLES TRUST 2015-   ON1]   [HLSS SERVICER ADVANCE RECEIVABLES    TRUST MS3]   [NRZ SERVICER ADVANCE RECEIVABLES   TRUST (ON) JPMC]   By: [HLSS Holdings, LLC, its administrator]         By:       Name:       Title:   Acknowledged and agreed to as of                   By:       Name:     Title:   Schedule 1 to RMSR Transfer Agreement Specified Servicing Agreements [to be attached] Schedule 2 to RMSR Transfer Agreement Wire Transfer Instructions Exhibit 3B Form of Sale Agreement Sale Agreement [date] Section 1.    Ocwen Purchase of Rights to MSRs and Transferred Receivables Assets. 1.1    Pursuant to Section [9.2][9.4][11] of the Master Agreement, Ocwen wishes to purchase the Rights to MSRs and Transferred Receivables Assets in respect of the MSRPA Servicing Agreements set forth on Schedule 1 hereto (such MSRPA Servicing Agreements, the “Specified Servicing Agreements”). TREATMENT. the date hereof: perform this Sale Agreement (this “Agreement”) and to consummate the transactions herein contemplated. any provisions of applicable law or regulation or any order of any court or regulatory body and will not result in the breach of, or constitute a default, or require any consent, under any material agreement, property may be bound or affected. MATTERS CONTEMPLATED HEREBY; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT; (III) CONSENTS TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER OR BY ANY OTHER MANNER IN ACCORDANCE WITH LAW; AND (IV) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. Agreement.   HLSS HOLDINGS, LLC                 By:       Name:       Title:             By:         By:       Name:       Title:       ON1]      TRUST MS3]       By:         By:       Name:       Title:                     By:       Name:     Title:   Schedule 1 to Sale Agreement Specified Servicing Agreements Schedule 2 to Sale Agreement Wire Transfer Instructions EXHIBIT 4 List of Specified Termination Events CONFIDENTIAL - EXHIBIT NOT TO BE PUBLICLY FILED EXCEPT TO THE EXTENT REQUIRED BY APPLICABLE LAW [ATTACHED] APPLICABLE LAW THE REMAINDER OF THIS PAGE AND THE FOLLOWING PAGE OF THIS EXHIBIT HAVE BEEN PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. EXHIBIT 5 The Third Party Purchase Agreement will be prepared in accordance with the following documentation principles: PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. Attachment 1 to Exhibit 5 THE REMAINDER OF THIS PAGE AND THE FOLLOWING FOUR PAGES OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A Attachment 2 to Exhibit 5 [ATTACHED] MORTGAGE SERVICING RIGHTS PURCHASE AND SALE AGREEMENT by and between as Seller and [    ], as Purchaser Dated as of [    ], 20[ ] MSR PURCHASE AND SALE TRANSACTION TABLE OF CONTENTS ARTICLE I   DEFINITIONS 1 1 Definitions. 1       ARTICLE II   PURCHASE AND SALE OF THE PURCHASED ASSETS; CLOSING 8 2.1 Purchase and Sale. 8 2.2 Sale Date and Transfer Date. 9 2.3 Closing Obligations. 9 2.4 Sale Date Data Tapes. 10 2.5 [RESERVED]. 10 2.6 Payment of Purchase Price. 10 2.7 [RESERVED]. 10 2.8 [RESERVED]. 10 2.9 Transfer of Ownership. 10 2.10 Servicing Transfer Instructions. 10 2.11 Document and Data Transfer. 11 2.12 Assignments; Endorsements. 11 2.13 Required Consents. 12 2.14 Costs of Transfer. 13 2.15 Notice to Borrowers. 13 2.16 Flood Contracts. 13 2.17 Tax Records Monitoring. 14 2.18 Loan Tapes. 14 2.19 Custodian. 14 2.20 Transfers of REO. 14 2.21 [RESERVED.] 14 2.22 Mortgage Insurance. 14       ARTICLE III   REPRESENTATIONS AND WARRANTIES OF SELLER. 15         ARTICLE IV   18 4.1 Organization, Authority. 18 4.2 No Conflict. 19 4.3 Litigation. 19 4.4 Permits. 19 4.5 Financial Ability. 20 4.6 [No Brokers. 20 4.7 No Impediment. 20 4.8  Servicer Participation Agreement. 20 4.9 Sophisticated Purchaser. 21 i       ARTICLE V   COVENANTS 21         ARTICLE VI   CONDITIONS TO CLOSING 29 6.1 Conditions to the Obligations of Purchaser and Seller. 29 6.2 Conditions to the Obligations of Purchaser. 29 6.3 Conditions to the Obligations of Seller. 30       ARTICLE VII   INDEMNIFICATION 31         ARTICLE VIII   MISCELLANEOUS 34             8.1 Assignment. 34 8.2 No Third-Party Beneficiaries. 34 8.3 Termination. 35 8.4 Expenses. 36 8.5 Amendment and Modification. 36 8.6 Notices. 36 8.7 Governing Law. 37 8.8 Severability. 38 8.9 Waiver. 38 8.10 Counterparts; Facsimile. 38 8.11 Entire Agreement 38 8.12 Interpretation. 39 ii LIST OF EXHIBITS Exhibit A-1: [RESERVED] Exhibit A-2: [RESERVED] Exhibit B: [RESERVED] Exhibit C: Data Fields for the Mortgage Loan Schedule Exhibit D: Servicing Transfer Instructions Exhibit E: Form of Transfer Confirmation Exhibit F: Litigation Protocol Exhibit G: Form of Power of Attorney Exhibit H: Exhibit I: Form of HAMP/HAFA Assignment and Assumption Agreement Schedules Preliminary Mortgage Loan Schedule Schedule 3.4(a):    Litigation iii THIS MORTGAGE SERVICING RIGHTS PURCHASE AND SALE AGREEMENT, dated as of [ ], 20[ ] (this “Agreement”), is executed within the United States Virgin Islands by and between Ocwen Loan Servicing, LLC, a Delaware limited liability company (the “Seller”) and a wholly-owned subsidiary of Ocwen Mortgage Servicing, Inc., and [ ], a [___________] (the “Purchaser”). Seller and Purchaser are referred to collectively herein as the “Parties” and each individually as a “Party.” Background WHEREAS, Seller presently services certain mortgage loans, each secured by a first or second lien on residential real property, as more particularly described on the Mortgage Loan Schedule (as defined herein); WHEREAS, Ocwen Mortgage Servicing, Inc., the parent corporation of Seller, (i) has reviewed, analyzed, and approved this transaction, (ii) has authorized and caused Seller to enter into this Agreement, and (iii) has not delegated any authority to any person outside the United States Virgin Islands to agree to WHEREAS, Seller and Purchaser desire to set forth the terms and conditions pursuant to which Seller will sell, transfer and assign to Purchaser all of Seller’s right, title and interest in and to the Servicing Rights (as defined herein), and Purchaser will purchase and assume all right, title and interest in and to the Servicing Rights. Terms ARTICLE I DEFINITIONS 1.1 Definitions. (a)    Certain Definitions. As used in this Agreement, the following terms shall “Action” means any action, suit, litigation, arbitration, inquiry, proceeding or investigation by or before any Governmental Authority. “Affiliate” shall have the meaning given to such term in Rule 12b-2 promulgated under the Securities Exchange Act of 1934, as amended from time to time. “Agreement” shall have the meaning given thereto in the preamble hereto, as this Agreement may be amended or modified from time to time in accordance with the provisions hereof. “Ancillary Fees” means all fees and income derived from and related to the Mortgage Loans, excluding Servicing Fees attributable to the Mortgage Loans, but including late charges, prepayment penalties, incentive fees payable under HAMP, fees received with respect to checks or bank drafts returned by the related bank for non-sufficient funds, assumption fees, optional insurance administrative fees, income on escrow accounts and custodial accounts or other receipts on or with respect to such Mortgage Loans, and all other incidental fees, income and charges collected from or assessed against the Mortgagor, other than those charges payable to the applicable Investor under the terms of the applicable Servicing Agreements or as otherwise agreed by the Parties. “Applicable Law” means, as of the time of a particular action, omission or event, any Law or Order applicable to the Mortgage Loans, the Servicing Rights or the Contemplated Transactions. “Applicable Servicing Requirements” means, as applicable, as of the time of a particular action, omission or event (i) all contractual obligations relating to the Servicing of the Mortgage Loans, including those contractual obligations contained in the applicable Servicing Agreements or in the Mortgage Loan Documents; and (ii) all Applicable Laws applicable to the Servicing of the related Mortgage Loans, including any Order with any Regulator. “Assignment of Mortgage Instrument” means an assignment of Mortgage Instrument, notice of transfer or equivalent instrument in recordable form, sufficient under the laws of the jurisdiction where the related Mortgaged Property is located to reflect the transfer of the Mortgage Instrument to the party indicated therein or if the related Mortgage Instrument has been recorded or previously assigned in the name of MERS or its designee, such actions as are necessary to cause the designee to be shown as the owner of the related Mortgage Instrument on the records of MERS for purposes of the system of recording transfers of beneficial ownership of mortgages maintained by MERS. “Assumption Agreement” means the agreement pursuant to which the Purchaser shall assume the Seller’s rights and obligations under the applicable Servicing Agreement. “Business Day” means any day other than (i) a Saturday or Sunday, or (ii) a day on which banking institutions located in the states in which the Parties do business generally are required or authorized by law or executive order to close. “Closing” means the consummation of the applicable Contemplated Transactions on the Sale Date, at such time on the Sale Date as is mutually agreed to by the Parties. “Collateral Files” means, with respect to each Mortgage Loan, that file containing the Mortgage Loan Documents or, as permitted by Applicable Servicing Requirements, copies thereof, that are required by the applicable Investor pursuant to Applicable Servicing Requirements to be held by the Custodian. Agreement. “Custodial Accounts” means the accounts in which Custodial Funds are to be deposited and maintained by Servicer. “Custodial Funds” means all funds held by Servicer with respect to the related Mortgage Loans, including all principal and interest funds, and any other funds due the Investor, maintained by Servicer relating to the Mortgage Loans. “Custodian” means the party, or its successors or assigns, responsible for the safekeeping and tracking of the Collateral File. “Effective Date” means the date on which this Agreement is executed by both Parties. “Encumbrances” means any claims, liens, encumbrances, pledges, easements, servitudes, mortgages, deeds of trust, security interests, options, charges or similar rights of any kind whatsoever. “Escrow Accounts” means the accounts in which Escrow Funds are to be deposited and maintained by the Servicer. “Escrow Funds” means funds held by Servicer or on Servicer’s behalf with respect to the related Mortgage Loans for the payment of taxes, assessments, insurance premiums, ground rents, funds from hazard insurance loss drafts, other mortgage escrow and impound items and similar charges (including interest accrued thereon for the benefit of the Mortgagors under the Mortgage Loans, if applicable). “Escrow Payment” means the portion of a Mortgage Loan Payment in connection with a Mortgage Loan that relates to funds for the payment of taxes, assessments, insurance premiums and other customary mortgage escrow amounts required under the Mortgage Loan Documents. “Fannie Mae” means the Federal National Mortgage Association (FNMA), or any successor thereto. “Governmental Authority” means any federal, state or local governmental authority, agency, commission or court, including any Regulator. “HAFA” means the Home Affordable Foreclosure Alternatives Program, including all Supplemental Directives, in effect as of the Transfer Date, pursuant to regulations promulgated by the U.S. Department of the Treasury. “HAMP” means the Home Affordable Modification Program, including all Supplemental Directives (including the Principal Reduction Alternatives described in Supplemental Directive 10-05, et. seq. “PRA”), in effect as of the Sale Date, pursuant to regulations promulgated by the U.S. Department of Treasury. “Insurer” or “Insurers” means any private insurer of Mortgage Insurance and any insurer under any standard hazard insurance policy, any federal flood insurance policy, any title insurance policy or alternative title product, any earthquake insurance policy, or any other insurance policy applicable to a Mortgage Loan, Mortgaged Property or Pool, and any successor thereto. “Investor” means any private investor, trust or other Person who owns or holds Mortgage Loans or any interest therein (including any trustee on behalf of any holders of any related mortgage backed securities, and not the holders of such related mortgage backed securities) serviced by Seller pursuant to any Servicing Agreement, provided, that if Seller only owes Servicing obligations to a Person other than the owner or holder of a Mortgage Loan or any interest therein (including any trustee on behalf of any holders of any related mortgage backed securities) under a Servicing Agreement, such other Person shall be deemed to be the Investor for the purposes of this Agreement. “Law” means any federal, state, local, municipal, or other constitution, law, rule, standard, requirement, administrative ruling, order, ordinance, principle of common law, legal doctrine, code, regulation, or statute relating to the making, servicing, purchasing, selling, or holding, or securitizing residential mortgage loans, including, for the avoidance of doubt, (i) the Real Estate Settlement Procedures Act, the federal Truth in Lending Act, the Equal Credit Opportunity Act, the Fair Housing Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Home Mortgage Disclosure Act, the Federal Trade Commission Act, the Gramm-Leach-Bliley Act and all applicable state laws similar to or related to the foregoing, (ii) laws covering predatory lending, fair housing and unfair and deceptive practices and (iii) state adaptations of the Uniform Commercial Code and the Uniform Consumer Credit Code. “Losses” means any and all actual and direct out-of-pocket losses, costs, deficiencies, claims, damages or expenses, including reasonable attorneys’ fees and disbursements in respect of any obligation to indemnify any Person pursuant to the terms of this Agreement; provided, however, that Losses shall not include (i) any consequential, punitive, indirect or special losses or damages, other than such damages or losses paid to a third party or imposed under legal authority on an Indemnified Party by a third party, including any Regulator or (ii) amounts attributable to or arising from overhead allocations, general or administrative costs and expenses, or any cost for the time of either Party’s employees. “MERS” means the Mortgage Electronic Registration System that enables MERS members to track servicing and beneficial rights ownership without the need for the execution, delivery and recordation of an Assignment of Mortgage Instrument with respect to a Mortgage Loan from the existing Servicer to the new Servicer when the servicing with respect to the Mortgage Loan is transferred. “MOM Loan” means a Mortgage Loan with respect to which the granting clause of the uniform security instrument has been modified according to applicable Investor requirements so that the Mortgagor grants the mortgage to MERS rather than to the original lender and which, when recorded, reflects MERS as the original mortgagee. “Mortgage Instrument” means any deed of trust, security deed, mortgage, security agreement or any other instrument which constitutes a lien or encumbrance on real estate securing payment by a Mortgagor of a Mortgage Note. “Mortgage Insurance” means the default insurance provided by private mortgage insurance companies on certain Mortgage Loans, whether lender-paid or borrower-paid. “Mortgage Loan” means the one- to four-family residential mortgage loans or REO identified on the Mortgage Loan Schedule with respect to which, prior to the Sale Date, Seller is the owner of the Servicing Rights and which are the subject of this Agreement. “Mortgage Loan Documents” means, with respect to any Mortgage Loan, the original Mortgage Loan related documents held by the Custodian, including, if applicable, the Mortgage Note; Mortgage Instrument; Assignments of the Mortgage Instrument, if any; title insurance policy or alternative title product; power of attorney; assumption, modification or consolidation agreements, if any, in each case if and to the extent required by Applicable Servicing Requirements. “Mortgage Loan Payment” means, with respect to any Mortgage Loan, the amount of each monthly installment of principal and interest and/or escrow or other payment, as applicable, on such Mortgage Loan, whether required or permitted to be paid by the Mortgagor in accordance with the terms of the Mortgage Loan Documents. [“Mortgage Loan Schedule” means the schedule of the Mortgage Loans setting forth the information with respect to each Mortgage Loan identified in Exhibit C, which information may be updated and amended pursuant to Section 2.4 hereof or as otherwise agreed by the Parties, and which will be delivered in electronic form.]1 “Mortgage Note” means the original or a certified true and correct copy of the promissory note executed by a Mortgagor, or lost note affidavit, as applicable, secured by a Mortgage Instrument and evidencing the indebtedness of the Mortgagor under a Mortgage Loan. “Mortgaged Property” means the property that secures a Mortgage Note and that is subject to a Mortgage Instrument. “Mortgagor” means any obligor under a Mortgage Note or a Mortgage Instrument. agreement, or arbitration award of a Governmental Authority. “Origination Source”: Any Person who, in connection with the origination of a Mortgage Loan or the program under which such Mortgage Loan was originated, retained the right to consent to the subsequent transfer of servicing of such Mortgage Loan and/or sale of the related Servicing Rights. “Origination Source Consent”: The written consent of an Origination Source. 1 To be updated based on type of servicing rights being sold. “Party” or “Parties” means Seller and Purchaser. “Permit” means any license, permit, order, consent, registration, authorization qualification, certificate or filing with any Governmental Authority or pursuant to any Law or Servicing Agreement. company, a joint venture, a trust, an unincorporated association or organization, or a government body, agency or instrumentality. “Pool” means one or more Mortgage Loans that have been aggregated pursuant to the requirements of the applicable Investor, and have been pledged or sold to secure or support payments on specific securities or participation certificates or whole loan pools. “Preliminary Cut-Off Date” means, with respect to the Servicing Rights, the close of business on the fifth (5th) Business Day prior to the Sale Date. “Purchase Price” means, [    ] “Purchaser Material Adverse Effect” means any event that has had, or would be reasonably expected to have, a material and adverse effect upon the ability of Purchaser to consummate the Contemplated Transactions or perform its obligations under this Agreement or any of the Transfer Confirmations. “Regulator” means the Consumer Financial Protection Bureau, or any successor thereto or other Governmental Authority having jurisdiction over Seller or Purchaser. “REO” means any residential real property owned by Seller, any of its Affiliates or an Investor (whether for its own account or on behalf of an Investor), as a result of an actual completion of foreclosure proceedings or other acquisition of title with respect to a Mortgage Loan. “Representatives” means each of the respective attorneys, accountants, officers, employees and other authorized agents, advisors and representatives of Purchaser or Seller. “Required Consent”: With respect to each Mortgage Loan and the related Servicing Rights, each and every consent, approval, notice, confirmation, agreement or other documentation required by the applicable Servicing Agreement and Applicable Servicing Requirements in order to sell, assign and transfer the Servicing Rights to the Purchaser in accordance with this Agreement, including, without limitation, as applicable, Investor consent, Insurer consent, Origination Source Consent, trustee consent, master servicer consent and rating agency confirmation. “Sale” means a sale of Servicing Rights on the Sale Date, as provided in this Agreement. “Sale Date” means [_______], 20[__] or a date that is mutually agreed to in writing by Seller and Purchaser, in each case assuming that all conditions precedent to Closing have been satisfied in accordance with Article IV. “Seller Material Adverse Effect” [***] “Servicer” means, with respect to any Mortgage Loan, a party contractually obligated to service the Mortgage Loan in accordance with the applicable Servicing Agreement. “Servicing” means the responsibilities with respect to servicing the Mortgage Loans under the Applicable Servicing Requirements. “Servicing Agreements” With respect to any Mortgage Loan, all of the contracts (including, without limitation, any pooling agreement, servicing agreement, custodial agreement or other agreement or arrangement) establishing and relating to the rights and obligations of the Servicer, whether as master servicer, servicer, sub-servicer or other similar role, as applicable. “Servicing Fees” means all compensation payable to Seller under the applicable Servicing Agreements, including each servicing fee payable based on a percentage of the outstanding principal balance of the Mortgage Loans and any payments received in respect of the foregoing and proceeds thereof but excluding any servicing fees payable on monthly payments that were due in any month prior to the Transfer Date, that remain unpaid or collected following such Transfer Date, excluding any other servicing compensation, such as Ancillary Fees and investment income. “Servicing File” means, with respect to each Mortgage Loan, the physical and electronic files and records maintained by the Seller in connection with its servicing of such Mortgage Loan, including, without limitation, Mortgage Loan Documents, payment histories and Mortgagor communications, in each case to the extent applicable. “Servicing Rights” means any and all of the following: (i) the rights and obligations to service, administer, collect payments for the reduction of principal and application of interest thereon, collect payments on account of taxes and insurance, pay taxes and insurance, remit collected payments, provide foreclosure services, provide full escrow administration, (ii) any other obligations required by any Investor or Insurer in, of, for or in connection with such Mortgage Loan pursuant to the applicable Servicing Agreement, (iii) the right of the applicable Servicer to possess any and all documents, files, records, mortgage file, servicing documents, servicing records, data tapes, computer records, or other information pertaining to such Mortgage Loan or pertaining to the past, present or prospective servicing of such Mortgage Loan, (iv) the right to receive the Servicing Fees and any Ancillary Fees arising from or connected to such Mortgage Loan and the benefits derived from and obligations related to any accounts arising from or connected to such Mortgage Loan and (v) all rights, powers and privileges incident to any of the foregoing, subject, in each case, to any rights, powers and prerogatives retained or reserved by the Investors. “Servicing Transfer Instructions” means the instructions detailing the procedures pursuant to which Seller shall cause the transfer of servicing of the Mortgage Loans to Purchaser attached hereto as Exhibit D. “Termination Date” means [DATE], unless a different date is mutually agreed upon by the Parties in writing. “Transaction Documents” means this Agreement and the Transfer Confirmations (including, in each case, any and all exhibits, schedules and attachments to any such documents and any other documents executed or delivered in connection therewith). “Transfer Confirmation” means a document, substantially in the form of Exhibit E hereto, executed by Seller and Purchaser, which confirms the sale, transfer and assignment of the Servicing Rights to Purchaser for Servicing on the Transfer Date. “Transfer Date” means [_______], 20[__]; provided that the applicable Required Consents, and the other conditions to the transfer of the Servicing Rights have been obtained, satisfied or waived. The Sale Date and the Transfer Date will be the same date. ARTICLE II 2.1 Purchase and Sale. (a)    In exchange for the Purchase Price, Seller agrees to sell to Purchaser, and Purchaser agrees to purchase from Seller, the Servicing Rights relating to the Mortgage Loans and Pools identified on the Mortgage Loan Schedule. Upon the terms and subject to the conditions of this Agreement, and subject to the Applicable Servicing Requirements, Seller shall, on the Sale Date, sell and assign to Purchaser, and Purchaser shall purchase and assume from Seller, all right, title, interest and obligation of Seller in and to the Servicing Rights to the Mortgage Loans identified on the Mortgage Loan Schedule as being sold on that date (the “Purchased Assets”). (b)    Prior to the Sale Date or the Transfer Date, as applicable, Purchaser and Seller shall execute (or cause to be executed) and deliver the documents required by the Investor in connection with the transfer of the related Purchaser and Seller, and shall execute and deliver such other instruments or documents as Purchaser and Seller shall reasonably determine are necessary to evidence the transactions contemplated hereby. 2.2 (a)    Subject to the terms and conditions of this Agreement, including the receipt of the Required Consents, on the Sale Date, all legal, beneficial and equitable ownership of and to the applicable Purchased Assets shall be sold, assigned, transferred, conveyed and delivered by Seller to Purchaser, and Purchaser shall purchase from Seller, all legal, beneficial and equitable ownership of and to such Purchased Assets, free and clear of all liens. (b)    Notwithstanding any provision in this Agreement to the contrary, all rights, title (including any document of title), interest, beneficial ownership, and risk of loss in the Servicing Rights that are sold, transferred, assigned, set over, and conveyed to Purchaser on the Sale Date shall pass by Seller to Purchaser in the United States Virgin Islands upon the Sale Date, subject to the (c)    On the Transfer Date, (x) Seller shall cease to be the servicer, under the related Servicing Agreement in respect of the Mortgage Loans and (y) the physical transfer of Servicing Rights to Purchaser shall occur on the books and records of the Investor. 2.3 Closing Obligations. (a)    Deliveries of Seller. (i)    No later than the close of business on the Business Day prior to the Sale Date, Seller shall deliver to Purchaser the Required Consents. (ii)    No later than two (2) Business Days prior to the Sale Date, Seller shall deliver to Purchaser payment instructions indicating the bank account or accounts to which Purchaser should pay, by wire transfer of immediately available funds, the Purchase Price relating to the Servicing Rights. (iii)    On the Sale Date, Seller shall deliver to Purchaser, or shall cause to be delivered to Purchaser, (A) a duly executed Assignment and Assumption Agreement in the form attached hereto as Exhibit H; and (B) any and all other agreements, certificates, instruments and documents otherwise required of Seller under this Agreement or as may reasonably be requested by Purchaser. (b)    Deliveries of Purchaser. On the Sale Date, Purchaser shall deliver to Seller (A) a duly executed Assignment and Assumption Agreement in the form attached hereto as Exhibit H; and (B) the Purchase Price in accordance with Section 2.6(a). (c)    Assumed Obligations. Subject to the terms and conditions of this Agreement, including Seller’s indemnification obligations in Article VII, on the Sale Date, Purchaser shall assume and shall agree to pay, perform and discharge all of the obligations, covenants, and agreements of as Servicer under the Servicing Agreements assigned on the Sale Date, solely to the extent arising on or after the Sale Date, and not relating to an act or omission of Servicer or any other Person prior to the Sale Date (collectively, the “Assumed Liabilities”). For the avoidance of doubt, Seller and Purchaser agree that Purchaser is not assuming any agreements other than the Servicing Agreements and related loss mitigation agreements referenced in Section 5.9. 2.4 No later than three (3) Business Days before the Sale Date, Seller shall provide Purchaser with a preliminary tape(s) containing the information reasonably required hereunder to purchase the Servicing Rights to be transferred on the Sale Date. Without limiting the foregoing, the data tape or tapes delivered in connection with the Sale Date shall contain the information specified on the Mortgage Loan Schedule as of the Preliminary Cut-Off Date. 2.5 [RESERVED]. 2.6 (a)    In full consideration for the sale of the Servicing Rights, and subject to Article VI hereof, on the Sale Date, Purchaser shall [PURCHASE PRICE MECHANIC TO BE UPDATED]. 2.7 [RESERVED]. 2.8 [RESERVED]. 2.9 Transfer of Ownership. From and after the Sale Date, all legal, beneficial and equitable ownership of and to the related Servicing Rights shall vest in Purchaser. The possession by any Person of all Servicing Files, Collateral Files, Custodial Accounts and Escrow Accounts following the Sale Date, is solely in a custodial capacity for and at the will of Purchaser, subject to Investor requirements. 2.10 Servicing Transfer Instructions. In connection with the transfer of Servicing Rights from Seller to Purchaser pursuant to this Agreement, Seller and Purchaser shall follow the Servicing Transfer Instructions in all material respects and shall take all steps necessary or appropriate to effectuate and evidence the transfer of the servicing of the related Mortgage Loans and Pools to Purchaser. In any instance in which the Servicing Transfer Instructions conflict with the terms of this Agreement, the terms of this Agreement shall control. Seller and Purchaser shall work cooperatively to ensure that the process of transferring the Servicing Rights complies with Applicable Servicing Requirements, including those of the Regulators, and the Servicing Transfer Instructions shall conform to such Applicable Servicing Requirements. Each of Seller and Purchaser shall comply with servicing transfer guidance issued by the Consumer Financial Protection Bureau. 2.11 (a)    Seller shall provide or cause to be provided to Purchaser or its designee accurate and complete Mortgage Loan information and documentation (including, without limitation, all servicing notes, collateral documents and other agreements related to the Mortgage Loans) in Seller’s possession and control at the time of the Transfer Date so as to enable Purchaser or its designee, to service the Mortgage Loans on and after the Transfer Date. To the extent not previously provided, the following items will be delivered within the timeframes set forth in the Servicing Transfer Instructions: (i)    One or more readable tapes or electronic data files, in a form and content as mutually agreed, to allow Purchaser to service such Mortgage Loans in accordance with the applicable Servicing Agreements following the Transfer Date; (ii)    Electronic images of the Servicing Files in the possession of Seller in accordance with the terms of the Agreement, or access to Seller’s web portal containing such documents, that are reasonably sufficient to enable Purchaser to assume the responsibility for and to conduct the Servicing of such Mortgage Loans in all material respects following the Transfer Date; (iii) [Reserved]; (iv)    If reasonably available and without any representation or warranty as to accuracy, Seller shall provide to Purchaser for each related Servicing Agreement, with respect to delinquent Mortgage Loans, the most recent broker price opinions made with respect to the related Mortgage Loans, which may be included in the related Servicing File; and (v) On the Transfer Date, the applicable Transfer Confirmation. (b)    Anything to the contrary contained in this Agreement notwithstanding, except for Applicable Servicing Requirements which must be satisfied, with respect to each Mortgage Loan, Seller may deliver any documents required to be delivered to Purchaser by means of electronic data containing the relevant information or a computer disk containing scanned images of some or all documents relating to the Mortgage Loan; provided, that any such electronic data shall be in a format mutually agreed upon by the Parties. (c)    Seller shall cooperate with Purchaser in connection with reasonable loan level testing, through review of images and reports, to allow Purchaser to prepare for the transfer of servicing of the Mortgage Loans. Any images provided to Purchaser shall be in PDF, TIF or multi-TIF format. 2.12    Assignments; Endorsements. (a)    As soon as practicable after the Transfer Date, Purchaser will provide notification of endorsements needed from Seller’s name to Purchaser or the applicable Investor based on its receipt of custodial exception reports. Within one hundred twenty (120) days of receipt of such notification (or such earlier time as required under Applicable Servicing Requirements if requested by Purchaser with respect to a particular Mortgage Loan in order to service such Mortgage Loan in accordance with Applicable Servicing Requirements), Seller shall complete endorsements from its name to Purchaser or the applicable Investor. Seller shall provide Purchaser a semi-monthly status report of endorsements in progress. If the original Mortgage Note is endorsed to a specific party or to Seller, Seller will endorse the original Mortgage Note “pay to the order of blank/Purchaser or its designee, without recourse” signed in the name of Seller by an authorized officer. If the original Mortgage Note is endorsed “pay to the order of ‘blank’”, Seller will deliver the Mortgage Note to Purchaser or its designee, and will not complete an additional endorsement. (b)    If the Mortgage Instrument or Assignment of Mortgage Instrument is in the name of Seller, Seller will no later than one hundred twenty (120) days after the Transfer Date, prepare and submit to the appropriate county office for recordation an Assignment of Mortgage Instrument to Purchaser or its designee. Seller shall bear all costs associated with the preparation and recording of such Assignments of Mortgage Instrument. For the avoidance of doubt, Seller shall not be obligated to prepare or record any such Assignment of Mortgage Instrument if there is an executed Assignments of Mortgage Instrument in blank in the related Collateral File. (c)    With respect to Mortgage Loans registered with MERS, Seller shall provide Purchaser with the MERS mortgage loan identification number for each such Mortgage Loan and take such other actions with respect to MERS as set forth in the Servicing Transfer Instructions. For each Mortgage Loan registered with MERS that has a status of “Active (Registered)” in the MERS system as of the Transfer Date, Purchaser shall follow the requirements of the applicable Investor and MERS to reflect in the records of MERS the assignment and transfer of the applicable Servicing Rights from Seller to Purchaser. For each Mortgage Loan registered with MERS or closed as a MOM Loan, Seller shall bear all costs and responsibility associated with the reflection of the transfer of Servicing Rights in the records of MERS, which costs shall include, for the avoidance of doubt, the expense associated with the registration of the assignment of the Servicing Rights from Seller to Purchaser on the MERS system. Purchaser or its designee shall provide the MERS Servicer and Investor ORG ID to Seller ten (10) Business Days prior to the Sale Date. 2.13 Required Consents. From the date hereof until the Sale Date, or the Termination Date, Purchaser shall use its commercially reasonable efforts to obtain, and Seller shall cooperate with Purchaser to obtain, the applicable Required Consents on or prior to the Sale Date. Seller will be responsible for all costs and expenses (including any indemnification obligations that are acceptable to Seller) arising out of or relating to obtaining such consents; provided, however, that Purchaser shall be responsible for any costs or expenses of Seller or its counsel. The Parties shall use commercially reasonable efforts to minimize the cost and expenses incurred in connection with obtaining the applicable Required Consents. Prior to the Sale Date, Purchaser and Seller shall (i) execute (or cause to be executed) and deliver the documents required by the applicable Investors in connection with the transfer of the related Servicing Rights and, as applicable, the Servicing Agreements, hereunder, in form and substance reasonably satisfactory to both Parties, and (ii) cooperate with each other to transfer (to the extent permitted by the applicable Investor) from Seller to Purchaser the benefit of any waivers granted by Investors directly related to Servicing the Mortgage Loans (which, for the avoidance of doubt, includes waivers related to Collateral Files), including with respect to Mortgage Loan Documents required to be held in the Collateral File to the extent held by the Custodian. 2.14 Costs of Transfer. Except as otherwise provided herein, each of the Parties hereto shall bear its own fees, expenses and commissions of financial, legal and accounting advisors and other outside consultants incurred in connection with the due diligence, negotiation and execution of this Agreement and the consummation of the Contemplated Transactions. 2.15 Notice to Borrowers. Seller and Purchaser shall work jointly to provide servicing transfer notices and any other similar notices to Mortgagors if and as may be required under the Applicable Servicing Requirements, including the Federal Real Estate Settlement Procedures Act codified § 2601 et seq. and implemented by Regulation X, 24 C.F.R. Part 3500, and if any such notices shall be required to be sent (or are otherwise sent) by either Party (or both Parties), each Party shall bear the expense of sending its own notices. In addition, and without limiting the generality of the foregoing sentence, at least fifteen (15) days prior to the Transfer Date, Seller shall, at Seller’s expense, (a) in accordance with Applicable Servicing Requirements, notify the Mortgagor of each related Mortgage Loan of the transfer of the servicing to Purchaser and instruct the Mortgagor to remit all monthly payments to Purchaser after the Transfer Date, and (b) by the Transfer Date, notify any custodian, real estate tax authorities and insurance companies and/or agents, that the Servicing Rights are being transferred and instruct such entities to deliver all payments, notices, tax bills and insurance statements to Purchaser after the Transfer Date. No later than fifteen (15) days after the Transfer Date, Purchaser shall, at Purchaser’s expense, in accordance with Applicable Servicing Requirements, notify the Mortgagor of each related Mortgage Loan of the transfer of the servicing to Purchaser and instruct the Mortgagor to remit all monthly payments to Purchaser after the Transfer Date. The form of such “goodbye letter” and “welcome letter” shall be approved not less than three (3) weeks in advance of the first Transfer Date by both Parties, which such approval shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, Seller and Purchaser may mutually agree to provide joint notifications to the Mortgagors consistent with Applicable Servicing Requirements. 2.16 Flood Contracts. No later than the Transfer Date, Seller shall assign to Purchaser, at Seller’s expense, a fully paid, freely assignable, completed life of loan flood certificate on each Mortgage Loan, including appropriate loan-level flood determination data. If Seller is unable to assign such certificate, but does provide a fully paid, freely assignable, completed life of loan flood certificate issued by a vendor other than CoreLogic on each Mortgage Loan, including appropriate loan-level flood determination data, Seller shall pay Purchaser $3.50 for each such Mortgage Loan. If Seller is unable to assign such life of loan certificates for each Mortgage Loan, Seller shall pay Purchaser $6.00 for each such Mortgage Loan. 2.17 Tax Records Monitoring. No later than the Transfer Date, Seller shall assign to Purchaser a fully paid, freely assignable, life of loan tax service contract on each Mortgage Loan, if and to the extent assignable at Seller’s expense. If Seller fails to deliver such contract for any Mortgage Loan, Seller shall pay Purchaser $25.00 for each such Mortgage Loan. 2.18 Loan Tapes. Seller will provide to Purchaser a test tape, trial tape, and an accurate conversion tape containing all available history, and loan information and all other information necessary to service the Mortgage Loans in accordance with the Applicable Servicing Requirements as of the Transfer Date so as to complete the conversion of all Mortgage Loans, and security information, in each case in such manner as reasonably requested by Purchaser, including the information set forth in the Servicing Transfer Instructions. A test tape described above with a cut-off date sixty (60) days prior to the Transfer Date shall be provided by Seller to Purchaser within five (5) Business Days following such cut-off date. 2.19 Custodian. Purchaser shall continue to use the Custodian presently used by the Investor pursuant to the Servicing Agreement. 2.20 Transfers of REO. In connection with any REOs acquired in the name of Seller in accordance with Applicable Servicing Requirements for the account of the applicable Investor, Purchaser, at Seller’s sole cost and expense, shall transfer record title from Seller to Purchaser or its designee. 2.21 [RESERVED.] 2.22 Mortgage Insurance. Seller will agree to provide reasonable cooperation in connection with the resolution of curtailments and rescissions, including, without limitation, providing documentation, data and backup with respect thereto that is in the possession or control of Seller and not previously provided to or otherwise in the possession of Purchaser. In addition, Seller and Purchaser understand that the master servicer of the securitizations may condition its consent of the servicing transfer on the implementation of certain processes. If such request is made by the master servicer, Seller and Purchaser shall work together in good faith to resolve such request. ARTICLE III THE REMAINDER OF THIS PAGE AND THE FOLLOWING FOUR PAGES OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. ARTICLE IV Purchaser represents and warrants to Seller as of the date hereof, as of the Sale Date and as of the Transfer Date as follows: 4.1    Organization, Authority. Purchaser is duly organized and validly existing as a [__________] in good standing under the laws of [_______]. Purchaser has all corporate or similar power and corporate or similar authority and is duly qualified or otherwise authorized in all material respects to do business in each jurisdiction where the ownership or operation of the Purchased Assets requires such qualification. All necessary corporate or similar action and other proceedings required to be taken by Purchaser to authorize the execution, delivery and performance of this Agreement and the Transfer Confirmations and the consummation of the Contemplated Transactions have been duly taken. This Agreement has been, and each of the Transfer Confirmations will be, duly executed and delivered by or on behalf of Purchaser and, assuming the due execution by Seller of this Agreement and the Transfer Confirmations, constitute the legal, valid and binding obligations of Purchaser, enforceable against Purchaser in accordance with its terms, except as such enforceability may be limited by Laws applicable to bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other similar Laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies or by general principles of equity. 4.2 No Conflict. (a)    The execution, delivery and performance by Purchaser of this Agreement and the consummation by Purchaser of the Contemplated Transactions will not: (i)    violate or conflict with the organizational documents of Purchaser; (ii)    violate any provision of Law to which Purchaser is subject or violate or conflict with any Order applicable to Purchaser; or (iii)    violate, breach or constitute a default (with or without notice or lapse of time or both) under or give rise to a right of termination, cancellation or acceleration of any right, remedy or obligation under any term or provision of any material contract or agreement to which Purchaser is a party which breach could reasonably be expected to (A) result in a Purchaser Material Adverse Effect, (B) impair in any material respect the ability of Purchaser to perform its obligations under this Agreement or any of the Transfer Confirmations or (C) prevent or materially impede or delay the consummation of the Contemplated Transactions. (b)    Except for the Required Consents, the execution, delivery and performance by Purchaser of this Agreement and the consummation by Purchaser of the Contemplated Transactions do not require any consent from, registration, declarations or other filing with or approval or authorization of any Governmental Authority by or with respect to Purchaser. 4.3 Litigation. No Actions are pending or, to Purchaser’s knowledge, threatened against Purchaser which would have a Purchaser Material Adverse Effect. Purchaser is not subject to any Order that would have a Purchaser Material Adverse Effect. 4.4 Permits. (a)    Purchaser has all of the Permits that are required to own and administer the Servicing Rights, except where the failure to obtain such Permits would not delay the consummation of the Contemplated Transactions or have, individually or in the aggregate, a Purchaser Material Adverse Effect. Purchaser has complied in all material respects with all requirements in connection with such Permits and such Permits are in full force and effect and, to the knowledge of Purchaser, no suspension or cancellation of any of them has been threatened and the Permits will not be subject to suspension, modification or revocation as a result of this Agreement or the consummation of the Contemplated Transactions, except where any such failures to hold or comply or any such suspension, modification or revocation would not either delay the consummation of the Contemplated Transactions or have, individually or in the aggregate, a Purchaser Material Adverse Effect. (b)    Without limiting the generality of Section 4.4(a), Purchaser is (i) properly licensed and qualified to do business and in good standing in each jurisdiction in which such licensing and qualification is necessary to act as the servicer under any of the Servicing Agreements and applicable law, and (ii) qualified to act as the servicer under each Servicing Agreement, and no event has occurred which would make Purchaser unable to comply with all such eligibility requirements or which would require notification to an Investor. (c) Purchaser is an approved member in good standing of the MERS system. 4.5 Financial Ability. Purchaser will have (when required under this Agreement) immediate access to all funds necessary to pay the Purchase Price and related fees and expenses and Purchaser will have (when required under this Agreement) the financial capacity to perform all of its other obligations under this Agreement. 4.6 [No Brokers. No agent, broker, investment banker, financial advisor or other Person is or will be entitled to any broker’s or finder’s fee or any other similar commission or fee from Purchaser or any of its Affiliates in connection with any of the Contemplated Transactions.]3  4.7 No Impediment. Except as previously disclosed to Seller or disclosed in Purchaser’s public filings with the Securities and Exchange Commission, if any, to Purchaser’s knowledge, there is no event relating to Purchaser’s business, operations, management, financial condition, legal status or other such factor that would reasonably be expected to adversely affect in any material respect (a) the likelihood that any of the conditions set forth in Article VI and Article VII could not reasonably be satisfied within the time period contemplated by this Agreement, including timely receipt of Required Consents or related third-party consents in accordance with Section 2.13 hereof, and the absence of any actual or threatened material Actions related to Purchaser’s servicing of residential mortgage loans or acceptance of servicing transfers, (b) the ability of Purchaser to perform its obligations under this Agreement, or (c) on Seller, including material adverse reputation risk. 4.8 Servicer Participation Agreement. __________________ 3 Subject to change if NRM is permitted to use a broker Purchaser is a party in good standing to a Servicer Participation Agreement with Fannie Mae, acting on behalf of the U.S. Department of the Treasury, for the implementation of HAMP, and such Servicer Participation Agreement is not subject to any termination based on a breach or default by Purchaser. 4.9 Sophisticated Purchaser. Purchaser is a sophisticated investor and its bid and decision to purchase the Servicing Rights is based upon Purchaser’s own independent experience, knowledge, due diligence and evaluation of the transactions contemplated in this Agreement. Purchaser has relied solely on such experience, knowledge, due diligence and evaluation and has not relied on any oral or written information provided by Seller or Seller’s agents other than the representations and warranties made by Seller herein. ARTICLE V COVENANTS THE REMAINDER OF THIS PAGE AND THE FOLLOWING SEVEN PAGES HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. ARTICLE VI CONDITIONS TO CLOSING 6.1 The respective obligations of Purchaser and Seller to effect the Contemplated Transactions shall be subject to the satisfaction or waiver by Purchaser and Seller at or prior to each Closing, of the following conditions: (a)    No Law or Orders. (i) No Law that restrains, enjoins or otherwise prohibits the Contemplated Transactions shall have been enacted, adopted or promulgated and be in effect, (ii) no temporary restraining order, preliminary or permanent injunction, decree, judgment, legal restraint or other Order of a court of competent jurisdiction or other Governmental Authority which materially impairs, restrains, enjoins or otherwise prohibits the Contemplated Transactions shall have been issued, entered or enforced and be in effect and (iii) no action or proceeding by a Governmental Authority seeking such an Order shall be pending. (b)    Required Consents. Purchaser and Seller shall have received the Required Consents on or before the Sale Date. (c)    Other Documents. Each Party shall have delivered to the other Party all such other documents as it may reasonably request in order to consummate the Contemplated Transactions. (d)    Absence of Certain Regulatory Objections. The Consumer Financial Protection Bureau shall not have raised (or, if raised, shall have subsequently not withdrawn), any material objection to the consummation of the Contemplated Transactions. 6.2 The obligation of Purchaser to effect the Contemplated Transactions shall be subject to the satisfaction or waiver by Purchaser at or prior to each Closing, (a)    Representations and Warranties.    All representations and warranties of Seller contained in this Agreement: (i)    that are qualified as to materiality or Seller Material Adverse Effect in all material respects, as of the Effective Date (or in the case of any representation and warranty which specifically relates to an earlier date, as of such earlier date), and (ii)    shall be true and correct as of the Sale Date, as though made on and as of the Sale Date (or in the case of any representation and warranty which specifically relates to an earlier date, as of such earlier date), except for the failure or failures of such representations and warranties to be so true and correct that (after excluding any effect of materiality or Seller Material Adverse Effect qualifications set forth in any such representation or warranty) have not had and would not have, individually or in the aggregate, a Seller Material Adverse Effect. (b)    Covenants and Agreements. Seller shall have performed in all material respects all of the covenants and agreements required to be performed by it under this Agreement prior to the Closing. (c)    Closing Deliveries. Seller shall have delivered all of the closing deliveries set forth in Section 2.3(a). (d)    Assumption Agreements. Purchaser shall be in receipt of, with respect to each underlying securitization transaction, an Assumption Agreement, executed by the related trustee and each other required party for such Contemplated Transaction, in form and substance reasonably acceptable to Purchaser. (e)    Other Documents. Seller shall have delivered to Purchaser all such other documents as Purchaser may reasonably request in order to consummate the Contemplated Transactions. 6.3 The obligation of Seller to effect the Contemplated Transactions shall be subject to the satisfaction or waiver by Seller at or prior to the Closing, of the following conditions: Purchaser contained in this Agreement: (i)    that are qualified as to materiality or Purchaser Material Adverse Effect specifically relates to an earlier date, as of such earlier date), in the case of Section 4.8 without regard to any knowledge qualifier therein and except for correct that (after excluding any effect of materiality or Purchaser Material Adverse Effect qualifications as set forth in any such representation or warranty) have not had and would not have, individually or in the aggregate, a Purchaser Material Adverse Effect. (b)    Covenants and Agreements. Purchaser shall have performed in all material (c)    Closing Deliveries. Purchaser shall have delivered all of the closing deliveries set forth in Section 2.3(b). (d)    No Actions. There are no actual or threatened material Actions related to Purchaser’s servicing of residential mortgage loans or acceptance of servicing transfers that could reasonably be expected to have a material adverse effect on Seller, including material adverse reputation risk, if the Contemplated Transaction were consummated. ARTICLE VII INDEMNIFICATION THE REMAINDER OF THIS PAGE AND THE FOLLOWING THREE PAGES OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. ARTICLE VIII MISCELLANEOUS 8.1 Assignment. This Agreement and the rights hereunder shall not be assignable or transferable by either Party hereto without the prior written consent of the other Party hereto; provided, however, that Purchaser shall have the right to assign (a) its rights and interests in the Servicing Rights and (b) this Agreement and all or any part of its rights hereunder and to delegate all or any part of its obligations hereunder to any Affiliate of Purchaser, but in such event Purchaser shall remain fully liable for the performance of all of such obligations in the manner prescribed in this Agreement. Notwithstanding the above, this Agreement shall inure to the benefit of, and be binding upon and enforceable against, the respective successors and permitted assigns of the Parties. 8.2 Except for Section 5.9 (Loss Mitigation) and Article VII (relating to Indemnified Parties), this Agreement is for the sole benefit of the Parties and their respective successors and permitted assigns, and nothing herein expressed or implied shall give or be construed to give to any Person (including employees), other than the Parties and such respective successors and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement. 8.3 Termination. (a)    This Agreement may be terminated at any time prior to the Closing with respect to the sale of Servicing Rights pertaining to a particular Servicing Agreement: (i)    by the mutual written consent of Seller and Purchaser; (ii)    with respect to all or any portion of the Servicing Rights, by Seller or Purchaser if the Closing shall not have occurred on or before the Termination Date, provided, that neither Party may terminate this Agreement pursuant to this Section 8.3(a)(ii) if the failure of the Closing to have occurred on or before the Termination Date was due to such Party’s willful breach of any representation or warranty or material breach of any covenant or other obligation contained in this Agreement; (iii)    by either Seller or Purchaser, if (A) any Governmental Authority which must grant a required Purchaser Governmental Approval or Seller Governmental Approval has denied such approval and such denial has become final and nonappealable or (B) any Governmental Authority shall have issued a final nonappealable Order enjoining or otherwise prohibiting the consummation of the Contemplated Transactions; (iv)    by Purchaser, if it is not in material breach of its representations, warranties, covenants or other obligations under this Agreement (after, in the case of such representations and warranties, excluding any effect of materiality or Purchaser Material Adverse Effect qualifications), and if (A) at any time that any of the representations and warranties of Seller herein become untrue or inaccurate such that Section 6.2(a) would not be satisfied or (B) there has been a breach on the part of Seller of any of its covenants or agreements contained in this Agreement such that Section 6.2(b) would not be satisfied, and, in both case (A) and case (B), such breach (if curable) has not been cured within thirty (30) days after Purchaser has provided written notice of such breach to Seller; (v)    by Seller, if it is not in material breach of its representations, case of any other representations and warranties, excluding any effect of materiality or Seller Material Adverse Effect qualifications), and if (A) at any time that any of the representations and warranties of Purchaser herein become untrue or inaccurate such that Section 6.3(a) would not be satisfied or (B) there has been a breach on the part of Purchaser of any of its covenants or agreements contained in this Agreement such that Section 6.3(b) would not be satisfied, and, in both case (A) and case (B), such breach (if curable) has not been cured within thirty (30) days after Seller has provided written notice of such breach to Purchaser; or (vi)    by Purchaser, in the event that prior to the Sale Date there shall have occurred (x) a material change in financial markets, an outbreak or escalation of hostilities or a material change in national or international political, financial or economic conditions; (y) a general suspension of trading on major stock exchanges; or (z) a disruption in or moratorium on commercial banking activities or securities settlement services; in any such case, Purchaser shall have the right to terminate this Agreement or negotiate in good faith an adjustment to the Purchase Price to be paid as of the Sale Date (b)    In the event of termination by Seller or Purchaser pursuant to Section 8.3(a), written notice thereof shall forthwith be given to the other Party, this Agreement shall become void and have no effect and the Contemplated Transactions shall be terminated without further action by any Party; provided, that, in the event this Agreement is terminated only with respect to the sale of certain Servicing Rights pertaining to any particular Servicing Agreement, it shall become void and have no effect and the Contemplated Transactions shall be terminated without further action by any Party only with respect to such sale of such Servicing Rights and shall otherwise remain in full force and effect between the Parties. If the Contemplated Transactions (or a portion thereof) are terminated as provided herein: (i)    each Party shall return to the other Party hereto within thirty (30) days of termination all documents and other material received from such other Party or its respective Affiliates or Representatives relating to the Contemplated Transactions (or such portion thereof), whether so obtained before or after the execution hereof; (ii)    all confidential information received by each Party hereto with respect to Seller’s or Purchaser’s servicing business shall be treated in accordance with the Confidentiality Agreement, which shall remain in full force and effect notwithstanding the termination of this Agreement; and (iii)    the provisions of Section 5.2(a) (Confidentiality), Section 5.4 (Publicity), Article VII (Indemnification) and this Article VIII shall remain in full force and effect, along with any other Section which, by its terms, relates to post-termination rights or obligations. (c)    In no event shall any termination of this Agreement limit or restrict the rights and remedies of a Party hereto against the other Party with respect to any liabilities or Losses incurred or suffered by such Party as a result of the breach by the other Party of any of its representations, warranties, covenants or agreements in this Agreement. 8.4 Expenses. Except as otherwise provided herein, Seller and Purchaser will each be liable for its own costs and expenses incurred in connection with the negotiation, preparation, execution or performance of this Agreement and the Transfer Confirmations, whether or not the Closing shall have occurred. Neither Party shall have the right to set-off against the other Party any amounts which may be due and payable by such Party pursuant to a separate agreement, from any amounts which are due and payable pursuant to this Agreement. 8.5 Amendment and Modification. This Agreement may not be amended except by an instrument or instruments in writing signed and delivered on behalf of each of the Parties hereto. 8.6 Notices. deemed given (a) on the date of delivery if delivered personally, (b) on the date of transmission if sent via facsimile transmission to the facsimile number given below, and telephonic confirmation of receipt is obtained promptly after completion of transmission, (c) on the Business Day after delivery to a reputable nationally recognized overnight courier service or (d) upon receipt after being mailed by registered or certified mail (return receipt requested) to shall be specified by like notice): (i) [    ] [    ] [    ] Attention: [    ] With a required copy (which shall not constitute notice) to: [    ] [    ] [    ] Attention: [    ] (ii) Ocwen Loan Servicing, LLC 402 Strand Street Frederiksted, USVI 00840 Attention: Secretary and General Counsel Such addresses may be changed from time to time by means of a notice given in the manner provided in this Section 8.6 (provided, that no such notice shall be effective until it is received by the other Party hereto). 8.7 Governing Law. This Agreement and the powers of attorney shall be governed by, and construed in accordance with, the Laws of the State of New York applicable to contracts executed in and to be performed in that state. All Actions arising out of or relating to this Agreement shall be heard and determined exclusively in any New York federal court sitting in the Borough of Manhattan of The City of New York; provided, however, that if such federal court does not have jurisdiction over such Action, such Action shall be heard and determined exclusively in any New York state court sitting in the Borough of Manhattan of The City of New York. Consistent with the preceding sentence, the Parties hereto hereby (i) submit to the exclusive jurisdiction of any federal or state court sitting in the Borough of Manhattan of The City of New York for the purpose of any Action arising out of or relating to this Agreement brought by any Party and (ii) irrevocably waive, and agree not to assert by way of motion, defense, or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the Action is brought in an inconvenient forum, that the venue of the Action is improper, or that this Agreement or the Contemplated Transactions may not be enforced in or by any of the above-named courts. (a)    EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY ANCILLARY AGREEMENT OR THE CONTEMPLATED TRANSACTIONS. EACH PARTY CERTIFIES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS SET FORTH IN THIS SECTION 8.7. 8.8 Severability. If any provision of this Agreement or the application of any such provision to any Person or circumstance shall be held invalid, illegal or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality or unenforceability shall not affect the legality, validity or enforceability of any other provision hereof. If any provision of this Agreement, or the application thereof to any Person or any circumstance, is found by a court or other Governmental Authority of competent jurisdiction to be invalid or unenforceable, (a) a suitable and equitable provision will be substituted therefore in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid or unenforceable provision and (b) the remainder of this Agreement and the application of such provision to other Persons or circumstances will not be affected by such invalidity or unenforceability, nor will such invalidity or unenforceability affect the validity or enforceability of such provision, or the application thereof, in any other jurisdiction. 8.9 Waiver. Waiver of any term or condition of this Agreement by either Party shall be effective if in writing and shall not be construed as a waiver of any subsequent breach or failure of the same term or condition, or a waiver of any other term of this Agreement. No failure or delay by either Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise 8.10 Counterparts; Facsimile. This Agreement may be executed in any number of counterparts, all of which shall more such counterparts have been signed by each Party and delivered to the other Party. Signatures of the Parties transmitted by facsimile or other electronic communication means shall be binding and effective for all purposes. Such Party shall subsequently deliver to the other Party an original, executed copy of this Agreement; provided, however, that a failure to deliver such original shall not invalidate a facsimile or other electronic signature. 8.11    Entire Agreement. This Agreement, including the Schedules and Exhibits hereto, and the Transfer Confirmations contain the entire agreement and understanding between the Parties hereto with respect to the subject matter hereof and supersede all prior and contemporaneous agreements, negotiations, correspondence, undertakings and understandings, oral or written, relating to such subject matter. 8.12 Interpretation. All references to immediately available funds or dollar amounts contained in this Agreement shall mean United States dollars. The table of contents and headings contained in this Agreement are for reference purposes only and shall References in this Agreement to any gender include references to all genders, and references to the singular include references to the plural and vice versa. The words “include,” “includes” and “including” when used in this Agreement shall be deemed to be followed by the phrase “without limitation.” Unless the context otherwise requires, references in this Agreement to Articles, Sections, Exhibits and Schedules shall be deemed references to Articles and Sections of, and Exhibits and Schedules to, this Agreement. Unless the context otherwise requires, the words “hereof,” “hereby” and “herein” and words of similar meaning when used in this Agreement refer to this Agreement in its entirety and not to any particular Article, Section or provision of this Agreement. The Parties have participated jointly in negotiating and drafting this Agreement. In the event that an ambiguity or a question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring either Party by virtue of the authorship of any provision of this Agreement. Nothing in this Agreement shall be construed to require either Party hereto to violate any Law. PURCHASER: [ ] By: Name: Title: ACKNOWLEDGMENT Territory of the U.S. Virgin Islands    ) ss: Judicial District of St. Thomas-St. John    ) On this ______ day of [______], 2017, before me personally appeared _____________ _____________, who executed the foregoing instrument, and acknowledged that he/she executed the same as his/her free act and deed. [ ] Personally Known [ ] Produced Identification Type of ID Produced __________________ NOTARY PUBLIC SELLER: ACKNOWLEDGMENT Territory of the U.S. Virgin Islands    ) ss: Judicial District of St. Thomas-St. John    ) [ ] Personally Known [ ] Produced Identification NOTARY PUBLIC EXHIBIT A-1 [RESERVED] EXHIBIT A-2 [RESERVED] EXHIBIT B [RESERVED] EXHIBIT C DATA FIELDS FOR MORTGAGE LOAN SCHEDULE EXHIBIT D SERVICING TRANSFER INSTRUCTIONS [Attached] EXHIBIT E FORM OF TRANSFER CONFIRMATION [DATE] [PURCHASER ADDRESS] Re:    Transfer Confirmation Ladies and Gentlemen: This transfer confirmation (this “Transfer Confirmation”) between Ocwen Loan Servicing, LLC (the “Seller”) and [_________] (the “Purchaser”) sets forth our acknowledgement, pursuant to which the Purchaser is assuming responsibility for the Servicing, and the Seller is transferring the Servicing of those certain Mortgage Loans (and only those certain Mortgage Loans) identified on Schedule 1 hereto and more particularly described herein (the “Servicing Rights”), effective as of the date of this Transfer Confirmation which, notwithstanding anything to the contrary in the Agreement, shall be the “Transfer Date” for such Servicing and the related Mortgage Loans and Servicing Rights. The transfer of the Servicing as contemplated herein shall be governed by that certain Mortgage Servicing Rights Purchase and Sale Agreement, dated as of [_____], 20[__], between the Seller and the Purchaser (the “Agreement”). All schedules hereto are incorporated herein in their entirety. In the event there exists any inconsistency between the Agreement and this Transfer Confirmation, the Agreement shall be controlling notwithstanding anything contained in this Transfer Confirmation to the contrary. All capitalized terms such terms in the Agreement. Kindly acknowledge your agreement to the terms of this Transfer Confirmation by signing in the appropriate space below and returning this Transfer Confirmation to the undersigned. Telecopy or electronically imaged signatures (including by PDF) shall be deemed valid and binding to the same extent as the original. OCWEN LOAN SERVICING, LLC    [PURCHASER] By: Name: Title: SCHEDULE 1 TO TRANSFER CONFIRMATION MORTGAGE LOANS EXHIBIT F [LITIGATION PROTOCOL]4 4 Discuss if needed. EXHIBIT G FORM OF POWER OF ATTORNEY [Attached] EXHIBIT H This Assignment and Assumption Agreement (this “Agreement”), dated [ ] (the “Sale Date”), is by and between Ocwen Loan Servicing, LLC (the “Seller”) and WHEREAS, Seller and Purchaser have entered into that certain Mortgage Servicing Rights Purchase and Sale Agreement, dated as of [    ], 20[__] (the “Purchase Agreement”), pursuant to which Seller has agreed to sell, transfer and assign to Purchaser certain Purchased Assets; and WHEREAS, Seller and Purchaser are executing this Agreement in connection with the consummation of certain transactions contemplated by the Purchase Agreement. NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: 1.Definitions. Unless otherwise defined herein, capitalized terms used but not defined herein shall be as defined in the Purchase Agreement. 2.Sale and Assignment. Upon the terms and subject to the conditions of the Purchase Agreement, and subject to the Applicable Servicing Requirements, Seller, on the Sale Date, hereby sells and assigns to Purchaser, and Purchaser purchases and assumes from Seller, all right, title, interest and obligation of Seller in and to the Servicing Rights to the Mortgage Loans identified on the Agreements listed on Schedule II attached hereto. 3.Incorporation of Terms of the Purchase Agreement. This Agreement is made, executed and delivered pursuant to the Purchase Agreement, and is subject to all the terms, provisions and conditions thereof. Except as expressly contemplated by the Purchase Agreement, to the extent any provisions of this Agreement conflict with any provisions of the Purchase Agreement, the Purchase Agreement shall control, including with respect to the enforcement of the rights and obligations of the parties to this Agreement. 4.Binding Effect. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their successors and assigns. Nothing in this Agreement, express or implied, is intended to confer on any Person other than the parties hereto and their successors and assigns, any rights, obligations, remedies or liabilities. 5.Applicable Law. This Agreement shall be construed in accordance with the laws of the State of New York and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with the laws of the State of New York applicable to contracts executed in and to be performed in that state, except to the extent preempted by Federal law. 6.Counterparts. This Agreement may be executed in counterparts, each of which, when so executed and delivered, shall be deemed to be an original and all of which, taken together, shall constitute one and the same instrument. 7.Assignment. Neither party may assign all or any part of this Agreement, or any interest herein, without the prior written consent of the other party, and any permitted assignee shall assume the assignor’s obligations under this Agreement. 8.No Third Party Beneficiaries. This Agreement is for the sole benefit of the parties and their respective successors and permitted assigns, and nothing herein expressed or implied shall give or be construed to give to any Person, other than the parties and such respective successors and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement. IN WITNESS WHEREOF, each of the parties to this Agreement has caused this Agreement to be executed and delivered by its duly authorized officer or agent as of the day and year first written above. SELLER: By: Name: Title: PURCHASER: [ ] By: Name: Title: SCHEDULE I MORTGAGE LOAN SCHEDULE SCHEDULE II SERVICING AGREEMENTS EXHIBIT I FORM OF HAMP/HAFA ASSIGNMENT AND ASSUMPTION AGREEMENT This Assignment and Assumption Agreement (the “Assignment and Assumption Agreement”) is entered into as of [TRANSFER DATE] by and between Ocwen Loan Servicing, LLC (“Assignor”) and [_______] (“Assignee”). All terms used, but not defined, herein shall have the meanings ascribed to them in the Underlying Agreement (defined below). WHEREAS, Assignor and Federal National Mortgage Association, a federally chartered corporation, as financial agent of the United States (“Fannie Mae”), are parties to a Commitment to Purchase Financial Instrument and Servicer Participation Agreement, a complete copy of which (including all exhibits, amendments and modifications thereto) is attached hereto and incorporated herein by this reference (the “Underlying Agreement”); WHEREAS, Assignor has agreed to assign to Assignee all of its rights and obligations under the Underlying Agreement with respect to the Eligible Loans that are identified on the schedule attached hereto as Schedule 1 (collectively, the “Assigned Rights and Obligations”); and WHEREAS, Assignee has agreed to assume the Assigned Rights and Obligations. 1.Assignment. Assignor hereby assigns to Assignee all of Assignor’s rights and obligations under the Underlying Agreement with respect to the Assigned Rights and Obligations. 2.Assumption. Assignee hereby accepts the foregoing assignment and assumes all of the rights and obligations of Assignor under the Underlying Agreement with respect to the Assigned Rights and Obligations. 3.Effective Date. The date on which the assignment and assumption of rights and obligations under the Underlying Agreement is effective is [TRANSFER DATE]. 4.Successors. All future transfers and assignments of the Assigned Rights and Obligations transferred and assigned hereby are subject to the transfer and assignment provisions of the Underlying Agreement. This Assignment and Assumption Agreement shall inure to the benefit of, and be binding upon, the permitted successors and assigns of the parties hereto. 5.Counterparts. This Assignment and Assumption Agreement may be executed in counterparts, each of which shall be an original, but all of which together IN WITNESS WHEREOF, Assignor and Assignee, by their duly authorized officials, hereby execute and deliver this Assignment and Assumption Agreement, together with Schedule I, effective as of the date set forth in Section 3 above. ASSIGNOR: OCWEN LOAN SERVICING, LLC By: Name: Title: ASSIGNEE: [ ] By: Name: Title: Schedule I Mortgage Loans SCHEDULE 3.4(a) LITIGATION [Attached] SCHEDULE 3.4(a)-1 SCHEDULE 5.12(a) SUBJECT LITIGATION [Attached] Attachment 3 to Exhibit 5 Seller Indemnification THE REMAINDER OF THIS PAGE AND THE FOLLOWING TWO PAGES OF THIS EXHIBIT HAVE BEEN PURSUANT TO A EXHIBIT 6 [RESERVED] EXHIBIT 7 Major Shelf Groups [attached] EXHIBIT 7 Major Shelf Groups THE REMAINDER OF THIS PAGE AND THE FOLLOWING 40 PAGES OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. EXHIBIT 8 The New RMSR Agreement will provide that the Seller and the Purchasers will have similar interests and economics in the related Servicing Rights and Rights to MSRs for the MSRPA Servicing Agreement subject to the New RMSR Agreement that NRM and the Purchasers would have under the NRM Subservicing Agreement (including any related portfolio defense or MSR recapture arrangements) if the related Transfer Date for such MSRPA Servicing Agreement occurred except as otherwise set forth in this Exhibit 8. The New RMSR Agreement will be based, to the extent possible, unless explicitly prohibited by Applicable Requirements (as defined in the NRM Subservicing Agreement) or any other contractual requirements in effect as of the Effective Date, including any MSRPA Servicing Agreement, upon the NRM Subservicing Agreement, consistent with any changes contemplated by the items described below and such other changes mutually agreed in writing by Holdings and Seller: 1. Seller, not NRM, will be the named servicer or sub-servicer, as applicable, under the related MSRPA Servicing Agreements subject to the New RMSR Agreement. Seller shall service the related Mortgage Loans in respect of the MSRPA Servicing Agreements in a manner substantially similar to the NRM Subservicing Agreement but for the benefit of the Purchasers because of the Purchasers’ interests in the related Rights to MSRs and other interests under the RMSR Servicing Agreement. Subject to Applicable Requirements (as defined in the NRM Subservicing Agreement), the Purchasers shall have substantively the same rights and interests (including any and all applicable representations, warranties, covenants and indemnities) in connection with the servicing of the related Mortgage Loans under the related MSRPA Servicing Agreements subject to the New RMSR Agreement that NRM has under the NRM Subservicing Agreement, as long as Seller is servicing the loans, including, but not limited to, rights to receive reports and data from Seller, vendor oversight of Seller's vendors, rights related to REO downstream services, and audit rights of Seller. Seller shall not be required to take an action with respect to a Change Request (as defined in the NRM Subservicing Agreement) which, in Seller’s reasonable opinion, may violate Applicable Requirements (as defined in the NRM Subservicing Agreement) as detailed in an Initial Response Notice (as defined in the NRM Subservicing Agreement). 2. Holdings will pay Seller the same fees and other compensation under the New RMSR Agreement for any applicable MSRPA Servicing Agreement and the related Mortgage Loans that NRM would have otherwise paid Seller under the NRM Subservicing Agreement for such MSRPA Servicing Agreement and the related Mortgage Loans had the related Transfer Date had occurred. The Purchasers will be entitled to all other economic interests under the related Servicing Rights (either under the New RMSR Agreement or because of their ownership of the Rights to MSRs under the MSR Purchase Agreement and the Sale Supplements) in the same manner that NRM would have under the NRM Subservicing Agreement had the related Transfer Date occurred. Seller will, subject to Applicable Requirements and any other contractual requirements as in effect as of the Effective Date, refer to a Purchaser or a Purchaser’s designee all services giving rise to Downstream Ancillary Income (as defined in the NRM Subservicing Agreement) in respect of the relevant MSRPA Servicing Agreements. Seller will not receive any fees or other compensation for such referrals. 3. Seller will sell (and Holdings will purchase) all related Servicing Advance Receivables in a manner consistent with Article 3 of the Sale Supplements. 4. The Purchasers shall not be required to pay any consideration to Seller in connection with any assignment of any Clean Up Call Rights to Purchaser (or any Purchaser’s designee), but the Purchasers (or any applicable designee) will be required to comply with provisions related to “Securitization Transactions” substantially identical to those contemplated by the NRM Subservicing Agreement. 5. Seller will grant to each of the Purchasers a security interest in Collateral in scope consistent with Article 9 of the Sale Supplements to secure Seller’s obligations under the New RMSR Agreement. 6. Upon either Purchaser’s written direction, Seller and Purchasers shall use best efforts to transfer any Servicing Rights subject to the New RMSR Agreement to NRM. Any such transfer will be subject to obtaining any requisite third-party consents. Upon any such transfer, the related Servicing Rights will be subject to the NRM Subservicing Agreement. To the extent any costs of such transfers are incurred on or prior to the one-year anniversary of the related MSRPA Servicing Agreement becoming subject to the New RMSR Agreement, such will be allocated in accordance with Section 8 of this Agreement. To the extent any particular cost arises after the one year anniversary of the related MSRPA Servicing Agreement becoming subject to the New RMSR Agreement, (i) such cost shall be paid by the Purchasers if the NRM Subservicing Agreement has been terminated when such cost is incurred, and (ii) such cost will be allocated in accordance with Section 8 of this Agreement if the NRM Subservicing Agreement has not terminated when such cost is incurred. In the event the parties are unable to transfer any Servicing Rights, the related MSRPA Servicing Agreements will remain subject to the New RMSR Agreement until the Servicing Rights can be transferred. 7. If NRM terminates the NRM Subservicing Agreement without cause, Seller and Purchasers shall use best efforts to transfer any Servicing Rights subject to the New RMSR Agreement to a party selected by Holdings as promptly as practical. consents and the cooperation of the Purchasers. Purchasers will be entitled to keep all of the proceeds of any such transfer. In such a case of transfer without cause, Seller will be entitled to compensation consistent with the compensation for a termination without cause contemplated by the NRM Subservicing Agreement, including, without limitation, with respect to process and timing. The Purchasers will pay the costs of any such transfer. In the event the parties are unable to transfer any Servicing 8. If NRM terminates the NRM Subservicing Agreement for cause, Seller and practicable. Any such transfer will be subject to obtaining any requisite third-party consents and the cooperation of the Purchasers. Purchasers will be entitled to keep all of the proceeds of any such transfer. Except as otherwise set forth herein, any such transfer shall be subject to terms and conditions substantially similar to those set forth in Section 5.4 of the NRM Subservicing Agreement, including without limitation, with respect to processes and timing, except that the costs of any such transfer will be paid by Seller to the extent such costs are incurred on or prior to the one-year anniversary of the related MSRPA Servicing Agreement becoming subject to the New RMSR Agreement, and any costs arising thereafter shall be paid by the Purchasers. In the event the parties are unable to transfer any Servicing Rights, the related MSRPA Servicing Agreements will remain subject to the New RMSR Agreement until the Servicing Rights can be transferred. 9. The “Step-Up Fee” contemplated by Section 5.4(d) of the NRM Subservicing Agreement will not apply in respect of the New RMSR Agreement. 10. Subject to the penultimate sentence of this documentation principle, in the event that a Purchaser directs Seller to engage a third party to act as subservicer and to perform any primary servicing obligations in respect of the MSRPA Servicing Agreements, (A) such third party shall be reasonably acceptable to Seller and shall be licensed and qualified as a subservicer under such MSRPA Servicing Agreements, and (B) Seller shall be entitled to (i) indemnification from Purchasers in respect of acts or omissions of any such subservicer in connection with the subservicing of the related mortgage loans (which indemnification shall be no less favorable to Seller than the indemnification in favor of NRM in the NRM Subservicing Agreement), and (ii) substantially the same reporting and information access in respect of the related mortgage loans from any such subservicer as Seller is required to deliver NRM under the NRM Subservicing Agreement. Notwithstanding anything to the contrary herein, no Purchaser shall have the right to direct Seller to engage a third party to act as subservicer or to perform any primary servicing obligations in respect of any MSRPA Servicing Agreement unless any Purchaser or Seller has reasonably demonstrated that the Servicing Rights in respect of such MSRPA Servicing Agreement cannot be otherwise transferred in accordance with the terms of such MSRPA Servicing Agreements. The terms and conditions of any subservicing agreement by and among Seller and such third-party subservicer relating to reporting, oversight and indemnification shall be no less favorable to Seller than the terms and conditions of the NRM Subservicing Agreement. 11. The initial term of the New RMSR Agreement will be the same as the initial term of the NRM Subservicing Agreement. Upon either Purchaser’s direction therefor following the expiration of the New RMSR Agreement, Seller and Purchasers shall use best efforts to transfer any Servicing Rights subject to the New RMSR Agreement to a party selected by Holdings. Any such transfer will be subject to obtaining any requisite third-party consents and the cooperation of the Purchasers. Purchasers will be entitled to keep all of the proceeds of any such transfer. To the extent any particular cost arises in connection with any such transfer, (i) such cost shall be paid by the Purchasers if the NRM Subservicing Agreement has been terminated or has otherwise expired when such cost is incurred, and (ii) such cost will be allocated in accordance with Section 8 of this Agreement if the NRM Subservicing Agreement has not terminated when such cost is incurred. In the event that the term of the New RMSR Agreement expires and the parties are unable to transfer any Servicing Rights, the related MSRPA Servicing Agreements will remain subject to the New RMSR Agreement, on the same economic terms as immediately before the expiration, until the Servicing Rights can be transferred.   EXHIBIT 9 TREATMENT. EXHIBIT 10 Designated Servicing Agreements Designated Servicing Agreement (referenced by Investor ID) Designated Servicing Agreement (Deal Name) Designated Servicing Agreement Price PURSUANT TO A ANNEX I Schedules I –VI to Sale Supplement, dated as of February 10, 2012 [attached]      SCHEDULE I SERVICING AGREEMENTS THE REMAINDER OF THIS PAGE AND THE FOLLOWING 28 PAGES OF THIS EXHIBIT HAVE BEEN SCHEDULE II UNDERLYING DOCUMENTS None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE TREATMENT. SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE SCHEDULE VI AMORTIZATION PERCENTAGE ANNEX II Schedules I –VI to Sale Supplement, dated as of May 1, 2012 [attached] SCHEDULE I SERVICING AGREEMENTS SCHEDULE II UNDERLYING DOCUMENTS None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE TREATMENT. SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE TREATMENT. SCHEDULE VI AMORTIZATION PERCENTAGE ANNEX III Schedules I –VI to Sale Supplement, dated as of August 1, 2012 [attached] SCHEDULE I SERVICING AGREEMENTS SCHEDULE II Underlying Documents None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE TREATMENT. SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE TREATMENT. SCHEDULE VI AMORTIZATION PERCENTAGE PURSUANT TO ANNEX IV Schedules I –VI to Sale Supplement, dated as of September 13, 2012 [attached] SCHEDULE I SERVICING AGREEMENTS THE REMAINDER OF THIS PAGE AND THE FOLLOWING FIVE PAGES OF THIS EXHIBIT HAVE SCHEDULE II Underlying Documents None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE TREATMENT. SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE SCHEDULE VI AMORTIZATION PERCENTAGE E REMAINDER OF THIS PAGE AND THE FOLLOWING THREE PAGES OF THIS EXHIBIT HAVE BEEN ANNEX V Schedules I –VI to Sale Supplement, dated as of September 28, 2012 [attached] SCHEDULE I SERVICING AGREEMENTS THE REMAINDER OF THIS PAGE AND THE FOLLOWING SIX PAGES OF THIS EXHIBIT HAVE BEEN SCHEDULE II UNDERLYING DOCUMENTS None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE TREATMENT. SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE SCHEDULE VI AMORTIZATION PERCENTAGE PURSUANT ANNEX VI Schedules I –VI to Sale Supplement, dated as of December 26, 2012 [attached] SCHEDULE I SERVICING AGREEMENTS THE REMAINDER OF THIS PAGE AND THE FOLLOWING TEN PAGES OF THIS EXHIBIT HAVE BEEN      SCHEDULE II UNDERLYING DOCUMENTS None      SCHEDULE III RETAINED SERVICING FEE PERCENTAGE TREATMENT.      SCHEDULE IV TARGET RATIO SCHEDULE      SCHEDULE V VALUATION PERCENTAGE      SCHEDULE VI AMORTIZATION PERCENTAGE ANNEX VII Schedules I –VI to Sale Supplement, dated as of March 13, 2013 [attached] SCHEDULE I SERVICING AGREEMENTS SCHEDULE II UNDERLYING DOCUMENTS None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE TREATMENT. SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE SCHEDULE VI AMORTIZATION PERCENTAGE ANNEX VIII Schedules I –VI to Sale Supplement, dated as of May 21, 2013 [attached] SCHEDULE I SERVICING AGREEMENTS SCHEDULE II UNDERLYING DOCUMENTS None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE TREATMENT. SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE SCHEDULE VI AMORTIZATION PERCENTAGE ANNEX IX Schedules I –VI to Sale Supplement, dated as of July 1, 2013 [attached] SCHEDULE I SERVICING AGREEMENTS THE REMAINDER OF THIS PAGE AND THE FOLLOWING 29 PAGES OF THIS EXHIBIT HAVE BEEN SCHEDULE II UNDERLYING DOCUMENTS None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE SCHEDULE VI AMORTIZATION PERCENTAGE PURSUANT TO A ANNEX X Schedules I –VI to Sale Supplement, dated as of October 25, 2013 [attached] SCHEDULE I SERVICING AGREEMENTS THE REMAINDER OF THIS PAGE AND THE FOLLOWING EIGHT PAGES OF THIS EXHIBIT HAVE SCHEDULE II UNDERLYING DOCUMENTS None SCHEDULE III RETAINED SERVICING FEE PERCENTAGE SCHEDULE IV TARGET RATIO SCHEDULE SCHEDULE V VALUATION PERCENTAGE SCHEDULE VI AMORTIZATION PERCENTAGE

EXHIBIT 10.59   STOCK UNIT AGREEMENT   STOCK UNIT AGREEMENT (“Agreement”) effective as of September 8, 2008 (“Grant Date”), by and between AboveNet, Inc. (the “Company”) and Rich Postma (the   WHEREAS, the Company believes it desirable that the Participant be provided additional incentive to advance the interests of the Company through a grant of stock units under the AboveNet, Inc. 2008 Equity Incentive Plan (the “Plan”);     1. Grant of Stock Units.   Pursuant to the Plan and on the terms and subject to the conditions set forth herein and therein, the Company hereby grants to the Participant 500 stock units (the “Stock Units”). Each Stock Unit constitutes a right to receive from the Company one share (each a “Unit Share” and collectively the “Unit Shares”) of the Company’s Common Stock, $.01 par value per share (the “Common Stock”), subject to adjustment as provided in the Plan. Capitalized terms that are not defined in this Agreement shall have the respective meanings given in the Plan.   2. Vesting; Delivery of Unit Shares.   The Stock Units vest (i.e., are not subject to forfeiture) on the first anniversary of the Grant Date and the underlying Unit Shares shall be delivered to the Participant on November 16, 2009. The Stock Units are subject to earlier vesting and delivery as set forth in Sections 4(a) and 4(c).   3. Withholding.   The Company’s obligation to deliver Unit Shares under this Agreement shall be subject to the payment by the Participant of any applicable federal, state and local withholding tax. The Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to the Participant any federal, state or local taxes required to be withheld with respect to the vesting of the Stock Units or the delivery of the Unit Shares.   4. Termination of Employment; Change of Control.   (a) In the event of the Participant’s death prior to the termination of his Continuous Service, any unvested Stock Units shall immediately vest and the underlying Unit Shares of all vested Stock Units shall be immediately delivered to the Participant’s beneficiary or beneficiaries.   (b) Upon the termination of Participant’s Continuous Service with the Company for any reason other than the Participant’s death or in connection with a Change of Control, any unvested Stock Units shall immediately be forfeited.   (c) In the event of a Change of Control, any unvested Stock Units shall immediately vest and the underlying Unit Shares of all vested Stock Units shall be immediately delivered to the Participant.   (d) The parties may not accelerate the delivery of any Stock Units before the dates set forth above.   5. Transfer of Stock Units; Limitations on Delivery of Unit Shares; Put Right.   (a) The Stock Units are not transferable otherwise than by will or the laws of descent and distribution. Any attempt to transfer the Stock Units in contravention of this subparagraph (a) is void ab initio. The Stock Units shall not be subject to execution, attachment or other process.   (b) In the event that on the date of delivery, any of the following shall be true (1) the Unit Shares may not be sold by the Participant at such time under Rule 144 of the Securities Act of 1933, as amended (the “Securities Act”), or pursuant to a currently effective registration statement under the Securities Act, (2) the Participant is unable to sell the stock underlying his Unit Shares due to any Company imposed trading restriction or the Participant otherwise is in possession of material, non-public information regarding the Company or its securities or (3) the Company’s shares are not listed on a national stock exchange, the Company shall be obligated, following notice from the Participant as provided below, to repurchase such number of Unit Shares at the Fair Market Value of the Unit Shares on the date of such repurchase as required to meet the Company’s required minimum tax withholding with respect to the delivered Unit Shares (based on minimum statutory withholding rates for federal, state and local purposes, including payroll taxes, that are applicable to such market value of the Unit Shares is greater than the Fair Market Value as determined under the Plan and the Participant has incurred additional liability for income taxes, the Fair Market Value for purposes of this subparagraph (b) shall be increased to the value determined by the Internal Revenue Service. The Participant must give his notice to the Company of his election to exercise the right to require the Company to repurchase a portion of the Unit Shares not less than two (2) business days before the delivery date. In the event such Participant does not exercise such right, he shall be deemed to have elected to forego such right.   6. No Rights in Unit Shares.   The Participant shall have none of the rights of a shareholder with respect to particular Unit Shares unless and until such Unit Shares are issued and delivered to him under this Agreement.   7. No Right to Employment.   Nothing contained herein shall be deemed to confer upon the Participant any right to remain as an employee of the Company. The Company reserves the right to dismiss the Participant free from any liability hereunder, or any claim under the Plan, except as specifically provided in this Agreement. 2   8. Governing Law/Jurisdiction.   the State of New York without reference to principles of conflict of laws.   9. Miscellaneous.   This Agreement cannot be changed or terminated orally. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that the rights under this Agreement shall not be impaired by any such amendment unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing. This Agreement and the Plan contain the entire agreement between the parties relating to the subject matter hereof. In the event of any conflict between the provisions of this Agreement and those of the Plan, the provisions of the Plan shall control. The paragraph headings herein are intended for reference only and shall not affect the interpretation hereof.     /s/ Rich Postma   Rich Postma   Participant          ABOVENET, INC.               By: /s/ Robert Sokota     Name: Robert Sokota     Title: SVP and General Counsel   3  

Exhibit 16.1 December 28, 2011 Securities and Exchange Commission 100 F. Street, N.E. Washington, DC 20549 Re: Southern Trust Securities Holding Corp. (Commission File No. (000-52618) We have read the statements that we understand Southern Trust Securities Holding Corp. will include under Item 4 of the Form 8-K report it will file regarding the recent change of auditors. We agree with such statements made regarding our firm. We have no basis to agree or disagree with other statements made under Item 4. Your truly, Rothstein, Kass & Company, P.C.

Filed byHarbor Point Limited pursuant to Rule 425 under the Securities Act of 1933 Subject Company: Harbor Point Limited Commission File No.: 132-02706 March 3, 2010 Dear Colleagues, I am very pleased to share with you exciting news for Harbor Point and our business partners.Harbor Point Limited and Max Capital Group Ltd. have agreed to combine through a merger of equals.As you will see in the attached press release and presentation, we believe the combination will bring many benefits to all our stakeholders after its expected close in the second quarter of 2010. The reinsurance books of Harbor Point and Max are highly complementary so we anticipate minimal fallout of business as a result of this transaction.

Exhibit 10.1 INCENTIVE PLAN OF CARRIZO OIL & GAS, INC. (As Amended and Restated Effective May 15, 2014 ) 1.Plan. This Incentive Plan of Carrizo Oil & Gas, Inc. (the “Plan”) was adopted by Carrizo Oil & Gas, Inc. to reward certain corporate officers and key employees of Carrizo Oil & Gas, Inc. and certain independent consultants by enabling them to acquire shares of common stock of Carrizo Oil & Gas, Inc. 2.Objectives. This Plan is designed to attract and retain key employees of the Company and its Subsidiaries (as hereinafter defined), to attract and retain qualified directors of the Company, to attract and retain consultants and other independent contractors, to encourage the sense of proprietorship of such employees, directors and independent contractors and to stimulate the active and its Subsidiaries. These objectives are to be accomplished by making Awards (as hereinafter defined) under this Plan and thereby providing Participants (as hereinafter defined) with a proprietary interest in the growth and performance of the Company and its Subsidiaries. 3.Definitions. As used herein, the terms set forth below shall have the following respective meanings: “Authorized Officer” means the Chairman of the Board or the Chief Executive Officer of the Company (or any other senior officer of the Company to whom either of them shall delegate the authority to execute any Award Agreement). “Award” means an Employee Award, a Director Award or an Independent Contractor Award. “Award Agreement” means any Employee Award Agreement, Director Award Agreement or Independent Contractor Award Agreement. “Cash Award” means an award denominated in cash. “Change in Control” is defined in Attachment A. “Committee” means (i) the Compensation Committee of the Board or (ii) such other committee of the Board as is designated by the Board to administer the Plan or (iii) to the extent contemplated hereby, the Board. “Common Stock” means the Common Stock, par value $.01 per share, of the Company. “Company” means Carrizo Oil & Gas, Inc., a Texas corporation. “Director” means an individual serving as a member of the Board. “Director Award” means a Director Option or Director Stock Award. “Director Award Agreement” means a written agreement between the Company and a Participant who is a Nonemployee Director setting forth the terms, conditions and limitations applicable to a Director Award. “Director Stock Award” means a Stock Award granted to a Nonemployee Director pursuant to Section 9 hereof. “Disability” means, with respect to a Nonemployee Director, the inability to perform the duties of a Director for a continuous period of more than three months by reason of any medically determinable physical or mental impairment. “Dividend Equivalents” means, with respect to the shares of Common Stock subject to a Stock Award, an amount equal to all dividends and other distributions (or the economic equivalent thereof) that are payable to stockholders of record during the Restriction Period on a like number of shares of Common Stock. “Employee” means an employee of the Company or any of its Subsidiaries and an individual who has agreed to become 1 an Employee of the Company or any of its Subsidiaries and is expected to become such an Employee within the following six months. “Employee Award” means the grant of any Option, SAR, Stock Award, Cash Award or Performance Award, whether granted singly, in combination or in tandem, to a Participant who is an Employee pursuant to such applicable terms, conditions and limitations as the Committee may establish in order to fulfill the objectives of the Plan. “Employee Award Agreement” means a written agreement between the Company and a Participant who is an Employee setting forth the terms, conditions and limitations applicable to an Employee Award. to time. “Fair Market Value” of a share of Common Stock means, as of a particular date, (i)(A) if the shares of Common Stock are listed on a national securities exchange (including the NASDAQ Global Select Market), the mean between the highest and lowest sales price per share of the Common Stock on the consolidated transaction reporting system for the principal national securities exchange on which shares of Common Stock are listed on that date, or, if there shall have been no such sale so reported on that date, on the last preceding date on which such a sale was so reported, or, at the discretion of the Committee, the price prevailing on the exchange at the time of exercise or other relevant event (as determined under procedures established by the Committee) including the average of the closing bid and asked price on that date, (B) if the shares of Common Stock are not so listed but are listed or quoted on another securities exchange or market, the mean between the highest and lowest sales price per share of Common Stock reported on the principal securities exchange or market on which the shares of Common Stock are traded (as determined by the Committee), or, if there shall have been no such sale so reported on that date, on the last preceding date on which such a sale was so reported or, at the discretion of the Committee, the price prevailing on such principal securities exchange or market at the time of exercise or other relevant event, including the average of the closing bid and asked price on that date, or, if there are no quotations available for such date, on the last preceding date on which such quotations shall be available, (C) if the shares of Common Stock are not publicly traded, the most recent value determined by an independent appraiser appointed by the Company for such purpose, or (D) if none of (A)-(C) are applicable, the fair market value of a share of Common Stock as determined in good faith by the Committee; or (ii) if applicable, the price per share as determined in accordance with the procedures of a third party administrator retained by the Company to administer the Plan and as approved by the Committee. “Incentive Option” means an Option that is intended to comply with the requirements set forth in Section 422 of the Code. “Independent Contractor” means a person providing services to the Company or any of its Subsidiaries, including an Employee or Nonemployee Director. “Independent Contractor Award” means the grant of any Nonqualified Stock Option, SAR, Stock Award, Cash Award or Performance Award, whether granted singly, in combination or in tandem, to a Participant who is an Independent Contractor pursuant to such applicable terms, conditions and limitations as the Committee may establish in order to fulfill the objectives of the Plan. “Independent Contractor Award Agreement” means a written agreement between the Company and a Participant who is an Independent Contractor setting forth the terms, conditions and limitations applicable to an Independent Contractor Award. “Nonemployee Director” has the meaning set forth in Section 4(b) hereof. “Nonqualified Stock Option” means an Option that is not an Incentive Option. “Option” means a right to purchase a specified number of shares of Common Stock at a specified price. “Participant” means an Employee, Director or Independent Contractor to whom an Award has been made under this Plan. “Performance Award” means an award made pursuant to this Plan to a Participant who is an Employee or Independent Contractor who is subject to the attainment of one or more Performance Goals. “Performance Goal” means a standard established by the Committee, to determine in whole or in part whether a Performance Award shall be earned. “Restricted Stock” means any Common Stock that is restricted or subject to forfeiture provisions. 2 “Restriction Period” means a period of time beginning as of the date upon which a Stock Award is made pursuant to this Plan and ending as of the date upon which the Common Stock subject to such Award is deliverable or no longer restricted or subject to forfeiture provisions. “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act, or any successor rule. “SAR” means a right to receive a payment, in cash or Common Stock, equal to the excess of the Fair Market Value or other specified valuation of a specified number of shares of Common Stock on the date the right is exercised over a specified strike price, in each case, as determined by the Committee. “Stock Award” means an award in the form of shares of Common Stock or units denominated in shares of Common Stock. For the avoidance of doubt, a Stock Award does not include an Option or SAR. “Subsidiary” means (i) in the case of a corporation, any corporation of which the Company directly or indirectly owns shares representing more than 50% of the combined voting power of the shares of all classes or series of capital stock of such corporation which have the right to vote generally on matters submitted to a vote of the stockholders of such corporation and (ii) in the case of a partnership or other business entity not organized as a corporation, any such business entity of which the Company directly or indirectly owns more than 50% of the voting, capital or profits interests (whether in the form of partnership interests, membership interests or otherwise). 4.Eligibility. (a)Employees. Key Employees eligible for Employee Awards under this Plan are those who hold positions of responsibility and whose performance, in the judgment of the Committee, can have a significant effect on the success of the Company and its Subsidiaries. (b)Directors. Directors eligible for Director Awards under this Plan are those who are not employees of the Company or any of its Subsidiaries (“Nonemployee Directors”). (c)Independent Contractors. Independent Contractors eligible for Independent Contractor Awards under this Plan are those Independent Contractors providing services to, or who will provide services to, the Company or any of its Subsidiaries. 5.Common Stock Available for Awards. Subject to the provisions of Section 15 hereof, there shall be available for Awards under this Plan granted wholly or partly in Common Stock (including rights or options that may be exercised for or settled in Common Stock) an aggregate of 10,822,500 shares of Common Stock (the “Maximum Share Limit”), all of which shall be available for Incentive Options. Each Stock Award (including Stock Awards granted as Restricted Stock or Performance Awards) granted under this Plan shall be counted against the Maximum Share Limit as 1.35 shares of Common Stock. The number of shares of Common Stock that are the subject of Awards under this Plan, that are forfeited or terminated, expire unexercised, are settled in cash in lieu of Common Stock or are exchanged for Awards that do not involve Common Stock, shall again immediately become available for additional Awards hereunder. Notwithstanding the foregoing, the following shares of Common Stock may not again be made available for issuance as Awards under this Plan: (i) shares of Common Stock not issued or delivered as a result of the net settlement of an outstanding SAR or Option, (ii) shares of Common Stock used to pay the exercise price or withholding taxes related to an outstanding Award, or (iii) shares of Common Stock repurchased on the open market with the proceeds of the option exercise price. The Board and the appropriate officers of the Company shall from time to time take whatever actions are necessary to file any required documents with governmental authorities, stock exchanges and transaction reporting systems to ensure that shares of Common Stock are available for issuance pursuant to Awards. 6.Administration. (a)This Plan shall be administered by the Committee. To the extent required in order for Employee Awards to be exempt from Section 16 of the Exchange Act by virtue of the provisions of Rule 16b-3, (i) the Committee shall consist of at least two members of the Board who meet the requirements of the definition of “non-employee director” set forth in Rule 16b-3 (b)(3)(i) promulgated under the Exchange Act or (ii) Awards may be granted by, and the Plan may be administered by, the Board. (b)Subject to the provisions hereof, the Committee shall have full and exclusive power and authority to administer this Plan and to take all actions that are specifically contemplated hereby or are necessary or appropriate in connection with the administration hereof. The Committee shall also have full and exclusive power to interpret this Plan and to adopt such rules, regulations and guidelines for carrying out this Plan as it may deem necessary or proper, all of which powers shall be exercised in the best interests of the Company and in keeping with the objectives of this Plan. The Committee may, in its discretion, provide for the extension of the exercisability of an Award, accelerate the vesting or exercisability of an Award, eliminate or make less restrictive any restrictions contained in an Award, waive any restriction or other provision of this Plan or an Award or otherwise amend or modify an Award in any manner that is either (i) not adverse to the Participant to whom such Award was granted or (ii) 3 consented to by such Participant. Notwithstanding the foregoing, except in connection with a transaction involving the Company or its capitalization (as provided in Section 15), the terms of outstanding awards may not be amended to reduce the exercise price of outstanding Options or SARs or cancel, exchange, substitute, buyout or surrender outstanding Options or SARs in exchange for cash, other awards or Options or SARs with an exercise price that is less than the exercise price of the original Options or SARs without approval of the shareholders of the Company. The Committee may make an award to an individual who it expects to become an Employee of the Company or any of its Subsidiaries within the next six months, with such award being subject to the individual's actually becoming an Employee within such time period, and subject to such other terms and conditions as may be established by the Committee. The Committee may correct any defect or supply any omission or reconcile any inconsistency in this Plan or in any Award in the manner and to the extent the Committee deems necessary or desirable to further the Plan purposes. Any decision of the Committee in the interpretation and administration of this Plan shall lie within its sole and absolute discretion and shall be final, conclusive and binding on all parties concerned. (c)No member of the Committee or officer of the Company to whom the Committee has delegated authority in accordance with the provisions of Section 7 of this Plan shall be liable for anything done or omitted to be done by him or her, by any member of the Committee or by any officer of the Company in connection with the performance of any duties under this Plan, except for his or her own willful misconduct or as expressly provided by statute. 7.Delegation of Authority. The Committee may delegate to the Chief Executive Officer and to other senior officers of the Company its duties under this Plan pursuant to such conditions or limitations as the Committee may establish, except that the Committee may not delegate to any person the authority to grant Awards to, or take other action with respect to, Participants who are subject to Section 16 of the Exchange Act. 8.Employee and Independent Contractor Awards. (a)The Committee shall determine the type or types of Employee Awards to be made under this Plan and shall designate from time to time the Employees who are to be the recipients of such Awards. Independent Contractor Awards shall be subject to the same terms and restrictions as are set forth herein with respect to Employee Awards (including, without limitation, restrictions on term, exercise price and per person limitations), and subject to such restrictions, the Committee shall have the sole responsibility and authority to determine the type or types of Independent Contractor Awards to be made under this Plan and may make any such Awards as could be made to an Employee, other than Incentive Options. The term of an Employee Award shall not exceed ten years from the date of grant. Each Employee Award may be embodied in an Employee Award Agreement, which shall contain such terms, conditions and limitations as shall be determined by the Committee in its sole discretion and shall be signed by the Participant to whom the Employee Award is made and by an Authorized Officer for and on behalf of the Company. Employee Awards may consist of those listed in this Section 8(a) and may be granted singly, in combination or in tandem. Employee Awards may also be made in combination or in tandem with, in replacement of, or as alternatives to, grants or rights under this Plan or any other employee plan of the Company or any of its Subsidiaries, including the plan of any acquired entity. An Employee Award may provide for the grant or issuance of additional, replacement or alternative Employee Awards upon the occurrence of specified events, including the exercise of the original Employee Award granted to a Participant. Notwithstanding the foregoing, except in shareholders of the Company. All or part of an Employee Award may be subject to conditions established by the Committee, which may include, but are not limited to, continuous service with the Company and its Subsidiaries, achievement of specific business objectives, increases in specified indices, attainment of specified growth rates and other comparable measurements of performance. Upon the termination of employment by a Participant who is an Employee, any unexercised, deferred, unvested or unpaid Employee Awards shall be treated as set forth in the applicable Employee Award Agreement. (i)Stock Option. An Employee Award may be in the form of an Option. An Option awarded pursuant to this Plan may consist of an Incentive Option or a Nonqualified Option. The price at which shares of Common Stock may be purchased upon the exercise of an Incentive Option shall be not less than the Fair Market Value of the Common Stock on the date of grant. The price at which shares of Common Stock may be purchased upon the exercise of a Nonqualified Option shall be not less than the Fair Market Value of the Common Stock on the date of grant. Subject to the foregoing provisions, the terms, conditions and limitations applicable to any Options awarded pursuant to this Plan, including the term of any Options and the date or dates upon which they become exercisable, shall be (ii)Stock Appreciation Right. An Employee Award may be in the form of a SAR. The strike price for a SAR shall be not less than the Fair Market Value of the Common Stock on the date on which the SAR is granted. The terms, conditions and limitations applicable to any SARs awarded pursuant to this Plan, including the term of any SARs, whether the SAR will be settled in cash or stock and the date or dates upon which they become exercisable, shall be determined by the Committee. 4 (iii)Stock Award. An Employee Award may be in the form of a Stock Award. The terms, conditions and limitations applicable to any Stock Awards granted pursuant to this Plan shall be determined by the Committee. (iv)Cash Award. An Employee Award may be in the form of a Cash Award. The terms, conditions and limitations applicable to any Cash Awards granted pursuant to this Plan shall be determined by the Committee. (v)Performance Award. Without limiting the type or number of Employee Awards that may be made under the other provisions of this Plan, an Employee Award may be in the form of a Performance Award. A Performance Award shall be paid, vested or otherwise deliverable solely on account of the attainment of one or more pre-established, objective Performance Goals, either individually or in any combination, established by the Committee prior to the earlier to occur of (x) 90 days after the commencement of the period of service to which the Performance Goal relates and (y) the lapse of 25% of the period of service (as scheduled in good faith at the time the goal is established), and in any event while the outcome is substantially uncertain. A Performance Goal is objective if a third party having knowledge of the relevant facts could determine whether the goal is met. Such a Performance Goal may be based on one or more business criteria applicable to the Participant, the Company as a whole, or one or more of the Company’s business units, subsidiaries, business segments, divisions, or geographic regions measured either annually or over a period of years, on an absolute basis or relative to a pre-established target, to results over a previous period or to a designated peer group, in each case as specified by the Committee in the Performance Award. The particular performance-based objectives that may be imposed in connection with a Performance Award that qualifies as performance-based compensation under Code Section 162(m) are as follows and need not be the same for each Participant: •revenue and income measures (which include revenues, revenues including the net cash impact of derivative settlements (“Adjusted Revenues”), gross margin, operating income, earnings before or after the effect of certain items such as interest, income taxes, depreciation, depletion and amortization, and non-cash or non-recurring items of income or expense (“Adjusted EBITDA”), net income before the effect of certain non-cash or non-recurring items of income or expense (“Adjusted Net Income”), net income and related per share amounts); •expense measures (which include operating expense, general and administrative expense and depreciation, depletion and amortization expense); •operating measures (which include production volumes, margin, drilling, completion, leasehold or seismic capital expenditures, results of drilling and completion activities and the number of wells drilled, brought on production or producing); •reserve measures (which include developed, undeveloped and total reserves, reserve replacement ratios, extensions and discoveries, revisions of previous estimates, PV-10 values, finding and development costs and other reserve measures); •cash flow measures (which include net cash flows from operating activities, discretionary cash flows from operating activities and working capital); •liquidity measures (which include Adjusted EBITDA, net debt to Adjusted EBITDA, working capital and the credit facility borrowing base); •leverage measures (which include debt-to-equity ratio, debt-to-total capitalization ratio, and net debt); •market measures (which include stock price, total shareholder return and market capitalization measures); •return measures (which include return on equity, return on assets and return on invested capital); •corporate value measures (which include compliance, safety, environmental and personnel matters); and •measures relating to acquisitions or dispositions. Unless otherwise stated, such a Performance Goal need not be based upon an increase or positive result under a particular business criterion and could include, for example, maintaining the status quo or limiting economic losses (measured, in each case, by reference to specific business criteria). In interpreting Plan provisions applicable to Performance Goals and Performance Awards, it is the intent of the Plan to conform with the standards of Section 162(m) of the Code and Treasury Regulation § 1.162-27(e)(2)(i), and the Committee in establishing such goals and interpreting the Plan shall be guided by such provisions. Prior to the payment of any compensation based on the achievement of Performance Goals, the Committee must certify in writing that applicable Performance Goals and any of the material terms thereof were, in fact, satisfied. The Committee may provide in any such Performance Award that any evaluation of performance may include or exclude any of the following events that occurs during a performance period: (a) asset impairments, (b) litigation or claim judgments or settlements, (c) the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results, (d) any reorganization and 5 restructuring programs, (e) extraordinary items as described in FASB ASC Topic No. 360 or nonrecurring, unusual or special items as described in management’s appearing in the Company’s annual report to stockholders, Form 10-K or Form 10-Q for the applicable period, (f) acquisitions or divestitures, (g) foreign exchange gains and losses; (h) derivative settlements or (i) such other objective adjustments as may be provided for connection with the establishment of the performance goal. The amount of cash or shares payable or vested pursuant to Awards that are intended to be Performance Awards that are intended to satisfy the requirements of “qualified performance-based compensation” under Section 162(m) of the Code (“Qualified Performance Awards”) may not be adjusted upward; provided, however, that the Committee may retain the discretion to adjust the amount of cash or shares payable or vested pursuant to such Qualified Performance Awards downward, either on a formula or discretionary basis or any combination, as the Committee determines. Subject to the foregoing provisions, the terms, conditions and limitations applicable to any Performance Awards made (b)Notwithstanding anything to the contrary contained in this Plan, the following limitations shall apply to any Employee Awards made hereunder: (i)no Participant may be granted, during any calendar year, Employee Awards consisting of Options or SARs that are exercisable for more than 375,000 shares of Common Stock; (ii)no Participant may be granted, during any calendar year, Stock Awards covering or relating to more than 250,000 shares of Common Stock (the limitation set forth in this clause (ii), together with the limitation set forth in clause (i) above, being hereinafter collectively referred to as the “Stock Based Awards Limitations”); and (iii)no Participant may be granted Cash Awards (including Cash Awards that are granted as Performance Awards) in respect of any calendar year having a value determined on the date of grant in excess of $5,000,000. In general, each Award is only subject to a single limitation set forth above in clauses (i), (ii), or (iii). However, a Participant may be granted Awards in combination such that portions of the Award are subject to differing limitations set out in the clauses of this Paragraph 8(b), in which event each portion of the combination Award is subject only to a single appropriate limitation in clauses (i), (ii) or (iii). For example, if a Participant is granted an Award that is in part a Stock Award and in part a Cash Award, then the Stock Award shall be subject only to the limitation in clause (ii) and the Cash Award shall be subject only to the limitation in clause (iii). 9.Director Awards. Each Nonemployee Director of the Company shall be granted Director Awards in accordance with this Section 9 and subject to the applicable terms, conditions and limitations set forth in this Plan and the applicable Director Award Agreement. Notwithstanding anything to the contrary contained herein Director Awards shall not be made in any year in which a sufficient number of shares of Common Stock are not available to make such Awards under this Plan. (a)Director Options. From time to time, the Board or the Committee may, in its discretion, grant such Nonemployee Director one or more Director Options that provides for the purchase of such number of shares of Common Stock as the Board or the Committee may determine in its discretion, subject to the limitation that such Awards may not exceed the number of shares of Common Stock then available for award under this Plan. Each Director Option shall, unless otherwise provided in the specific Award granted, have a term of ten years from the date of grant, notwithstanding any earlier termination of the status of the holder as a Nonemployee Director. The purchase price of each share of Common Stock subject to a Director Option shall be equal to the Fair Market Value of the Common Stock on the date of grant. Upon a Change in Control, all Director Options shall immediately vest. All Director Options held by a Nonemployee Director shall vest upon such Director’s death. All unvested Director Options shall be forfeited if the Nonemployee Director resigns as a Director without the consent of a majority of the other Directors. Any Award of Director Options shall be embodied in a Director Award Agreement, which shall contain the terms, conditions and limitations of the Award, including without limitation those set forth above, and shall be signed by the Participant to whom the Director Options are granted and by an Authorized Officer for and on behalf of the Company. (b)Director Stock Awards. From time to time, the Board or the Committee may, in its discretion, grant such Nonemployee Director one or more Director Stock Awards for such number of shares of Common Stock as the Board or the Committee may determine in its discretion, subject to the limitation that such Awards may not exceed the number of shares of Common Stock then available for award under this Plan. Upon a Change in Control, all Director Stock Awards shall immediately vest. All unvested Director Stock Awards shall vest upon such Director’s death. All unvested Director Stock Awards shall be forfeited if the Nonemployee Director Any Director Stock Award shall be embodied in a Director Award Agreement, which shall contain the terms, conditions and limitations of the Award, including without limitation those set forth above, and shall be signed by the Participant to whom 6 the Director Stock Award is granted and by an Authorized Officer for and on behalf of the Company. 10.Payment of Awards. (a)General. Payment of Employee Awards or Independent Contractor Awards may be made in the form of cash or Common Stock, or a combination thereof, and may include such restrictions as the Committee shall determine, including, in the case of Common Stock, restrictions on transfer and forfeiture provisions. If payment of an Employee Award or Independent Contractor Award is made in the form of Restricted Stock, the applicable Award Agreement relating to such shares shall specify whether they are to be issued at the beginning or end of the Restriction Period. In the event that shares of Restricted Stock are to be issued at the beginning of the Restriction Period, the certificates evidencing such shares (to the extent that such shares are so evidenced) shall contain appropriate legends and restrictions that describe the terms and conditions of the restrictions applicable thereto. In the event that shares of Restricted Stock are to be issued at the end of the Restriction Period, the right to receive such shares shall be evidenced by book entry registration or in such other manner as the Committee may determine. (b)Dividends and Interest. In the discretion of the Committee, rights to dividends or Dividend Equivalents may be extended to and made part of any Stock Award, but such dividends or Dividend Equivalents shall be held by the Company and paid, without interest, within 10 days following the lapse of the restrictions on the Stock Award. In the event the Stock Award is forfeited, dividends and Dividend Equivalents paid with respect to such shares during the Restriction Period shall also be forfeited. No Dividend Equivalents may be paid in respect of an Award of Options or SARs. (c)Substitution of Awards. Subject to the provisions of Section 6(b), at the discretion of the Committee, a Participant who is an Employee or Independent Contractor may be offered an election to substitute an Employee Award or Independent Contractor Award for another Employee Award or Independent Contractor Award or Employee Awards or Independent Contractor Awards of the same or different type. No Option or SAR may be substituted for another Employee Award or Independent Contractor Award without the approval of the shareholders of the Company (except in connection with a change in the Company’s capitalization or as otherwise provided in Section 15 hereof). 11.Stock Option Exercise. The price at which shares of Common Stock may be purchased under an Option shall be paid in full at the time of exercise in cash or, if elected by the optionee, the optionee may purchase such shares by means of tendering Common Stock or surrendering another Award, including Restricted Stock, valued at Fair Market Value on the date of exercise, or any combination thereof. The Committee shall determine acceptable methods for Participants who are Employees or Independent Contractors to tender Common Stock or other Employee Awards or Independent Contractor Awards. The Committee may provide for procedures to permit the exercise or purchase of such Awards by use of the proceeds to be received from the sale of Common Stock issuable pursuant to an Employee Award or Independent Contractor Award. Unless otherwise provided in the applicable Award Agreement, in the event shares of Restricted Stock are tendered as consideration for the exercise of an Option, a number of the shares issued upon the exercise of the Option, equal to the number of shares of Restricted Stock used as consideration therefor, shall be subject to the same restrictions as the Restricted Stock so submitted as well as any additional restrictions that may be imposed by the Committee. 12.Taxes. The Company shall have the right to deduct applicable taxes from any Award payment and withhold, at the time of delivery or vesting of cash or shares of Common Stock under this Plan, an appropriate amount of cash or number of shares of Common Stock or a combination thereof for payment of taxes required by law or to take such other action as may be necessary in the opinion of the Company to satisfy all obligations for withholding of such taxes. The Committee may also permit withholding to be satisfied by the transfer to the Company of shares of Common Stock theretofore owned by the holder of the Award with respect to which withholding is required. If shares of Common Stock are used to satisfy tax withholding, such shares shall be valued based on the Fair Market Value when the tax withholding is required to be made. To the extent allowed by law, the Committee may provide for loans, on either a short term or demand basis, from the Company to a Participant who is an Employee or Independent Contractor to permit the payment of taxes required by law. 13.Amendment, Modification, Suspension or Termination. The Board may amend, modify, suspend or terminate this Plan for the purpose of meeting or addressing any changes in legal requirements or for any other purpose permitted by law, except that (i) no amendment or alteration that would adversely affect the rights of any Participant under any Award previously granted to such Participant shall be made without the consent of such Participant and (ii) no amendment or alteration shall be effective prior to its approval by the stockholders of the Company to the extent such approval is then required pursuant to Rule 16b-3 in order to preserve the applicability of any exemption provided by such rule to any Award then outstanding (unless the holder of such Award consents) or to the extent stockholder approval is otherwise required by applicable legal requirements. 14.Assignability. Unless otherwise determined by the Committee and provided in the Award Agreement, no Award or any other benefit under this Plan constituting a derivative security within the meaning of Rule 16a-1(c) under the Exchange Act shall be assignable or otherwise transferable except by will or the laws of descent and distribution or pursuant to a qualified domestic relations order as defined by the Code or Title I of the Employee Retirement Income Security Act, or the rules thereunder. The Committee may prescribe and include in applicable Award Agreements other restrictions on transfer. Any attempted assignment of an Award or any other benefit under this Plan in violation of this Section 14 shall be null and void. 7 15.Adjustments. (a)The existence of outstanding Awards shall not affect in any manner the right or power of the Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the capital stock of the Company or its business or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock (whether or not such issue is prior to, on a parity with or junior to the Common Stock) or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding of any kind, whether or not of a character similar to that of the acts or proceedings enumerated above. (b)In the event of any subdivision or consolidation of outstanding shares of Common Stock, declaration of a dividend payable in shares of Common Stock or other stock split, then (i) the number of shares of Common Stock reserved under this Plan, (ii) the number of shares of Common Stock covered by outstanding Awards in the form of Common Stock or units denominated in Common Stock, (iii) the exercise or other price in respect of such Awards, (iv) the appropriate Fair Market Value and other price determinations for such Awards, and (v) the Stock Based Awards Limitations shall each be proportionately adjusted by the Board to reflect such transaction. In the event of any other recapitalization or capital reorganization of the Company, any consolidation or merger of the Company with another corporation or entity, the adoption by the Company of any plan of exchange affecting the Common Stock or any distribution to holders of Common Stock of securities or property (other than normal cash dividends or dividends payable in Common Stock), the Board shall make appropriate adjustments to (i) the number of shares of Common Stock covered by Awards in the form of Common Stock or units denominated in Common Stock, (ii) the exercise or other price in respect of such Awards, (iii) the appropriate Fair Market Value and other price determinations for such Awards, and (iv) the Stock Based Awards Limitations to give effect to such transaction shall each be proportionately adjusted by the Board to reflect such transaction; provided that such adjustments shall only be such as are necessary to maintain the proportionate interest of the holders of the Awards and preserve, without exceeding, the value of such Awards. In the event of a corporate merger, consolidation, acquisition of property or stock, separation, reorganization or liquidation, the Board shall be authorized to issue or assume Awards by means of substitution of new Awards, as appropriate, for previously issued Awards or to assume previously issued Awards as part of such adjustment. (c)In the event of a corporate merger, consolidation, acquisition of property or stock, separation, reorganization or liquidation, the Board may make such adjustments to outstanding Awards or other provisions for the disposition of outstanding Awards as it deems equitable, and shall be authorized, in its discretion, (i) to provide for the substitution of a new Award or other arrangement (which, if applicable, may be exercisable for such property or stock as the Board determines) for an outstanding Award or the assumption of an outstanding Award, regardless of whether in a transaction to which Section 424(a) of the Code applies, (ii) to provide, prior to the transaction, for the acceleration of the vesting and exercisability of, or lapse of restrictions with respect to, the outstanding Award and, if the transaction is a cash merger, to provide for the termination of any portion of the Award that remains unexercised at the time of such transaction or (iii) to provide for the acceleration of the vesting and exercisability of an outstanding Award and the cancellation thereof in exchange for such payment of such cash or property as shall be determined by the Board in its sole discretion., which for the avoidance of doubt in the case of Options or SARs (whether stock- or cash-settled) shall be the excess, if any, of the Fair Market Value of the shares of Common Stock subject to the Option or SAR on such date over the aggregate exercise price of such Award; provided, however, that no such adjustment shall increase the aggregate value of any outstanding award. No adjustment or substitution pursuant to this Section 15 shall be made in a manner that results in noncompliance with Section 409A of the Code, to the extent applicable. 16.Restrictions. No Common Stock or other form of payment shall be issued with respect to any Award unless the Company shall be satisfied based on the advice of its counsel that such issuance will be in compliance with applicable federal and state securities laws. It is the intent of the Company that grants of Awards under this Plan comply with Rule 16b-3 with respect to persons subject to Section 16 of the Exchange Act unless otherwise provided herein or in an Award Agreement and that any ambiguities or inconsistencies in the construction of such an Award or this Plan be interpreted to give effect to such intention. Certificates evidencing shares of Common Stock delivered under this Plan (to the extent that such shares are so evidenced) may be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations and other requirements of the Securities and Exchange Commission, any securities exchange or transaction reporting system upon which the Common Stock is then listed or to which it is admitted for quotation and any applicable federal or state securities law. The Committee may cause a legend or legends to be placed upon such certificates (if any) to make appropriate reference to such restrictions. 17.Unfunded Plan. Insofar as it provides for Awards of cash, Common Stock or rights thereto, this Plan shall be unfunded. Although bookkeeping accounts may be established with respect to Participants who are entitled to cash, Common Stock or rights thereto under this Plan, any such accounts shall be used merely as a bookkeeping convenience. The Company shall not be required to segregate any assets that may at any time be represented by cash, Common Stock or rights thereto, nor shall this Plan be construed as providing for such segregation, nor shall the Company, the Board or the Committee be deemed to be a trustee of any cash, Common Stock or rights thereto to be granted under this Plan. Any liability or obligation of the Company to any Participant with respect to an Award of cash, Common Stock or rights thereto under this Plan shall be based solely upon any contractual obligations 8 that may be created by this Plan and any Award Agreement, and no such liability or obligation of the Company shall be deemed to be secured by any pledge or other encumbrance on any property of the Company. Neither the Company nor the Board nor the Committee shall be required to give any security or bond for the performance of any obligation that may be created by this Plan. 18.Section 409A of the Code. All Awards under this Plan are intended either to be exempt from, or to comply with the requirements of Section 409A, and this Plan and all Awards shall be interpreted and operated in a manner consistent with that intention. Notwithstanding anything in this Plan to the contrary, if any Plan provision or Award under this Plan would result in the imposition of an applicable tax under Section 409A, that Plan provision or Award shall be reformed to avoid imposition of the applicable tax and no such action shall be deemed to adversely affect the Participant’s rights to an Award. 19.Governing Law. This Plan and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by mandatory provisions of the Code or the securities laws of the United States, shall be governed by and construed in accordance with the laws of the State of Texas. 20.Clawback. To the extent required by applicable law or any applicable securities exchange listing standards, or as otherwise determined by the Committee, Awards and amounts paid or payable pursuant to or with respect to Awards shall be subject to the provisions of any clawback policy implemented by the Company, which clawback policy may provide for forfeiture, repurchase or recoupment of Awards and amounts paid or payable pursuant to or with respect to Awards. Notwithstanding any provision of this Plan or any Award Agreement to the contrary, the Company reserves the right, without the consent of any Participant, to adopt any such clawback policies and procedures. 21.No Right to Employment or Continued Service. Nothing in this Plan or an Award Agreement shall interfere with or limit in any way the right of the Company or a Subsidiary to terminate any Participant’s employment or other service relationship at any time, nor confer upon any Participant any right to continue in the capacity in which he or she is employed or otherwise serves the Company or any Subsidiary. Further, nothing in this Plan or an Award Agreement constitutes any assurance or obligation of the Board to nominate any Nonemployee Director for re-election by the Company’s shareholders. 22.Successors. All obligations of the Company under this Plan with respect to Awards granted hereunder shall be binding on any successor to the Company by 23.Effectiveness. This Plan was previously amended and restated effective February 17, 2000 and April 30, 2009 and was thereafter amended. This amendment and restatement of the Plan is effective May 15, 2014, the date on which it was approved by the shareholders of the Company. This Plan shall continue in effect for a term of ten years after the date on which the shareholders of the Company approve this amended and restated Plan, unless sooner terminated by action of the Board. IN WITNESS WHEREOF, the Company has caused this Plan to be executed by its duly authorized officer. By: /s/ Paul F. Boling Title: Chief Financial Officer, Vice President, Secretary and Treasurer 9 ATTACHMENT A “CHANGE IN CONTROL” The following definitions apply regarding Change in Control provisions of the foregoing Plan: “Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations under the Exchange Act, as in effect on the date of this Agreement. “Associate” shall mean, with reference to any Person, (a) any corporation, firm, partnership, association, unincorporated organization or other entity (other than the Company or a subsidiary of the Company) of which such Person is an officer or general partner (or officer or general partner of a general partner) or is, directly or indirectly, the Beneficial Owner of 10% or more of any class of equity securities, (b) any trust or other estate in which such Person has a substantial beneficial interest or as to which such Person serves as trustee or in a similar fiduciary capacity and (c) any relative or spouse of such Person, or any relative of such spouse, who has the same home as such Person. “Beneficial Owner” shall mean, with reference to any securities, any Person if: (a)such Person or any of such Person’s Affiliates and Associates, directly or indirectly, is the “beneficial owner” of (as determined pursuant to Rule 13d-3 of the General Rules and Regulations under the Exchange Act, as in effect on the date of this Agreement) such securities or otherwise has the right to vote or dispose of such securities, including pursuant to any agreement, arrangement or understanding (whether or not in writing); provided, however, that a Person shall not be deemed the “Beneficial Owner” of, or to “beneficially own,” any security under this subsection (a) as a result of an agreement, arrangement or understanding to vote such security if such agreement, arrangement or understanding: (i) arises solely from a revocable proxy or consent given in response to a public (i.e., not including a solicitation exempted by Rule 14a-2(b)(2) of the General Rules and Regulations under the Exchange Act) proxy or consent solicitation made pursuant to, and in accordance with, the applicable provisions of the General Rules and Regulations under the Exchange Act and (ii) is not then reportable by such Person on Schedule 13D under the Exchange Act (or any comparable or successor report); (b)such Person or any of such Person’s Affiliates and Associates, directly or indirectly, has the right or obligation to acquire such securities (whether such right or obligation is exercisable or effective immediately or only after the passage of time or the occurrence of an event) pursuant to any agreement, arrangement or understanding (whether or not in writing) or upon the exercise of conversion rights, exchange rights, other rights, warrants or options, or otherwise; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to “beneficially own,” (i) securities tendered pursuant to a tender or exchange offer made by such Person or any of such Person’s Affiliates or Associates until such tendered securities are accepted for purchase or exchange or (ii) securities issuable upon exercise of Exempt Rights; or (c)such Person or any such Person’s Affiliates or Associates (i) has any agreement, arrangement or understanding (whether or not in writing) with any other Person (or any Affiliate or Associate thereof) that beneficially owns such securities for the purpose of acquiring, holding, voting (except as set forth in the proviso to subsection (a) of this definition) or disposing of such securities or (ii) is a member of a group (as that term is used in Rule 13d-5(b) of the General Rules and Regulations under the Exchange Act) that includes any other Person that beneficially owns such securities; provided, however, that nothing in this definition shall cause a Person engaged in business as an underwriter of securities to be the Beneficial Owner of, or to “beneficially own,” any securities acquired through such Person’s participation in good faith in a firm commitment underwriting until the expiration of 40 days after the date of such acquisition. For purposes hereof, “voting” a security shall include voting, granting a proxy, consenting or making a request or demand relating to corporate action (including, without limitation, a demand for stockholder list, to call a stockholder meeting or to inspect corporate books and records) or otherwise giving an authorization (within the meaning of Section 14(a) of the Exchange Act) in respect of such security. The terms “beneficially own” and “beneficially owning” shall have meanings that are correlative to this definition of the term “Beneficial Owner”. “Change of Control” shall mean any of the following: (a)any Person (other than an Exempt Person) shall become the Beneficial Owner of 40% or more of the shares of Common Stock then outstanding or 40% or more of the combined voting power of the Voting Stock of the Company then outstanding; provided, however, that no Change of Control shall be deemed to occur for purposes of this subsection (a) if such Person shall become a Beneficial Owner of 40% or more of the shares of Common Stock or 40% or more of the combined voting power of the Voting Stock of the Company solely as a result of (i) an Exempt Transaction or (ii) an acquisition by a Person pursuant to a reorganization, merger or consolidation, if, following such reorganization, merger A-1 subsection (c) of this definition are satisfied; or (b)individuals who, as of May 15, 2014, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to May 15, 2014 whose election, or nomination for election by the Company’s shareholders, the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board; provided, further, that there shall be excluded, for result of any actual or threatened election contest; or (c)the Company engages in and completes a reorganization, merger or consolidation, in each case, unless, following such reorganization, merger or consolidation, (i) more than 85% of the then outstanding shares of common stock of the corporation resulting from such reorganization, merger or consolidation and the combined voting power of the then outstanding Voting Stock of such corporation beneficially owned, directly or indirectly, by all or substantially all of the Persons who were the Beneficial Owners of the outstanding Common Stock immediately prior to such reorganization, merger, or consolidation in reorganization, merger or consolidation, of the outstanding Common Stock, (ii) no Person (excluding any Exempt Person or any Person beneficially owning, immediately prior to such reorganization, merger or consolidation, directly or indirectly, 40% or more of the Common Stock then outstanding or 40% or more of the combined voting power of the Voting Stock of the Company then outstanding) beneficially owns, directly or indirectly, 40% or more of the then outstanding shares of common stock of the corporation resulting from such reorganization, merger or consolidation or the combined voting power of the then outstanding Voting Stock of such corporation and (iii) at least a majority of the members of the board of directors of the corporation resulting from such reorganization, merger or consolidation were members of the Incumbent Board at the time of the execution of the initial agreement or initial action by the Board providing for such reorganization, merger or consolidation; or (d)the Company engages in and completes (i) a complete liquidation or dissolution of the Company unless such liquidation or dissolution is approved as part of a plan of liquidation and dissolution involving a sale or disposition of all or substantially all of the assets of the Company to a corporation with respect to which, following such sale or other disposition, all of the requirements of clauses (ii) (A), (B) and (C) of this subsection (d) are satisfied, or (ii) the sale or other disposition of all or substantially all of the assets of the Company, other than to a corporation, with respect to which, following such sale or other disposition, (A) more than 85% of the then outstanding shares of common stock or such corporation and the combined voting power of the Voting Stock of such corporation is then beneficially owned, directly or indirectly, by all or substantially all of the Persons who were the Beneficial Owners of the outstanding Common Stock immediately prior to such sale or other disposition in substantially the same proportion as their ownership, immediately prior to such sale or other disposition, of the outstanding Common Stock, (B) no Person (excluding any Exempt Person and any Person beneficially owning, immediately prior to such sale or other disposition, directly or shares of common stock of such corporation and the combined voting power of the then outstanding Voting Stock of such corporation and (C) at least a majority of the members of the board of directors of such corporation were members of the Incumbent Board at the time of the execution of the initial agreement or initial action of the Board providing for such sale or other disposition of assets of the Company. “Exempt Person” shall mean the Company, any subsidiary of the Company, any employee benefit plan of the Company or any subsidiary of the Company, and any Person organized, appointed or established by the Company for or pursuant to the terms of any such plan. “Exempt Rights” shall mean any rights to purchase shares of Common Stock or other Voting Stock of the Company if at the time of the issuance thereof such rights are not separable from such Common Stock or other Voting Stock (i.e., are not transferable otherwise than in connection with a transfer of the underlying Common Stock or other Voting Stock) except upon the occurrence of a contingency, whether such rights exist as of May 15, 2014 or are thereafter issued by the Company as a dividend on shares of Common Stock or other Voting Securities or otherwise. “Exempt Transaction” shall mean an increase in the percentage of the outstanding shares of Common Stock or the percentage of the combined voting power of the outstanding Voting Stock of the Company beneficially owned by any Person solely as a result of a reduction in the number of shares of Common Stock then outstanding due to the repurchase of Common Stock or Voting Stock by the Company, unless and until such time as (a) such Person or any Affiliate or Associate of such Person shall purchase or otherwise become the Beneficial Owner of additional shares of Common Stock constituting 1% or more of the then outstanding shares of Common Stock or additional Voting Stock representing 1% or more of the combined voting power of the then outstanding Voting Stock, or (b) any other Person (or Persons) who is (or collectively are) the Beneficial Owner of shares of Common Stock A-2 constituting 1% or more of the then outstanding shares of Common Stock or Voting Stock representing 1% or more of the combined voting power of the then outstanding Voting Stock shall become an Affiliate or Associate of such Person. “Person” shall mean any individual, firm, corporation, partnership, association, trust, unincorporated organization or other entity. “Voting Stock” shall mean, with respect to a corporation, all securities of such corporation of any class or series that are entitled to vote generally in the election of directors of such corporation (excluding any class or series that would be entitled so to vote by reason of the occurrence of any contingency, so long as such contingency has not occurred). A-3

Exhibit 10.1   CREDIT AGREEMENT   THIS CREDIT AGREEMENT (this “Agreement”) is entered into as of December 28, 2007, by and between WILLDAN GROUP, INC., a Delaware corporation (“Borrower”), and WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”).   RECITALS   Borrower has requested that Bank extend or continue credit to Borrower as described below, and Bank has agreed to provide such credit to Borrower on the terms and conditions contained herein.   NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Bank and Borrower hereby agree as follows:   ARTICLE I CREDIT TERMS   SECTION 1.1.                           LINE OF CREDIT.   (a)                        Line of Credit. Subject to the terms and conditions of this Agreement, Bank hereby agrees to make advances to Borrower from time to time up to and including January 1, 2010, not to exceed at any time the aggregate principal amount of Ten Million Dollars ($10,000,000.00) (“Line of Credit”), the proceeds of which shall be used to finance Borrower’s working capital requirements. Borrower’s obligation to repay advances under the Line of Credit shall be evidenced by a promissory note dated as of December 28, 2007 (“Line of Credit Note”), all terms of which are incorporated herein by this reference.   (b)                        Letter of Credit Subfeature. As a subfeature under the Line of Credit, Bank agrees from time to time during the term thereof to issue or cause an affiliate to issue standby letters of credit for the account of Borrower (each, a “Letter of Credit” and collectively, “Letters of Credit”); provided however, that the aggregate undrawn amount of all outstanding Letters of Credit shall not at any time exceed Five Million Dollars ($5,000,000.00). The form and substance of each Letter of Credit shall be subject to approval by Bank, in its sole discretion. No Letter of Credit shall have an expiration date subsequent to the maturity date of the Line of Credit. The undrawn amount of all Letters of Credit shall be reserved under the Line of Credit and shall not be available for borrowings thereunder. Each Letter of Credit shall be subject to the additional terms and conditions of the Letter of Credit agreements, applications and any related documents required by Bank in connection with the issuance thereof. Each drawing paid under a Letter of Credit shall be deemed an advance under the Line of Credit and shall be repaid by Borrower in accordance with the terms and conditions of this Agreement applicable to such advances; provided however, that if advances under the Line of Credit are not available, for any reason, at the time any drawing is paid, then Borrower shall immediately pay to Bank the full amount drawn, together with interest thereon from the date such drawing is paid to the date such amount is fully repaid by Borrower, at the rate of interest applicable to advances under the Line of Credit. In such event Borrower agrees that Bank, in its sole discretion, may debit any account maintained by Borrower with Bank for the amount of any such drawing.   (c)                         Borrowing and Repayment. Borrower may from time to time during the term of the Line of Credit borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to all of the limitations, terms and conditions contained herein or in the Line of Credit Note; provided however, that the total outstanding borrowings under the Line of Credit shall not at any time exceed the maximum principal amount available thereunder, as set forth above.   1   SECTION 1.2.                           INTEREST/FEES.   (a)                        Interest. The outstanding principal balance of each credit subject hereto shall bear interest at the rate of interest set forth in each promissory note or other instrument or document executed in connection therewith.   (b)                       Computation and Payment. Interest shall be computed on the basis of a 360-day year, actual days elapsed. Interest shall be payable at the times and place set forth in each promissory note or other instrument or document required hereby.   (c)                        Unused Commitment Fee. Borrower shall pay to Bank a fee equal to one quarter percent (0.25%) per annum (computed on the basis of a 360-day year, actual days elapsed) on the average daily unused amount of the Line of Credit, which fee shall be calculated on a fiscal quarterly basis by Bank and shall be due and payable by Borrower in arrears within ten (10) days after each billing is sent by Bank.   (d)                       Letter of Credit Fees. Borrower shall pay to Bank fees upon the issuance of each Letter of Credit, upon the payment or negotiation of each drawing under any Letter of Credit and upon the occurrence of any other activity with respect to any Letter of Credit (including without limitation, the transfer, amendment or cancellation of any Letter of Credit) determined in accordance with Bank’s standard fees and charges then in effect for such activity.   SECTION 1.3.                           COLLECTION OF PAYMENTS. Borrower authorizes Bank to collect all interest and fees due under each credit subject hereto by charging Borrower’s deposit account number 4121-618235 with Bank, or any other deposit account maintained by Borrower with Bank, for the full amount thereof. Should there be insufficient funds in any such deposit account to pay all such sums when due, the full amount of such deficiency shall be immediately due and payable by Borrower.   SECTION 1.4.                           COLLATERAL.   As security for all indebtedness and other obligations of Borrower to Bank subject hereto, Borrower hereby grants to Bank security interests of first priority in all Borrower’s accounts receivable and other rights to payment, general intangibles, inventory and equipment.   subject hereto, Borrower shall cause MuniFinancial, Arroyo Geotechnical, Willdan and American Homeland Solutions and any other Subsidiary (as defined below) to grant to Bank security interests of first priority in all accounts receivable and other rights to payment, general intangibles, inventory and equipment.   All of the foregoing shall be evidenced by and subject to the terms of such security agreements, financing statements, deeds or mortgages, and other documents as Bank shall reasonably require, all in form and substance satisfactory to Bank. Borrower shall pay to Bank immediately upon demand the full amount of all charges, costs and expenses (to include fees paid to third parties and all allocated costs of Bank personnel), expended or incurred by Bank in connection with any of the foregoing security, including without limitation, filing and recording fees and costs of appraisals, audits and title insurance.   2   SECTION 1.5.                           GUARANTIES. The payment and performance of all indebtedness and other obligations of Borrower to Bank shall be guaranteed jointly and severally by MuniFinancial, Arroyo Geotechnical, Willdan and American Homeland Solutions and any other Subsidiary in the principal amount of Ten Million Dollars ($10,000,000.00) each, as evidenced by and subject to the terms of guaranties in form and substance satisfactory to Bank.   ARTICLE II REPRESENTATIONS AND WARRANTIES   Borrower makes the following representations and warranties to Bank, which representations and warranties shall survive the execution of this Agreement and shall continue in full force and effect until the full and final payment, and satisfaction and discharge, of all obligations of Borrower to Bank subject to this Agreement.   SECTION 2.1.                           LEGAL STATUS. Borrower is a corporation, duly organized and existing and in good standing under the laws of Delaware, and is qualified or licensed to do business (and is in good standing as a foreign corporation, if applicable) in all jurisdictions in which such qualification or licensing is required or in which the failure to so qualify or to be so licensed could have a material adverse effect on Borrower.   MuniFinancial is a corporation, duly organized and existing and in good standing under the laws of California, and is qualified or licensed to do business (and is in good standing as a foreign corporation, if applicable) in all jurisdictions in which such qualification or licensing is required or in which the failure to so qualify or to be so licensed could have a material adverse effect on it. Borrower owns one hundred percent (100%) of MuniFinancial.   Arroyo Geotechnical is a corporation, duly organized and existing and in good standing under the laws of California, and is qualified or licensed to do business (and is in good standing as a foreign corporation, if applicable) in all jurisdictions in which such qualification or licensing is required or in which the failure to so qualify or to be so licensed could have a material adverse effect on it. Borrower owns one hundred percent (100%) of Arroyo Geotechnical.   Willdan is a corporation, duly organized and existing and in good standing under the laws of California, and is qualified or licensed to do business (and is in good standing as a foreign corporation, if applicable) in all jurisdictions in which such qualification or licensing is required or in which the failure to so qualify or to be so licensed could have a material adverse effect on it. Borrower owns one hundred percent (100%) of Willdan.   American Homeland Solutions is a corporation, duly organized and existing and in good standing under the laws of California, and is qualified or licensed to do adverse effect on it. Borrower owns one hundred percent (100%) of American Homeland Solutions.   As used herein the term “Subsidiary” shall mean any corporation or other entity of which at least a majority of the securities or other ownership interests having ordinary voting power for the election of directors or other persons performing similar functions are owned directly or indirectly by Borrower. As of the date hereof, MuniFinancial, Arroyo Geotechnical, Willdan and American Homeland Solutions are the only Subsidiaries of Borrower.   3   SECTION 2.2.                           AUTHORIZATION AND VALIDITY. This Agreement and each promissory note, contract, instrument and other document required hereby or at any time hereafter delivered to Bank in connection herewith (collectively, the “Loan Documents”) have been duly authorized, and upon their execution and delivery in accordance with the provisions hereof will constitute legal, valid and binding agreements and obligations of Borrower or the party which executes the same, enforceable in accordance with their respective terms.   SECTION 2.3.                           NO VIOLATION. The execution, delivery and performance by Borrower of each of the Loan Documents do not violate any provision of any law or regulation, or contravene any provision of the Articles of Incorporation or By-Laws of Borrower or any Subsidiary, or result in any breach of or default under any contract, obligation, indenture or other instrument to which Borrower or any Subsidiary is a party or by which Borrower or any Subsidiary may be bound.   SECTION 2.4.                           LITIGATION. There are no pending, or to the best of Borrower’s knowledge threatened, actions, claims, investigations, suits or proceedings by or before any governmental authority, arbitrator, court or administrative agency which could have a material adverse effect on the financial condition or operation of Borrower or any Subsidiary other than those disclosed by Borrower to Bank in writing prior to the date hereof.   SECTION 2.5.                           CORRECTNESS OF FINANCIAL STATEMENT. The financial statement of Borrower and Subsidiaries dated December 29, 2006, and all interim financial statements delivered to Bank since said date, true copies of which have been delivered by Borrower to Bank prior to the date hereof, (a) are complete and correct and present fairly the financial condition of Borrower and Subsidiaries, (b) disclose all liabilities of Borrower and Subsidiaries that are required to be reflected or reserved against under generally accepted accounting principles, whether liquidated or unliquidated, fixed or contingent, and (c) have been prepared in accordance with generally accepted accounting principles consistently applied. Since the dates of such financial statements there has been no material adverse change in the financial condition of Borrower or any Subsidiary, nor has Borrower or any Subsidiary mortgaged, pledged, granted a security interest in or otherwise encumbered any of its assets or properties except in favor of Bank or as otherwise permitted by Bank in writing.   SECTION 2.6.                           INCOME TAX RETURNS. Borrower has no knowledge of any pending assessments or adjustments of its or any Subsidiary’s income tax payable with respect to any year.   SECTION 2.7.                           NO SUBORDINATION. There is no agreement, indenture, contract or instrument to which Borrower or any Subsidiary is a party or by which Borrower or any Subsidiary may be bound that requires the subordination in right of payment of any of Borrower’s obligations subject to this Agreement to any other obligation of Borrower or any Subsidiary.   SECTION 2.8.                           PERMITS, FRANCHISES. Borrower and each Subsidiary possess, and will hereafter possess, all permits, consents, approvals, franchises and licenses required and rights to all trademarks, trade names, patents, and fictitious names. If any, necessary to enable them to conduct the businesses in which they are now engaged in compliance with applicable law.   4   SECTION 2.9.                           ERISA. Borrower and each Subsidiary are in compliance in all material respects with all applicable provisions of the Employee Retirement Income Security Act of 1974, as amended or recodified from time to time (“ERISA”); neither Borrower nor any Subsidiary has violated any provision of any defined employee pension benefit plan (as defined in ERISA) maintained or contributed to by Borrower or any subsidiary (each, a “Plan”); no Reportable Event as defined in ERISA has occurred and is continuing with respect to any Plan initiated by Borrower or any Subsidiary; Borrower and each Subsidiary have met their minimum funding requirements under ERISA with respect to each Plan; and each Plan will be able to fulfill its benefit obligations as they come due in accordance with the Plan documents and under generally accepted accounting principles.   SECTION 2.10.                     OTHER OBLIGATIONS. Neither Borrower nor any Subsidiary is in default on any obligation for borrowed money, any purchase money obligation or any other material lease, commitment, contract, instrument or obligation.   SECTION 2.11.                     ENVIRONMENTAL MATTERS. Except as disclosed by Borrower to Bank in writing prior to the date hereof, Borrower and each Subsidiary are in compliance in all material respects with all applicable federal or state environmental, hazardous waste, health and safety statutes, and any rules or regulations adopted pursuant thereto, which govern or affect any of Borrower’s or Subsidiary’s operations and/or properties, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, the Superfund Amendments and Reauthorization Act of 1986, the Federal Resource Conservation and Recovery Act of 1976, and the Federal Toxic Substances Control Act, as any of the same may be amended, modified or supplemented from time to time. None of the operations of Borrower or any Subsidiary is the subject of any federal or state investigation evaluating whether any remedial action involving a material expenditure is needed to respond to a release of any toxic or hazardous waste or substance into the environment. Neither Borrower nor any Subsidiary has any material contingent liability in connection with any release of any toxic or hazardous waste or substance into the environment.   ARTICLE III CONDITIONS   SECTION 3.1.                           CONDITIONS OF INITIAL EXTENSION OF CREDIT. The obligation of Bank to extend any credit contemplated by this Agreement is subject to the fulfillment to Bank’s satisfaction of all of the following conditions:   (a)                       Approval of Bank Counsel. All legal matters incidental to the extension of credit by Bank shall be satisfactory to Bank’s counsel.   (b)                      Documentation. Bank shall have received, in form and substance satisfactory to Bank, each of the following, duly executed:   (i)    This Agreement and each promissory note or other instrument or document required hereby. (ii)   Certificates of Incumbency. (iii)   Corporate Resolutions: Third Party Collateral. (iv)   Corporate Resolutions: Continuing Guaranty. (v)   Corporate Resolution: Borrowing. (vi)   Disbursement Order.   5   (vii)   Continuing Guaranties. (viii)   Security Agreement: Equipment. (ix)   Continuing Security Agreement: Rights to Payments and Inventory. (x)   Third Party Security Agreements: Rights to Payments and Inventory. (xi)   Third Party Security Agreements: Equipment. (xii)   Such other documents as Bank may require under any other Section of this Agreement.   (c)                       Financial Condition. There shall have been no material adverse change, as determined by Bank, in the financial condition or business of Borrower or any Subsidiary, nor any material decline, as determined by Bank, in the market value of any collateral required hereunder or a substantial or material portion of the assets of Borrower or any Subsidiary.   (d)                       Insurance. Borrower shall have delivered to Bank evidence of insurance coverage on all Borrower’s and each Subsidiary’s property, in form, substance, amounts, covering risks and issued by companies satisfactory to Bank, and where required by Bank, with loss payable endorsements in favor of Bank.   SECTION 3.2.                           CONDITIONS OF EACH EXTENSION OF CREDIT. The obligation of Bank to make each extension of credit requested by Borrower hereunder shall be subject to the fulfillment to Bank’s satisfaction of each of the following conditions:   (a)                      Compliance. The representations and warranties contained herein and in each of the other Loan Documents shall be true on and as of the date of the signing of this Agreement and on the date of each extension of credit by Bank pursuant hereto, with the same effect as though such representations and warranties had been made on and as of each such date, and on each such date, no Event of Default as defined herein, and no condition, event or act which with the giving of notice or the passage of time or both would constitute such an Event of Default, shall have occurred and be continuing or shall exist.   (b)                     Documentation. Bank shall have received all additional documents which may be required in connection with such extension of credit.   ARTICLE IV AFFIRMATIVE COVENANTS   Borrower covenants that so long as Bank remains committed to extend credit to Borrower pursuant hereto, or any liabilities (whether direct or contingent, liquidated or unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations of Borrower subject hereto, unless Bank otherwise consents in writing:   SECTION 4.1.                           PUNCTUAL PAYMENTS. Borrower shall punctually pay all principal, interest, fees or other liabilities due under any of the Loan Documents at the times and place and in the manner specified therein.   SECTION 4.2.                           ACCOUNTING RECORDS. Borrower shall, and shall cause each Subsidiary to, maintain adequate books and records in accordance with generally accepted accounting principles consistently applied, and permit any representative of Bank, at any reasonable time, to inspect, audit and examine such books and records, to make copies of the same, and to inspect the properties of Borrower and each Subsidiary.   6   SECTION 4.3.                           FINANCIAL STATEMENTS. Borrower shall provide to Bank all of the following, in form and detail satisfactory to Bank:   (a)                      not later than 100 days after and as of the end of each fiscal year, a copy of Borrower’s 10-K report as filed with the Securities and Exchange Commission;   (b)                     not later than 50 days after and as of the end of each fiscal quarter, a copy of Borrower’s 10-Q report as filed with the Securities and Exchange Commission;   (c)                      from time to time such other information as Bank may reasonably request.   SECTION 4.4.                           COMPLIANCE. Borrower shall, and shall cause each Subsidiary to, preserve and maintain all licenses, permits, governmental approvals, rights, privileges and franchises necessary for the conduct of their businesses; and comply with the provisions of all documents pursuant to which they are organized and/or which govern their continued existence and with the requirements of all laws, rules, regulations and orders of any governmental authority applicable to them and/or their businesses.   SECTION 4.5.                           INSURANCE. Borrower shall, and shall cause each Subsidiary to, maintain and keep in force insurance of the types and in amounts customarily carried in similar lines of business, including but not limited to fire, extended coverage, public liability, flood, property damage and workers’ compensation, with all such insurance carried with companies and in amounts satisfactory to Bank, and deliver to Bank from time to time at Bank’s request schedules setting forth all insurance then in effect.   SECTION 4.6.                           FACILITIES. Borrower shall, and shall cause each Subsidiary to, keep all properties useful or necessary to their businesses in good repair and condition, and from time to time make necessary repairs, renewals and replacements thereto so that such properties shall be fully and efficiently preserved and maintained.   SECTION 4.7.                           TAXES AND OTHER LIABILITIES. Borrower shall, and shall cause each Subsidiary to, pay and discharge when due any and all indebtedness, obligations, assessments and taxes, both real or personal, including without limitation federal and state income taxes and state and local property taxes and assessments, except such (a) as they may in good faith contest or as to which a bona fide dispute may arise, and (b) for which they have made provision, to Bank’s satisfaction, for eventual payment thereof in the event Borrower or any Subsidiary is obligated to make such payment.   SECTION 4.8.                           LITIGATION. Borrower shall promptly give notice in writing to Bank of any litigation pending or threatened against Borrower or any Subsidiary with a claim in excess of $500,000.00.   SECTION 4.9.                                   FINANCIAL CONDITION. Borrower shall, and shall cause each Subsidiary to, maintain the financial condition of Borrower and Subsidiaries on a consolidated basis as follows using generally accepted accounting principles consistently applied and used consistently with prior practices (except to the extent modified by the definitions herein):   (a)                      Tangible Net Worth not less than $25,000,000.00 at any time, with “Tangible Net Worth” defined as the aggregate of total stockholders’ equity less any intangible assets and less any loans or advances to, or investments in, any related entities or individuals.   7   (b)                      Net income after taxes not less than $1.00 on an annual basis, determined as of each fiscal year end;   (c)                       Net income after taxes not less than $1.00 for any fiscal quarter that immediately follows a fiscal quarter in which Borrower failed to maintain net income after taxes of not less than $1.00, determined as of each fiscal quarter end;   (d)                      Total Funded Debt to EBITDA not greater than 2.5 to 1.0 as of each fiscal quarter end, determined on a rolling 4-quarter basis, with “Funded Debt” defined as the sum of all obligations for borrowed money (including subordinated debt, any contingent liabilities, the undrawn amount of any outstanding Letters of Credit, and all capital lease obligations), and with “EBITDA” defined as net profit before tax plus interest expense (net of capitalized interest expense), depreciation expense and amortization expense.   (e)                       Minimum Asset Coverage Ratio not less than 1.50 to 1.00 as of each fiscal quarter end, with “Minimum Asset Coverage Ratio” defined as unencumbered liquid assets (defined as cash, cash equivalents and/or publicly traded/quoted marketable securities acceptable to Bank in its sole discretion) plus the amount of net billed accounts receivable divided by the outstanding principal balance under the Line of Credit (including the undrawn amount of any outstanding Letters of Credit issued thereunder).   SECTION 4.10.                     NOTICE TO BANK. Borrower shall, and shall cause each Subsidiary to, promptly (but in no event more than five (5) days after the occurrence of each such event or matter) give written notice to Bank in reasonable detail of: (a) the occurrence of any Event of Default, or any condition, event or act which with the giving of notice or the passage of time or both would constitute an Event of Default; (b) any change in the name or the organizational structure of Borrower or any Subsidiary; (c) the occurrence and nature of any Reportable Event or Prohibited Transaction, each as defined in ERISA, or any funding deficiency with respect to any Plan; or (d) any termination or cancellation of any insurance policy which Borrower or any Subsidiary is required to maintain, or any uninsured or partially uninsured loss through liability or property damage, or through fire, theft or any other cause affecting Borrower’s or any Subsidiary’s property.   ARTICLE V NEGATIVE COVENANTS   Borrower further covenants that so long as Bank remains committed to extend credit to Borrower pursuant hereto, or any liabilities (whether direct or contingent, liquidated or unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations of Borrower subject hereto, without Bank’s prior written consent:   SECTION 5.1.                           USE OF FUNDS. Borrower will not use any of the proceeds of any credit extended hereunder except for the purposes stated in Article I hereof.   SECTION 5.2.                           OTHER INDEBTEDNESS. Borrower will not, and will not permit any Subsidiary to, create, incur, assume or permit to exist any indebtedness or liabilities resulting from borrowings, loans or advances, whether secured or unsecured, matured or unmatured, liquidated or unliquidated, joint or several, except (a) the liabilities of Borrower and Subsidiaries to Bank, (b) any other liabilities of Borrower and Subsidiaries existing as of, and disclosed to   8   Bank prior to, the date hereof, and (c) purchase money indebtedness incurred hereafter by Borrower in the ordinary course of its business, provided, that such amount does not exceed $2,000,000.00 in the aggregate at any time.   SECTION 5.3.                           MERGER, CONSOLIDATION, TRANSFER OF ASSETS. Borrower will not, and will not permit any Subsidiary to, merge into or consolidate with any other entity; make any substantial change in the nature of Borrower’s or any Subsidiary’s business as conducted as of the date hereof; acquire all or substantially all of the assets of any other entity except Permitted Acquisitions (defined below); nor sell, lease, transfer or otherwise dispose of all or a substantial or material portion of Borrower’s or any Subsidiary’s assets except in the ordinary course of its business.   As used herein, “Permitted Acquisitions” means any direct acquisition by Borrower of (a) all or substantially all of the operating assets of any person or entity; (b) all of the stock of any corporation provided, however, that all of the following conditions are satisfied:   (i)                                The assets, entity or line of business which is acquired is in a substantially similar line of business as that of Borrower as its business is conducted on the date of this Agreement.   (ii)                             The acquisition is consummated in compliance with applicable law.   (iii)                          There is no Event of Default, nor any act, condition or event which with the giving of notice or the passage of time or both would constitute an Event of Default, and no such Event of Default or potential Event of Default would result after giving effect to the acquisition.   (iv)                         Borrower gives Bank at least thirty (30) days prior notice of the acquisition;   (v)                            Borrower furnishes Bank with copies of such documents and with such information pertaining to the acquisition as Bank may require, including without limitation copies of any acquisition agreement and formation documents of any acquired company.   (vi)                         Borrower furnishes Bank with financial statements of the company to be acquired (or the company whose assets are being acquired) showing that such company has maintained EBITDA of not less than $1.00 as of the end of each of the two fiscal years preceding the date of the closing of any such acquisition, with “EBITDA” defined as net profit before tax plus interest expense (net of capitalized interest expense), depreciation expense and amortization expense, with compliance determined by using generally accepted accounting principles consistently applied and used consistently with prior practices.   (vii)                      The aggregate consideration (valuing any non-cash consideration at its fair market value, and including without limitation the amount of all liabilities assumed or acquired) does not exceed Five Million Dollars ($5,000,000.00) for any individual acquisition and Ten Million Dollars ($10,000,000.00) for all such acquisitions in the aggregate during any fiscal year.   (viii)                   Borrower causes each company acquired pursuant to the provisions hereof to (a) guaranty the payment and performance of all indebtedness and other obligations of Borrower to Bank hereunder, and (b) grant to Bank security interests of first priority in all such company’s accounts receivable and other rights to payment, general intangibles, inventory and equipment as security for all indebtedness and other obligations of Borrower to Bank subject hereto. Borrower shall cause each such company to execute guaranties, security agreements and such other documents as Bank may require in connection herewith, all of which shall be in form and substance satisfactory to Bank.   9   SECTION 5.4.                           GUARANTIES. Borrower will not, and will not permit any Subsidiary to, guarantee or become liable in any way as surety, endorser (other than as endorser of negotiable instruments for deposit or collection in the ordinary course of business), accommodation endorser or otherwise for, nor pledge or hypothecate any assets of Borrower as security for, any liabilities or obligations of any other person or entity, except any of the foregoing in favor of Bank.   SECTION 5.5.                           LOANS, ADVANCES, INVESTMENTS. Borrower will not, and will not permit any Subsidiary to, make any loans or advances to or investments in any person or entity, except (a) any of the foregoing existing as of, and disclosed to Bank prior to, the date hereof, and (b) loans or advances made hereafter by Borrower to any third party in the ordinary course of Borrower’s business provided that such amounts do not exceed $2,000,000.00 in the aggregate at any time.   SECTION 5.6.                           DIVIDENDS, DISTRIBUTIONS, SHARE REPURCHASES. Borrower will not declare or pay any dividend or distribution either in cash, stock or any other property on Borrower’s stock now or hereafter outstanding, nor redeem, retire, repurchase or otherwise acquire any shares of any class of Borrower’s stock now or hereafter outstanding. Notwithstanding the foregoing, Borrower may make lawful repurchases of any shares of any class of Borrower’s stock now or hereafter outstanding, provided that the aggregate fair market valuation of any such repurchased shares does not exceed $5,000,000.00 in the aggregate during any calendar year, and provided, further, that there exists no Event of Default, or any act, condition or event which with the giving of notice or the passage of time or both would constitute such an Event of Default, or if any such Event of Default would result after giving effect to any such contemplated repurchase.   SECTION 5.7.                           PLEDGE OF ASSETS. Borrower will not, and will not permit any Subsidiary to, mortgage, pledge, grant or permit to exist a security interest in, or lien upon, all or any portion of Borrower’s or any Subsidiary’s assets now owned or hereafter acquired, except (a) any of the foregoing in favor of Bank or which is existing as of, and disclosed to Bank in writing prior to, the date hereof and (b) purchase money liens to the extent they secure purchase money debt permitted under Section 5.2 hereof.   ARTICLE VI EVENTS OF DEFAULT   SECTION 6.1.                           The occurrence of any of the following shall constitute an “Event of Default” under this Agreement:   (a)                        Borrower shall fail to pay when due any principal, interest, fees or other amounts payable under any of the Loan Documents.   (b)                       Any financial statement or certificate furnished to Bank in connection with, or any representation or warranty made by Borrower or any other party under this Agreement or any other Loan Document shall prove to be incorrect, false or misleading in any material respect when furnished or made.   10   (c)                      Any default in the performance of or compliance with any obligation, agreement or other provision contained herein or in any other Loan Document (other than those referred to in subsections (a) and (b) above), and with respect to any such default which by its nature can be cured, such default shall continue for a period of twenty (20) days from its occurrence.   (d)                     Any default in the payment or performance of any obligation, or any defined event of default, under the terms of any contract or instrument (other than any of the Loan Documents) pursuant to which Borrower, any guarantor hereunder or any general partner or joint venturer in Borrower if a partnership or joint venture (with each such guarantor, general partner and/or joint venturer referred to herein as a ‘Third Party Obligor”) has incurred any debt or other liability to any person or entity, including Bank.   (e)                      The filing of a notice of judgment lien against Borrower or any Third Party Obligor; or the recording of any abstract of judgment against Borrower or any Third Party Obligor in any county in which Borrower or such Third Party Obligor has an interest in real property; or the service of a notice of levy and/or of a writ of attachment or execution, or other like process, against the assets of Borrower or any Third Party Obligor; or the entry of a judgment against Borrower or any Third Party Obligor.   (f)                        Borrower or any Third Party Obligor shall become insolvent, or shall suffer or consent to or apply for the appointment of a receiver, trustee, custodian or liquidator of itself or any of its property, or shall generally fail to pay its debts as they become due, or shall make a general assignment for the benefit of creditors; Borrower or any Third Party Obligor shall file a voluntary petition in bankruptcy, or seeking reorganization, in order to effect a plan or other arrangement with creditors or any other relief under the Bankruptcy Reform Act. Title 11 of the United States Code, as amended or recodified from time to time (“Bankruptcy Code”), or under any state or federal law granting relief to debtors, whether now or hereafter in effect; or any involuntary petition or proceeding pursuant to the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors is filed or commenced against Borrower or any Third Party Obligor, or Borrower or any Third Party Obligor shall file an answer admitting the jurisdiction of the court and the material allegations of any involuntary petition; or Borrower or any Third Party Obligor shall be adjudicated a bankrupt, or an order for relief shall be entered against Borrower or any Third Party Obligor by any court of competent jurisdiction under the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors.   (g)                     There shall exist or occur any event or condition which Bank in good faith believes impairs, or is substantially likely to impair, the prospect of payment or performance by Borrower of its obligations under any of the Loan Documents.   (h)                     The death or incapacity of Borrower or any Third Party Obligor if an individual. The dissolution or liquidation of Borrower or any Third Party Obligor if a corporation, partnership, joint venture or other type of entity; or Borrower or any such Third Party Obligor, or any of its directors, stockholders or members, shall take action seeking to effect the dissolution or liquidation of Borrower or such Third Party Obligor.   (i)                         Borrower ceases to own one hundred percent (100%) of any Subsidiary.   (j)                         A Change in Control of Borrower, and as used herein, “Change in Control” means (a) any “person” (as such term is used in Sections “Exchange Act”)), other than a trustee or other fiduciary holding   11   securities of the Company under an employee benefit plan of Borrower, becomes the “beneficial owner” (as defined in Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of the Borrower representing 25% or more of (A) the outstanding shares of common stock of Borrower or (B) the combined voting power of Borrower’s then outstanding securities; or (b) the Borrower is party to a merger or consolidation which results in the voting securities of the Borrower outstanding immediately prior thereto failing to continue to represent (either by remaining outstanding or by being converted into voting securities of the surviving or another entity) at least twenty five (25%) percent of the combined voting power of the voting securities of the Borrower or such surviving or other entity outstanding immediately after such merger or consolidation.   SECTION 6.2.                           REMEDIES. Upon the occurrence of any Event of Default: (a) all indebtedness of Borrower under each of the Loan Documents, any term thereof to the contrary notwithstanding, shall at Bank’s option and without notice become immediately due and payable without presentment, demand, protest or notice of dishonor, all of which are hereby expressly waived by Borrower; (b) the obligation, if any, of Bank to extend any further credit under any of the Loan Documents shall immediately cease and terminate; and (c) Bank shall have all rights, powers and remedies available under each of the Loan Documents, or accorded by law, including without limitation the right to resort to any or all security for any credit subject hereto and to exercise any or all of the rights of a beneficiary or secured party pursuant to applicable law. All rights, powers and remedies of Bank may be exercised at any time by Bank and from time to time after the occurrence of an Event of Default, are cumulative and not exclusive, and shall be in addition to any other rights, powers or remedies provided by law or equity.   ARTICLE VII MISCELLANEOUS   SECTION 7.1.                           NO WAIVER. No delay, failure or discontinuance of Bank in exercising any right, power or remedy under any of the Loan Documents shall affect or operate as a waiver of such right, power or remedy; nor shall any single or partial exercise of any such right, power or remedy preclude, waive or otherwise affect any other or further exercise thereof or the exercise of any other right, power or remedy. Any waiver, permit, consent or approval of any kind by Bank of any breach of or default under any of the Loan Documents must be in writing and shall be effective only to the extent set forth in such writing.   SECTION 7.2.                           NOTICES. All notices, requests and demands which any party is required or may desire to give to any other party under any provision of this Agreement must be in writing delivered to each party   BORROWER:   Willdan Group, Inc.     2711 Centerville Road, Suite 400     Wilmington, Delaware               2401 East Katella Avenue     Suite 300     Anaheim, CA 92806   12   BANK:       San Gabriel Valley Regional Commercial Banking Officer     1000 Lakes Drive, Suite 250     West Covina, CA 91790   or to such other address as any party may designate by written notice to all other parties. Each such notice, request and demand shall be deemed given or made as follows: (a) if sent by hand delivery, upon delivery; (b) if sent by mail, upon the earlier of the date of receipt or three (3) days after deposit in the U.S. mail, first class and postage prepaid; and (c) if sent by telecopy, upon receipt.   SECTION 7.3.                           COSTS, EXPENSES AND ATTORNEYS’ FEES. Borrower shall pay to Bank immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys’ fees (to include outside counsel fees and all allocated costs of Bank’s in-house counsel), expended or incurred by Bank in connection with (a) the negotiation and preparation of this Agreement and the other Loan Documents, Bank’s continued administration hereof and thereof, and the preparation of any amendments and waivers hereto and thereto, (b) the enforcement of Bank’s rights and/or the collection of any amounts which become due to Bank under any of the Loan Documents, and (c) the prosecution or defense of any action in any way related to any of the Loan Documents, including without limitation, any action for declaratory relief, whether incurred at the trial or appellate level, In an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Bank or any other person) relating to Borrower or any other person or entity.   SECTION 7.4.                           SUCCESSORS, ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the heirs, executors, administrators, legal representatives, successors and assigns of the parties; provided however, that Borrower may not assign or transfer its interests or rights hereunder without Bank’s prior written consent. Bank reserves the right to sell, assign, transfer, negotiate or grant participations in all or any part of, or any interest in, Bank’s rights and benefits under each of the Loan Documents. In connection therewith, Bank may disclose all documents and information which Bank now has or may hereafter acquire relating to any credit subject hereto, Borrower or its business, any guarantor hereunder or the business of such guarantor, or any collateral required hereunder.   SECTION 7.5.                           ENTIRE AGREEMENT; AMENDMENT. This Agreement and the other Loan Documents constitute the entire agreement between Borrower and Bank with respect to each credit subject hereto and supersede all prior negotiations, communications, discussions and correspondence concerning the subject matter hereof. This Agreement may be amended or modified only in writing signed by each party hereto.   SECTION 7.6.                           NO THIRD PARTY BENEFICIARIES. This Agreement is made and entered into for the sole protection and benefit of the parties hereto and their respective permitted successors and assigns, and no other person or entity shall be a third party beneficiary of, or have any direct or indirect cause of action or claim in connection with, this Agreement or any other of the Loan Documents to which it is not a party.   SECTION 7.7.                           TIME. Time is of the essence of each and every provision of this Agreement and each other of the Loan Documents.   13   SECTION 7.8.                           SEVERABILITY OF PROVISIONS. If any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity without invalidating the remainder of such provision or any   SECTION 7.9.                           COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which when executed and delivered shall be deemed to be an original, and all of which when taken together shall constitute one and the same Agreement.   SECTION 7.10.                     GOVERNING LAW. This Agreement shall be California.   SECTION 7.11.                     ARBITRATION.   (a)                     Arbitration. The parties hereto agree, upon demand by any party, to submit to binding arbitration all claims, disputes and controversies between or among them (and their respective employees, officers, directors, attorneys, and other agents), whether in tort, contract or otherwise in any way arising out of or relating to (i) any credit subject hereto, or any of the Loan Documents, and their negotiation, execution, collateralization, administration, repayment, modification, extension, substitution, formation, inducement, enforcement, default or termination; or (ii) requests for additional credit.   (b)                    Governing Rules. Any arbitration proceeding will (i) proceed in a location in California selected by the American Arbitration Association (“AAA”); (ii) be governed by the Federal Arbitration Act (Title 9 of the United States Code), notwithstanding any conflicting choice of law provision in any of the documents between the parties; and (iii) be conducted by the AAA, or such other administrator as the parties shall mutually agree upon, in accordance with the AAA’s commercial dispute resolution procedures, unless the claim or counterclaim is at least $1,000,000.00 exclusive of claimed interest, arbitration fees and costs in which case the arbitration shall be conducted in accordance with the AAA’s optional procedures for large, complex commercial disputes (the commercial dispute resolution procedures or the optional procedures for large, complex commercial disputes to be referred to herein, as applicable, as the “Rules”). If there is any inconsistency between the terms hereof and the Rules, the terms and procedures set forth herein shall control. Any party who fails or refuses to submit to arbitration following a demand by any other party shall bear all costs and expenses incurred by such other party in compelling arbitration of any dispute. Nothing contained herein shall be deemed to be a waiver by any party that is a bank of the protections afforded to it under 12 U.S.C. §91 or any similar applicable state law.   (c)                     No Waiver of Provisional Remedies. Self-Help and Foreclosure. The arbitration requirement does not limit the right of any party to (i) foreclose against real or personal property collateral; (ii) exercise self-help remedies relating to collateral or proceeds of collateral such as setoff or repossession; or (iii) obtain provisional or ancillary remedies such as replevin, injunctive relief, attachment or the appointment of a receiver, before during or after the pendency of any arbitration proceeding. This exclusion does not constitute a waiver of the right or obligation of any party to submit any dispute to arbitration or reference hereunder, including those arising from the exercise of the actions detailed in sections (i), (ii) and (iii) of this paragraph.   14   (d)                    Arbitrator Qualifications and Powers. Any arbitration proceeding in which the amount in controversy is $5,000,000.00 or less will be decided by a single arbitrator selected according to the Rules, and who shall not render an award of greater than $5,000,000.00. Any dispute in which the amount in controversy exceeds $5,000,000.00 shall be decided by majority vote of a panel of three arbitrators; provided however, that all three arbitrators must actively participate in all hearings and deliberations. The arbitrator will be a neutral attorney licensed in the State of California or a neutral retired judge of the state or federal judiciary of California, in either case with a minimum of ten years experience in the substantive law applicable to the subject matter of the dispute to be arbitrated. The arbitrator will determine whether or not an issue is arbitratable and will give effect to the statutes of limitation in determining any claim. In any arbitration proceeding the arbitrator will decide (by documents only or with a hearing at the arbitrator’s discretion) any pre-hearing motions which are similar to motions to dismiss for failure to state a claim or motions for summary adjudication. The arbitrator shall resolve all disputes in accordance with the substantive law of California and may grant any remedy or relief that a court of such state could order or grant within the scope hereof and such ancillary relief as is necessary to make effective any award. The arbitrator shall also have the power to award recovery of all costs and fees, to impose sanctions and to take such other action as the arbitrator deems necessary to the same extent a judge could pursuant to the Federal Rules of Civil Procedure, the California Rules of Civil Procedure or other applicable law. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction. The institution and maintenance of an action for judicial relief or pursuit of a provisional or ancillary remedy shall not constitute a waiver of the right of any party, including the plaintiff, to submit the controversy or claim to arbitration if any other party contests such action for judicial relief.   (e)                       Discovery. In any arbitration proceeding, discovery will be permitted in accordance with the Rules. All discovery shall be expressly limited to matters directly relevant to the dispute being arbitrated and must be completed no later than 20 days before the hearing date. Any requests for an extension of the discovery periods, or any discovery disputes, will be subject to final determination by the arbitrator upon a showing that the request for discovery is essential for the party’s presentation and that no alternative means for obtaining information is available.   (f)                         Class Proceedings and Consolidations. No party hereto shall be entitled to join or consolidate disputes by or against others in any arbitration, except parties who have executed any Loan Document, or to include in any arbitration any dispute as a representative or member of a class, or to act in any arbitration in the interest of the general public or in a private attorney general capacity.   (g)                      Payment Of Arbitration Costs And Fees. The arbitrator shall award all costs and expenses of the arbitration proceeding.   (h)                      Real Property Collateral; Judicial Reference. Notwithstanding anything herein to the contrary, no dispute shall be submitted to arbitration if the dispute concerns indebtedness secured directly or indirectly, in whole or in part, by any real property unless (i) the holder of the mortgage, lien or security interest specifically elects in writing to proceed with the arbitration, or (ii) all parties to the arbitration waive any rights or benefits that might accrue to them by virtue of the single action rule statute of California, thereby agreeing that all indebtedness and obligations of the parties, and all mortgages, liens and security interests securing such indebtedness and obligations, shall remain fully valid and enforceable. If any such dispute is not submitted to arbitration, the dispute shall be referred to a referee in accordance with California Code of Civil Procedure Section 638 et seq., and this general reference agreement is intended to be specifically enforceable in accordance with said Section 638. A referee with the qualifications required herein for arbitrators shall be selected pursuant to the AAA’s selection procedures. Judgment upon the decision rendered by a referee shall be entered in the court in which such proceeding was commenced in accordance with California Code of Civil Procedure Sections 644 and 645.   15   (i)                          Miscellaneous. To the maximum extent practicable, the AAA, the arbitrators and the parties shall take all action required to conclude any arbitration proceeding within 180 days of the filing of the dispute with the AAA. No arbitrator or other party to an arbitration proceeding of information by a party required in the ordinary course of its business or by applicable law or regulation. If more than one agreement for arbitration by or between the parties potentially applies to a dispute, the arbitration provision most directly related to the Loan Documents or the subject matter of the dispute shall control. This arbitration provision shall survive termination, amendment or expiration of any of the Loan Documents or any relationship between the parties.   (j)                          Small Claims Court. Notwithstanding anything herein to the contrary, each party retains the right to pursue in Small Claims Court any dispute within that court’s jurisdiction. Further, this arbitration provision shall apply only to disputes in which either party seeks to recover an amount of money (excluding attorneys’ fees and costs) that exceeds the jurisdictional limit of the Small Claims Court.       WELLS FARGO BANK, WILLDAN GROUP, INC    NATIONAL ASSOCIATION     By:  /s/ Kimberly D. Gant   By: /s/ Jared Myres       Kimberly D. Gant   Jared Myres Title:   Chief Financial Officer     Assistant Vice President   16

Execution Copy Exhibit 10.1     CONTRIBUTION AGREEMENT BY AND AMONG ENBRIDGE ENERGY COMPANY, INC., ENBRIDGE PIPELINES (ALBERTA CLIPPER) L.L.C. ENBRIDGE ENERGY, LIMITED PARTNERSHIP, ENBRIDGE ENERGY PARTNERS, L.P., ENBRIDGE PIPELINES (LAKEHEAD) L.L.C. AND ENBRIDGE PIPELINES (WISCONSIN) INC.     July 17, 2009 TABLE OF CONTENTS             Page ARTICLE I DEFINITIONS    1     Section 1.1    Definitions    1 ARTICLE II CONTRIBUTIONS AT CLOSING AND OTHER CLOSING TRANSACTIONS    4     Section 2.1    Partnership Agreement and Initial Series AC Capital Contributions    4     Section 2.2    Initial Debt Financing    5     Section 2.3    Repayment of Certain Series AC Liabilities    5 ARTICLE III COVENANTS AND CLOSING CONDITIONS    5     Section 3.1    Covenants of the Parties    5     Section 3.2    Closing Conditions of the EEP Parties    5     Section 3.3    Closing Conditions of the EECI Parties    6 ARTICLE IV CLOSING AND TERMINATION    7     Section 4.1    Closing    7     Section 4.2    The EEP Parties’ Closing Obligations    7     Section 4.3    EECI Parties’ Closing Obligations    8     Section 4.4    Termination of Agreement    8     Section 4.5    Procedure Upon and Effect of Termination    9 ARTICLE V LIMITATIONS    9     Section 5.1    Disclaimer of Warranties and Representations    9     Section 5.2    Damages    9 ARTICLE VI MISCELLANEOUS    9     Section 6.1    Headings; References; Interpretation    9     Section 6.2    Successors and Assigns    10     Section 6.3    Third Party Rights    10     Section 6.4    Counterparts    10     Section 6.5    Governing Law    10     Section 6.6    Severability    10     Section 6.7    Amendment or Modification    10     Section 6.8    Waiver of Compliance; Consents    11     Section 6.9    Notices    11     Section 6.10    Integration    11   i Exhibits:      Exhibit A   -    Form of Amended and Restated Partnership Agreement Exhibit B   -    Form of Facility A1 Exhibit C   -    Form of Facility B1 Exhibit D   -    Form of Facility C1   ii CONTRIBUTION AGREEMENT This Contribution Agreement, dated July 17, 2009 (this “Agreement”), is entered into by and among Enbridge Energy Company, Inc., a Delaware corporation (“EECI”), Enbridge Pipelines (Alberta Clipper) L.L.C., a Delaware limited liability company (“EECI Sub”), Enbridge Energy, Limited Partnership, a Delaware limited partnership (the “Partnership”), Enbridge Energy Partners, L.P., a Delaware limited partnership (“Enbridge Partners”), Enbridge Pipelines (Lakehead) L.L.C., a Delaware limited liability company (“Lakehead GP”) and Enbridge Pipelines (Wisconsin) Inc., a Wisconsin corporation (“Wisconsin GP”). The parties to this Agreement are each sometimes referred to as a “Party” and RECITALS WHEREAS, the Parties wish to jointly fund, construct and operate the Alberta Clipper Project (as defined below) while preserving the regulatory benefits associated with leaving the legal title to, and direct ownership of, the associated assets embedded within the Partnership. NOW, THEREFORE, in consideration of the mutual undertakings and agreements set forth below and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as follows: ARTICLE I DEFINITIONS Section 1.1 Definitions. The following capitalized terms shall have the meanings given below. All references to dollar amounts refer to United States dollars. “Affiliate” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Agreement” has the meaning assigned to such term in the preamble to this Agreement. “Alberta Clipper Project” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Amended and Restated Partnership Agreement” means the form of Third Amended and Restated Agreement of Limited Partnership of the Partnership attached to this Agreement as Exhibit A, which agreement shall become effective in accordance with its terms upon the execution by all of the Parties thereto at the Closing as provided in Article II. “Capital Contribution” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Closing” means the consummation of the transactions contemplated by Article II “Closing Date” means August 1, 2009, unless otherwise agreed to in writing by the Parties.   1 “EECI” has the meaning assigned to such term in the preamble to this Agreement. “EECI Parties” means EECI and EECI Sub. “EECI Sub” has the meaning assigned to such term in the preamble to this Agreement. “EEM” means Enbridge Energy Management, L.L.C., a Delaware limited liability company. “EEP Parties” means Enbridge Partners, the Partnership, Lakehead GP and Wisconsin GP. “Enbridge Partners” has the meaning assigned to such term in the preamble to this Agreement. “Facility A1” means the A1 Credit Agreement in the form attached to this Agreement as Exhibit B. “Facility B1” means the B1 Credit Agreement in the form attached to this Agreement as Exhibit C. “Facility C1” means the C1 Credit Agreement in the form attached to this Agreement as Exhibit D. “General Partner Interest” has the meaning assigned to such term in the Amended “Governmental Authority” means any executive, legislative, judicial, regulatory or administrative agency, body, commission, department, board, court, tribunal, arbitrating body or authority of the United States or any foreign country, or any state, local or other governmental subdivision thereof. amended, and the rules and regulations thereunder. “Initial Series AC Capital Contribution” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Intercompany Preliminary Construction Cost Payable” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Lakehead GP” has the meaning assigned to such term in the preamble to this Agreement. “Law” means any statute, law, treaty, rule, code, ordinance, requirement, regulation, permit or certificate of any Governmental Authority, any interpretation of any of the foregoing by any Governmental Authority, or any binding judgment, decision, decree, injunction, writ, order or like action of any court, arbitrator or other Governmental Authority.   2 “Limited Partner Interest” has the meaning assigned to such term in the Amended “Material Adverse Effect” means (i) a single event, occurrence or fact that, alone or together with all other events, occurrences or facts, would reasonably be expected to result in a material adverse effect on the business, operations, assets, liabilities, financial condition, results of operation or prospects of the Partnership as a whole or the Alberta Clipper Project individually, other than changes in general economic, political or business conditions that affect the Partnership in a manner similar to its competitors or (ii) any condition or occurrence that has materially impaired or would reasonably be expected to materially impair the ability of the EEP Parties to consummate the Transactions or perform their respective obligations under the Transaction Documents. or arbitration award of a Governmental Authority. “Parties” has the meaning assigned to such term in the preamble to this Agreement. “Partnership” has the meaning assigned to such term in the preamble to this Agreement. “Preliminary Alberta Clipper Construction Costs” has the meaning assigned to “Series AC” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Series AC Assets” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Series AC Liabilities” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Series LH” has the meaning assigned to such term in the Amended and Restated Partnership Agreement. “Special Committee” means the committee of the Board of Directors of EEM, comprised solely of independent directors of such Board, that was created by resolution of such Board on January 30, 2009. “Transaction Documents” means, collectively, this Agreement, the Amended and Restated Partnership Agreement, Facility A1, Facility B1, Facility C1 and any other agreements, documents and instruments to be delivered by the Parties pursuant to Article IV. “Transactions” means the transactions described in Article II. “Wisconsin GP” has the meaning assigned to such term in the preamble to this Agreement.   3 ARTICLE II CONTRIBUTIONS AT CLOSING AND OTHER CLOSING TRANSACTIONS Section 2.1 Partnership Agreement and Initial Series AC Capital Contributions. At the Closing, and subject to the terms and conditions of this Agreement, the Parties hereby agree and undertake as follows: (a) Each of Enbridge Partners, Lakehead GP, Wisconsin GP, EECI and EECI Sub will execute and deliver the Amended and Restated Partnership Agreement and the Partnership will file an amended and restated certificate of limited partnership with the Delaware Secretary of State containing a notice that the Partnership is a series limited partnership; (b) Enbridge Partners will contribute, as its Initial Series AC Capital Contribution, immediately available U.S. dollars to the Partnership with respect to the Series AC in an amount equal to 33.329% of 55% of the Preliminary Alberta Clipper Construction Costs. In exchange for such Initial Series AC Capital Contribution, the Partnership will issue to Enbridge Partners a 33.329% Limited Partner Interest in the Series AC; (c) Lakehead GP will contribute, as its Initial Series AC Capital Contribution, immediately available U.S. dollars to the Partnership with respect to the Series AC in an amount equal to 0.0005% of 55% of the Preliminary Alberta Clipper Construction Costs. In exchange for such Initial Series AC Capital Contribution, the Partnership will issue to Lakehead GP a 0.0005% General Partner Interest in the Series AC; (d) Wisconsin GP will contribute, as its Initial Series AC Capital Contribution, the Partnership will issue to Wisconsin GP a 0.0005% General Partner Interest in the Series AC; (e) EECI will contribute, as its Initial Series AC Capital Contribution, AC in an amount equal to 66.66% of 55% of the Preliminary Alberta Clipper the Partnership will issue to EECI a 66.66% Limited Partner Interest in the Series AC; and (f) EECI Sub will contribute, as its Initial Series AC Capital Contribution, AC in an amount equal to 0.01% of 55% of the Preliminary Alberta Clipper the Partnership will issue to EECI Sub a 0.01% Limited Partner Interest in the Series AC.   4 Section 2.2 Initial Debt Financing. Concurrently with the Transactions described in Section 2.1, and subject to the terms and conditions of this Agreement, the (a) EECI and Enbridge Partners will enter into Facility A1; (b) Enbridge Partners and the Partnership, on behalf of the Series AC, will enter into Facility B1; (c) Enbridge Partners and the Partnership, on behalf of the Series AC, will enter into Facility C1; (d) The Series AC will draw under Facility B1 an amount equal to 66.67% of 45% of the Preliminary Alberta Clipper Construction Costs and Enbridge Partners will draw an identical amount under Facility A1; and (e) The Series AC will draw under Facility C1 an amount equal to 33.33% of 45% of the Preliminary Alberta Clipper Construction Costs. Section 2.3 Repayment of Certain Series AC Liabilities. Immediately following the Transactions described in Sections 2.1 and 2.2, and subject to the other terms and conditions of this Agreement, the Series AC will use the immediately available U.S. dollars contributed by EECI, EECI Sub, Enbridge Partners, Lakehead GP and Wisconsin GP, together with the proceeds from its initial draws under Facility B1 and Facility C1, to repay in full the Intercompany Preliminary Construction Cost Payable. ARTICLE III COVENANTS AND CLOSING CONDITIONS Section 3.1 Covenants of the Parties. Each of the Parties agrees to use its reasonable best efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary, proper or advisable under applicable Law or otherwise to consummate and make effective the Transactions on the Closing Date, including using their reasonable best efforts to satisfy the conditions to Closing set forth in this Article III. Each of the Parties will furnish to the other Parties such necessary information and reasonable assistance as such other Parties may reasonably request in connection with the foregoing obligations. Section 3.2 Closing Conditions of the EEP Parties. The obligation of the EEP Parties to consummate the Transactions is subject, at the option of the EEP Parties, to the satisfaction at or prior to the Closing of all of the following conditions: (a) Transaction Documents. The EECI Parties shall have executed and delivered (or caused to be executed and delivered) all Transaction Documents that the EECI Parties are required to execute and deliver to the EEP Parties under Section 4.3; (b) No Action. No action, proceeding or litigation (excluding any action, proceeding or litigation initiated by the EEP Parties or any of their respective Affiliates)   5 shall be pending or threatened before any Governmental Authority seeking to enjoin or restrain the consummation of the Transactions or recover damages from any EEP Party or any Affiliate of an EEP Party resulting therefrom; (c) No Existing Order. No Order shall have been entered and be in effect, and no Law shall have been promulgated or enacted and be in effect, that restrains, enjoins or invalidates this Agreement or the consummation of the Transactions; (d) Consents. All consents, licenses and approvals from all third parties or Governmental Authorities (other than such consents, licenses and approvals the failure of which to obtain or with which to comply would not reasonably be expected to have a Material Adverse Effect with respect to the EEP Parties or a material adverse effect with respect to the EECI Parties) that are necessary or appropriate for the EECI Parties or the EEP Parties to consummate the Transactions shall have been obtained; (e) Fairness of Transactions. The Special Committee shall not have withdrawn or qualified its approval of this Agreement and the Transactions; (f) Contributions. The Partnership in respect of the Series AC shall have received the Capital Contributions from EECI and EECI Sub as described in Section 2.1; and (g) Borrowings. EECI shall have made available sufficient funds for Enbridge Partners to draw under Facility A1. Section 3.3 Closing Conditions of the EECI Parties. The obligation of the EECI Parties to consummate the Transactions is subject, at the option of the EECI conditions: (a) Transaction Documents. The EEP Parties shall have executed and delivered (or caused to be executed and delivered) all Transaction Documents that the EEP Parties are required to execute and deliver to the EECI Parties under Section 4.2; proceeding or litigation initiated by the EECI Parties or any of their respective Affiliates) shall be pending or threatened before any Governmental Authority seeking to enjoin or restrain the consummation of the Closing or recover damages from any EECI Party or any Affiliate of an EECI Party resulting therefrom;   6 (e) No Material Adverse Effect. There shall have been no Material Adverse Effect since the date of this Agreement; (f) Fairness of Transactions. The Special Committee shall not have withdrawn or (g) Contributions. The Partnership in respect of the Series AC shall have received the Capital Contributions from Enbridge Partners, Lakehead GP and Wisconsin GP as described in Section 2.1; and (h) Borrowings. The Partnership, on behalf of the Series AC, shall have drawn the amounts under Facility B1 and Facility C1 and Enbridge Partners shall have drawn the amount under Facility A1, each as described in Section 2.2. ARTICLE IV CLOSING AND TERMINATION Section 4.1 Closing. Subject to the satisfaction of the conditions set forth in Sections 3.1 and 3.2 (or waiver thereof by the party entitled to the benefit thereof), the Closing shall be held on the Closing Date at 10:00 a.m., local time, at the office of Vinson & Elkins L.L.P., First City Tower, 1001 Fannin, Suite 2500, Houston, Texas, or at such other time or place as the Parties may otherwise agree in writing. For all intents and purposes, the Closing shall be deemed effective at 12:01 a.m. on the Closing Date. Section 4.2 The EEP Parties’ Closing Obligations. At Closing, Enbridge Partners shall deliver, or cause to be delivered, to the EECI Parties, the other EEP Parties or to the Partnership in respect of Series AC, as applicable, the following: (a) the Amended and Restated Partnership Agreement, duly executed by each of Enbridge Partners, Lakehead GP and Wisconsin GP evidencing, among other things, the issuance of (i) a 0.0005% General Partner Interest in the Series AC to Lakehead GP, (ii) a 0.0005% General Partner Interest in the Series AC to Wisconsin GP, (iii) a 33.329% Limited Partner Interest in the Series AC to Enbridge Partners, (iv) a 66.66% Limited Partner Interest in the Series AC to EECI and (v) a 0.01% Limited Partner Interest in the Series AC to EECI Sub; (b) a copy of the Partnership’s amended and restated certificate of limited partnership, certified as of a recent date by the Secretary of State of the State of Delaware, that contains a notice that the Partnership is a series limited partnership; (c) Facility A1, duly executed by Enbridge Partners; (d) Facility B1, duly executed by the Partnership, on behalf of the Series AC; (e) Facility C1, duly executed by the Partnership, on behalf of the Series AC;   7 (f) immediately available U.S. dollars in an amount equal to 33.33% of 55% of the Preliminary Alberta Clipper Construction Costs (of which 0.005% shall be delivered on behalf of Lakehead GP and 0.005% shall be delivered on behalf of Wisconsin GP); and (g) any other agreements, instruments and documents that are otherwise necessary and appropriate to consummate the Transactions that may be reasonably requested by the EECI Parties. Section 4.3 EECI Parties’ Closing Obligations. At Closing, EECI shall deliver, or cause to be delivered, to the EEP Parties or to the Partnership in respect of Series AC, as applicable, the following: (a) the Amended and Restated Partnership Agreement, duly executed by EECI and EECI Sub; (b) Facility A1, duly executed by EECI; (c) immediately available U.S. dollars in an amount equal to 66.67% of 55% of the Preliminary Alberta Clipper Construction Costs (of which 0.01% shall be delivered on behalf of EECI Sub); and (d) any other agreements, instruments and documents that are otherwise necessary by the EEP Parties. Section 4.4 Termination of Agreement. This Agreement may be terminated prior to the Closing only under the following conditions: (a) at the election of Enbridge Partners (with the prior approval of the Special Committee) or EECI on or after August 31, 2009, if the Closing shall not have occurred by the close of business on such date, provided, that the terminating Party is not then in material default of any of its obligations hereunder; (b) by mutual written consent of Enbridge Partners (with the prior approval of the Special Committee) and EECI; (c) by written notice from (i) EECI to Enbridge Partners that there has been an event, change, occurrence or circumstance that has had or would reasonably be expected to have a Material Adverse Effect or (ii) Enbridge Partners (with the prior approval of the Special Committee) to EECI that there has been an event, change, occurrence or circumstance that has had or would reasonably be expected to have a material adverse effect on EECI’s ability to consummate the Transactions; or (d) by Enbridge Partners (with the prior approval of the Special Committee) or EECI if there shall be in effect a final nonappealable Order of a Governmental Authority of competent jurisdiction restraining, enjoining or otherwise prohibiting the consummation of the Transactions.   8 Section 4.5 Procedure Upon and Effect of Termination. In the event of termination of this Agreement under Section 4.4 other than by the mutual written consent of Enbridge Partners (with the prior approval of the Special Committee) and EECI, written notice of termination shall promptly be delivered by the terminating Party to the other Parties. This Agreement shall terminate immediately upon delivery of such notice or upon such mutual written consent, as applicable, and the Transactions shall be abandoned without liability to, or further action by, any of the Parties; provided, that no such termination shall relieve any Party from liability for any breach of this Agreement that occurred ARTICLE V LIMITATIONS Section 5.1 Disclaimer of Warranties and Representations. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN ANY OTHER PROVISION OF THIS AGREEMENT, IT IS THE EXPLICIT INTENT OF EACH PARTY HERETO THAT NO PARTY IS MAKING ANY REPRESENTATION OR WARRANTY WHATSOEVER TO ANY OTHER PARTY, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE. Section 5.2 Damages. NOTWITHSTANDING ANYTHING CONTAINED TO THE CONTRARY IN ANY OTHER PROVISION OF THIS AGREEMENT, EACH PARTY HEREBY AGREES THAT THE RECOVERY BY ANY PARTY HERETO OF ANY DAMAGES OR OTHER LIABILITIES SUFFERED OR INCURRED BY IT AS A RESULT OF ANY BREACH BY THE OTHER PARTY OF ANY OF ITS OBLIGATIONS UNDER THIS AGREEMENT SHALL BE LIMITED TO THE ACTUAL DAMAGES AND/OR LIABILITIES SUFFERED OR INCURRED BY THE NON-BREACHING PARTY AS A RESULT OF THE BREACH BY THE BREACHING PARTY OF ITS OBLIGATIONS HEREUNDER AND IN NO EVENT SHALL THE BREACHING PARTY BE LIABLE TO THE NON-BREACHING PARTY FOR ANY INDIRECT, CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES (INCLUDING ANY DAMAGES ON ACCOUNT OF LOST PROFITS OR OPPORTUNITIES OR BUSINESS INTERRUPTION) SUFFERED OR INCURRED BY THE NON-BREACHING PARTY AS A RESULT OF THE BREACH BY THE BREACHING PARTY OF ANY OF ITS OBLIGATIONS HEREUNDER. ARTICLE VI MISCELLANEOUS Section 6.1 Headings; References; Interpretation. All Article and Section headings in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any of the provisions of this import, when used in this Agreement, shall refer to this Agreement as a whole, including, without limitation, all Exhibits attached to this Agreement, and not to any particular provision of this Agreement. All references herein to Articles, Sections and Exhibits shall, unless the context requires a different construction, be deemed to be references to the Articles and Sections of this Agreement and the Exhibits attached   9 to this Agreement, and all such Exhibits attached to this Agreement are hereby incorporated herein and made a part hereof for all purposes. All singular nouns or pronouns shall include the plural and vice versa. Section 6.2 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. The EEP Parties may not assign this Agreement or any rights or obligations hereunder without the prior written consent of EECI, which consent shall not be unreasonably withheld, conditioned, or delayed. The EECI Parties may not assign this Agreement or any rights or obligations hereunder without the prior written consent of Enbridge Partners (subject to the prior approval of the Special Committee), which consent shall not be unreasonably withheld, conditioned, or delayed. Section 6.3 Third Party Rights. The provisions of this Agreement are intended to bind the Parties as to each other and are not intended to and do not create rights in any other person or confer upon any other person any benefits, rights or remedies and no other person is or is intended to be a third party beneficiary of any of the provisions of this Agreement. Section 6.4 Counterparts. This Agreement may be executed in any number of counterparts, all of which together shall constitute one and the same agreement binding on the Parties. Section 6.5 Governing Law. This Agreement shall be governed by, and construed in accordance with, the Laws of the State of Texas applicable to contracts made and to be performed wholly within such state without giving effect to conflict of law principles thereof. Each of the Parties hereto hereby submits to the non-exclusive jurisdiction of the United States District Court for the Southern District of Texas, Houston Division, or in the event there is no applicable federal jurisdiction, to the non-exclusive jurisdiction of any state court of competent jurisdiction located in Houston, Texas, for the purposes of all legal proceedings arising out of or relating to this Agreement. Each of the Parties hereby irrevocably waives, to the fullest extent permitted by Law, any objection proceeding brought in such a court and any claim that any such proceeding brought in such a court has been brought in an inconvenient forum. Section 6.6 Severability. If any of the provisions of this Agreement are held by any court of competent jurisdiction to contravene, or to be invalid under, the Laws of any Governmental Authority having jurisdiction over the subject matter hereof, such contravention or invalidity shall not invalidate the entire Agreement. Instead, this Agreement shall be construed as if it did not contain the particular provision or provisions held to be invalid and an equitable adjustment shall be made and necessary provision added so as to give effect to the intention of the Parties as expressed in this Agreement at the time of Section 6.7 Amendment or Modification. This Agreement may be amended or modified from time to time only by the written agreement of all the Parties; provided that any amendment or modification agreed to by the EEP Parties that would adversely affect any of the EEP Parties (to be determined in the sole discretion of the general partner of the Partnership generally) shall be subject to the prior approval of the Special Committee. Each such instrument shall be reduced to writing and shall be designated on its face as an Amendment to this Agreement.   10 Section 6.8 Waiver of Compliance; Consents. Any failure of any of the Parties to comply with any obligation, covenant, agreement or condition herein may be waived by the Party entitled to the benefits thereof only by a written instrument signed by the Party granting such waiver, but such waiver or failure to insist upon strict compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure. Any waiver granted by any EEP Party that would prior approval of the Special Committee. Section 6.9 Notices. All notices and other communications hereunder shall be in writing and shall be deemed given if delivered personally or by facsimile transmission, or mailed by a nationally recognized overnight courier or registered or certified mail (return receipt requested), postage prepaid, to the Parties at the following addresses: If to the EECI Parties, to: Enbridge Inc. 3000 Fifth Avenue Place 425 – 1st Street S.W. Calgary, Alberta T2P 3L8 Canada Attention: Group Vice-President, Corporate Law Facsimile: 403-231-3920 If to the EEP Parties, to: Enbridge Energy Partners, L.P. 1100 Louisiana Street, Suite 3300 Houston, Texas 77001 Attention: Vice President—Law and Deputy General Counsel Facsimile: 713-821-2000 Section 6.10 Integration. This Agreement and the other Transaction Documents supersede all previous understandings or agreements among the Parties, whether oral or written, with respect to their subject matter. This document and such other Transaction Documents contain the entire understanding of the Parties with respect to the subject matter hereof and thereof. No understanding, representation, promise or agreement, whether oral or written, is intended to be or shall be included in or form part of this Agreement unless it is contained in a written amendment hereto executed by the Parties after the date of this Agreement.   11 IN WITNESS WHEREOF, this Agreement has been duly executed by the Parties as of   ENBRIDGE ENERGY, LIMITED PARTNERSHIP By:   ENBRIDGE PIPELINES (LAKEHEAD), L.L.C.   its general partner By:   /s/ Mark A. Maki Name:   Mark A. Maki Title:   Vice President, Finance and Accounting By:   ENBRIDGE PIPELINES (WISCONSIN) INC.,   its general partner By:   Name:   Mark A. Maki Title:   Vice President, Finance and Accounting ENBRIDGE ENERGY PARTNERS, L.P. By:   ENBRIDGE ENERGY MANAGEMENT, L.L.C.,   as delegate of authority of Enbridge Energy Company, Inc., its general partner By:   /s/ Terrance L. McGill Name:   Terrance L. McGill Title:   President ENBRIDGE PIPELINES (LAKEHEAD) L.L.C. By:   [Signature Page – Contribution Agreement of Enbridge Energy, Limited Partnership] ENBRIDGE PIPEINES (WISCONSIN) INC. By:   ENERGY COMPANY, INC. By:   /s/ Stephen J.J. Letwin Name:   Stephen J.J. Letwin Title:   Managing Director ENBRIDGE PIPELINES (ALBERTA CLIPPER) L.L.C. By:   Name:   Stephen J.J. Letwin Title:   Managing Director EXHIBIT A FORM OF AMENDED AND RESTATED PARTNERSHIP AGREEMENT THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF ENBRIDGE ENERGY, LIMITED PARTNERSHIP TABLE OF CONTENTS   ARTICLE I    DEFINITIONS    1 Section 1.1    Definitions.    1 Section 1.2    Construction.    17 ARTICLE II    ORGANIZATION    17 Section 2.1    Continuation.    17 Section 2.2    Name.    17 Section 2.3    Principal Office; Registered Office.    17 Section 2.4    Purpose and Business.    18 Section 2.5    Powers.    18 Section 2.6    Term.    18 Section 2.7    Title to Partnership Assets.    18 ARTICLE III    ESTABLISHMENT AND DESIGNATION OF SERIES    18 Section 3.1    Establishment and Designation of Series.    18 Section 3.2    Series AC.    19 Section 3.3    Series LH.    20 Section 3.4    Allocation Among Series.    21 Section 3.5    No Transfer or Sale.    22 ARTICLE IV    TRANSFER OF PARTNERSHIP INTERESTS; RIGHT OF FIRST REFUSAL; TAG-ALONG RIGHTS    22 Section 4.1    Transfers Generally.    22 Section 4.2    General Restrictions on Transfers of Partnership Interests.    23 Section 4.3    Additional Restrictions on Transfers of Partnership Interests.    23 Section 4.4    Right of First Refusal.    24 Section 4.5    Tag-Along Rights.    26 Section 4.6    Transfers of Certain Partnership Assets—ROFR.    27 Section 4.7    Specific Performance.    29 ARTICLE V    CONVERSION; CAPITAL CONTRIBUTIONS; PARTNERSHIP INTERESTS; FUTURE CAPITAL REQUIREMENTS    29 Section 5.1    Conversion of Prior Partnership Interests.    29 Section 5.2    Series LH Capital Contributions.    30 Section 5.3    Initial Series AC Capital Contributions and Initial Debt Financing.    30 Section 5.4    Additional Series AC Capital Contributions.    30 Section 5.5    Additional Debt Financing.    34 Section 5.6    Future Alberta Contributions.    36 Section 5.8    Capital Accounts.    36 ARTICLE VI    ALLOCATIONS AND DISTRIBUTIONS    37 Section 6.1    Allocations for Capital Account Purposes.    37   i Section 6.2    Requirement and Characterization of Series AC Distributions; Distributions to Series AC Partners.    40 Section 6.3    Distributions to Series LH Partners.    41 ARTICLE VII    MANAGEMENT AND OPERATION OF BUSINESS; LIMITED PARTNERS    41 Section 7.1    Management.    41 Section 7.2    Certificate of Limited Partnership.    42 Section 7.3    Restrictions on the Managing General Partners’ Authority.    43 Section 7.4    Series AC Annual Budget.    45 Section 7.5    Collection of Series AC Revenue Entitlement.    45 Section 7.6    Compensation of General Partners.    46 Section 7.7    Indemnification.    46 Section 7.8    Interseries Indemnification.    47 Section 7.9    Liability of Indemnitees.    48 Section 7.10    Limitation of Liability.    48 Section 7.11    Management of Business.    49 Section 7.12    Outside Activities of the Limited Partners.    49 Section 7.13    Reliance by Third Parties.    49 Section 7.14    Managing General Partner.    50 Section 7.15    Conflicts of Interest.    50 Section 7.16    Shared Use of Shared Assets.    50 ARTICLE VIII    BOOKS, RECORDS AND ACCOUNTING    51 Section 8.1    Records and Accounting.    51 Section 8.2    Fiscal Year.    51 ARTICLE IX    TAX MATTERS    51 Section 9.1    Tax Returns.    51 Section 9.2    Partner Tax Return Information.    51 Section 9.3    Tax Elections.    52 Section 9.4    Tax Controversies.    52 Section 9.5    Withholding.    53 Section 9.6    Tax Reimbursement.    53 Section 9.7    Tax Partnership.    53 Section 9.8    Tax Matters Following a Fundamental Change.    54 ARTICLE X    OTHER EVENTS    54 Section 10.1    Fundamental Change.    54 Section 10.2    Surcharge Expiration.    56 ARTICLE XI    DISSOLUTION AND LIQUIDATION    57 Section 11.1    Dissolution of the Partnership.    57 Section 11.2    Termination of a Series.    58 Section 11.3    Winding Up, Liquidation and Distribution of Assets of the Partnership or a Series Upon Dissolution of the Partnership or Termination of Such Series.    58   ii Section 11.4    Cancellation of Certificate of Limited Partnership.    59 Section 11.5    Return of Capital Contributions.    60 Section 11.6    Waiver of Partition.    60 Section 11.7    Capital Account Restoration.    60 ARTICLE XII    AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE; MERGER    60 Section 12.1    Amendment.    60 Section 12.2    Amendment Requirements.    60 Section 12.3    Voting Rights.    61 Section 12.4    Meetings.    61 Section 12.5    Place of Meetings.    61 Section 12.6    Notice of Meetings.    61 Section 12.7    Quorum.    61 Section 12.8    Proxies.    62 Section 12.9    Action Without a Meeting.    62 Section 12.10    Waiver of Notice.    62 Section 12.11    Merger, Consolidation and Conversion.    62 ARTICLE XIII    GENERAL PROVISIONS    63 Section 13.1    Addresses and Notices; Written Communications.    63 Section 13.2    Further Action.    64 Section 13.3    Binding Effect.    64 Section 13.4    Integration.    64 Section 13.5    Creditors.    64 Section 13.6    Waiver.    64 Section 13.7    Counterparts.    65 Section 13.8    Applicable Law.    65 Section 13.9    Invalidity of Provisions.    65 Section 13.10    Consent of Partners.    65 Section 13.11    Third Party Beneficiaries.    65 EXHIBITS       Exhibit A:    Initial Partnership Interests    Exhibit B:    Exclusive Series AC Assets    Exhibit C:    Shared Assets      iii THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF ENBRIDGE ENERGY, LIMITED PARTNERSHIP THIS THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP, dated as of [            ], 2009, is entered into by and among Enbridge Pipelines (Lakehead) L.L.C., a Delaware limited liability company (“Lakehead GP”), and Enbridge Pipelines (Wisconsin) Inc., a Wisconsin corporation (“Wisconsin GP”), each as a general partner of the Partnership with respect to the applicable Series as set forth opposite its name on Exhibit A and, in the case of Lakehead GP, as a general partner of the Partnership generally, and Enbridge Energy Company, Inc., a Delaware corporation (“EECI”), Enbridge Pipelines (Alberta Clipper) L.L.C., a Delaware limited liability company (“EECI Sub”), and Enbridge Energy Partners, L.P., a Delaware limited partnership (“Enbridge Partners”), each as a limited partner of the Partnership with respect to the applicable Series set forth opposite its name on Exhibit A, together with any other Persons who become Partners in the Partnership associated with any Series or the Partnership generally as provided herein. WHEREAS, Lakehead GP, Wisconsin GP and Enbridge Partners entered into that Second Amended and Restated Agreement of Limited Partnership of Enbridge Energy, Limited Partnership on October 17, 2002, as amended on September 7, 2007 (as so amended, the “Prior Agreement”); and WHEREAS, the parties hereto have determined it to be in their respective best interests to establish and designate two separate series of partnership interests and related assets and liabilities of the Partnership in accordance with Section 17-218 of the Delaware Act, one of which is related to the Alberta Clipper Project and the other of which is related to all other assets of the Partnership, and to amend and restate the Prior Agreement in its entirety; NOW, THEREFORE, in consideration of the covenants, conditions and agreements contained herein, the parties hereto do hereby amend and restate the Prior Agreement to provide in its entirety as set forth below: ARTICLE I DEFINITIONS Section 1.1 Definitions. The following definitions shall be for all purposes, unless otherwise clearly indicated to the contrary, applied to the terms used in this Agreement. “154-B Model” means the FERC Opinion No. 154-B model estimate relating to the Alberta Clipper Surcharge on file with the FERC from time to time. “Additional Series AC Capital Contribution” has the meaning assigned to such term in Section 5.4(a). “Adjusted Capital Account” means the Series Capital Account maintained for a Partner with respect to a Series, (i) increased by any amounts that such Partner is obligated to restore or is treated as obligated to restore under Treasury Regulation Sections 1.704-1(b)(2)(ii)(c), 1.704-2(g)(1) and 1.704-2(i)(5) and (ii) decreased by any amounts described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6) with respect to such Partner.   1 “Affiliate” means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with the Person in question. As used herein, the term “control” means the possession, direct or indirect, of the power to direct or the ownership of voting securities, by contract or otherwise. For the purposes of this Agreement, (i) with respect to Enbridge Partners and its Subsidiaries, the term “Affiliate” shall exclude Enbridge Inc. and each of its Subsidiaries (other than Enbridge Partners and its Subsidiaries) and (ii) with respect to Enbridge Inc. and its Subsidiaries (other than Enbridge Partners and its Subsidiaries), the term “Affiliate” shall exclude Enbridge Partners and each of its Subsidiaries. “Agreed Value” of property contributed by a Partner to the Partnership with respect to a Series means the fair market value of such property or other consideration at the time of contribution as reasonably determined by the Managing General Partner of such Series. The Managing General Partner of such Series shall use such method as it determines to be appropriate to allocate the aggregate Agreed Value of properties contributed by a Partner to the Partnership with respect to a Series in a single or integrated transaction among each separate property on a basis proportional to the fair market value of each contributed property. “Agreement” means this Third Amended and Restated Agreement of Limited Partnership of Enbridge Energy, Limited Partnership, including all exhibits hereto, as it may be amended, supplemented or restated from time to time. “Alberta Clipper Expansion Budget” means a budget and forecast approved by a Majority in Interest of Series AC Partners and setting forth the anticipated revenues and expenses for any Alberta Clipper Expansion Project that has been designated as a Series AC Asset, including any anticipated growth capital expenditures, maintenance capital expenditures, revenues, Capital Contributions and distributions related to such Alberta Clipper Expansion Project. “Alberta Clipper Expansion Capital Requirement” has the meaning assigned to such term in Section 5.6(b). “Alberta Clipper Expansion Project” has the meaning assigned to such term in Section 5.6(a). “Alberta Clipper Expansion Project Terms” has the meaning assigned to such term in Section 5.6(a). “Alberta Clipper Expansion Proposal” has the meaning assigned to such term in “Alberta Clipper Expansion Series” has the meaning assigned to such term in Section 5.6(d).   2 “Alberta Clipper Project” means (a) the U.S. segment of the proposed 36-inch diameter crude oil pipeline that will extend from Hardisty, Alberta to Superior, Wisconsin, with an initial annual capacity of 450,000 barrels per day and (b) related terminals, interconnections, tanks and pump stations located within the United States, each as more fully described in the FERC Settlement Offer. “Alberta Clipper Surcharge” means the tariff surcharge related to the Alberta Clipper Project approved by the FERC by letter dated August 28, 2008 (124 FERC ¶ 61,200 (2008)) as described in the FERC Settlement Offer. “Book Value” means, with respect to any property associated with a Series, such property’s adjusted basis for U.S. federal income tax purposes, except as follows: (a) the initial Book Value of any property contributed by a Partner to the Partnership with respect to a Series shall be the Agreed Value of such property; (b) the Book Values of all properties of a Series shall be adjusted to equal their respective fair market values as determined by the Managing General Partner of such Series in connection with (i) the acquisition of an interest in such Series by any new or existing Partner in exchange for more than a de minimis capital contribution, (ii) the distribution to a Partner of more than a de minimis amount of property of a Series as consideration for an interest in such Series, (iii) the grant of an interest in such Series (other than a de minimis interest) as consideration for the provision of services to or for the benefit of such Series by an existing Partner acting in a Partner capacity, or by a new Partner acting in a Partner capacity or in anticipation of becoming a Partner, (iv) the liquidation of the Partnership or any Series within the meaning of Treasury Regulation Section 1.704-1(b)(2)(ii)(g)(1) (other than pursuant to Section 708(b)(1)(B) of the Code), or (v) any other event to the extent determined by the Managing General Partner of such Series to be necessary to properly reflect Book Values in accordance with the standards set forth in Treasury Regulation Section 1.704-1(b)(2)(iv)(q); (c) the Book Value of any property of a Series distributed to a Partner shall be the fair market value of such property as reasonably determined by the Managing General Partner of such Series; and (d) the Book Values of all properties of a Series shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such property 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 attributable to such Series pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m) and clause (f) of the definition of Profits and Losses or Section 6.1(b)(viii); provided, however, Book Value shall not be adjusted pursuant to this clause (d) to the extent the Managing General Partner of such Series reasonably determines that an adjustment pursuant to clause (b) hereof is necessary or appropriate in connection with the transaction that would otherwise result in an adjustment pursuant to this clause (d).   3 If the Book Value of any property has been determined or adjusted pursuant to clauses (b) or (d) hereof, such Book Value shall thereafter be adjusted by the Depreciation taken into account with respect to such property for purposes of computing Profits and Losses and other items allocated pursuant to Article VI. “Business Day” means Monday through Friday of each week, except that a legal holiday recognized as such by the government of the United States of America or the State of Texas shall not be regarded as a Business Day. “Capital Account” means the capital account maintained for a Partner pursuant to Section 5.8. “Capital Contribution” means, with respect to any Partner, the amount of money and the Net Agreed Value of any property contributed by such Partner to the Partnership with respect to a Series. Any reference in this Agreement to the Capital Contribution of a Partner shall include its pro rata share of any Capital Contribution of its predecessors in interest. “Certificate of Limited Partnership” means the Certificate of Limited Partnership of the Partnership filed with the Secretary of State of the State of Delaware as referenced in Section 7.2, as such Certificate of Limited Partnership may be amended, supplemented or restated from time to time. “Claims” has the meaning assigned to such term in Section 7.7(a). “Closing Date” means [            ], 2009. “Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time. All references herein to sections of the Code shall include any corresponding provision or provisions of succeeding law. “Control Option” has the meaning assigned to such term in Section 10.1(b). “Damages” has the meaning assigned to such term in Section 7.7(a). “Default Capital Contribution” has the meaning assigned to such term in Section 5.4(e). “Defaulting Series AC Partner” has the meaning assigned to such term in “Defaulting Series AC Partner Obligation” has the meaning assigned to such term in Section 5.4(e)(ii)(B). “Delaware Act” means the Delaware Revised Uniform Limited Partnership Act, 6 Del C. Section 17-101, et seq., as amended, supplemented or restated from time to time, and any successor to such statute.   4 “Depreciation” means, for each taxable year, an amount equal to the depreciation, amortization or other cost recovery deduction allowable for U.S. federal income tax purposes with respect to property for such taxable year, except that with respect to any property the Book Value of which differs from its adjusted tax basis for U.S. federal income tax purposes, Depreciation for such taxable year shall be the amount of book basis recovered for such taxable year under the rules prescribed by Treasury Regulation Section 1.704-3(d)(2). “Economic Risk of Loss” has the meaning assigned to such term in Treasury Regulation Section 1.752-2(a). Agreement. “Enbridge Inc.” means Enbridge Inc., a Canadian corporation. this Agreement. “Enbridge Partners Long-Term Indebtedness” has the meaning assigned to such term in Section 5.5(c). “Enbridge Pipelines Inc.” means Enbridge Pipelines Inc., a Canadian corporation. “Entity” means a corporation, firm, limited liability company, partnership (general or limited), joint venture, trust, business trust, unincorporated organization, cooperative, association or other legal entity. “Exclusive Series AC Assets” means all assets and rights related exclusively to the Alberta Clipper Project, including the assets and rights set forth as “Exclusive Series AC Assets” on Exhibit B hereto. “Existing Indebtedness” means Indebtedness of the Partnership or Enbridge Partners or both existing on the Closing Date. “Facility A1” means the credit facility designated as the A1 Credit Agreement, dated the Closing Date, by and between EECI and Enbridge Partners, as it may be amended, supplemented or restated from time to time. “Facility B1” means the credit facility designated as the B1 Credit Agreement, dated the Closing Date, by and between Enbridge Partners and the Partnership, on behalf of the Series AC, as it may be amended, supplemented or restated from time to time. “Facility C1” means the credit facility designated as the C1 Credit Agreement, behalf of Series AC, as it may be amended, supplemented or restated from time to time. “FERC” means the U.S. Federal Energy Regulatory Commission.   5 “FERC Settlement Offer” means the Offer of Settlement of the Partnership filed with the FERC, on June 27, 2008 in Docket No. OR08-12-000. “Fundamental Change” has the meaning assigned to such term in Section 10.1(a). “General Partner” means a general partner of the Partnership generally or any Series, as applicable. “General Partner Interest” means the Partnership Interest of a General Partner in the Partnership generally or with respect to a Series (in its capacity as a General Partner without reference to any Limited Partner Interest held by it). amended. “In-Service Date” means the “In-Service Date” (as such term is used in the Tariff Term Sheet) of the Alberta Clipper Project. “Indebtedness” means (a) debt for money borrowed and similar monetary obligations evidenced by bonds (excluding surety and performance bonds), notes, debentures or other similar instruments, (b) reimbursement obligations with respect to letters of credit and (c) guaranties, endorsements and other contingent obligations whether direct or indirect in respect of liabilities of others of any of the types described in clauses (a) and (b) above (other than endorsements for collection or deposit in the ordinary course of business). For the avoidance of doubt, the term “Indebtedness” excludes trade accounts payable in the ordinary course of business. “Indemnified Series” has the meaning assigned to such term in Section 7.8. “Indemnifying Series” has the meaning assigned to such term in Section 7.8. “Indemnitee” means, with respect to a Series, (a) any Person who is or was a General Partner of such Series or a General Partner of the Partnership generally, (b) any Person who is or was a delegate of any such General Partner, (c) any Person who is or was an Affiliate of any such General Partner or delegate, (d) any Person who is or was a member, partner, director, officer, fiduciary or trustee of any such General Partner or delegate and (e) any Person who is or was serving at the request of any such General Partner or delegate or any Affiliate of any such General Partner or delegate as an officer, director, member, partner, fiduciary or trustee of another Person; provided that a Person shall not be an Indemnitee by reason of providing, on a fee-for-services basis, trustee, fiduciary or custodial services. “Initial Debt Financing” means the borrowings incurred under Facility B1 and Facility C1 on the Closing Date as described in Section 5.3(b). in Section 5.3(a).   6 “Intercompany Obligations” means the Liabilities incurred, assumed or otherwise contracted for between Enbridge Partners or any Material Subsidiary of Enbridge Partners, on the one hand, and the Partnership generally or any Series, on the other hand. “Intercompany Preliminary Construction Cost Payable” means outstanding Indebtedness of the Partnership arising from intercompany borrowings by the Partnership from Enbridge Partners in an aggregate principal amount equal to the Preliminary Alberta Clipper Construction Costs. Agreement. “Lakehead System” means the crude oil and liquid petroleum pipeline, owned by the Partnership (and associated with one or more Series) and regulated by the FERC, that extends from the U.S.-Canadian border near Neche, North Dakota extending through the upper and lower Great Lakes region of the U.S. and re-entering Canada near Marysville, Michigan with an extension across the Niagara River into the Buffalo, New York area, as such pipeline may be extended or modified from time to time, including by the Alberta Clipper Project. “Lending Series AC Partner” has the meaning assigned to such term in Section 5.4(e)(ii). “Liability” means any debt, liability, expense or other obligation. “Limited Partner” means any limited partner of the Partnership generally or of any Series, as applicable. “Limited Partner Interest” means the Partnership Interest of a Limited Partner limited partner without reference to any General Partner Interest held by it). “Liquidation Date” means (a) in the case of an event giving rise to the dissolution of the Partnership or termination of a Series of the type described in Sections 11.1(a)(iv), 11.1(a)(v) or 11.2(a)(iv), the date on which the applicable time period during which the Partners have the right to elect to continue the business of the Partnership or Series, as applicable, has expired without such an election being made and (b) in the case of any other event giving rise to the dissolution of the Partnership or termination of a Series, the date on which such event occurs. “Long-Term Debt Financing” means the Indebtedness of the Series AC to Enbridge Partners on substantially the same terms as the Enbridge Partners Long-Term Indebtedness that is used to refinance the outstanding borrowings of the Series AC under Facility B1 and Facility C1 as described in Section 5.5(c) and (d). “Majority in Interest” means, with respect to a Series, one or more Partners of such Series holding Partnership Interests in such Series that in the aggregate exceed fifty percent (50%) of all Percentage Interests owned by Partners of such Series. “Managing General Partner” has the meaning assigned to such term in Section 7.14.   7 “Material Subsidiary of Enbridge Partners” means any Subsidiary of Enbridge Partners that directly or through one or more of its Subsidiaries (i) owns assets with a book value equal to 10% or more of the book value of the consolidated assets of Enbridge Partners and its consolidated Subsidiaries, (ii) contributed 10% or more of consolidated operating income for any fiscal quarter during the four fiscal quarters most recently ended of Enbridge Partners and its Consolidated Unrestricted Subsidiaries (as defined in the Partnership’s Second Amended and Restated Credit Facility dated as of April 4, 2007, as amended), or (iii) is a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act as such Regulation is in effect on any date of determination. “Maximum Commitment” means, with respect to a Series AC Partner, the amount set forth opposite such Series AC Partner’s name on Exhibit A in the column entitled “Maximum Commitment.” “Maximum Permitted Delegation” has the meaning assigned to such term in Section 10.1(a). “Minimum Gain” has the meaning assigned to the term “partnership minimum gain” in Treasury Regulation Section 1.704-2(d). “Monthly Capital Requirement” has the meaning assigned to such term in Section 5.4(b). “Net Agreed Value” means, (a) in the case of any property contributed by a Partner to the Partnership with respect to a Series, the Agreed Value of such property reduced by any liabilities either assumed by such Series upon such contribution or to which such property is subject when contributed and (b) in the case of any property of a Series distributed to a Partner, the Book Value of such property at the time such property is distributed, reduced by any indebtedness either assumed by such Partner upon such distribution or to which such property is subject at the time of distribution, in either case, as determined under Section 752 of the Code. “New AC Entity” means a new Entity controlled by EECI or its designee, formed for the purpose of owning and operating the Series AC Assets following any exercise of the Separation Option. “Non-Defaulting Series AC Partner” has the meaning assigned to such term in “Nonrecourse Deductions” has the meaning assigned to such term in Treasury Regulation Section 1.704-2(b). “Note Agreement” has the meaning assigned to such term in Section 3.2(d). “Offered Interests” has the meaning assigned to such term in Section 4.4(a). “Offering Partner” has the meaning assigned to such term in Section 4.4(a). “Omnibus Agreement” means the Omnibus Agreement, dated October 17, 2002, by and among EECI, Enbridge Partners and Enbridge Pipelines Inc.   8 “Partner Nonrecourse Debt” has the meaning assigned to such term in Treasury Regulation Section 1.704-2(b)(4). “Partner Nonrecourse Debt Minimum Gain” has the meaning assigned to such term in Treasury Regulation Section 1.704-2(i)(2). “Partner Nonrecourse Deductions” has the meaning assigned to such term in Treasury Regulation Section 1.704-2(i)(1). “Partners” means the General Partners and the Limited Partners. “Partnership” means Enbridge Energy, Limited Partnership, a Delaware limited partnership, formed on October 9, 1991 pursuant to the Delaware Act upon the filing of the Certificate of Limited Partnership in the office of the Secretary of State of the State of Delaware and the entry into the Agreement of Limited Partnership of the Partnership dated October 9, 1991. “Partnership generally” means, with respect to the Partnership, the “limited partnership generally” as such phrase is used in Section 17-218 of the Delaware Act. “Partnership Interest” means a partnership interest in the Partnership generally or with respect to a Series, which shall include General Partner Interests and Limited Partner Interests. “Percentage Interest” means, with respect to any Partner of a Series, the Percentage Interest set forth opposite such Partner’s name for such Series on Exhibit A. The Percentage Interests of the Partners of any Series shall be adjusted as follows: (a) from time to time pursuant to Sections 5.4(e)(i) or 5.4(e)(ii)(E); and (b) immediately following (i) the admission of any Person as a new Partner of such Series or (ii) any Capital Contribution to such Series that is not Pro Rata among the Partners of such Series (other than a Capital Contribution pursuant to Sections 5.4(e)(i) or 5.4(e)(ii)(E)), to reflect the quotient, expressed as a percentage, obtained by dividing (A) such Partner’s Series Capital Account balance with respect to such Series by (B) the sum of all Partners’ Series Capital Account balances with respect to such Series, in each case, taking into account any prior adjustments pursuant to clause (a) of this definition. Upon the adjustment of the Percentage Interests in the manner set forth in this definition, Exhibit A will be amended to reflect such adjusted Percentage Interests. The Percentage Interest of any Partner of the Partnership generally shall at all times be zero. “Permitted Transferee” means, with respect to any Person, an Affiliate of such Person; provided that the term “Permitted Transferee” shall not include any Affiliate that, at the date of determination, such Person or any of its Affiliates intends or expects to sell, assign, exchange or otherwise cease to own or control. “Person” means an individual, Entity or government agency or political subdivision thereof.   9 “Preliminary Alberta Clipper Construction Costs” means $[            ]1, which amount represents the sum of (1) all cash costs, expenses and liabilities actually paid by the Partnership prior to the Closing Date that are directly attributable to or properly allocable to the Series AC Assets and (2) all allowances for funds used during construction (AFUDC) that are directly attributable to or properly allocable to the Series AC Assets prior to the Closing Date. “Primary Obligor” has the meaning assigned to such term in Section 3.4(c). “Prior Agreement” has the meaning assigned to such term in the preamble to this Agreement. “Prior Budget” has the meaning assigned to such term in Section 7.4(c). “Prior General Partner Interests” means the general partner interests in the Partnership outstanding immediately prior to the effectiveness of this Agreement. “Prior Limited Partner Interests” means the limited partner interests in the Agreement. “Pro Rata” means apportioned among all Partners of a particular Series in accordance with their relative Percentage Interests in such Series. “Profits” or “Losses” means, for each taxable year with respect to any Series, an amount equal to such Series’ taxable income or loss for such taxable year, determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to (a) any income of such Series that is exempt from U.S. federal income tax and not otherwise taken into account in computing Profits and Losses pursuant to this definition of “Profits” and “Losses” shall be added to such taxable income or loss; (b) any expenditures of such Series 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 Profits or Losses pursuant to this definition of “Profits” and “Losses” shall be subtracted from such taxable income or loss; (c) in the event the Book Value of any asset is adjusted pursuant to clause (b) or clause (c) of the definition of Book Value, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the Book Value of the asset) or an item of loss (if the adjustment decreases the Book Value of the asset) from the disposition of such asset and shall be taken into account for purposes of computing Profits or Losses; which gain or loss is recognized for U.S. federal income tax purposes shall be computed by reference to the Book Value of the property disposed of, Book Value;   1 To be determined as of the Closing Date.   10 (e) in lieu of the depreciation, amortization and other cost recovery deductions taken into account Depreciation for such taxable year; (f) to the extent an adjustment to the adjusted tax basis of any asset pursuant to Code Section 734(b) is required, pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Account balances for such Series as a result of a distribution other than in liquidation of a Partner’s Partnership Interest with respect to such Series, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or an item of loss (if the adjustment decreases such basis) from the disposition of such asset and shall be taken into account for purposes of computing Profits or Losses; and (g) any items that are allocated pursuant to Sections 6.1(b) and 6.1(c) shall be determined by applying rules analogous to those set forth in clauses (a) through (g) hereof but shall not be taken into account in computing Profits and Losses. “Proportionate Share of Shared Liabilities” has the meaning assigned to such term in Section 3.4(d). “Quarter” means, unless the context requires otherwise, a fiscal quarter of the Partnership. “Regulatory Allocations” means the allocations set forth in Sections 6.1(b)(i)-(iii) and 6.1(b)(v)-(vii). “Revenue Requirement” means the Revenue Requirement as set forth in Section 3 “Revenue Requirement” of the Tariff Term Sheet. “Revised Tariff Structure” has the meaning assigned to such term in Section 10.2(a). “ROFR Asset Closing Period” has the meaning assigned to such term in Section 4.6(d). “ROFR Asset Expiration Date” has the meaning assigned to such term in Section 4.6(b). “ROFR Asset Notice” has the meaning assigned to such term in Section 4.6(a). “ROFR Asset Notice Date” has the meaning assigned to such term in “ROFR Asset Offer Price” has the meaning assigned to such term in “ROFR Closing Period” has the meaning assigned to such term in Section 4.4(d). “ROFR Expiration Date” has the meaning assigned to such term in Section 4.4(b). “ROFR Holder” has the meaning assigned to such term in Section 4.4(a).   11 “ROFR Notice” has the meaning assigned to such term in Section 4.4(a). “ROFR Notice Date” has the meaning assigned to such term in Section 4.4(a). “ROFR Offer Price” has the meaning assigned to such term in Section 4.4(a). “ROFR Offered Asset” has the meaning assigned to such term in Section 4.6(a). “ROFR Proportionate Share” has the meaning assigned to such term in Section 4.4(b). “Securities Act” means the Securities Act of 1933, as amended, supplemented or restated from time to time and any successor to such statute. “Separation Option” has the meaning assigned to such term in Section 10.1(c). “Series” means the Series AC, the Series LH and any Alberta Clipper Expansion Series. “Series AC” has the meaning assigned to such term in Section 3.1(a). “Series AC Annual Budget” has the meaning assigned to such term in Section 7.4(a). “Series AC Assets” means the assets identified as Series AC Assets in Section 3.2(a). “Series AC Capital Contribution Notice” has the meaning assigned to such term in Section 5.4(a). “Series AC Distribution” has the meaning assigned to such term in Section 6.2(a). “Series AC Distribution Amount” means, with respect to any Quarter (including any Quarter in which the liquidation of the Series AC is completed), an amount equal to (a) the sum of (i) the portion of the Series AC Revenue Entitlement that has been collected during such Quarter through the system-wide rates of the Lakehead System as either the facilities surcharge or the base rates as provided in Section 7.5 (prior to the expiration of the Surcharge Term) or as determined pursuant to Section 10.2 (following the expiration of the Surcharge Term), (ii) any other cash receipts attributable to or arising out of the ownership, operation, sale or other disposition of the Series AC Assets collected during such Quarter and (iii) any reduction during such Quarter in the amount of Series AC Reserves established in any prior Quarter that are not used by the Partnership, less (b) the sum of (i) all Series AC Expenses for such Quarter, (ii) all cash interest expenses (and principal reductions net of borrowings) of the Partnership for such Quarter attributable to Series AC Liabilities (other than any Intercompany Obligation for which the Series AC is not the Primary Obligor), (iii) any cash maintenance and pipeline integrity capital expenditures for such Quarter properly allocable to the Series AC, (iv) any other cash expenses for such Quarter constituting or attributable to or arising out of a Series AC Liability (other than any Intercompany Obligation for which the Series AC is not the Primary Obligor) or otherwise attributable to or arising out of the ownership or operation of the Series AC Assets and (iv) any increase in Series AC Reserves as shall be established by the Managing General Partner of the Series AC in respect of such Quarter in accordance with Section 7.3.   12 “Series AC Expansion Capital Expenditures” means cash expenditures by the Series AC for: (a) any transaction in which the Series AC acquires (through an asset acquisition, merger, stock acquisition or other form of investment) control over all or a portion of the assets, properties or business of another Person for the purpose of increasing for a period longer than the short-term the operating capacity of the Series AC Assets or operating income of the Series AC from the operating capacity of the Series AC Assets or operating income of the Series AC existing immediately prior to such transaction, or (b) any (i) additions or improvements to the capital assets of the Series AC or (ii) acquisitions of existing, or the construction of new or the improvement or replacement of existing, capital assets, in each case if such additions, improvements, acquisitions, replacements or construction is made to increase for a period longer than the short-term the operating capacity of the Series AC Assets or operating income of the Series AC from the operating capacity of the Series AC Assets or operating income of the Series AC existing immediately prior to such addition, improvement, replacement, acquisition or construction. The term “Series AC Expansion Capital Expenditures” shall not include Series AC Maintenance Capital Expenditures. For purposes of this definition, the term “short-term” generally refers to a period not exceeding 12 months. “Series AC Expenses” means, for any period prior to the expiration of the Surcharge Term, the aggregate Series AC General and Administrative Expenses, Series AC Non-Mandatory Health and Safety Expenses, Series AC Operating Expenses, Series AC Pipeline Integrity Operating Expenses, Series AC Power Expenses and Series AC Property Taxes for such period. Following the expiration of the Surcharge Term, the Series AC Expenses will be determined pursuant to Section 10.2. “Series AC General and Administrative Expenses” means, for any period, the cash general and administrative expenses attributable to the Series AC Assets determined by applying the allocation methodology used to determine the estimate of such expenses pursuant to Section 3(f)(i) of the Tariff Term Sheet to the actual general and administrative expenses of the Partnership for such period. “Series AC General Partner” means any General Partner of the Series AC. “Series AC Liabilities” means the Liabilities identified as Series AC Liabilities on the Series AC Records from time to time in accordance with this Agreement. “Series AC Limited Partner” means any Limited Partner of the Series AC. “Series AC Maintenance Capital Expenditures” means cash expenditures by the Series AC (including expenditures for the addition or improvement to or replacement of the capital assets of the Series AC or for the acquisition of existing, or the construction or development of, new capital assets) if such expenditures are made to maintain, including for a period longer than   13 the short-term, the operating capacity of the Series AC Assets or operating income of the Series AC. The term “Series AC Maintenance Capital Expenditures” shall not include Series AC Expansion Capital Expenditures. For purposes of this definition, the term “short-term” generally refers to a period not exceeding 12 months. “Series AC Non-Mandatory Health and Safety Expenses” means, for any period, the non-mandatory health and safety cash expenses related to the Series AC Assets for such period. “Series AC Operating Expenses” means, for any period, the cash operating expenses (excluding any cash expenses related to property taxes, power, pipeline integrity operating expenditures and non-mandatory health and safety expenditures) attributable to the Series AC Assets determined by applying the allocation methodology used to determine the estimate of such expenses pursuant to Section 3(f)(i) of the Tariff Term Sheet to the actual cash operating expenditures) of the Partnership for such period without regard to the estimated expenses included in the 154-B Model for such period. “Series AC Partners” means the Series AC General Partners and the Series AC Limited Partners. “Series AC Pipeline Integrity Operating Expenses” means, for any period, the cash pipeline integrity operating expenses related to the Series AC Assets for such period without regard to the allocation of such expenses pursuant to Section 3(f)(iii)(1) of the Tariff Term Sheet. “Series AC Power Expenses” means, for any period, the cash expenses for power attributable to the Series AC Assets pursuant to Section 3(f)(ii) of the Tariff Term Sheet for such period. “Series AC Property Taxes” means, for any period, the cash property tax payments attributable to the Series AC Assets determined by applying the allocation methodology used to determine the estimate of such payments pursuant to Section 3(f)(i) of the Tariff Term Sheet to the actual cash property tax payments of the Partnership for such period, without regard to the risk sharing provisions set forth in the second sentence of Section 3(f)(i)(4) of the Tariff Term Sheet. “Series AC Records” means the records maintained for the Series AC in accordance with Section 3.1(b). “Series AC Reserves” means any cash reserves established by the Managing General Partner of the Series AC with respect to the Series AC to provide for the proper conduct of the business of the Series AC, including reserves for future capital expenditures and anticipated credit needs of the Series AC, or otherwise comply with applicable law or any agreement or other obligation of the Series AC or to which any Series AC Assets are subject. “Series AC Revenue Entitlement” means, prior to the expiration of the Surcharge Term, the Revenue Requirement (excluding any reduction attributable to the “Revenue Credit” provided for in Section 13 of the Tariff Term Sheet). The Series AC Revenue Entitlement will   14 be calculated in accordance with the 154-B Model on file at such time. If the Partnership does not file a 154-B Model during any year prior to the expiration of the Surcharge Term, due to a change in the FERC’s regulatory requirements or otherwise, then the Series AC Revenue Entitlement shall be estimated in accordance with a model prepared as if a 154-B Model was required to be filed. Following the expiration of the Surcharge Term, the Series AC Revenue Entitlement will be determined pursuant to Section 10.2. “Series Capital Account” means the capital account maintained for a Partner with respect to a Series pursuant to Section 5.8. “Series Indemnified Damages” has the meaning assigned to such term in Section 7.8. “Series LH” has the meaning assigned to such term in Section 3.1(a). “Series LH Assets” means the assets identified as Series LH Assets in Section 3.3(a). “Series LH Distribution” has the meaning assigned to such term in Section 6.3(a). “Series LH General Partner” means any General Partner of the Series LH. “Series LH Liabilities” means the Liabilities identified as Series LH Liabilities on the Series LH Records from time to time in accordance with this Agreement. “Series LH Limited Partner” means any Limited Partner of the Series LH. “Series LH Partners” means the Series LH General Partners and the Series LH Limited Partners. “Series LH Records” means the records maintained for the Series LH in accordance “Shared Assets” has the meaning assigned to such term in Exhibit C. “Short-Term Debt Financing” means any borrowings incurred under Facility B1 and Facility C1. “Springing Guarantee” has the meaning assigned to such term in Section 7.3(g). “Subsidiary” means, with respect to any Person, (a) a corporation of which more than 50% of the voting power of shares entitled (without regard to the Subsidiaries of such Person, or a combination thereof or (c) any other Person (other than a corporation or a   15 partnership) in which such Person, one or more Subsidiaries of such Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) at least a majority ownership interest or (ii) the power to elect or direct the election of a majority of the directors or other governing body of such Person. “Surcharge Term” means the primary term of the Alberta Clipper Surcharge and any extension thereof in accordance with the FERC Settlement Offer. “Tag-Along Notice” has the meaning assigned to such term in Section 4.5(a). “Tag-Along Right” has the meaning assigned to such term in Section 4.5(a). “Tag-Along Transferee” has the meaning assigned to such term in Section 4.5(a). “Tag Offerees” has the meaning assigned to such term in Section 4.5(a). “Tag Pro Rata Share” means with respect to any Partner that holds Series AC Partnership Interests, a fraction (expressed as a percentage), the numerator of which equals such Partner’s Series AC Percentage Interest and the denominator of which equals (i) in a situation where the Tag Pro Rata Share is being calculated with respect to all Partners that hold Series AC Partnership Interests, 100% and (ii) in a situation where the Tag Pro Rata Share is being calculated with respect to a particular group of Partners that hold less than 100% of the Series AC Partnership Interests, the total Series AC Percentage Interests held by all the Partners of such group. “Tariff Term Sheet” means the Alberta Clipper U.S. Term Sheet dated June 28, 2007 and approved by the FERC by the letter dated August 28, 2008 (124 FERC ¶ 61,200 (2008)), as the same may be amended from time to time. “Third Party” means, with respect to any Partner, any Person that is not a Permitted Transferee with respect to such Partner. “Third Party Asset Offer” has the meaning assigned to such term in “Third Party Offer” has the meaning assigned to such term in Section 4.4(a). “Transfer” means, with respect to any Partnership Interest, a transaction (i) by which a General Partner assigns its General Partner Interest to another Person, and includes a sale, assignment, gift, pledge, encumbrance, hypothecation, mortgage, exchange or any other disposition by law or merger or otherwise or (ii) by which the holder of a Limited Partner Interest assigns such Limited Partner Interest to another Person, and includes a sale, assignment, gift, exchange or any other disposition by law or merger or otherwise, in each case, including a pledge, encumbrance, hypothecation or mortgage of such Partnership Interest. “Transferor” has the meaning assigned to such term in Section 4.5(a). Agreement.   16 Section 1.2 Construction. Unless the context requires otherwise: (a) any pronoun used in this Agreement versa; (b) references to Articles and Sections refer to Articles and Sections of this Agreement; (c) the terms “include,” “includes,” “including” or words of like import shall be deemed to be followed by the words “without limitation”; and (d) the terms “hereof,” “herein” or “hereunder” refer to this Agreement as a whole and not to any particular provision of this Agreement. The headings contained in this Agreement are for reference purposes only, and shall not affect in any way the meaning or interpretation of this Agreement. ARTICLE II ORGANIZATION Section 2.1 Continuation. Lakehead GP, Wisconsin GP and Enbridge Partners hereby continue the Partnership as a limited partnership under the Delaware Act and, together with EECI Sub and EECI, enter into this Agreement, which amends and restates the Prior Agreement in its entirety. This Agreement shall be effective as of the date set forth in the introductory paragraph of this Agreement. Except as modified in this Agreement, the rights, duties (including fiduciary duties), liabilities and obligations of the Partners and the administration, dissolution and termination of the Partnership or any Series shall be governed by the Delaware Act. Section 2.2 Name. The name of the Partnership shall continue to be “Enbridge Energy, Limited Partnership.” Subject to applicable law, the Partnership’s business may be conducted under any other name or names as determined by the Managing General Partner of the Partnership generally, including the name of such Managing General Partner. Each Series’ business shall be conducted under the name of the Partnership on behalf of such Series, the name of such Series or, subject to applicable law, any other name or names as determined by the Managing General Partner of such Series, including the name of such Managing General Partner. The words “Limited Partnership,” “LP” or similar words or letters shall be included in the Partnership’s or any Series’ name where necessary for the purpose of complying with the laws of any jurisdiction that so requires. Without the consent of any Partner being required, the Managing General Partner of the Partnership generally may amend this Agreement and the Certificate of Limited Partnership to change the name of the Partnership at any time and from time to time and shall promptly notify the Partners of such change. Section 2.3 Principal Office; Registered Office. (a) The principal office of the Partnership and each Series shall be at 1100 Louisiana, Suite 3300, Houston, Texas 77002 or such other place as the Managing General Partner of the Partnership generally may from time to time designate. The Partnership and each Series may maintain offices at such other places as the Managing General Partner of the Partnership generally or such Series, as applicable, deems advisable.   17 (b) The address of the Partnership’s registered office in the State of Delaware shall be 1209 Orange Street, Wilmington, Delaware 19801, and the Partnership’s registered agent for service of process on the Partnership in the State of Delaware shall be The Corporation Trust Company. Without the consent of any Partner being required, the Managing General Partner of the Partnership generally may amend this Agreement and the Certificate of Limited Partnership to change the address of the Partnership’s registered office or the Partnership’s registered agent for service of process at any time and from time to time and shall promptly notify the Partners of such change. Section 2.4 Purpose and Business. The purpose and nature of the business to be conducted by the Partnership and each Series shall be to engage in any lawful activity for which limited partnerships may be organized under the Delaware Act. Section 2.5 Powers. The Partnership and each Series shall be empowered to do any and all acts and things necessary or appropriate for the furtherance and accomplishment of the purposes and business described in Section 2.4 and for the protection and benefit of the Partnership or any Series. Section 2.6 Term. The term of the Partnership shall continue in existence until the dissolution of the Partnership in accordance with the provisions of Article XI. The existence of the Partnership as a separate legal entity shall continue until the cancellation of the Certificate of Limited Partnership as provided in the Delaware Act. Each Series shall have a perpetual existence until the earlier of the dissolution of the Partnership or the termination of such Series in accordance with the provisions of Article XI. Section 2.7 Title to Partnership Assets. Subject to applicable law, record title to any or all of the assets of any Series may be held in the name of the Partnership, such Series, the Managing General Partner of such Series or one or more nominees, as the Managing General Partner of such Series may determine. Each Managing General Partner hereby declares and warrants that the assets of any Series for which record title is held in the name of such Managing General Partner or one or more nominees shall be held in trust by such Managing General Partner or such nominee for the use and benefit of the applicable Series in accordance with the provisions of this Agreement. ARTICLE III ESTABLISHMENT AND DESIGNATION OF SERIES Section 3.1 Establishment and Designation of Series. (a) The Partners hereby establish two series of partnership interests in the Partnership, the “Series AC” and the “Series LH,” each of which shall constitute a separate series of partnership interests in accordance with Section 17-218 of the Delaware Act, having separate rights, powers, duties and obligations as set forth herein, with each such Series comprised of both General Partner Interests and Limited Partner Interests, as set forth in Article V.   18 (b) Each Series shall be separate and distinct from each other Series, and separate and distinct records shall be maintained for each Series. The records maintained for each Series shall account for the assets and Liabilities associated with such Series separately from the assets and Liabilities associated with any other Series. Records maintained for a Series that reasonably identify its assets, including by specific listing, category, type, quantity, computational or allocational formula or procedure (including a percentage or share of any asset or assets) or by any other method where the identity of such assets is objectively determinable, will be deemed to account for the assets associated with such Series separately from the assets associated with any other Series. Except for the Intercompany Obligations and the Springing Guarantees or as may be expressly agreed to by a Series or the Partnership generally, no Liability of a Series shall be a Liability of any other Series or the Partnership generally. To the fullest extent permitted by applicable law, except for the Intercompany Obligations and the Springing Guarantees or as may be expressly agreed to by a Series or the Partnership generally, all of the Liabilities incurred, contracted for or otherwise now or hereafter existing with respect to a particular Series shall be enforceable against the assets of such Series only or a General Partner associated with such Series and not against the assets of any other Series or of the Partnership generally or any General Partner not associated with such Series, and, except for the Intercompany Obligations and the Springing Guarantees or as may be expressly agreed to by a Series or the Partnership generally, none of the Liabilities incurred, contracted for or otherwise existing with respect to any other Series shall be enforceable against the assets of such Series. The Certificate of Limited Partnership shall contain a notice of the limitation of liabilities of the Series in conformity with Section 17-218 of the Delaware Act. (c) Each Series shall have the power and capacity to, in its own name, contract, hold title to assets (including real, personal and intangible property), grant liens and security interests and sue and be sued. Section 3.2 Series AC. (a) The following shall constitute the Series AC Assets: (i) the Exclusive Series AC Assets; (ii) all rights and interests of the Series AC set forth in Exhibit C with respect to the Shared Assets; and (iii) all other assets identified as Series AC Assets on the Series AC Records. (b) The following shall constitute the Series AC Liabilities (without duplication): (i) all Liabilities associated with or arising from the ownership or operation of the Exclusive Series AC Assets, including Facility B1 and Facility C1; (ii) the Series AC’s Proportionate Share of Shared Liabilities;   19 (iii) the Intercompany Preliminary Construction Cost Payable; (iv) the Intercompany Obligations; (v) the Springing Guarantees; and (vi) all other Liabilities identified as Series AC Liabilities on the Series AC Records. (c) The Partners hereby acknowledge and agree that all Series AC Assets are available to satisfy the claims of all creditors in respect of any Series AC Liability, in each case, without priority of claims among such creditors, except as may be expressly set forth in the documents evidencing the obligations owed to any such creditor. (d) The Partners hereby acknowledge and agree that all Series AC Assets will be available to satisfy the claims of holders of notes pursuant to the Note Agreement, dated December 12, 1991, related to the Partnership’s 9.15% First Mortgage Notes due December 15, 2011 (the “Note Agreement”). Section 3.3 Series LH. (a) The following shall constitute the Series LH Assets: (i) all assets and rights of the Partnership that are not associated with any other Series; (ii) all rights and interests of the Series LH set forth in Exhibit C with (iii) all other assets identified as Series LH Assets on the Series LH Records. (b) The following shall constitute the Series LH Liabilities (without duplication): (i) all Liabilities of the Partnership that are not associated with any other Series; (ii) the Series LH’s Proportionate Share of Shared Liabilities; (iii) the Intercompany Obligations; (iv) the Springing Guarantees; and (v) all other Liabilities identified as Series LH Liabilities on the Series LH Records. (c) The Partners hereby acknowledge and agree that all Series LH Assets are available to satisfy the claims of all creditors in respect of any Series LH   20 (d) The Partners hereby acknowledge and agree that all Series LH Assets will be Agreement. Section 3.4 Allocation Among Series. (a) The Partnership may acquire assets only to the extent that they are acquired by the Partnership with respect to one or more particular Series and not with respect to the Partnership generally. To the extent commercially feasible, all Liabilities (other than any Intercompany Obligations or Springing Guarantees) contractually created or incurred or amended by any Series following the Closing Date shall be made expressly non-recourse to (i) the Partnership generally and any other Series and (ii) the Partners of the Partnership generally or any Series (in their respective capacities as such). (b) The Managing General Partner of the Partnership generally shall establish procedures designed to ensure that, to the extent commercially feasible, all contracts of a Series (other than contracts relating to any Intercompany Obligations or Springing Guarantees) entered into or amended after the Closing Date, (i) expressly acknowledge the separateness of the Partnership generally and each Series, (ii) notify the contract counterparty of the identity of the obligor or obligors thereunder (and if more than one obligor, the obligation of each obligor, which obligation may be joint and several or may be several depending on the facts and circumstances) and (iii) are properly executed and delivered by a duly authorized Person on behalf of the Partnership generally and/or such Series, as applicable. (c) The Partners (in their respective capacities as such) on the one hand, and Enbridge Partners (on behalf of itself and each Material Subsidiary of Enbridge Partners) on the other hand, acknowledge and agree that, for so long as any Existing Indebtedness (or refinancing thereof) requires, all Intercompany Obligations currently or hereafter existing are expressly recourse to the Partnership generally and to each Series, and expressly non-recourse to the Partners of the Partnership generally and to the Partners of each Series (in the case of Partners, in their respective capacities as such). The Managing General Partner of the Partnership generally shall designate each Intercompany Obligation as the primary obligation of the applicable Series (the “Primary Obligor”) with respect to which the Intercompany Obligation was incurred. The Series AC will be the Primary Obligor with respect to the Intercompany Preliminary Construction Cost Payable and Facility B1 and Facility C1 and any refinancing thereof, including the Long-Term Debt Financing, and the Series LH will be the Primary Obligor with respect to all other Intercompany Obligations existing on the Closing Date. As among each Series of the Partnership and the Partnership generally, the Primary Obligor with respect to an Intercompany Obligation shall have the primary responsibility for administering and discharging such obligation and shall have primary liability to the creditors or other obligees associated with such obligation. (d) The Managing General Partner of the Partnership generally shall determine the portion of the Liabilities associated with or arising from the use, ownership or operation of the Shared Assets and that arise from events or circumstances occurring after the Closing Date to be designated as Series AC Liabilities or Series LH Liabilities (with respect to each Series, its “Proportionate Share of Shared Liabilities”) based on the following criteria (and the Managing General Partners of the Series AC and the Series LH shall maintain the Series AC Records and the Series LH Records, respectively, in a manner consistent with such determination): (i) the relative use by the Series AC and the Series LH of the Shared Asset to which the Liability relates;   21 (ii) the relative benefit to the Series AC and the Series LH of the Shared Asset to which the Liability relates; and (iii) if applicable, the relative fault of the Series AC and the Series LH with respect to the activities or events giving rise to the Liability related to such Shared Asset. Section 3.5 No Transfer or Sale. The Partners acknowledge and agree that neither the establishment of the Series AC and the Series LH, nor the designation of their respective assets as set forth in this Article III shall constitute a sale, transfer or other disposition of any asset of the Partnership. ARTICLE IV TRANSFER OF PARTNERSHIP INTERESTS; RIGHT OF FIRST REFUSAL; TAG-ALONG RIGHTS Section 4.1 Transfers Generally. (a) Transfers of Partnership Interests may only be made in strict compliance with all applicable terms of this Agreement, and any purported Transfer of Partnership Interests that does not so comply with all applicable provisions of this Agreement shall, to the fullest extent permitted by law, be null and void and of no force or effect, and no Managing General Partner acting on behalf of the Partnership generally or any Series shall recognize or be bound by any such purported Transfer or effect any such purported Transfer on the transfer books of the Partnership generally or any Series. The Partners agree that the restrictions contained in this Article IV are fair and reasonable and in the best interests of the Partnership, each Series and the Partners. (b) Notwithstanding anything herein to the contrary, no Transfer by a Partner of all or any part of its Partnership Interest to another Person shall be permitted unless (i) the transferee agrees in writing to assume the rights and duties of such Partner under this Agreement and to be bound by the provisions of this Agreement and (ii) such transferee shall be admitted to the Partnership as a Partner with respect to the Partnership generally or a Series, as applicable, pursuant to Section 4.1(c) immediately prior to the transferor ceasing to be a Partner with respect to the transferred portion of the Partnership Interest, and the business of the Partnership and each Series shall continue without dissolution or termination, respectively. (c) To effect the admission of any Partner to the Partnership generally or any Series, the Managing General Partner of the Partnership generally and each applicable Series shall take all steps necessary or appropriate under the Delaware Act to amend the records of the Partnership and the applicable Series to reflect such admission and, if necessary, notwithstanding Sections 12.1 or 12.2, to prepare and adopt as soon as practicable an amendment to this   22 Agreement and, if required by law, the Managing General Partner of the Partnership generally shall prepare and file an amendment to the Certificate of Limited Partnership. The transferee shall be admitted to the Partnership with respect to the Partnership generally or the applicable Series, as the case may be, as a general partner or limited partner, as applicable, upon satisfaction of the requirements of Section 4.1(b) and this Section 4.1(c), without the consent of any other Partner being required. (d) No Partner shall have any right to withdraw from the Partnership; provided, however, that when a transferee of a Partner’s Partnership Interest is admitted to the Partnership in accordance with Section 4.1(c) with respect to the Partnership Interest so transferred, the transferring Partner shall cease to be a Partner with respect to the Partnership Interest so transferred. Section 4.2 General Restrictions on Transfers of Partnership Interests. (a) Notwithstanding the other provisions of this Article IV, no Transfer of any Partnership Interests shall be made if such Transfer would (i) violate the then applicable federal or state securities laws or rules and regulations of the Commission, any state securities commission or any other governmental authority with jurisdiction over such Transfer, (ii) terminate the existence or qualification of the Partnership or any Series under the laws of the State of Delaware or (iii) cause the Partnership or any Series to be treated as an association taxable as a corporation or otherwise to be taxed as an entity for U.S. federal income tax purposes (to the extent not already so treated or taxed). (b) The Managing General Partner of the Partnership generally may impose restrictions on the Transfer of Partnership Interests if it receives an opinion of counsel that such restrictions are necessary to avoid a significant risk of the Partnership or any Series becoming taxable as a corporation or otherwise becoming taxable as an entity for U.S. federal income tax purposes. Notwithstanding Sections 12.1 and 12.2, the Managing General Partner of the Partnership generally may impose such restrictions by amending this Agreement. (c) For so long as the Partnership is a partnership for U.S. federal income tax purposes, in no event may any Transfer of any Partnership Interests by any Partner be made if such Transfer is effectuated through an “established securities market” or a “secondary market (or the substantial equivalent thereof)” within the meaning of Section 7704 of the Code or if such Transfer would otherwise result in the Partnership or any Series being treated as a “publicly traded partnership,” as such term is defined in Section 7704(b) of the Code and the regulations promulgated thereunder. Section 4.3 Additional Restrictions on Transfers of Partnership Interests. (a) Series AC Partnership Interests. No Transfer of a Series AC Partnership Interest may be made unless (i) such Transfer complies with the provisions of Section 4.1 and Section 4.2 and (ii) unless such Transfer is to a Permitted Transferee of the transferring Partner, such Transfer is made in accordance with Sections 4.4 and 4.5. (b) Series LH Partnership Interests. No Transfer of a Series LH Partnership Section 4.4.   23 Section 4.4 Right of First Refusal. (a) If any Partner receives a bona fide written offer from a Third Party (a “Third Party Offer”) for the Transfer of all or a part of (i) in the case of EECI, EECI Sub and their respective Permitted Transferees, such Partner’s Partnership Interests in any Series or (ii) in the case of Enbridge Partners, Lakehead GP, Wisconsin GP and their respective Permitted Transferees, such Partner’s Partnership Interests in the Partnership generally or any Series, and such Partner (the “Offering Partner”) desires to accept and is otherwise permitted to effect such proposed Transfer pursuant to this Article IV, such Offering Partner shall deliver written notice of such Third Party Offer (the “ROFR Notice”) to the Managing General Partner of the Partnership generally as soon as reasonably practicable, but in no event less than 35 days prior to the date of the proposed Transfer. The date that the ROFR Notice is received by the Managing General Partner of the Partnership generally shall constitute the “ROFR Notice Date.” Within five Business Days following the ROFR Notice Date, the Managing General Partner of the Partnership generally shall send a copy of the ROFR Notice along with a letter indicating the ROFR Notice Date to all other Partners holding Series AC Partnership Interests (each such Partner, a “ROFR Holder”). The ROFR Notice shall set forth the identity of the Third Party (including, (x) if such information is not publicly available, information about the identity of the Third Party, (y) the identity of Affiliates of the Third Party and (z) if the Third Party is making the Third Party Offer as a nominee of another Person, the identity of such other Person and its Affiliates), the amount and the Partnership Interests to be sold (the “Offered Interests”), the proposed purchase price for the Offered Interests (the “ROFR Offer Price”), all details of the payment terms and all other material terms and conditions, including the nature of the representations and warranties to be made and the indemnities to be given, in connection with the proposed Transfer. The ROFR Offer Price shall be expressed in U.S. dollars, whether or not the form of consideration in the Third Party Offer is wholly or partially cash or cash equivalents. (b) Each ROFR Holder shall have the right, but not the obligation, to purchase up to that amount of the Offered Interests equal to the product of (i) the amount of the Offered Interests and (ii) a fraction (the “ROFR Proportionate Share”), the numerator of which shall be the Series AC Percentage Interest of such ROFR Holder and the denominator of which shall be the sum of all of the Series AC Percentage Interests held by all ROFR Holders. Within 25 days after the ROFR Notice Date, each such ROFR Holder may deliver a written notice to the Offering Partner, the Managing General Partner of the Partnership generally and each other ROFR Holder of its election to purchase such Offered Interests. Any ROFR Holder whose written notice has not been received by the Managing General Partner of the Partnership generally within such 25-day period shall be deemed to have elected not to exercise its right of first refusal in connection with such Transfer. To the extent any such ROFR Holder does not elect to purchase its full ROFR Proportionate Share of such Offered Interests, each ROFR Holder that has elected to purchase its full ROFR Proportionate Share shall be entitled, by delivering written notice to the Offering Partner and the Managing General Partner of the Partnership generally within five Business Days following the end of such 25-day period (such fifth Business Day, the “ROFR Expiration Date”), to purchase up to all of the remaining Offered Interests. If there is an oversubscription, the oversubscribed amount shall be allocated among the   24 ROFR Holders fully exercising their rights to purchase such remaining Offered Interests pro rata based on the Series AC Percentage Interest owned by each fully-electing ROFR Holder. The delivery of a notice of election under this Section 4.4(b) shall constitute an irrevocable commitment to purchase such Offered Interests. If the ROFR Holders shall have elected to purchase all but not less than all of the Offered Interests, the Managing General Partner of the Partnership generally shall thereafter set a reasonable place and time for the closing of the purchase and sale of the Offered Interests, which shall be not less than 10 days nor more than 60 days after the ROFR Expiration Date (subject to extension to the extent necessary to pursue any required regulatory or Partner approvals, including to allow for the expiration or termination of all waiting periods under the HSR Act) unless otherwise agreed by all of the parties to such transaction. (c) The purchase price and terms and conditions for the purchase of the Offered Interests pursuant to this Section 4.4 shall be the purchase price and terms and conditions set forth in the applicable Third Party Offer (or the cash equivalent thereof); provided that the purchase price shall be the ROFR Offer Price and shall be payable in immediately available U.S. dollars; and provided further that the Offering Partner shall at a minimum make customary representations and warranties concerning (i) such Offering Partner’s valid title to and ownership of the Offered Interests, free and clear of all liens, claims and encumbrances (excluding those arising hereunder and under applicable securities laws), (ii) such Offering Partner’s authority, power and right to enter into and consummate the sale of the Offered Interests, (iii) the absence of any violation, default or acceleration of any agreement or obligation to which such Offering Partner is subject or by which its assets are bound as a result of the sale of the Offered Interests and (iv) the absence of, or compliance with, any governmental or third party consents, approvals, filings or notifications required to be obtained or made by such Offering Partner in connection with the sale of the Offered Interests. The Offering Partner and participating ROFR Holders shall use commercially reasonable efforts to close the purchase of the Offered Interests as soon as reasonably practicable following the ROFR Expiration Date and shall each execute and deliver such instruments and documents and take such actions, including obtaining all applicable approvals and consents and making all applicable notifications and filings, as the other parties may reasonably request in order more effectively to implement the purchase and sale of the Offered Interests hereunder. (d) Notwithstanding the foregoing, if (i) the ROFR Holders (A) shall have elected to purchase less than all of the Offered Interests or (B) shall not have elected to purchase any of the Offered Interests on or prior to the ROFR Expiration Date, and the Offering Partner has fully complied with the provisions of this Section 4.4, then the Offering Partner may sell all, but not less than all, of the Offered Interests within 90 days after the ROFR Expiration Date (subject to extension for a reasonable amount of time to the extent necessary to obtain any required regulatory or Partner approvals, including to allow for the expiration of all waiting periods under the HSR Act) or (ii) if the ROFR Holders fail to consummate the closing of the purchase and sale of the Offered Interests within the time period provided in the last sentence of Section 4.4(b) (such period, the “ROFR Closing Period”) and the Offering Partner has fully complied with the provisions of this Section 4.4, then the Offering Partner may sell all, but not less than all, of the Offered Interests within 90 days after the expiration of the ROFR Closing Period to the Third Party, in each case subject to the provisions of Section 4.2. Any such sale shall not be at less than the purchase price or upon terms and conditions more favorable in any material respect,   25 individually or in the aggregate, to the purchaser than those specified in the Third Party Offer. If the Offered Interests are not so transferred within the applicable time periods specified in this Section 4.4(d), the Offering Partner may not sell any of the Offered Interests without again complying in full with the provisions of this Article IV. (e) Each of EECI and Enbridge Partners shall be entitled to assign any rights it has to purchase Offered Interests pursuant to this Section 4.4 to any of its Permitted Transferees. (f) This Section 4.4 shall not apply to any Transfer or proposed Transfer of Partnership Interests to a Permitted Transferee. Section 4.5 Tag-Along Rights. (a) If a Series AC Partner (the “Transferor”) proposes to Transfer all or a part of its Series AC Partnership Interests to a Third Party (the “Tag-Along Transferee”), then such Transferor shall send written notice of such proposed Transfer (the “Tag-Along Notice”) to the other Series AC Partners (the “Tag Offerees”) at least 30 days prior to effecting such Transfer. Such Tag-Along Notice may be combined with a ROFR Notice and may be conditioned upon the ROFR Holders not exercising the right of first refusal contained in Section 4.4. The Tag-Along Notice shall set forth the identity of the Tag-Along Transferee (including, if such information is not publicly available, information about the identity of the Tag-Along Transferee and its Affiliates), the amount and the Series AC Partnership Interests to be Transferred, the proposed purchase price expressed in U.S. dollars (whether or not the form of consideration is wholly or partially cash or cash equivalents), all details of the payment terms, the time and place for the closing and all other material terms and conditions, including the nature of the representations and warranties to be made and the indemnities to be given, in connection with the proposed Transfer. Each of the Tag Offerees shall then have the irrevocable right (a “Tag-Along Right”), exercisable by delivery of an irrevocable notice to the Transferor at any time within 20 days after receipt of the Tag-Along Notice, to participate in such Transfer by selling to the Tag-Along Transferee a pro rata portion of such Tag Offeree’s Series AC Partnership Interests, based on the respective Tag Pro Rata Share of the Transferor and the other Tag Offerees that exercise their Tag-Along Right, on the same terms (including with respect to representations, warranties and indemnification) as the Transferor; provided, however, that (i) any representations and warranties relating specifically to any such Tag Offeree shall only be made by such Tag Offeree; (ii) any indemnification provided by the Transferor and any such Tag Offeree (other than with respect to the representations referenced in the foregoing subsection (i)) shall be based on the Series AC Percentage Interest being sold by each party in the proposed sale, either on a several, not joint, basis or solely with recourse to an escrow (such escrow not to exceed 25% of the proceeds received by the Tag Offerees that exercise their Tag-Along Right without the consent of such Tag Offerees) established for the benefit of the proposed purchaser (each party’s contributions to such escrow to be on a pro rata basis in accordance with the proceeds received from such sale), it being understood and agreed that any such indemnification obligation of any such Tag Offeree shall in no event exceed the net proceeds to such Tag Offeree from such proposed Transfer; and (iii) the form of consideration to be received by the Transferor in connection with the proposed sale shall be the same as that received by such Tag Offeree.   26 (b) If any Tag Offeree has exercised its Tag-Along Rights and the Tag-Along Transferee is unwilling to purchase all of the Series AC Partnership Interests proposed to be Transferred by the Transferor and each exercising Tag Offeree, then the Transferor and the exercising Tag Offerees shall reduce, on a pro rata basis, based on their respective Tag Pro Rata Share, the amount of such Series AC Partnership Interests that each otherwise would have sold so as to permit the Transferor and the exercising Tag Offerees to sell the portion of Series AC Partnership Interests (determined in accordance with such Tag Pro Rata Share) that the proposed Tag-Along Transferee is willing to purchase. (c) Each Tag Offeree and the Transferor shall sell to the Tag-Along Transferee all of the Series AC Partnership Interests proposed to be Transferred by them, at not less than the purchase price payable in immediately available U.S. dollars and upon terms and conditions, if any, not more favorable in any material respect, individually and in the aggregate, to the Tag-Along Transferee than those in the Tag-Along Notice at the time and place provided for the closing in the Tag-Along Notice, or at such other time and place as the Tag Offerees, the Transferor and the Tag-Along Transferees shall agree. (d) The Transferor shall have the right to require the Managing General Partner of the Series AC and the Managing General Partner of the Partnership generally to cooperate fully with potential acquirors of its Series AC Partnership Interests by taking all customary and other actions reasonably required by the Transferor or such potential acquirors, including making the records and assets of each Series and the Partnership generally reasonably available for inspection by such potential acquirors and making the officers and employees who manage the business of the Partnership and the Series reasonably available for interviews; provided that the potential acquirer has entered into a customary confidentiality agreement with the Partnership and the applicable Series. Neither the Managing General Partner of any Series nor the Managing General Partner of the Partnership generally shall be required to disclose to any potential acquirer (i) any information that such Managing General Partner reasonably believes to be in the nature of trade secrets or (ii) other information the disclosure of which such Managing General Partner reasonably believes (A) could damage the Partnership or any Series or their respective businesses or (B) that the Partnership or any Series is required by law or by agreement to keep confidential. Section 4.6 Transfers of Certain Partnership Assets—ROFR. (a) If the Partnership or any Series receives a bona fide written offer from a Third Party (a “Third Party Asset Offer”) for the transfer of any Series asset or group of related assets with a fair market value in excess of $5.0 million, and the Managing General Partner of the Series associated with such assets desires to accept and is otherwise permitted to effect such proposed transfer pursuant to this Section 4.6, such Managing General Partner shall deliver written notice of such Third Party Asset Offer (the “ROFR Asset Notice”) to EECI no less than 30 days prior to the date of the proposed Transfer. The date that the ROFR Asset Notice is received by EECI shall constitute the “ROFR Asset Notice Date.” The ROFR Asset Notice shall set forth the identity of the Third Party (including, if such information is not publicly available, information about the identity of the Third Party and its Affiliates), a description of the Series asset or group of related assets to be transferred (the “ROFR Offered Asset”), the proposed purchase price for the ROFR Offered Asset (the “ROFR Asset Offer Price”), all details of the   27 payment terms and all other material terms and conditions, including the nature of the representations and warranties to be made and the indemnities to be given, in connection with the proposed transfer. The ROFR Asset Offer Price shall be expressed in U.S. dollars, whether or not the form of consideration in the Third Party Asset Offer is wholly or partially cash or cash equivalents. (b) For so long as EECI or any of its Affiliates is a holder of a Partnership Interest, EECI shall have the right, but not the obligation, to purchase the ROFR Offered Asset. Within 25 days after the ROFR Asset Notice Date (such 25th day, the “ROFR Asset Expiration Date”), EECI may deliver a written notice to the Managing General Partner of the applicable Series of its election to purchase such ROFR Offered Asset. The delivery of a notice of election under this Section 4.6 shall constitute an irrevocable commitment to purchase such ROFR Offered Asset. Such Managing General Partner shall thereafter set a reasonable place and time for the closing of the purchase and sale of the ROFR Offered Asset, which shall be not less than 10 days nor more than 60 days after the ROFR Asset Expiration Date (subject to extension to the extent necessary to pursue any required regulatory or Partner approvals, including to allow for the expiration or termination of all waiting periods under the HSR Act) unless otherwise agreed by all of the parties to such transaction. (c) The purchase price and terms and conditions for the purchase of the ROFR Offered Asset pursuant to this Section 4.6 shall be the purchase price and terms and conditions set forth in the applicable Third Party Asset Offer; provided that the purchase price shall be the ROFR Asset Offer Price and shall be payable in immediately available U.S. dollars; and provided further that the applicable Series shall at a minimum make customary representations and warranties concerning (i) the Series’ valid title to and ownership of the ROFR Offered Asset, free and clear of all liens, claims and encumbrances (excluding those arising hereunder and under applicable securities laws), (ii) the Series’ authority, power and right to enter into and consummate the sale of the ROFR Offered Asset, (iii) the absence of any violation, default or acceleration of any agreement to which the Series is subject or by which its assets are bound as a result of the agreement to sell and the sale of the ROFR Offered Asset and (iv) the absence of, or compliance with, any governmental or third party consents, approvals, filings or notifications required to be obtained or made by the Series in connection with the sale of the ROFR Offered Asset. The Managing General Partner of such Series and EECI shall use commercially reasonable efforts to close the purchase of the ROFR Offered Asset as soon as reasonably practicable following the giving of the ROFR Asset Notice and shall execute and deliver such instruments and documents and take such actions, including obtaining all applicable approvals and consents and making all applicable notifications and filings, as the other party may reasonably request in order more effectively to implement the purchase and sale of the ROFR Offered Asset hereunder. (d) If (i) EECI shall not have elected to purchase the ROFR Offered Asset on or prior to the ROFR Asset Expiration Date and the Series has fully complied with the provisions of this Section 4.6, then the Series may sell the ROFR Offered Asset within 90 days after the ROFR Asset Expiration Date (subject to extension for a reasonable amount of time to the extent necessary to obtain any required regulatory or Partner approvals, including to allow for the expiration of all waiting periods under the HSR Act) or (ii) EECI fails to consummate the closing of the purchase and sale of the ROFR Offered Asset within the time period provided in the last   28 sentence of Section 4.6(b) (such period, the “ROFR Asset Closing Period”) and the Series has fully complied with the provisions of this Section 4.6, then EECI shall not have the right to purchase the ROFR Offered Asset, and the Series may sell the ROFR Offered Asset within 90 days after the expiration of the ROFR Asset Closing Period, in each case subject to the provisions of Section 7.3. Any such sale shall not be at less than the purchase price or upon terms and conditions more favorable in any material respect, individually or in the aggregate, to the purchaser than those specified in the Third Party Asset Offer. If the ROFR Offered Asset is not so transferred within the applicable time periods specified in this Section 4.6(d), the Series may not sell the ROFR Offered Asset without again complying in full with the provisions of this Section 4.6. (e) EECI shall be entitled to assign any rights it has to purchase a ROFR Offered Asset pursuant to this Section 4.6 to any of its Permitted Transferees. (f) This Section 4.6 shall not apply to any transfer or proposed transfer of assets to a Permitted Transferee. Section 4.7 Specific Performance. Each Partner acknowledges that it shall be inadequate or impossible, or both, to measure in money the damage to the Partnership, any Series or the Partners, if any of them or any transferee or any legal representative of any party hereto fails to comply with any of the restrictions or obligations imposed by this Article IV, that every such restriction and obligation is material, and that in the event of any such failure, the Partnership, the Series and the Partners shall not have an adequate remedy at law or in damages. Therefore, each Partner consents to the issuance of an injunction or the enforcement of other equitable remedies against such Partner at the suit of an aggrieved party without the posting of any bond or other security, to compel specific performance of all of the terms of this Article IV and to prevent any transfer of Partnership Interests or ROFR Offered Assets in contravention of any terms of this Article IV, and waives any defenses thereto, including the defenses of: (i) failure of consideration; (ii) breach of any other provision of this Agreement and (iii) availability of relief in damages. ARTICLE V CONVERSION; CAPITAL CONTRIBUTIONS; PARTNERSHIP INTERESTS; FUTURE CAPITAL REQUIREMENTS Section 5.1 Conversion of Prior Partnership Interests. On the date hereof, upon their execution of this Agreement and without further action by any Partner, the holders of each Prior General Partner Interest and Prior Limited Partner Interest shall be admitted as General Partners and Limited Partners, respectively, of Series LH, and each Prior General Partner Interest shall automatically convert into a Series LH General Partner Interest and each Prior Limited Partner Interest shall automatically convert into a Series LH Limited Partner Interest. Exhibit A sets forth the Series LH Percentage Interest and type of Series LH Partnership Interest of each Series LH Partner immediately following such conversion. In addition, Lakehead GP shall continue as a General Partner of the Partnership generally with a General Partner Interest in the Partnership generally that shall have no Percentage Interest and no economic rights with respect to the Partnership generally or otherwise.   29 Section 5.2 Series LH Capital Contributions. Any Series LH Limited Partner, with the consent of the Managing General Partner of the Series LH, may, but shall not be obligated, to make additional Capital Contributions to the Series LH. Upon any such additional Capital Contribution, each Series LH General Partner and any other Series LH Limited Partner shall be obligated to make an additional Capital Contribution to the Series LH in an amount necessary to maintain its Series LH Percentage Interest. Section 5.3 Initial Series AC Capital Contributions and Initial Debt Financing. (a) On the Closing Date, each of the Series AC Partners shall make its respective Capital Contribution (each, an “Initial Series AC Capital Contribution”) to the Series AC in immediately available U.S. dollars in the amounts set forth opposite its name on Exhibit A in return for the Series AC Percentage Interest and type of Series AC Partnership Interest set forth opposite its name on Exhibit A, and, upon its execution of this Agreement and the making of its Initial Series AC Capital Contribution, each such Series AC Partner shall be admitted as a Partner of the Series AC in the capacity set forth opposite its name on Exhibit A. (b) On the Closing Date, the Series AC shall (i) borrow under Facility B1 an amount equal to 66.67% of 45% of the Preliminary Alberta Clipper Construction Costs and (ii) borrow under Facility C1 an amount equal to 33.33% of 45% of the (c) On the Closing Date, the Managing General Partner of Series AC shall apply the proceeds of the Initial Series AC Capital Contributions and the Initial Debt Financing to repay the Intercompany Preliminary Construction Cost Payable. Section 5.4 Additional Series AC Capital Contributions. (a) Each Series AC Partner hereby agrees to make additional Capital Contributions to the Series AC (the “Additional Series AC Capital Contributions”) in proportion to such Series AC Partner’s Series AC Percentage Interest at such times and in such amounts as the Managing General Partner of the Series AC shall specify in a notice delivered to the Series AC Partners pursuant to Section 5.4(b) or Section 5.4(c) (“Series AC Capital Contribution Notice”); provided that in no event shall any Series AC Partner be required to make, in the aggregate, Capital Contributions in excess of such Series AC Partner’s respective Maximum Commitment set forth on Exhibit A. All Additional Series AC Capital Contributions shall be contributed to the Series AC in immediately available U.S. dollars on the date specified in the applicable Series AC Capital Contribution Notice. No Series AC Partner shall be required to make any Additional Series AC Capital Contribution, or to otherwise contribute any amount, to the Series AC unless such Additional Series AC Capital Contribution is reflected on the Series AC Annual Budget for such fiscal year or is otherwise approved by the Managing General Partner of the Series AC and a Majority in Interest of Series AC Partnership Interests.   30 (b) On the 12th day of each month beginning prior to the In-Service Date, the Managing General Partner of the Series AC shall deliver a Series AC Capital Contribution Notice to each of the Series AC Partners setting forth (i) the estimated cash construction costs related to the Alberta Clipper Project for such month, adjusted for the difference between (A) the actual construction costs related to the Alberta Clipper Project for the immediately preceding month and (B) the estimated construction costs set forth in the Series AC Capital Contribution Notice for the immediately preceding month (the “Monthly Capital Requirement”), (ii) the amount of the required Additional Series AC Capital Contribution to be made by such Series AC Partner, which shall be an amount equal to such Series AC Partner’s Pro Rata portion of 55% of the Monthly Capital Requirement, (iii) that such Additional Series AC Capital Contribution is due on the 15th day of such month and (iv) the Person or the account to which such Additional Series AC Capital Contribution is to be made. (c) From time to time following the In-Service Date, the Managing General Partner of the Series AC may deliver to the Series AC Partners a Series AC Capital Contribution Notice related to amounts that the Managing General Partner of the Series AC determines are necessary to fund the Series AC’s operations and establish reasonable reserves in respect of the Series AC’s expenses. Such notice shall set forth (i) the manner in which, and the expected date on which, such Additional Series AC Capital Contribution is to be applied, (ii) the amount of the required Additional Series AC Capital Contribution to be made by such Series AC Partner, which shall be an amount equal to such Series AC Partner’s Pro Rata portion of the total amount of such Additional Series AC Capital Contribution, (iii) the date on which such Additional Series AC Capital Contribution is due, which shall not be less than 10 Business Days from the date such notice is delivered and (iv) the Person or the account to which such (d) Each Series AC Partner agrees that payment of its required Additional Series AC Capital Contributions under this Agreement is an obligation of such Series AC Partner, that any default by any Series AC Partner would cause injury to the Series AC and to the other Series AC Partners and that the amount of damages caused by any such default would be difficult to calculate. (e) If a Series AC Partner fails to fund all or any portion of its required Additional Series AC Capital Contribution set forth in a Series AC Capital Contribution Notice and fails to cure such default within five Business Days after the due date set forth in such Series AC Capital Contribution Notice (the “Default Capital Contribution”), the Series AC Partner failing to make such contribution (the “Defaulting Series AC Partner”) will be in default. Upon the occurrence of any such default, the Managing General Partner of Series AC shall promptly notify the Defaulting Series AC Partner and the other Series AC Partners not in default (each a “Non-Defaulting Series AC Partner”) of the occurrence of such default. As long as a Default Capital Contribution remains unpaid or arrangements for the payment thereof have not been agreed to by the Series AC Partners, any Non-Defaulting Series AC Partner may advance to the Series AC the entire amount of the Defaulting Series AC Partner’s Capital Contribution that has not been contributed, with each Non-Defaulting Series AC Partner electing to participate in such advance making its share of such advance in proportion to its Series AC Percentage Interest (without taking into account the Series AC Percentage Interest of the Defaulting Series AC Partner). Each Non-Defaulting Series AC Partner who makes such an advance on behalf of a Defaulting Series   31 AC Partner will have the right to elect the extent to which such advance will (x) constitute a loan to the Defaulting Series AC Partner and/or (y) be treated as a Capital Contribution by such Non-Defaulting Series AC Partner and result in an immediate adjustment of the Series AC Percentage Interests of the Defaulting Series AC Partner and the Non-Defaulting Series AC Partner making such election in accordance with Section 5.4(e)(i); provided, however, that if the advancing Non-Defaulting Series AC Partner does not notify the Managing General Partner of the Series AC of its election to have all, or any portion of, such advance treated as a loan to the Defaulting Series AC Partner, in writing, at the time the advance is made, then such advance shall be deemed a Capital Contribution and will automatically result in an immediate adjustment of the Series AC Percentage Interests. (i) To the extent that one or more Non-Defaulting Series AC Partners do not elect to have an advance made pursuant to this Section 5.4(e) treated as a loan to the Defaulting Series AC Partner, or affirmatively elects to have such advance treated as a Capital Contribution, the Managing General Partner of the Series AC will automatically adjust the Series AC Percentage Interest of (A) each such Non-Defaulting Series AC Partner to equal the percentage obtained by dividing (x) the Series AC Capital Account of each such Non-Defaulting Series AC Partner (including any Capital Contribution made by such Non-Defaulting Series AC Partner under this Section 5.4(e) multiplied by three) by (y) the sum of the Series AC Capital Accounts of all Series AC Partners (including all Capital Contributions made under this Section 5.4(e) multiplied by three) and (B) such Defaulting Series AC Partner to equal the amount of (x) such Defaulting Series AC Partner’s Series AC Percentage Interest immediately prior to the occurrence of such default less (y) the aggregate increases to the Series AC Percentage Interests of Non-Defaulting Series AC Partners pursuant to clause (A). Notwithstanding the foregoing, the Defaulting Series AC Partner will have the right to re-acquire the interest in question from any advancing Non-Defaulting Series AC Partner within 30 days following the date on which such Series AC Percentage Interest adjustment is made by paying the entire amount advanced by such Non-Defaulting Series AC Partner in return for such adjustment, plus interest thereon at a rate equal to the lesser of (A) the maximum, lawful interest rate, compounded monthly, that is then-currently permitted under applicable law or (B) 12% per annum, whereupon the Series AC Percentage Interests of each Series AC Partner shall be adjusted to equal the Percentage Interest such Series AC Partner would have had in the absence of a default by such Defaulting Series AC Partner. (ii) To the extent one or more Non-Defaulting Series AC Partners (each, a “Lending Series AC Partner”) elects to have an advance made pursuant to this Section 5.4(e) constitute a loan to the Defaulting Series AC Partner, such advance will have the following results (except to the extent otherwise agreed by the Lending Series AC Partner and the Defaulting Series AC Partner, each in their sole discretion): (A) the sum advanced will constitute a loan from the Lending Series AC Partner to the Defaulting Series AC Partner and an Additional Series AC Capital Contribution of that sum to the Series AC by the Defaulting Series AC Partner pursuant to the applicable provisions of this Agreement; (B) the principal balance of the loan together with all accrued unpaid interest thereon and all costs and expenses associated therewith (collectively, the “Defaulting   32 Series AC Partner Obligation”) will be due and payable in whole no later than the tenth Business Day after the day written demand requesting payment of the Defaulting Series AC Partner Obligation is made by the Lending Series AC Partner to the Defaulting Series AC Partner; provided, however, that the Defaulting Series AC Partner may prepay the Defaulting Series AC Partner Obligation in whole or in part at any time prior to the date due; (C) the amount lent will bear interest at the same rate as Facility B1 until such facility is repaid and, after Facility B1 has been repaid, at the same rate as the Enbridge Partners Long-Term Indebtedness from the date on which the advance is deemed made until the date on which the Defaulting Series AC Partner Obligation is repaid to the Lending Series AC Partner; (D) the Lending Series AC Partner will have the right, in addition to the other rights and remedies granted to it pursuant to this Agreement, to take any action available to it at law or in equity that the Lending Series AC Partner may deem appropriate to obtain payment from the Defaulting Series AC Partner of the Defaulting Series AC Partner Obligation; and (E) initially, a loan by a Lending Series AC Partner to a Defaulting Series AC Partner as contemplated by this Section 5.4(e)(ii) will not be considered a Capital Contribution by such Lending Series AC Partner and will not increase the Capital Account balance of such Lending Series AC Partner. Notwithstanding the foregoing, if the principal and interest of any such loan have not been repaid within one year from the date of the loan, a Lending Series AC Partner, at any time thereafter by giving written notice to the Managing General Partner of the Series AC and the Defaulting Series AC Partner, may elect to have an amount equal to the unpaid principal and interest balance of such loan transferred from such Defaulting Series AC Partner’s Capital Account to such Lending Series AC Partner’s Capital Account and increase such Lending Series AC Partner’s Capital Account with a corresponding decrease in such Defaulting Series AC Partner’s Capital Account. Upon such transfer, the loan will be treated as a Capital Contribution and the Series AC Percentage Interest for (A) such Lending Series AC Partner will be automatically adjusted to equal the percentage obtained by dividing (x) the Capital Account of such Lending Series AC Partner (including any Capital Contribution made by such Lending Series AC Partner under this Section 5.4(e)(ii)(E) on behalf of the Defaulting Series AC Partner multiplied by three) by (y) the sum of the Series AC Capital Accounts of all Series AC Partners (including all Capital Contributions made under this by three) and (B) such Defaulting Series AC Partner will be automatically adjusted to equal the amount of (x) such Defaulting Series AC Partner’s Series AC Percentage Interest immediately prior to such election by the Lending Series AC Partner less (y) the increase to the Series AC Percentage Interest of Lending Series AC Partner pursuant to clause (A). (f) Notwithstanding the rights of Non-Defaulting Series AC Partners described in Section 5.4(e), the Managing General Partner of the Series AC, by a vote of a Majority in Interest of Series AC Partnership Interests (without taking into account the Series AC Partnership Interests of the Defaulting Series AC Partner), will have the right to exercise any rights and remedies available at   33 Section 5.5 Additional Debt Financing. (a) On the 15th day of each month beginning prior to the In-Service Date, the Series AC shall (i) to the extent funded by EECI to Enbridge Partners under Facility A1, borrow under Facility B1 an amount equal to 66.67% of 45% of the Monthly Capital Requirement set forth in the Series AC Capital Contribution Notice for such month delivered to the Series AC Partners pursuant to Section 5.4(b) and (ii) borrow under Facility C1 an amount equal to 33.33% of 45% of the Monthly Capital Requirement set forth in the Series AC Capital Contribution Notice for such month delivered to the Series AC Partners pursuant to Section 5.4(b). The proceeds of such borrowings shall be used to fund construction costs related to the Alberta Clipper Project. (b) On the 15th day of each month beginning prior to the In-Service Date, Enbridge Partners shall borrow under Facility A1 an amount equal to 66.67% of borrowings under Facility B1 pursuant to Section 5.5(a). (c) Promptly following the In-Service Date, Enbridge Partners shall use its commercially reasonable efforts to issue senior unsecured Indebtedness in an amount sufficient to refinance the outstanding borrowings under Facility C1 on such date in accordance with Section 3(d) of the Tariff Term Sheet (the “Enbridge Partners Long-Term Indebtedness”). The proceeds of the Enbridge Partners Long-Term Indebtedness shall be loaned to the Series AC on substantially the same terms as the Enbridge Partners Long-Term Indebtedness in order to refinance the outstanding borrowings under Facility C1. (d) On the date of issuance of the Enbridge Partners Long-Term Indebtedness, EECI shall loan to Enbridge Partners on substantially the same terms as the Enbridge Partners Long-Term Indebtedness an amount sufficient to refinance the outstanding borrowings under Facility B1 on such date. The proceeds of such loan shall be loaned by Enbridge Partners to the Series AC on substantially the same terms as the Enbridge Partners Long-Term Indebtedness in order to refinance the outstanding borrowings under Facility B1. Section 5.6 Future Alberta Clipper Expansions. (a) Any Series AC Partner may from time to time propose an expansion of the capacity of the Alberta Clipper Project (each, an “Alberta Clipper Expansion Project”) by providing a written proposal setting forth in reasonable detail the terms of such Alberta Clipper Expansion Project, including a budget and capital expenditure plan (an “Alberta Clipper Expansion Proposal”), to each Series AC Partner. Promptly following its receipt of an Alberta Clipper Expansion Proposal, the Managing General Partner of the Series AC shall use its commercially reasonable efforts to develop, and negotiate with shippers regarding, the tolling and other financial terms for such Alberta Clipper Expansion Project that include objectively determinable incremental revenues and costs (the “Alberta Clipper Expansion Project Terms”) that are as favorable to the Alberta Clipper Expansion Project as can reasonably be achieved; provided, however, that the Managing General Partner of the Series AC shall not be obligated to seek any Alberta Clipper Expansion Project Terms that could reasonably be expected to have a   34 material adverse impact on any Series. The Managing General Partner of the Series AC shall not agree to any Alberta Clipper Expansion Project Terms that could reasonably be expected to have a material adverse impact on any Series without the consent of a Majority in Interest of such Series (excluding for purposes of any such vote of the Series AC Partners or the Partners of an Alberta Clipper Expansion Series that is not wholly owned by any Partner and its Affiliates (i) prior to the occurrence of a Fundamental Change, the Partnership Interests owned by the Managing General Partner of the Series AC and its Affiliates and (ii) following the occurrence of a Fundamental Change, the Partnership Interests owned by EECI and its Affiliates). The Managing General Partner of the Series AC shall provide written notice of the Alberta Clipper Expansion Project Terms to each Series AC Partner promptly following the determination of the Alberta Clipper Expansion Project Terms. (b) Enbridge Partners shall have the right, but not the obligation, to provide all or any portion of the debt and equity financing required in connection with each Alberta Clipper Expansion Project (the “Alberta Clipper Expansion Capital Requirement”) by providing written notice of its election to participate in the Alberta Clipper Expansion Project to the Series AC Partners as soon as reasonably practicable but in any event within 30 days following the receipt of the Alberta Clipper Expansion Project Terms. If Enbridge Partners does not elect to fund 100% of the Alberta Clipper Expansion Capital Requirement, EECI shall have the right, but not the obligation, to fund the portion of the Alberta Clipper Expansion Capital Requirement that Enbridge Partners has elected not to fund. If EECI elects to fund such portion, it shall provide written notice to Enbridge Partners promptly following receipt of Enbridge Partners’ notice of election to fund a portion of the Alberta Clipper Expansion Capital Requirement. If EECI and/or Enbridge Partners do not elect to fund 100% of the Alberta Clipper Expansion Capital Requirement, then the Alberta Clipper Expansion Project will not be undertaken by the Partnership or any Series. Enbridge Partners and EECI may fund their respective portions of any Alberta Clipper Expansion Capital Requirement pursuant to this Section 5.6 either directly or through a Subsidiary or a controlled Affiliate. (c) If the Alberta Clipper Expansion Capital Requirement is to be provided Pro Rata by the Series AC Partners, all assets related to such Alberta Clipper Expansion Project shall be designated as Series AC Assets, and all Liabilities related to such Alberta Clipper Expansion Project shall be designated as Series AC Liabilities. Capital Contributions associated with such Alberta Clipper Expansion Project shall be Additional Series AC Capital Contributions. (d) The assets of any Alberta Clipper Expansion Project that is undertaken but that are not designated as Series AC Assets shall be designated as the assets of a new series of partnership interests in the Partnership to be held by the Partners participating in such Alberta Clipper Expansion Project in proportion to their respective capital contributions in respect of such Alberta Clipper Expansion Project (an “Alberta Clipper Expansion Series”). Subject to Section 7.3, the Managing General Partner of the Partnership generally is hereby authorized to take all actions necessary to create and establish the Alberta Clipper Expansion Series with such rights, powers and duties as the Managing General Partner of the Partnership generally and the Persons becoming Partners of such new Series shall determine, including to amend this Agreement and its exhibits to set forth all relevant terms applicable to such Series. The Persons becoming Partners of such Alberta Clipper Expansion Series shall be admitted to the Partnership with respect to such Series as Partners upon their execution of a counterpart to this Agreement in their capacity as Partners of such Alberta Clipper Expansion Series.   35 Section 5.7 Interest and Withdrawal of Capital Contributions. No interest shall be paid by the Partnership or any Series on Capital Contributions. No Partner shall be entitled to the withdrawal or return of its Capital Contribution, except to the extent, if any, that distributions made pursuant to this Agreement or upon dissolution of the Partnership or the termination of any Series may be considered as such by law and then only to the extent expressly provided for in this Agreement. Except to the extent expressly provided in this Agreement, no Partner shall have priority over any other Partner either as to the return of Capital Contributions or as to Profits, Losses or distributions. Any such return shall be a compromise to which all Partners agree within the meaning of Section 17-502(b) of the Delaware Act. Section 5.8 Capital Accounts. (a) A separate Capital Account shall be established and maintained for each Partner in accordance with the requirements of Treasury Regulation Section 1.704-1(b)(2)(iv). A Partner that owns a Partnership Interest in more than one Series shall have a single Capital Account that reflects all such Partnership Interests; provided, however, that Series Capital Accounts shall be maintained for each Partner in accordance with the requirements of Treasury Regulation Section 1.704-1(b)(2)(iv). A Partner’s Capital Account balance shall be the sum of the balances of each of such Partner’s Series Capital Accounts. (b) Each Series Capital Account for each Partner shall be increased by (i) the amount of money contributed by that Partner to the Partnership with respect to a Series, (ii) the Book Value of property contributed by that Partner to the Partnership with respect to a Series (net of liabilities secured by such contributed property that the Partnership is considered to assume or take subject to under Section 752 of the Code), and (iii) allocations to that Partner of Profits and any other items of income and gain attributable to a Series, and shall be decreased by (iv) the amount of money of a Series distributed to that Partner, (v) the Book Value of property of a Series distributed to that Partner (net of liabilities secured by such distributed property that such Partner is considered to assume or take subject to under Section 752 of the Code), and (vi) allocations to that Partner of Losses and any other items of loss and deduction attributable to a Series. (c) The Partners’ Series Capital Accounts shall also be maintained and adjusted as permitted by the provisions of Treasury Regulation § 1.704-1(b)(2)(iv)(f) and as required by the other provisions of Treasury Regulation §§ 1.704-1(b)(2)(iv) and 1.704-1(b)(4). (d) Whenever the fair market value of property of a Series is required to be determined pursuant to this Section 5.8, the Managing General Partner of such Series shall establish the fair market value in a notice to the Partners of such Series. (e) On a Transfer of all or part of a Partner’s Partnership Interest, each applicable Series Capital Account of the transferor that is attributable to the transferred Partnership Interests shall carry over to the transferee Partner in accordance with the provisions of Treasury Regulation § 1.704-1(b)(2)(iv)(1).   36 ARTICLE VI ALLOCATIONS AND DISTRIBUTIONS Section 6.1 Allocations for Capital Account Purposes. (a) Allocations. For purposes of maintaining the Series Capital Accounts pursuant to Section 5.8 and in determining the rights of the Partners among themselves with respect to each Series, after making all of the allocations under Sections 6.1(b) and 6.1(c), Profits and Losses and items thereof with respect to a Series shall be allocated among the Partners of such Series in each taxable year (or portion thereof) as provided herein below. (i) Series AC. Each item of income, gain, loss, deduction and credit attributable to Series AC Assets and Series AC Liabilities shall be allocated to the Series AC Partners in accordance with their respective Series AC Percentage Interests. (ii) Series LH. Each item of income, gain, loss, deduction and credit attributable to Series LH Assets and Series LH Liabilities shall be allocated to the Series LH Partners in accordance with their respective Series LH Percentage Interests. (iii) Notwithstanding Sections 6.1(a)(i) and 6.1(a)(ii), in the event of the dissolution and liquidation of the Partnership or the termination of a Series, allocations of Profit and Loss, and items thereof in connection with the liquidation shall be made in accordance with Section 11.3(a). Losses and other items of deduction and loss specially allocated to a Partner with respect to a Series shall not exceed the maximum amount of Losses and items of deduction and loss that can be allocated without causing such Partner to have a deficit in its Adjusted Capital Account for such Series at the end of any taxable year or other period. In the event that some but not all of the Partners would have a deficit in their Adjusted Capital Accounts for such Series as a consequence of an allocation pursuant to this Section 6.1, the limitation set forth in the preceding sentence shall be applied on a Partner by Partner basis, and Losses or items of deduction and loss not allocable to any Partner as a result of such limitation shall be allocated to the other Partners of such Series in accordance with and to the extent of the relative positive balances in such Partners’ Adjusted Capital Accounts attributable to such Series. Any excess Losses or other items of deduction and loss remaining shall be allocated, Pro Rata, to the Partners of any other Series whose Adjusted Capital Accounts for such other Series have positive balances to the extent of such positive balances. (b) Special Allocations. Notwithstanding any other provisions of this Section 6.1, the following special allocations shall be made on a Series by Series basis in the following order for each taxable period: (i) Notwithstanding any other provision of this Section 6.1, if there is a net decrease in Minimum Gain attributable to a Series during any taxable year, each Partner of such Series shall be allocated items of income and gain attributable to such Series for such year (and,   37 if necessary, subsequent taxable years) in the manner and amounts provided in Treasury Regulation Sections 1.704-2(f)(6), (g)(2) and (j)(2)(i). For purposes of this Section 6.1(b), each Partner’s Adjusted Capital Account balance for such Series shall be determined, and the allocation of income or gain required hereunder shall be effected, prior to the application of any other allocations pursuant to this Section 6.1 with respect to such taxable year. This Section 6.1(b)(i) is intended to comply with the minimum gain chargeback requirement in Treasury Regulation Section 1.704-2(f) and shall be interpreted consistently therewith. (ii) Notwithstanding the other provisions of this Section 6.1 (other than Section 6.1(b)(i) above), if there is a net decrease in Partner Nonrecourse Debt Minimum Gain attributable to a Series during any taxable year, any Partner with a share of such Partner Nonrecourse Debt Minimum Gain at the beginning of such taxable year shall be allocated items of income and gain attributable to such Series for such year (and, if necessary, subsequent taxable years) in the manner and amounts provided in Treasury Regulation Section 1.704-2(i)(4) and (j)(2)(ii). For purposes of this Section 6.1(b), each Partner’s Adjusted Capital Account balance shall be determined, and the allocation of income and gain required hereunder shall be effected, prior to the application of any other allocations pursuant to this Section 6.1, other than Section 6.1(b)(i) above, with respect to such taxable year. This Section 6.1(b)(ii) is intended to comply with the partner nonrecourse debt minimum gain chargeback requirement in Treasury Regulation Section 1.704-2(i)(4) and shall be interpreted consistently therewith. (iii) Except as provided in Sections 6.1(b)(i) and 6.1(b)(ii) above, in the event any Partner unexpectedly receives an adjustment, allocation or distribution described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6) attributable to a Series, items of income and gain of such Series shall be allocated to such Partner in an amount and manner sufficient to eliminate, to the extent required by such Treasury Regulation, the deficit balance, if any, in its Adjusted Capital Account attributable to such Series created by such adjustment, allocation or distribution as quickly as possible unless such deficit balance is otherwise eliminated pursuant to Sections 6.1(b)(i), 6.1(b)(ii), 6.1(b)(iv) or 6.1(b)(v). This Section 6.1(b)(iii) is intended to constitute a qualified income offset described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith. (iv) After giving effect to the allocations in Sections 6.1(b)(i), 6.1(b)(ii) and 6.1(b)(iii): (A) in the event that the Series LH Partners become obligated to make payments to the Series AC Partners pursuant to Section 6.2(c), items of Partnership gross income and gain shall be allocated to the Series LH Partners in accordance with their respective Series LH Percentage Interests until the aggregate amounts of items allocated to the Series LH Partners pursuant to this Section 6.1(b)(iv) for such taxable year and all prior taxable years equals the cumulative amount of payments made by the Series LH Partners to the Series AC Partners pursuant to Section 6.2(c) for such taxable year and all prior taxable years; and (B) in the event that the Series AC Partners become obligated to make payments to the Series LH Partners pursuant to Section 6.3(c), items of Partnership gross income and gain shall be allocated to the Series AC Partners in accordance with their respective Series AC Percentage Interests until the aggregate amounts of items allocated to the Series AC   38 Partners pursuant to this Section 6.1(b)(iv) for such taxable year and all prior taxable years equals the cumulative amount of payments made by the Series AC Partners to the Series LH Partners pursuant to Section 6.3(c) for such taxable year and all prior taxable years. (v) In the event any Partner has a deficit balance in its Adjusted Capital Account attributable to a Series at the end of any taxable year, such Partner shall be allocated items of gross income and gain of such Series in the amount of such excess as quickly as possible; provided, however, that an allocation pursuant to this Section 6.1(b)(v) shall be made only if and to the extent that such Partner would have a deficit balance in its Adjusted Capital Account for such Series after all other allocations provided in this Section 6.1(b) (other than Section 6.1(b)(iii)) have been tentatively made as if Section 6.1(b)(iii) and this Section 6.1(b)(v) were not in this Agreement. (vi) Nonrecourse Deductions attributable to a Series for any taxable year shall be allocated to the Partners of such Series in accordance with their Percentage Interests for such Series. (vii) Partner Nonrecourse Deductions with respect to a Partner Nonrecourse Debt for any taxable year shall be allocated 100% to the Partner that bears the Economic Risk of Loss with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable in accordance with Treasury Regulation Section 1.704-2(i). If more than one Partner bears the Economic Risk of Loss with respect to a Partner Nonrecourse Debt, Partner Nonrecourse Deductions attributable thereto shall be allocated between or among such Partners in accordance with the ratios in which they share such Economic Risk of Loss. This Section 6.1(b)(vii) is intended to comply with the provisions of Treasury Regulation Section 1.704-2(i) and shall be interpreted consistently therewith. (viii) To the extent an adjustment to the adjusted tax basis of any asset pursuant to Code Sections 734(b) or 743(b) is required, pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts as a result of a distribution in liquidation of a Partner’s Partnership Interest in a Series, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis), and such item of gain or loss shall be allocated to the Partners in a manner consistent with the manner in which their Series Capital Accounts are required to be adjusted pursuant to such provisions. (c) Curative Allocation. The Regulatory Allocations are intended to comply with certain requirements of the Treasury Regulations. It is the intent of the Partners that, to the extent possible, all Regulatory Allocations attributable to a Series shall be offset either with other Regulatory Allocations attributable to such Series, or with special allocations of other items of income, gain, loss or deduction attributable to such Series pursuant to this Section 6.1(c). Therefore, notwithstanding any other provision of this Article VI (other than the Regulatory Allocations), but subject to the Code and the Treasury Regulations, the Managing General Partner of the applicable Series shall make such offsetting special allocations of income, gain, loss or deduction in whatever manner it determines appropriate so that, after such offsetting allocations are made, each Partner’s applicable Series Capital Account balance is, to the extent possible, equal to the balance such Partner would have had if the Regulatory Allocations were   39 not part of this Agreement. In exercising its discretion under this Section 6.1(c), the Managing General Partner of the applicable Series shall take into account future Regulatory Allocations that, although not yet made, are likely to offset other Regulatory Allocations previously made. (d) Income Tax Allocations. (i) Except as otherwise provided in this Section 6.1, each item of income, gain, loss and deduction of a Series shall be allocated among the Partners of such Series for U.S. federal income tax purposes in the same manner as such items are allocated under Sections 6.1(a), 6.1(b) and 6.1(c). (ii) For U.S. federal income tax purposes, income, gain, loss and deduction with respect to property contributed to a Series by a Partner or the Book Value of which is adjusted pursuant to clause (b) or (d) of the definition of Book Value shall be allocated among the Partners of such Series in a manner that takes into account the variation between the adjusted tax basis of such property and its Book Value, as required by Section 704(c) of the Code and Treasury Regulation Section 1.704-1(b)(4)(i), using the remedial allocation method permitted by Treasury Regulation Section 1.704-3(d). (iii) All items of income, gain, loss, deduction and credit allocated to the Partners in accordance with the provisions hereof and basis allocations recognized by a Series for U.S. federal income tax purposes shall be determined without regard to any election under Code Section 754 that may be made by the Series. (iv) If any deductions for depreciation or cost recovery are recaptured as ordinary income upon the sale or other disposition of property of a Series, the ordinary income character of the gain from such sale or disposition shall be allocated among the Partners of such Series in the same ratio as the deductions giving rise to such ordinary income character were allocated. Distributions to Series AC Partners. (a) Within 45 days following the end of each Quarter commencing with the Quarter in which the In-Service Date occurs, the Partnership in respect of the Series AC shall distribute Pro Rata to the Series AC Partners as of the last day of such Quarter an amount in cash equal to the Series AC Distribution Amount with respect to such Quarter (the “Series AC Distribution”). Notwithstanding any provision to the contrary contained in this Agreement, neither the Partnership nor the Series AC shall make any distribution to any Series AC Partner on account of its Partnership Interest if such distribution would violate the Delaware Act or any other applicable law or violate Section 10.4(a) of the Note Agreement. (b) Notwithstanding Section 6.2(a), in the event of the dissolution and liquidation of the Partnership or the termination of the Series AC, all cash receipts received during or after the Quarter in which the Liquidation Date occurs shall be applied and distributed solely in accordance with, and subject to the terms and conditions of, Section 11.3.   40 (c) If, for any Quarter (including the Quarter in which the liquidation of the Series AC is completed), the cash that is distributed by the Partnership to the Series AC Partners is less than the Series AC Distribution Amount for such Quarter, then the Series LH Partners shall promptly pay to the Series AC Partners Pro Rata in cash an amount equal to such shortfall. Section 6.3 Distributions to Series LH Partners. (a) On the date the Series AC Distribution is made pursuant to Section 6.2(a), the Managing General Partner of the Series LH may, in its sole discretion, cause the Partnership in respect of the Series LH to distribute Pro Rata to the Series LH Partners any cash that is not otherwise required under this Agreement to be distributed to the Partners of any other Series or properly reserved by any other Series in accordance with this Agreement (the “Series LH Distribution”). Notwithstanding any provision to the contrary contained in this Agreement, neither the Partnership nor Series LH shall make any distribution to any Series LH Partner on account of its Series LH Partnership Interest if such distribution would violate the Delaware Act or other applicable law or violate Section 10.4(a) of the Note Agreement. (b) Notwithstanding Section 6.3(a), in the event of the dissolution and liquidation of the Partnership or the termination of the Series LH, all cash Series LH is completed), the Series AC Distribution Amount is less than zero, then the Series AC Partners shall promptly pay to the Series LH Partners Pro Rata in cash an amount equal to the amount by which the Series AC Distribution Amount was less than zero. ARTICLE VII MANAGEMENT AND OPERATION OF BUSINESS; LIMITED PARTNERS Section 7.1 Management. (a) The Managing General Partner of the Partnership generally shall conduct, direct and manage all activities of the Partnership generally, and the Managing General Partner of each Series shall conduct, direct and manage all activities of the Series for which it serves as Managing General Partner. Except as otherwise expressly provided in this Agreement, (i) all management powers over the business and affairs of the Partnership generally shall be exclusively vested in the Managing General Partner of the Partnership generally, and no Limited Partner or other General Partner shall have any management power over the business and affairs of (or authority to bind) the Partnership generally and (ii) all management powers over the business and affairs of each Series shall be exclusively vested in the Managing General Partner of such Series, and no the business and affairs of (or authority to bind) such Series. In addition to the powers now or hereafter granted a general partner of a limited partnership under applicable law or that are granted to a Managing General Partner under any other provision of this Agreement, each Managing General Partner, subject to any approval required by Section 7.3 or any other provision of this Agreement, shall have full power and authority to do all things and on such   41 terms as it determines to be necessary or appropriate to conduct the business of the Partnership generally or the applicable Series, as the case may be, to exercise all powers set forth in Section 2.5 and to effectuate the purposes set forth in Section 2.4, including the following: (i) the making of any expenditures, the lending or borrowing of money, the assumption or guarantee of, or other contracting for, indebtedness and other liabilities, the issuance of evidences of indebtedness and the incurring of any other obligations; (ii) the making of regulatory and other filings, or rendering of periodic or other reports to governmental or other agencies having jurisdiction over the business or assets of the Partnership and each Series (other than in connection with the matters set forth in Section 9.3); (iii) the acquisition, disposition, mortgage, pledge, encumbrance, hypothecation or exchange of any or all of the assets of the applicable Series or the merger or other combination of the Partnership with or into another Person; (iv) the use of the assets of the applicable Series (including cash on hand) for any purpose consistent with the terms of this Agreement; (v) the negotiation, execution and performance of any contracts, conveyances or other instruments on behalf of the Partnership generally or the applicable Series; (vi) the distribution of cash or property of the applicable Series; (vii) the maintenance of separate or joint insurance policies for the benefit of the Partnership, any Series, any Partners or any Indemnitees; (viii) the formation of, or acquisition of an interest in, and the contribution of property and the making of loans to, any further limited or general partnerships, joint ventures, corporations, limited liability companies or other relationships subject to the restrictions set forth in Section 2.4; (ix) the control of any matters affecting the rights and obligations of the Partnership or the applicable Series, including the bringing and defending of actions at law or in equity and otherwise engaging in the conduct of litigation, arbitration or mediation and the incurring of legal expense and the settlement of claims and litigation; and (x) the indemnification of any Person against liabilities and contingencies to Section 7.2 Certificate of Limited Partnership. The Managing General Partner of the Partnership generally has caused an amendment to and restatement of the Certificate of Limited Partnership to be filed with the Secretary of State of the State of Delaware as required by the Delaware Act, which contains a notice of the limitation of liabilities of the Series in conformity with Section 17-218 of the Delaware Act. To the extent the Managing General Partner of the Partnership generally determines such action to be   42 necessary or appropriate, the Managing General Partner of the Partnership generally shall file amendments to and restatements of the Certificate of Limited Partnership and do all necessary things to maintain the Partnership as a limited partnership (or a partnership or other entity in which the limited partners have limited liability) under the laws of the State of Delaware or of any other state in which the Partnership may elect to do business or own property. Section 7.3 Restrictions on the Managing General Partners’ Authority. Notwithstanding any other provision of this Agreement to the contrary, none of the Partnership, any Series, any Managing General Partner nor any other Partner shall cause or commit the Partnership or any Series to take any of the following actions without the prior written consent or vote of a Majority in Interest of Series AC Partnership Interests: (a) approve the Series AC Annual Budget as provided for in Section 7.4; (b) request or otherwise require any additional Series AC Capital Contributions, pursuant to Section 5.4 or otherwise, that are not reflected in the approved Series AC Annual Budget or an approved Alberta Clipper Expansion Budget; (c) establish any Series AC Reserves; (d) with respect to the Series AC, make any expenditure or series of related expenditures in excess of $1,000,000 that are not (i) reflected in the approved Series AC Annual Budget or an approved Alberta Clipper Expansion Budget or (ii) required to address an emergency; (e) the issuance, incurrence or assumption of any Indebtedness by the Series AC other than (i) Indebtedness reflected in the approved Series AC Annual Budget or an approved Alberta Clipper Expansion Budget, (ii) the Short-Term Debt Financing, (iii) the Long-Term Debt Financing, (iv) an Intercompany Obligation permitted by Section 7.3(f) or (v) a Springing Guarantee permitted by Section 7.3(g); (f) the issuance, incurrence or assumption of any Indebtedness by the Partnership generally or any Series (other than the Series AC) unless such Indebtedness is (i) (x) (A) by its terms, expressly non-recourse to any Series AC Assets and the Series AC Partners or (B) an Intercompany Obligation and (y) after giving effect to the issuance, incurrence or assumption of such Indebtedness, the aggregate principal amount of Indebtedness of the Partnership and all Series (excluding (A) short term Indebtedness incurred in connection with the construction of projects that have not yet been placed into service and (B) Indebtedness of the Series AC) does not exceed 45% of the capitalization of the Partnership generally and all Series (other than the Series AC) taken as a whole, (ii) incurred in connection with the refinancing of Existing Indebtedness for which the Partnership is the direct obligor (other than Existing Indebtedness that is an Intercompany Obligation), (iii) an Intercompany Obligation permitted by Section 7.3(e) or (iv) a Springing Guarantee permitted by Section 7.3(g); (g) any guarantee of Indebtedness of another Person by the Partnership generally or any Series other than (i) any guarantee of Indebtedness of another Person pursuant to a currently existing obligation arising under a debt agreement related to Existing Indebtedness or (ii) a   43 guarantee of Indebtedness of another Person similar to those currently existing under any Existing Indebtedness arising under a debt agreement entered into after the Closing Date if the Indebtedness under such debt agreement is senior to or pari passu with the Existing Indebtedness (any guarantee permitted under clauses (i) or (ii) above, a “Springing Guarantee”); (h) any material modification of any material contract related to the Series AC Assets or to which the Series AC is a party (excluding this Agreement); (i) any material modification to the Tariff Term Sheet or the Alberta Clipper Surcharge; (j) any merger, consolidation, conversion, business combination or reorganization of the Partnership or any Subsidiary of the Partnership that owns any Series AC Assets (other than any conversion pursuant to Section 12.11(c)); (k) any direct or indirect sale, exchange or other transfer of (i) any Series AC Assets or (ii) any assets of the Partnership generally or any Series (other than the Series AC) in excess of $25,000,000, in each case, other than sales, exchanges or other transfers as a result of the exercise of remedies pursuant to Existing Indebtedness; (l) any issuance of any additional Partnership Interests of the Partnership generally or any Series other than in connection with the creation of an Alberta Clipper Expansion Series pursuant to Section 5.6(d) (it being agreed that the making of Capital Contributions pursuant to Section 5.4 shall not constitute the issuance of additional Partnership Interests); (m) except as otherwise provided in Section 4.1(c) and Section 5.6(d), the admission of any Person as a new Partner of the Partnership generally or of any Series (whether by Transfer of existing Partnership Interests, merger or (n) except as otherwise provided in Section 4.1(c) and Section 5.6(d), any withdrawal or removal of any General Partner or admission of any new General Partner of the Partnership generally or any Series; (o) the amendment of any provision of this Agreement relating to the Series AC or any other amendment of this Agreement that would have an adverse effect on the Series AC, the Series AC Assets or the Series AC Partners; (p) the entry into or termination of any activity or business, or the acquisition or divestiture of any asset or business, that would cause the Partnership or any Series to be taxed as an association taxable as a corporation or otherwise taxable as an entity for U.S. federal income tax purposes; (q) the voluntary dissolution or liquidation of the Partnership or voluntary termination of any Series; or (r) the commencement of a voluntary case with respect to, or the consent to the entry of an order for relief in an involuntary case against, the Partnership or any Series under any bankruptcy laws.   44 Section 7.4 Series AC Annual Budget. (a) Fifteen days prior to the beginning of each fiscal year beginning after December 31, 2009, the Managing General Partner of the Series AC shall cause to be prepared and submitted to the Series AC Partners a budget and forecast setting forth the anticipated revenues and expenses for the Series AC for the following fiscal year, including any anticipated Series AC Expansion Capital Expenditures, Series AC Maintenance Capital Expenditures, operating expenses, revenues, Capital Contributions and distributions (the “Series AC Annual Budget”). (b) After the Series AC Annual Budget has been approved by a Majority in Interest of Series AC Partnership Interests, the Managing General Partner of the Series AC shall implement the Series AC Annual Budget and shall be authorized to make the expenditures and incur the obligations provided for therein. The Series AC Annual Budget may be revised at any time during a fiscal year subject to the approval of a Majority in Interest of Series AC Partnership Interests. (c) If a Majority in Interest of Series AC Partnership Interests fails to adopt on or before December 31 of any year a Series AC Annual Budget that has been properly submitted for approval by the Managing General Partner of the Series AC, then a Majority in Interest of Series AC Partnership Interests shall be deemed to have approved as the Series AC Annual Budget for the next calendar year the last Series AC Annual Budget that was approved by a Majority in Interest of Series AC Partnership Interests (the “Prior Budget”) adjusted as follows: (i) all operating expense items (including Series AC Maintenance Capital Expenditures but excluding Series AC Expansion Capital Expenditures) set forth in the Prior Budget shall be increased by 5% from the Prior Budget, (ii) all Series AC Expansion Capital Expenditures set forth in the Prior Budget shall be excluded and (iii) all expenditures related to the construction of the Alberta Clipper Project set forth in the Prior Budget shall be replaced with the estimated expenditures related to the construction of the Alberta Clipper Project for the next calendar year; provided, however, that if a Series AC Annual Budget subsequently is approved by a Majority in Interest of Series AC Partnership Interests, such subsequently approved Series AC Annual Budget shall be effective for the remainder of the applicable fiscal year. Section 7.5 Collection of Series AC Revenue Entitlement. (a) The Series AC Revenue Entitlement for each year will be collected by the Partnership on behalf of the Series AC through the surcharge provided for in Section 3 “Revenue Requirement” of the Tariff Term Sheet (excluding any reduction attributable to the “Revenue Credit” provided for in Section 13 of the Tariff Term Sheet that is collected through the base system tolls) that is levied during that year with respect to the projected level of costs and throughput volumes including the adjustment provided for in Section 4 “Revenue Requirement Adjustment” of the Tariff Term Sheet for over or under collection that is included in the surcharge levied in the year following the year of such over or under collection, inclusive of carrying charges. (b) The Managing General Partner of the Series AC shall cause the Series AC Records to set forth the cumulative amount by which the Series AC Revenue Entitlement exceeds or is less than amounts actually collected, inclusive of carrying charges.   45 (c) Neither the Series AC Revenue Entitlement, nor the amount of the Series AC Revenue Entitlement that is collected on behalf of Series AC in any period, will be reduced by any part of the revenue credit to the Alberta Clipper Surcharge specified in Section 13 of the Tariff Term Sheet. Section 7.6 Compensation of General Partners. No General Partner shall be compensated for its services as a General Partner of the Partnership generally or any Series; provided, however, this Section 7.6 shall not prohibit or restrict any reimbursement to which any General Partner is otherwise entitled for expenses it incurs or payments it makes on behalf of the Partnership generally or any Series, including any general and administrative expenses. Section 7.7 Indemnification. (a) To the fullest extent permitted by law but subject to the limitations expressly provided in this Agreement, each Series shall indemnify and hold harmless all of such Series’ Indemnitees from and against any and all losses, claims, damages, liabilities, joint or several, expenses (including legal fees and expenses), judgments, fines, penalties, interest, settlements or other amounts (“Damages”) arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative (“Claims”), in which any such Indemnitee may be involved, or is threatened to be involved, as a party or otherwise, by reason of its management of the affairs of such Series or by reason of its status as an Indemnitee of such Series, that relates to or arises out of such Series, its property, its business or its affairs; provided, that the Indemnitee shall not be indemnified and held harmless if there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of the matter for which the Indemnitee is seeking indemnification pursuant to this Section 7.7, the Indemnitee acted in bad faith or engaged in fraud, willful misconduct or, in the case of a criminal matter, acted with knowledge that the Indemnitee’s conduct was unlawful. Any indemnification pursuant to this Section 7.7 shall be made only out of the assets of the indemnifying Series, it being agreed that, except as provided in Section 11.7, no Partner shall be personally liable for such indemnification nor shall any Partner have any obligation to contribute or loan any monies or property to such Series to enable it to effectuate such indemnification. (b) To the fullest extent permitted by law, expenses (including legal fees and expenses) incurred by an Indemnitee who is indemnified pursuant to Section 7.7(a) in defending any Claim shall, from time to time, be advanced by the indemnifying Series prior to a determination that the Indemnitee is not entitled to be indemnified upon receipt by such Series of an undertaking by or on behalf of the Indemnitee to repay such amount if it shall be determined that the Indemnitee is not entitled to be indemnified as authorized in this Section 7.7. (c) The indemnification provided by this Section 7.7 shall be in addition to any other rights to which an Indemnitee may be entitled under any agreement, pursuant to any vote of a Majority in Interest of the indemnifying Series, as a matter of law or otherwise, both as to actions in the Indemnitee’s capacity as an Indemnitee and as to actions in any other capacity, and shall continue as to an Indemnitee who has ceased to serve in such capacity and shall inure to the benefit of the heirs, successors, assigns and administrators of the Indemnitee.   46 (d) Any Series may purchase and maintain (or reimburse such Series’ General Partners or their Affiliates for the cost of) insurance, on behalf of such Series’ General Partners, their Affiliates and such other Persons as such Series’ General Partners shall determine, against any liability that may be asserted against, or expense that may be incurred by, such Person in connection with such Series’ activities or such Person’s activities on behalf of such Series, regardless of whether such Series would have the power to indemnify such Person against such liability under the provisions of this Agreement. (e) In no event may an Indemnitee subject any Partner to personal liability by reason of the indemnification provisions set forth in this Agreement. (f) An Indemnitee shall not be denied indemnification in whole or in part under this Section 7.7 because the Indemnitee had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement with respect to the indemnifying Series. (g) The provisions of this Section 7.7 are for the benefit of the Indemnitees, their heirs, successors, assigns and administrators and shall not be deemed to create any rights for the benefit of any other Persons. (h) No amendment, modification or repeal of this Section 7.7 or any provision hereof shall in any manner terminate, reduce or impair the right of any past, present or future Indemnitee to be indemnified by a Series, nor the obligations of such Series to indemnify any such Indemnitee under and in accordance with the provisions of this Section 7.7 as in effect immediately prior to such amendment, modification or repeal with respect to Claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such Claims may arise or be asserted. (i) The provisions of this Section 7.7 shall not be construed to limit the power of any Series to indemnify an Indemnitee of such Series to the fullest extent permitted by law or to enter into specific agreements, commitments or arrangements for indemnification permitted by law. The absence of any express provision for indemnification herein shall not limit any right of indemnification existing independently of this Section 7.7. Section 7.8 Interseries Indemnification. Notwithstanding anything to the contrary set forth in this Agreement, in the event that any Series (the “Indemnified Series”) (a) becomes liable for any Liability of another Series (the “Indemnifying Series”), including any Claim for Damages by a Third Party that relate to or arise out of the actions, obligation, assets, property, business or affairs of the Indemnifying Series or (b) pays or discharges an Intercompany Obligation for which the Indemnifying Series is the Primary Obligor (collectively, “Series Indemnified Damages”), to the fullest extent permitted by law, the Indemnifying Series shall indemnify the Indemnified Series for the amount of the Series Indemnified Damages promptly following their incurrence or payment, as applicable. Any indemnification pursuant to this Section 7.8 shall be made (i) only out of the assets of the Indemnifying Series, it being agreed that, except as provided in Section 11.7, no Partner shall be personally liable for such indemnification nor shall any Partner have any obligation to contribute   47 or loan any monies or property to the Indemnifying Series to enable it to effectuate such indemnification and (ii) only to the extent that the Partners of the Indemnified Series have not received a payment from the Partners of the Indemnifying Series under Section 6.2(c) or 6.3(c) with respect to a shortfall related to the Liability that gave rise to the Series Indemnified Damages. Section 7.9 Liability of Indemnitees. (a) Notwithstanding anything to the contrary set forth in this Agreement, no Indemnitee shall be liable for monetary damages to any Series, any Partner or any other Person who is bound by this Agreement, for losses sustained or liabilities incurred as a result of any act or omission of an Indemnitee unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of the matter in question, conduct was criminal. (b) Subject to its obligations and duties as a Managing General Partner set forth in this Agreement, each Managing General Partner may exercise any of the powers granted to it by this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through its agents, and such Managing General Partner shall not be responsible for any misconduct or negligence on the part of any such agent appointed by such Managing General Partner in good faith. (c) To the extent that, at law or in equity, an Indemnitee has duties (including fiduciary duties) and liabilities relating thereto to the Partnership, any Series or the Partners, the General Partners and any other Indemnitee acting in connection with the Partnership’s or a Series’ business or affairs shall not be liable to the Partnership, such Series or any Partner for its good faith reliance on the provisions of this Agreement. The provisions of this Agreement, to the extent that they restrict or eliminate the duties and liabilities of a Partner or other Person to the parties hereto otherwise existing at law or in equity, are agreed by the parties hereto to replace such other duties and liabilities of such Partner or other Person. (d) Any amendment, modification or repeal of this Section 7.9 or any provision hereof shall be prospective only and shall not in any way affect the limitations on the liability of the Indemnitees under this Section 7.9 as in effect immediately prior to such amendment, modification or repeal with respect to Claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such Claims may arise or be asserted. Section 7.10 Limitation of Liability. The Limited Partners shall have no liability under this Agreement except as expressly provided in this Agreement or the Delaware Act. A General Partner of a Series shall not be liable for the obligations of the Partnership generally or any other Series solely as a result of its status as a General Partner of a Series, and a General Partner of the Partnership generally shall not be liable for the obligations of any Series solely as a result of its status as a General Partner of the Partnership generally.   48 Section 7.11 Management of Business. No Limited Partner, in its capacity as such, shall participate in the operation, management or control (within the meaning of the Delaware Act) of the Partnership’s or any Series’ business, transact any business in the Partnership’s or any Series’ name or have the power to sign documents for or otherwise bind the Partnership or any Series. Any action taken by any Affiliate of a General Partner or any officer, director, employee, manager, member, general partner, agent or trustee of a General Partner or any of its Affiliates shall not be deemed to be participation in the control of the business of the Partnership or any Series by a Limited Partner of the Partnership generally or any Series (within the meaning of Section 17-303(a) of the Delaware Act) and shall not affect, impair or eliminate the limitations on the liability of the Limited Partners under this Agreement. Section 7.12 Outside Activities of the Limited Partners. Notwithstanding any duty otherwise existing at law or in equity, except as otherwise set forth in any other agreement to which a Partner is a party, including the Omnibus Agreement, any Partner of the Partnership generally or any Series shall be entitled to and may have business interests and engage in business activities in addition to those relating to the Partnership or any Series, including business interests and activities in direct competition with the Partnership or any Series. Section 7.13 Reliance by Third Parties. Notwithstanding anything to the contrary in this Agreement, (a) any Person dealing with the Partnership shall be entitled to assume that the Managing General Partner of the Partnership generally, and any officer of such Managing General Partner authorized by such Managing General Partner to act on behalf of and in the name of the Partnership, has full power and authority to encumber, sell or otherwise use in any manner any and all assets of the Partnership generally, and to enter into any authorized contracts on behalf of the Partnership as a whole and the Partnership generally, and such Person shall be entitled to deal with such Managing General Partner or any such officer as if it were the Partnership’s sole party in interest, both legally and beneficially and (b) any Person dealing with any Series shall be entitled to assume that the Managing General Partner of such Series, and any officer of such Managing and in the name of such Series, has full power and authority to encumber, sell or otherwise use in any manner any and all assets of such Series and to enter into any authorized contracts on behalf of such Series and such Person shall be were such Series’ sole party in interest, both legally and beneficially. Each Limited Partner hereby waives, to the fullest extent permitted by law, any and all defenses or other remedies that may be available against such Person to contest, negate or disaffirm any action of any Managing General Partner or any such officer in connection with any such dealing. In no event shall any Person dealing with any Managing General Partner or any such officer or its representatives be obligated to ascertain that the terms of this Agreement have been complied with or to inquire into the necessity or expedience of any act or action of such Managing General Partner or any such officer or its representatives. Each and every certificate, document or other instrument executed on behalf of the Partnership or any Series by the Managing General Partner of the Partnership   49 generally or such Series, respectively, or its respective representatives shall be conclusive evidence in favor of any and every Person relying thereon or claiming thereunder that (a) at the time of the execution and delivery of such certificate, document or instrument, this Agreement was in full force and effect, (b) the Person executing and delivering such certificate, document or instrument was duly authorized and empowered to do so for and on behalf of the Partnership or such Series and (c) such certificate, document or instrument was duly executed and delivered in accordance with the terms and provisions of this Agreement and is binding upon the Partnership or such Series, as applicable. Section 7.14 Managing General Partner. Except as provided for in Section 10.1, Lakehead GP (or its designee) shall serve as the managing general partner (the “Managing General Partner”) of the Partnership generally and each Series. Except as expressly provided in this Agreement, all management powers over the business and affairs of the Partnership generally or a Series shall be exclusively vested in the Managing General Partner of the Partnership generally or of such Series, as applicable, and no other General Partner nor any Limited Partner shall have any management power over the business and affairs of the Partnership generally or any Series. Section 7.15 Conflicts of Interest. Unless otherwise expressly provided herein, (a) whenever a conflict of interest exists or arises between a Managing General Partner or any of its Affiliates, on the one hand, and the Partnership, any Series or any Partner or any Affiliates thereof, on the other hand, or (b) whenever this Agreement or any other agreement contemplated herein provides that a Managing General Partner or any of its Affiliates shall act in a manner that is, or provides terms that are, fair and reasonable to the Partnership or any Partner or any Affiliate thereof, such Managing General Partner shall resolve such conflict of interest, take such action or provide such terms, considering in each case the relative interest of each party (including its own interest) to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices and any applicable generally accepted accounting practices or principles. In the absence of bad faith by such Managing General Partner, the resolution, action or terms so made, taken or provided by such Managing General Partner shall be permitted and deemed approved by all the Partners and shall not constitute a breach of this Agreement or any other agreement contemplated herein or of any duty, including any fiduciary duty, or obligation of such Managing General Partner at law or in equity or otherwise, and it shall be presumed in making its decision that the Managing General Partner acted in good faith. In any proceeding challenging such decision, the party bringing the challenge shall have the burden of overcoming such presumption. Section 7.16 Shared Use of Shared Assets. The Shared Assets shall be shared between the Series AC and the Series LH in accordance with the terms set forth in Exhibit C. Exhibit C is hereby incorporated by reference herein and constitutes an integral, non-severable part of this Agreement. The parties hereto hereby agree to be bound by the terms and conditions of Exhibit C.   50 ARTICLE VIII BOOKS, RECORDS AND ACCOUNTING Section 8.1 Records and Accounting. The Managing General Partner of the Partnership generally and the Managing General Partner of each Series shall keep or cause to be kept full and true books of account maintained in accordance with generally accepted accounting principles consistently applied and in which shall be entered fully and accurately each transaction of the Partnership generally or such Series, as applicable. Such books of account, together with a copy of this Agreement, and of the Certificate of Limited Partnership, shall at all times be maintained at the principal place of business of the Partnership. The records maintained for each Series shall account for the assets associated with each such Series separately from the other assets of the Partnership, if any, or of any other Series. Upon written request, each Partner associated with a Series shall have the right, at a time during ordinary business hours, as reasonably determined by the Managing General Partner of such Series, to inspect and copy, at the requesting Partner’s expense, the records of such Series for any purpose reasonably related to such Partner’s interest with respect to such Series. Section 8.2 Fiscal Year. The fiscal year of the Partnership and of each Series shall be a fiscal year ending December 31. ARTICLE IX TAX MATTERS Section 9.1 Tax Returns. The Partnership shall timely file all returns of the Partnership that are required for U.S. federal, state and local income tax purposes on the basis of the accrual method and the taxable year or years that it is required by law to adopt, from time to time, as determined by the Managing General Partner of the Partnership generally. In the event the Partnership is required to use a taxable year other than a year ending on December 31, the Managing General Partner of the Partnership generally shall use reasonable efforts to change the taxable year of the Partnership to a year ending on December 31. The tax information reasonably required by Partners for U.S. federal and state income tax reporting purposes with respect to a taxable year shall be furnished to them within 90 days of the close of the calendar year in which the Partnership’s taxable year ends. The classification, realization and recognition of income, gain, losses and deductions and other items shall be on the accrual method of accounting for U.S. federal income tax purposes. Section 9.2 Partner Tax Return Information. The Partnership shall cause to be delivered to each Partner within 75 days after the end of the Partnership’s taxable year an IRS Form K-1 or a good faith estimate of the amounts to be included on such IRS Form K-1 for such Partner and such other information as shall be necessary (including a statement for that year of each Partner’s share of net income, net losses and other items allocated to such Partner) for the preparation and timely filing by the Partners of their U.S. federal, state and local income and other tax returns.   51 Section 9.3 Tax Elections. (a) If there is a distribution of property of a Series as described in Code Section 734 or a transfer of Partnership Interests as described in Code Section 743, upon request by notice from any Partner of such Series, to elect, pursuant to Code Section 754, to adjust the basis of Series property. (b) Except as otherwise provided herein, the Managing General Partner of the Partnership generally shall determine whether the Partnership should make any other elections permitted by the Code. Section 9.4 Tax Controversies. (a) Subject to the provisions hereof, the Managing General Partner of the Partnership generally is designated as the Tax Matters Partner (as defined in the Code) and is authorized and required to represent the Partnership in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to expend funds for professional services and costs associated therewith. Each Partner agrees to cooperate with the Tax Matters Partner and to do or refrain from doing any or all things reasonably required by the Tax Matters Partner to conduct such proceedings. (b) The Tax Matters Partner shall take such action as may be necessary to cause any Partner so requesting to become a “notice partner” within the meaning of Section 6231(a)(8) of the Code. The Tax Matters Partner shall inform each other Partner of all significant matters that may come to its attention in its capacity as Tax Matters Partner by giving notice thereof on or before the fifth Business Day after becoming aware thereof and, within that time, shall forward to each other Partner copies of all significant written communications it may receive in that capacity. Any cost or expense incurred by the Tax Matters Partner in connection with its duties, including the preparation for or pursuance of administrative or judicial proceedings, shall be paid by the Partnership. (c) If an audit of any of the Partnership’s tax returns shall occur, the Tax Matters Partner shall not settle or otherwise compromise assertions of the auditing agent that may be adverse to any Partner as compared to the position taken on the Partnership’s tax returns without the prior written consent of each such affected Partner. (d) No Partner shall file a request pursuant to Code Section 6227 for an administrative adjustment of Partnership items for any taxable year, or a petition under Code Sections 6226 or 6228 or other Code sections with respect to any item involving the Partnership, without first notifying the other Partners. Any Partner that enters into a settlement agreement with respect to any Partnership item (within the meaning of Code Section 6231(a)(3)) shall notify the other Partners of such settlement agreement and its terms within 90 days from the date of the settlement.   52 (e) If any Partner intends to file a notice of inconsistent treatment under Code Section 6222(b), such Partner shall give reasonable notice under the circumstances to the other Partners of such intent and the manner in which the Partner’s intended treatment of an item is (or may be) inconsistent with the treatment of that item by the other Partners. Section 9.5 Withholding. The Managing General Partner of the Partnership generally is authorized to take any action that may be required to cause the Partnership or any Series to comply with any withholding requirements established under the Code or any other federal, state or local law, including pursuant to Sections 1441, 1442, 1445 and 1446 of the Code. To the extent that the Partnership or any Series is required or elects to withhold and pay over to any taxing authority any amount resulting from the allocation or distribution of income to any Partner (including by reason of Section 1446 of the Code), the Managing General Partner of the Partnership generally or of the applicable Series may treat the amount withheld as a distribution of cash pursuant to Section 6.2 or Section 6.3, as applicable, in the amount of such withholding from such Partner. Section 9.6 Tax Reimbursement. If Texas law requires the Partnership or a Series and any Partner both to participate in the filing of a Texas franchise tax combined group report, and if such Partner or any other member of the Partner’s combined group pays the franchise tax liability due in connection with such combined report, the parties agree that the Partnership or the applicable Series shall promptly reimburse such Partner for the franchise tax paid on behalf of the Partnership as a combined group member. The franchise tax paid on behalf of the Partnership with respect to each applicable Series shall equal the excess, if any, of (i) the franchise tax that the combined group including the Partnership pays over (ii) the amount the combined group would have paid if it had computed its franchise tax liability for the report period without the Partnership as a member of the combined group, but in no event more than what the Partnership or each applicable Series would have paid had it filed the franchise tax return not as a member of a group. In such event, the parties agree that such Partner shall be considered as paying such amount on behalf of the Partnership with respect to each applicable Series and the Partnership with respect to each applicable Series shall deduct for U.S. federal income tax purposes 100% of the Texas franchise tax attributable to the Partnership with respect to each applicable Series; provided that in the event that such deduction may not be properly taken by the Partnership with respect to each applicable Series, the Partnership with respect to each applicable Series shall reimburse such Partner for the after-tax cost of such payment of Texas franchise tax paid on the Partnership’s behalf. Section 9.7 Tax Partnership. It is the intention of the Partners that the Partnership be classified as a partnership for U.S. federal tax purposes. Neither the Partnership nor any Partner shall make an election for the Partnership or any Series to be excluded from the application of the provisions of subchapter K of chapter 1 of subtitle A of the Code or any similar provisions of applicable state or local law or to be classified as other than a partnership pursuant to Treasury Regulation Section 301.7701-3 or any similar provision of state or local law.   53 Section 9.8 Tax Matters Following a Fundamental Change. Following the occurrence of a Fundamental Change, the following provisions shall take effect and supersede any conflicting provisions of this Article IX: (a) EECI Sub shall exercise full and exclusive discretion over all tax matters relating to or affecting the Series AC. For the avoidance of doubt, EECI Sub’s right to exercise its discretion shall include matters relating to the Partnership generally, such as Partnership tax elections permitted by the Code, to the extent that such matter affects the Series AC. (b) The Partnership shall cause to be delivered to EECI Sub at least 15 Business Days before the due date of any Partnership tax return a copy of the proposed tax return. EECI Sub shall have ten Business Days to request changes to any portions of such tax return that affect Series AC, and the Tax Matters Partner shall make all changes to such tax return requested by EECI Sub prior to timely filing such return. (c) If an audit of any of the Partnership’s tax returns shall occur, EECI Sub shall have the right, at its discretion, to control all decisions with respect to any matter relating to or affecting the Series AC, and the Tax Matters Partner shall act in accordance with EECI Sub’s direction. For the avoidance of doubt, EECI Sub shall control all decisions with respect to all matters under audit affecting or relating to the Partnership generally to the extent that such matters also affect the Series AC. ARTICLE X OTHER EVENTS Section 10.1 Fundamental Change. (a) If, at any time, (i) EECI is removed as the general partner of Enbridge Partners pursuant to Section 13.2 (or equivalent provision) of the Fourth Amended and Restated Agreement of Limited Partnership of Enbridge Partners, as amended, or (ii) Enbridge Partners shall cease to directly or indirectly control the Partnership generally and each Series (each, a “Fundamental Change”), then the Managing General Partner of Series AC and each Managing General Partner of any Alberta Clipper Expansion Series shall, without any further action on its part, be deemed to have automatically and irrevocably delegated to EECI Sub (or its designee), to the fullest extent permitted under this Agreement and Delaware law, all of such Managing General Partner’s power and authority to manage and control the business and affairs of the applicable Series (such delegation being referred to herein as the “Maximum Permitted Delegation”), subject to termination only in the sole discretion of EECI Sub. Notwithstanding the delegation provided for in this Section 10.1(a), no Managing General Partner shall be deemed to have withdrawn as a General Partner of the Partnership generally or the applicable Series, and such Managing General Partner shall retain all of its Partnership Interests and Percentage Interests in the Partnership generally and the applicable Series (as the case may be), and none of the foregoing shall be deemed to have been assigned or transferred to EECI Sub (or its designee). (b) If all or a portion of the Maximum Permitted Delegation is determined to be invalid or unenforceable for any reason following a Fundamental Change, EECI, in its sole discretion, may elect to become the Managing General Partner of the Series AC and each Alberta   54 Clipper Expansion Series by providing five Business Days’ prior written notice of such election to the Managing General Partner of the Partnership generally at any time (such election, the “Control Option”). Upon exercise of the Control Option: (i) the Limited Partner Interest of EECI Sub in the Series AC shall automatically convert into a General Partner Interest in the Series AC; (ii) EECI Sub shall be granted a General Partner Interest in each Alberta Clipper Expansion Series that shall have no economic rights with respect to such Series or otherwise; (iii) EECI Sub shall automatically become the Managing General Partner of the Series AC and each Alberta Clipper Expansion Series, with all rights, powers and obligations of the Managing General Partner of such Series as set forth in this Agreement; and (iv) all rights, powers and obligations of the existing Managing General Partner of the Series AC and each Alberta Clipper Expansion Series (in its capacity as such) shall immediately terminate. The exercise of the Control Option pursuant to this Section 10.1(b) shall not affect (A) the status of any Managing General Partner of the Partnership generally or any Series (other than the Series AC or an Alberta Clipper Expansion Series) or (B) the Percentage Interest of the Series AC Partners or the Partners of any Alberta Clipper Expansion Series. (c) Following a Fundamental Change, in addition to the rights set forth in Section 9.8 and Section 10.1, EECI, in its sole discretion, may elect to cause the Series AC Assets and the right to operate the assets of each Alberta Clipper Expansion Series to be transferred to the New AC Entity by providing five Business Days’ prior written notice of such election to the Managing General Partner of the Partnership generally at any time (such election, the “Separation Option”). Upon exercise of the Separation Option, the Managing General Partner of the Partnership generally and each Series AC Partner shall (i) negotiate reasonably and in good faith in connection with a transfer of all Series AC Assets and Series AC Liabilities to the New AC Entity and (ii) use their best efforts to (A) effectuate such transfer and (B) allow the newly formed entity to own and operate the Series AC Assets and operate any Alberta Clipper Expansion Projects, including the transfer of all necessary permits, licenses and rights-of-way and the good faith negotiation and performance of any necessary service agreements between the New AC Entity and the Partnership. The Series AC Partners at the time of exercise of the Separation Option shall be the initial partners or members, as applicable, of the New AC Entity, and their relative percentage interest in the New AC Entity shall be proportionate to their Series AC Percentage Interest at the time of exercise of the Separation Option; provided, however, that EECI or its designee shall be the managing general partner, managing member or the equivalent thereof of the New AC Entity. All costs reasonably incurred by the Partnership in complying with this Section 10.1(c) shall be reimbursed by the Series AC. (d) In connection with the exercise of the Control Option or the Separation Option pursuant to this Section 10.1, each of the Partners agrees to cooperate with respect to such matters and to execute such further assignments, releases, assumptions, amendments of this   55 Agreement and the Certificate of Limited Partnership, notifications and other documents as may be reasonably requested by EECI, EECI Sub or the Managing General Partner of the Series AC for the purpose of giving effect to, or evidencing or giving notice of, the transactions contemplated by such provisions and the otherwise continued operations of the Partnership. Section 10.2 Surcharge Expiration. (a) Upon the expiration or earlier termination of the Surcharge Term, the Tariff Term Sheet shall be replaced with a revised tariff structure in accordance with Section 2(b) of the Tariff Term Sheet (the “Revised Tariff Structure”). (b) If the Revised Tariff Structure sets forth an objectively determinable definition of (i) the revenue that the Partnership is entitled to collect in tolls and other charges in respect of the Series AC Assets and (ii) the expenses that the Partnership is entitled to allocate in respect of the Series AC Assets, then the Series AC Revenue Entitlement and Series AC Expenses shall be calculated in accordance with the Revised Tariff Structure. (c) If the Revised Tariff Structure does not set forth an objectively determinable definition of (i) the revenue that the Partnership is entitled to collect in tolls and other charges in respect of the Series AC Assets and (ii) the expenses that the Partnership is entitled to allocate in respect of the Series AC Assets, then EECI Sub and Lakehead GP, on behalf of all Partners of the Partnership generally and each Series, will negotiate in good faith an arrangement to allocate among each Series the total Lakehead System revenue collected by the Partnership following the expiration or earlier termination of the Surcharge Term. Such allocation arrangement will be based on the relative economic value of each Series as of the expiration or earlier termination of the Surcharge Term. If EECI Sub and Lakehead GP are able to agree on such allocation arrangement, then the Series AC Revenue Entitlement and Series AC Expenses will be calculated in accordance with such arrangement. If EECI Sub and Lakehead GP are unable to agree on such allocation arrangement at least 180 days prior to the expiration or earlier termination of the Surcharge Term, then the matter will be submitted to arbitration pursuant to Section 10.2(d). (d) If the Revised Tariff Structure does not set forth an objectively Series AC Assets, and EECI Sub and Lakehead GP are unable to agree on an allocation arrangement pursuant to Section 10.2(c), such allocation arrangement shall be determined through binding arbitration using three arbitrators, in accordance with the Commercial Arbitration Rules of the American Arbitration Association, as supplemented to the extent necessary to determine any procedural appeal questions by the Federal Arbitration Act (Title 9 of the United States Code). If there is any inconsistency between this Section 10.2(d) and the Commercial Arbitration Rules or the Federal Arbitration Act, the terms of this Section 10.2(d) will control the rights and obligations of the parties. Arbitration shall be initiated 180 days prior to the expiration of the Surcharge Term. Each of EECI Sub and Lakehead GP shall appoint an arbitrator at least 150 days prior to the expiration of the Surcharge Term. If either party fails for any reason to name an arbitrator within such period, the other party shall petition to the American Arbitration Association for appointment of an arbitrator for such party’s   56 account. The two arbitrators so chosen shall select a third arbitrator within 15 days after the second arbitrator has been appointed. Each of EECI Sub and Lakehead GP will pay the compensation and expenses of the arbitrator named by or for it. The costs of petitioning for the appointment of an arbitrator, if any, shall be paid by the party that has failed to appoint an arbitrator in the requisite period. Each of EECI Sub and Lakehead GP will each pay one-half of the compensation and expenses of the third arbitrator. All arbitrators must (a) be neutral Persons who have never been officers, directors or employees of Enbridge Partners, EECI or any of their Affiliates and (b) have not less than seven years experience in the energy industry. The hearing will be conducted in Houston, Texas and commence within 30 days after the selection of the third arbitrator. Within five days after the selection of the third arbitrator, EECI Sub and Lakehead GP shall exchange in writing, signed by the respective parties, their respective proposed allocation arrangements. At the conclusion of the hearing, the arbitrators shall choose either the allocation arrangement of EECI Sub or the allocation arrangement of Lakehead GP, and shall have no power or authority whatsoever to reach any other result. In making their choice, the arbitrators shall choose the allocation arrangement that in their judgment most equitably allocates the total Lakehead System revenues in a manner that best represents the relative economic value of each Series as of the expiration of the Surcharge Term. EECI Sub, Lakehead GP and the arbitrators shall proceed diligently and in good faith in order that the determination may be made as promptly as possible. Except as provided in the Federal Arbitration Act, the decision of the arbitrators will be binding on and non-appealable by the parties. ARTICLE XI DISSOLUTION AND LIQUIDATION Section 11.1 Dissolution of the Partnership. (a) The Partnership shall not be dissolved by the admission of additional Partners. The Partnership shall dissolve, and its affairs shall be wound up, upon: (i) subject to Section 7.3(q), an election to dissolve the Partnership by the Managing General Partner of the Partnership generally and the Managing General Partner of each Series that is approved by a Majority in Interest of each Series; (ii) the entry of a decree of judicial dissolution of the Partnership pursuant to the provisions of the Delaware Act; (iii) the termination of the last remaining Series; (iv) at any time that there are no Limited Partners, unless the Partnership is continued without dissolution in accordance with the Delaware Act; or (v) any event that causes a General Partner to cease to be a general partner of the Partnership generally or any Series; provided that the Partnership shall not be dissolved and required to be wound up in connection with any such event if (A) at the time of the occurrence of such event there is at least one remaining general partner of the Partnership generally or any Series who is hereby authorized to and does carry on the business of the Partnership or (B) within 90 days after the occurrence of such event, a Majority in Interest of the Limited   57 Partners of each Series agree in writing or vote to continue the business of the Partnership and to the appointment, effective as of the date of such event, if required, of one or more additional general partners of the Partnership generally and, to the extent applicable, each Series. (b) Upon the dissolution of the Partnership as provided herein, the Partnership shall be wound up by winding up each Series in the manner provided by Section 11.3. Section 11.2 Termination of a Series. (a) a Series shall be terminated upon any of the following events: (i) the dissolution of the Partnership; (ii) the entry of a decree of judicial termination of such Series under Section 17-218 of the Delaware Act; (iii) subject to Section 7.3(q), the approval of each General Partner of such Series and a Majority in Interest of the Partnership Interests of such Series; or (iv) any event that causes a General Partner to cease to be a general partner of the Series; provided that the Series shall not be terminated and required to be wound up in connection with any such event if (A) at the time of the occurrence of such event there is at least one remaining general partner of the Series who is hereby authorized to and does carry on the business of the Series or (B) within 90 days after the occurrence of such event, a Majority in Interest of the Limited Partners of such Series agree in writing or vote to continue the business of the Series and to the appointment, effective as of the date of such event, if required, of one or more additional general partners of the Series. (b) The termination and winding up of a Series (other than the last Series) shall not, in and of itself, cause a dissolution of the Partnership or the termination of any other Series. The termination of a Series shall not affect the limitation on liabilities of such Series or any other Series provided by this Agreement, the Certificate of Limited Partnership and the Delaware Act. Section 11.3 Winding Up, Liquidation and Distribution of Assets of the Such Series. (a) Upon dissolution of the Partnership or termination of a Series, the Managing shall commence to wind up the affairs of the Partnership (and all Series) or such Series, as applicable; provided, however, that a reasonable time shall be allowed for the orderly liquidation of the assets of any applicable Series and the discharge of liabilities of the Partnership (and all Series) or such Series, as applicable, to its creditors so as to enable the Partners to minimize the normal losses attendant upon a liquidation. Upon dissolution of the Partnership or termination of a Series after taking into account Regulatory Allocations, all allocations of Profit, Losses and items thereof with respect to a Series shall be made in a manner so that, to the greatest extent possible, the Series Capital Accounts of each Partner in such Series shall equal the amount that would be distributed to such Partner if liquidating distributions were made in accordance with the Partners’ Percentage Interests in such Series. The Partners of each Series being liquidated, as applicable,   58 shall be furnished with a statement prepared by a certified public accountant selected by the Managing General Partner of the Partnership generally, in its sole discretion, at the expense of such Series, if applicable, that shall set forth the assets and liabilities of the Partnership (and all Series) or such Series (as applicable) as of the date of termination. The proceeds of liquidation shall be distributed in the following order and priority: (i) to creditors of each applicable Series, including Partners who are creditors, to the extent otherwise permitted by law, in satisfaction (whether by payment or the making of reasonable provision for payment thereof) of all Liabilities of such Series, including, without limitation, the expenses incurred in connection with the liquidation of the Partnership (and all Series) or such Series; (ii) to the Partners of each Series being liquidated in accordance with such Partners’ Series Capital Account balances for such Series (after giving effect to all contributions, distributions, allocations and other Series Capital Account adjustments for all taxable years, including the year during which such termination and liquidation occurs) in compliance with Treasury Regulation § 1.704-1(b)(2)(ii)(b)(2); and (iii) if any Limited Partner has a deficit balance in its Series Capital Account for such Series (after giving effect to all contributions, distributions and allocations for all fiscal years, including the fiscal year during which such liquidation occurs), such Limited Partner shall have no obligation to make any contribution to the capital of the Partnership or of such Series with respect to such deficit, and such deficit shall not be considered a debt owed to the Partnership, such Series or to any other Person for any purpose whatsoever. (b) Notwithstanding any other provisions of this Section 11.3, in the event the Partnership is “liquidated” within the meaning of Treasury Regulation § 1.704-1(b)(2)(ii)(g), but such liquidation does not constitute a dissolution of the Partnership, the assets of the Partnership (and each Series) shall not be liquidated, the liabilities of the Partnership (and each Series) shall not be paid or discharged and the affairs of the Partnership (and each Series) shall not be wound up. Instead, solely for U.S. federal income tax purposes, the Partnership (and each Series) shall be deemed to have distributed all of the assets of the Partnership (and each Series) in kind to a new partnership in exchange for an interest in such new partnership and, immediately thereafter, the Partnership shall be deemed to liquidate by distributing interests in the new partnership to the Partners. (c) The Managing General Partners and Partners shall comply with all requirements of applicable law pertaining to the winding up of the affairs of the Partnership or any Series and the final distribution of its assets. Section 11.4 Cancellation of Certificate of Limited Partnership. Upon the completion of the winding up of the Partnership and each Series and the distribution of Series cash and property as provided in Section 11.3 in connection with the liquidation of the Partnership and each Series, the Certificate of Limited Partnership and all qualifications of the Partnership as a foreign limited partnership in jurisdictions other than the State of Delaware shall be canceled, and such other actions as may be necessary to terminate the Partnership and each Series shall be taken.   59 Section 11.5 Return of Capital Contributions. (a) Except as otherwise provided by applicable laws, upon termination of a Series, each Partner of such Series shall look solely to the assets of such Series for the return of its Capital Contributions made to such Series, and if the assets of such Series remaining after satisfaction (whether by payment or reasonable provision for payment) of the Liabilities of such Series are insufficient to return such Capital Contributions, such Partner shall have no recourse against any other Series, the Partnership or any Partner, except as otherwise provided by law or by Section 6.2(c) or 6.3(c). (b) Except as provided in Section 6.2(c), 6.3(c) or 11.7, no General Partner shall be personally liable for, and shall have no obligation to contribute or loan any monies or property to the Partnership or any Series to enable it to effectuate, the return of the Capital Contributions of the Limited Partners, or any portion thereof, it being expressly understood that any such return shall be made solely from Series assets. Section 11.6 Waiver of Partition. To the maximum extent permitted by law, each Partner hereby waives any right to partition of the Partnership or any Series property. Section 11.7 Capital Account Restoration. No Limited Partner shall have any obligation to restore any negative balance in its Capital Account or any Series Capital Account upon liquidation of the Partnership or such Series. A General Partner shall be obligated to restore any negative balance in its Capital Account upon liquidation of its interest in the Partnership or any Series by the end of the taxable year of the Partnership during which such liquidation occurs, or, if later, within 90 days after the date of such liquidation. ARTICLE XII AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE; MERGER Section 12.1 Amendment. Except as otherwise provided by this Agreement, this Agreement may be amended by the Managing General Partner of the Partnership generally in writing without the approval of any other Partner; provided that the provisions of Section 7.7 shall not be amended in any way that would adversely affect an Indemnitee without the consent of such Indemnitee. Section 12.2 Amendment Requirements. Notwithstanding the provisions of Section 12.1, no provision of this Agreement that establishes a Percentage Interest required to take any action with respect to any Series shall be   60 amended, altered, changed, repealed or rescinded in any respect that would have the effect of reducing such voting percentage unless such amendment is approved by the written consent or the affirmative vote of holders of Partnership Interests of such Series whose aggregate Percentage Interests constitute not less than the voting requirement sought to be reduced. Section 12.3 Voting Rights. Unless otherwise required by the Delaware Act or this Agreement, all actions, approvals and consents to be taken or given by the Partners of a Series under the Delaware Act, this Agreement or otherwise shall require the affirmative vote or written consent of a Majority in Interest of such Series, or if with respect to the Partnership as a whole, the affirmative vote or written consent of a Majority in Interest of each Series. Section 12.4 Meetings. Meetings of the Partners of a Series, for any purpose or purposes, may be called by the Managing General Partner of such Series or by any Partner or Partners of such Series holding at least 25% of the Percentage Interests of such Series. Section 12.5 Place of Meetings. The Partner or Partners calling a meeting may designate any place, either within or outside the State of Delaware, as the place of meeting for any meeting of the Partners of a Series. If a designation is not made, the place of meeting shall be the principal place of business of the Partnership. The Partners of a Series may participate in a meeting of the Partners of such Series by means of conference telephone or similar communications equipment; provided that all individuals participating in the meeting can hear each other, and such If all the participants of a meeting are participating by conference telephone or similar communications equipment, the meeting shall be deemed to be held at the principal place of business of the Partnership. Section 12.6 Notice of Meetings. Written notice stating the place, day and hour of a meeting and the purpose or purposes for which a meeting of the Partners of a Series is called shall be delivered not less than five nor more than 30 days before the date of the meeting, either personally or by mail, at the direction of the Partner or Partners calling the meeting, to each Partner of such Series entitled to vote at such meeting; provided, however, if the Partners of a Series representing a Majority in Interest of such Series shall meet or participate in a meeting at any time and place, either within or outside the State of Delaware, and consent (whether orally or in writing) to the holding of a meeting at such time, such meeting shall be valid without call or notice, and at such meeting lawful action may be taken. Section 12.7 Quorum. Partners of any Series holding a Majority in Interest of such Series entitled to vote, represented in person or by proxy, shall constitute a quorum at any meeting of Partners of such Series. In the absence of a quorum at any such meeting, Partners of such Series holding a   61 Majority in Interest of such Series may adjourn the meeting from time to time for a period not to exceed 60 days without further notice. However, if the adjournment is for more than 60 days, a notice of the adjourned meeting shall be given to each Partner of such Series of record entitled to vote at such meeting. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted that might have been transacted at the meeting as originally noticed. The Partners of such Series present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal during such meeting of Partners of such Series whose absence would cause less than a quorum to be present. If a quorum is present, the affirmative vote of Partners of such Series holding a Majority in Interest of such Series shall be the act of the Partners of such Series, unless a vote of greater or lesser proportion is otherwise expressly required or permitted by this Agreement. Section 12.8 Proxies. At all meetings of Partners of a Series, a Partner of such Series may vote in person or by proxy executed in writing by such Partner or by a duly authorized attorney-in-fact. Such proxy shall be filed with the Partnership before or at the time of the meeting. No proxy shall be valid after eleven months from the date of its execution, unless otherwise provided in the proxy. A proxy may only be given orally during a meeting taking place by conference telephone or similar communications equipment and shall expire at the termination of such meeting. Section 12.9 Action Without a Meeting. Any action required or permitted to be taken at a meeting of Partners of any Series may be taken without a meeting and without prior notice if the Managing General Partner of such Series receives written consents by the Partners of such Series representing the minimum number of votes that would be necessary to authorize or to take such action at a meeting at which all Partners of such Series were present and voted. Section 12.10 Waiver of Notice. When any notice is required to be given to any Partner, a waiver thereof in writing signed by the Partner entitled to such notice, whether before, at or after the time stated therein, or the presence and participation of such Partner in a meeting, or the participation by such Partner in a meeting by conference telephone or similar communications equipment, shall be equivalent to the giving of such notice. Section 12.11 Merger, Consolidation and Conversion. (a) Subject to Section 7.3, the Partnership may merge or consolidate with or into one or more corporations, limited liability companies, statutory trusts or associations, real estate investment trusts, common law trusts or unincorporated businesses, including a partnership (whether general or limited (including a limited liability partnership)) or convert into any such entity, whether such entity is formed under the laws of the State of Delaware or any other state of the United States of America, pursuant to a written plan of merger or consolidation or a written plan of conversion, as the case may be, approved by the Managing General Partner of the Partnership generally and a Majority in Interest of each Series.   62 (b) Pursuant to Section 17-211(g) of the Delaware Act, an agreement of merger or consolidation approved in accordance with this Section 12.11 may (i) effect any amendment to this Agreement or (ii) effect the adoption of a new partnership agreement for the Partnership. Any such amendment or adoption made pursuant to this Section 12.11 shall be effective at the effective time or date of the merger or consolidation. (c) The Managing General Partner of the Partnership generally shall have the authority to convert the Partnership to a Delaware statutory trust if, on the advice of counsel, such conversion (i) is necessary and advisable for Wisconsin GP to have or retain condemnation authority under Wisc. Stat. § 32.01, et seq. and (ii) would not result in a default under any Indebtedness of the Partnership or Enbridge Partners existing at such time; provided that (A) the trust is structured as a series trust pursuant to Del. Code tit. 12, § 3801, et seq., (B) the relative rights and obligations of the Partners of each Series are maintained in the trust (and each series thereof), (C) the beneficial owners of each series of the trust own an undivided beneficial interest in all of the assets of the Series of which they are beneficial owners, (D) the trust would be disregarded for U.S. federal income tax purposes and (E) the limited liability of the beneficial owners of the trust (and each series thereof) would be expected to be respected in all relevant states to the same extent as that applicable to limited partners of a Delaware limited partnership. ARTICLE XIII GENERAL PROVISIONS Section 13.1 Addresses and Notices; Written Communications. (a) Any notice, demand, request or report required or permitted to be given or made to a Partner under this Agreement shall be in writing and shall be deemed given or made when delivered in person or when sent by first class United States mail or by other means of written communication to the Partner at the following addresses: If to EECI or EECI Sub, to: Enbridge Inc. 3000 Fifth Avenue Place Calgary, Alberta T2P 3L8 Canada Attention: Group Vice President, Corporate Law If to Enbridge Partners, Lakehead GP or Wisconsin GP, to: Houston, Texas 77001   63 Any notice, payment or report to be given or made to a Partner hereunder shall be deemed conclusively to have been given or made, and the obligation to give such notice or report or to make such payment shall be deemed conclusively to have been fully satisfied, upon sending of such notice, payment or report to such Partner at its address as shown on the records of the Partnership, regardless of any claim of any Person who may have an interest in such Partnership Interests by reason of any assignment or otherwise. Any notice to the Partnership generally or any Series shall be deemed given if received by the Managing General Partner of the Partnership generally or the applicable Series at the principal office of the Partnership generally or the applicable Series designated pursuant to Section 2.3. Each Managing General Partner may rely and shall be protected in relying on any notice or other document from a Partner or other Person if believed by it to be genuine. (b) The terms “in writing,” “written communications,” “written notice” and words of similar import shall be deemed satisfied under this Agreement by use of e-mail and other forms of electronic communication. Section 13.2 Further Action. The parties shall execute and deliver all documents, provide all information and take or refrain from taking action as may be necessary or appropriate to achieve the purposes of this Agreement. Section 13.3 Binding Effect. hereto and their heirs, executors, administrators, successors, legal representatives and permitted assigns. Section 13.4 Integration. This Agreement constitutes a single, non-severable agreement and the entire agreement among the parties hereto pertaining to the subject matter hereof and supersedes all prior agreements and understandings pertaining thereto. Section 13.5 Creditors. None of the provisions of this Agreement shall be for the benefit of, or shall be enforceable by, any creditor of the Partnership or any Series. Section 13.6 Waiver. No failure by any party to insist upon the strict performance of any covenant, duty, agreement or condition of this Agreement or to exercise any right or remedy consequent upon a breach thereof shall constitute a waiver of any such breach of any other covenant, duty, agreement or condition.   64 Section 13.7 Counterparts. This Agreement may be executed in counterparts, all of which together shall constitute an agreement binding on all the parties hereto, notwithstanding that all such parties are not signatories to the original or the same counterpart. Section 13.8 Applicable Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware, without regard to the principles of conflicts of law. Section 13.9 Invalidity of Provisions. If any provision of this Agreement is or becomes invalid, illegal or remaining provisions contained herein shall not be affected thereby. Section 13.10 Consent of Partners. Each Partner hereby expressly consents and agrees that, whenever in this Agreement it is specified that an action may be taken upon the affirmative vote or consent of less than all of the Partners of the Partnership or any Series, such action may be so taken upon the concurrence of less than all of the Partners and each Partner shall be bound by the results of such action. Section 13.11 Third Party Beneficiaries. Except for the provisions of Section 3.4(c) (which are intended to be for the benefit of, and shall be enforceable by, each Material Subsidiary of Enbridge Partners as if they were party to this Agreement), nothing in this Agreement, express or implied, is intended to or shall confer upon any Person other than the parties hereto and Indemnitees any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]   65   ENBRIDGE ENERGY PARTNERS, L.P. By: ENBRIDGE ENERGY MANAGEMENT, L.L.C., as delegate of authority of Enbridge Energy Company, Inc., its general partner By:     Name:   Title:   ENBRIDGE PIPELINES (LAKEHEAD) L.L.C. By:     Name:   Title:   ENBRIDGE PIPELINES (WISCONSIN) INC. By:     Name:   Title:   ENBRIDGE ENERGY COMPANY, INC. By:     Name:   Title:   ENBRIDGE PIPELINES (ALBERTA CLIPPER) L.L.C. By:     Name:   Title:   [Signature Page – Third Amended and Restated Agreement of Limited Partnership EXHIBIT A Initial Partnership Interests   Series AC Partners    Series AC Partnership Interest    Initial Series AC Capital Contribution2     Maximum Commitment   EECI    66.66% limited partner interest    $ [                     ]    $ [                     ]  EECI Sub    0.01% limited partner interest      [                     ]      [                     ]  Enbridge Partners    33.329% limited partner interest      [                     ]      [                     ]  Lakehead GP    0.0005% general partner interest      [                     ]      [                     ]  Wisconsin GP [                     ]                        Total:    100.0000%    $ [                     ]    $ [                     ]    Series LH Partners    Series LH Partnership Interest Enbridge Partners    99.999% limited partner interest Lakehead GP    0.0005% general partner interest Wisconsin GP Total:    100.0000%   2 The Initial Series AC Capital Contribution of each Series AC Partner will be an amount equal to the product of (a) such Series AC Partner’s Series AC Partnership Interest and (b) 55% of the Preliminary Alberta Clipper Construction Costs. EXHIBIT B Exclusive Series AC Assets   1. Approximately 325 miles of new 36-inch diameter crude oil pipeline from the U.S.-Canadian border near Neche, North Dakota to Superior, Wisconsin.   2. Three new pump stations located at Viking, Clearbrook and Deer River, Minnesota.   3. 30-inch delivery piping with manifold connections and related control valves at Clearbrook, Minnesota.   4. Five 200,000-barrel break out tanks at Superior, Wisconsin.   5. 36-inch diameter tank lines from each tank at Superior, Wisconsin.   6. Three 1,000-horsepower booster pumps at Superior, Wisconsin.   7. 36-inch line from tank manifold to connections with Southern Access Expansion (Line 61) and Line 6A.   8. All service agreements, easements and rights-of-way related solely to the operation of the Alberta Clipper Project.   9. All permits, licenses, consents and approvals related solely to the operation of the Alberta Clipper Project.   10. All rights to the Revenue Requirement.   11. All shipping, transportation and storage agreements or arrangements related solely to the Alberta Clipper Project.   12. All other property interests (including real and personal property and tangible and intangible property) solely related to the Alberta Clipper Project. EXHIBIT C Shared Assets ARTICLE I DEFINITIONS 1.1 Additional Defined Terms. The following additional definitions shall be for all purposes, unless otherwise clearly indicated to the contrary, applied to the terms used in this Exhibit C. Unless specifically defined in this Exhibit C, terms defined in the Agreement are used in this Exhibit C as defined in the Agreement. “Capital Improvement Project” has the meaning assigned to such term in Section 4.3(a) of this Exhibit C. “Force Majeure Event” has the meaning assigned to such term in Section 5.1(b) of this Exhibit C. “Governmental Authority” shall mean (i) the United States of America or Canada, or any state, province or political subdivision thereof within the United States of America or Canada and (ii) any court or any governmental or administrative department, commission, board, bureau or agency of the United States of America or Canada, or of any state, province or political subdivision thereof within the United States of America or Canada. “Improvement Series” has the meaning assigned to such term in Section 4.3(a) of this Exhibit C. “Rejecting Series” has the meaning assigned to such term in Section 4.3(b) of this Exhibit C. “Shared Asset Manager” has the meaning assigned to such term in Section 4.2(a) of this Exhibit C. “Shared Assets” means collectively, the Shared Contracts, the Shared Facilities, the Shared Permits and the Shared Real Property Rights. “Shared Contract Party” means one or more of the Partnership generally, the Series AC or the Series LH, depending on which is or are parties to a particular Shared Contract. “Shared Contracts” means the contracts, agreements and commitments of the Partnership generally or a Series existing as of the Closing Date or entered into thereafter that are related to or necessary for the operation of both the assets of the Series AC and the assets of the Series LH, including the contracts described in Schedule 1 to this Exhibit C. “Shared Facilities” means the information systems, control systems, electrical communication lines, maintenance facilities, valves, motor control centers, buildings, pump station locations, terminal facilities, lab facilities, fire protection systems, tank farms and other facilities or systems of the   [Exhibit C – Page 1] Partnership generally or a Series existing as of the Closing Date or developed, constructed or acquired thereafter that are related to or necessary for the operation of both the assets of the Series AC and the assets of the Series LH. “Shared Permits” means the licenses, consents, approvals, registrations, franchises, permits and authorizations of the Partnership generally or a Series existing as of the Closing Date or acquired thereafter that are related to or necessary for the operation of both the assets of the Series AC and the assets of the Series LH. “Shared Real Property Rights” means the easements, leasehold rights, real property at station sites, other surface use rights and rights-of-way of the Partnership generally or a Series existing as of the Closing Date or acquired thereafter that are related to or necessary for the operation of both the assets of the Series AC and the assets of the Series LH. ARTICLE II DESIGNATION OF SHARED ASSETS 2.1 Shared Facilities. Each of the Series AC and the Series LH is hereby granted an unconditional, irrevocable, perpetual royalty free right to use the Shared Facilities to the extent necessary in connection with the construction, operation or maintenance of the assets of such Series. 2.2 Shared Contracts. Each Shared Contract Party shall hold each Shared Contract to which it is a party for the benefit of the Partnership generally, the Series AC and the Series LH. Each of the Partnership generally, the Series AC and the Series LH shall have the benefit of all rights available to the Shared Contract Party under each Shared Contract. All decisions in respect of the Shared Contracts shall be made by the Shared Asset Managers in accordance with the terms of Section 4.2 of this Exhibit C. The Shared Contract Party shall comply with such decisions or delegation of authority, as applicable, with respect to each Shared Contract. Without limiting the foregoing, (i) promptly upon receipt and delivery as applicable, the Shared Contract Party shall provide (a) to the Shared Asset Managers copies of all notices and other correspondence relating to each Shared Contract and (b) additionally, to the Series AC Partners copies of all notices and other correspondence relating to the Tariff Term Sheet, and (ii) the Shared Contract Party shall immediately notify the Shared Asset Managers if a default or other material event occurs in respect of a Shared Contract (such as an event that affects the validity or enforceability of a Shared Contract or an event that may result in an early termination of a Shared Contract). 2.3 Shared Real Property Rights. Each of the Series AC and the Series LH is hereby granted an unconditional, irrevocable, perpetual royalty free right to use the Shared Real Property Rights to the extent necessary in connection with the construction, operation or maintenance of the assets of such Series. 2.4 Shared Permits. The Partnership shall hold the Shared Permits for the benefit of the Series AC and the Series LH. Each of the Series AC and the Series LH shall have the benefit of all rights available to the Partnership under the Shared Permits. All decisions in respect of the Shared Permits shall be made by the Shared Asset Managers in accordance with the terms of   [Exhibit C – Page 2] Section 4.2 of this Exhibit C. The Partnership shall comply with such decisions or delegation of authority, as applicable. Without limiting the foregoing, promptly upon receipt and delivery as applicable, the Partnership shall provide to the Shared Asset Managers copies of all notices and other correspondence relating to the Shared Permits. 2.5 Designation of Shared Assets. The designated interest of each Series in a Shared Asset shall be allocated to the Series pro rata in accordance with a ratio the numerator of which is the costs incurred by each Series to develop, construct or acquire such Shared Asset and the denominator of which is the aggregate costs incurred by the Series AC and the Series LH collectively to develop, construct or acquire such Shared Asset; provided, however, that all of the Shared Assets existing as of the Closing Date will be allocated to the Series LH, except for any of the Shared Assets existing as of the Closing Date that have been developed, constructed or acquired by the Partnership in connection with the Alberta Clipper Project, which shall be allocated to the Series AC. The rights of each Series to use the Shared Assets as described in this Article II shall not be affected by the terms of this Section 2.5. ARTICLE III ADDITIONAL SERIES 3.1 Additional Series. In the event that, subsequent to the Closing Date, an additional Series is established, then each of the Series AC and the Series LH shall cooperate in good faith with such additional Series and the Partnership generally, if necessary, to amend the Agreement and this Exhibit C as appropriate to reflect the addition of such Series and for the applicable assets to be shared among the Series on mutually agreeable terms, reasonably determined on a basis similar to the terms set forth in this Exhibit C. ARTICLE IV COVENANTS OF THE PARTIES 4.1 Use of Shared Assets. (a) Rights to Use. Each of the Series AC and the Series LH acknowledges that both of the Series AC and the Series LH will have the right to use the Shared Assets in accordance with the terms of this Exhibit C. (b) Liability. Each Series shall be responsible for its Proportionate Share of Shared Liabilities with respect to each Shared Asset pursuant to Section 3.4(d) of the Agreement. (c) Cooperation. The Series AC and the Series LH shall cooperate in good faith with each other with respect to the use of the Shared Assets and will not use the Shared Assets in a manner that interferes unreasonably with the operations of any other Series or the Partnership generally. (d) Priority of Use. In the event of a conflict limiting the ability of both Series to make use of a particular Shared Asset to the extent desired by each of the Series AC and the Series LH, priority of use shall be given for the Series AC or the Series LH to use such Shared Asset in the following order:     (i) first, to the Series AC or the Series LH, to the extent necessary to address any emergency;   [Exhibit C – Page 3]   (ii) second, prior to the In-Service Date, to the Series AC, to the extent necessary in connection with the construction of the Alberta Clipper Project; provided that the Series AC’s use of the Shared Assets pursuant to this clause (ii) shall not result in interruptions that could materially and adversely affect the business operations of the Series LH without the consent of the Series LH’s Shared Asset Manager; and     (iii) third, in the proportions required by the Series AC and the Series LH to conduct their respective operations, provided in the event of a conflict limiting the ability of both Series to make use of a particular Shared Asset to the extent desired by each Series in such a situation, the Managing General Partner of the Partnership generally shall determine priority of use for the Series AC or the Series LH based on the needs of each Series in respect of such Shared Asset. (e) Standard of Care. Each Series shall act with respect to the Shared Assets (i) in a professional manner and in accordance with generally accepted industry standards, (ii) in accordance with the Partnership’s policies, procedures and requirements, as determined by the Managing General Partner of the Partnership generally, and (iii) in accordance with applicable law in all material respects. Each Series shall use commercially reasonable efforts to do or cause to be done all such things as shall be necessary and proper with respect to the Shared Assets to ensure that the rights of the other Series in respect of the Shared Assets shall be preserved for the benefit of such Series. 4.2 Management of Shared Assets. (a) Managers. Each Series hereby appoints the Managing General Partner of such Series (each a “Shared Asset Manager”) to serve as the primary point of contact for communications between the Series relating to the day-to-day operations of the Shared Assets, to have overall responsibility for managing and coordinating the performance of the appointing Series’ obligations under this Exhibit C, and to be authorized to act for and on behalf of the appointing Series concerning all matters relating to this Exhibit C. (b) Decisions.     (i) All decisions in respect of the Shared Assets shall require the joint decision of the Shared Asset Managers of the Series AC and the Series LH unless otherwise required by the terms of this Agreement. The Shared Asset Managers shall act reasonably, taking into account the considerations of each Series, in connection with all decisions regarding the Shared Assets.   [Exhibit C – Page 4]   (ii) In the event of a conflict between the Shared Asset Managers of the Series AC and the Series LH, then (1) if one Series has priority of use pursuant to Section 4.1(d) of this Exhibit C, then such Series shall prevail and (2) other decisions shall be made by the Shared Asset Manager of the Series that is reasonably likely to bear the greater proportion of the costs relating to such matter.     (iii) If the Shared Asset Managers are not the same Person, then notwithstanding the foregoing, the following actions shall require the prior written consent of the Majority in Interest of the Series AC and the Majority in Interest of the Series LH:     (A) the disposition, transfer, sale, conveyance or exchange of any Shared Asset in excess of $25,000,000, in each case; or     (B) material modifications of the Shared Contracts, Shared Real Property Rights or Shared Permits. (c) Meetings. The Shared Asset Managers agree to have meetings if called at any time upon five Business Days prior written notice by a Shared Asset Manager. Each Series shall make available at such meetings their personnel who are familiar with the details of the particular Shared Assets under review. 4.3 Capital Improvements. (a) A Series (the “Improvement Series”) may submit from time to time to the other Series written requests to undertake capital expenditures or capital improvement projects relating to the Shared Assets (each, a “Capital Improvement Project”). Any such requests shall specify in reasonable detail the Capital Improvement Project, any permits that may be required, the estimated cost of such Capital Improvement Project, any proposed changes to this Exhibit C, and any other relevant information relating to such Capital Improvement Project. Each Series agrees that it will consider in good faith any such request, but a Series shall have no obligation to agree to undertake any Capital Improvement Project and may reject any request by the other Series. If the Series agree to undertake any Capital Improvement Project, the Series shall cooperate in good faith to reach agreement on the allocation of responsibility for all costs associated with such Capital Improvement Project. (b) A rejecting Series (the “Rejecting Series”) shall provide the other Series a written explanation for the rejection of any request to undertake a Capital Improvement Project. If the Improvement Series desires to undertake a Capital Improvement Project relating to the Shared Assets despite the Rejecting Series’s rejection, then the Improvement Series (i) may undertake such Capital Improvement Project on a sole risk basis, (ii) shall bear the entire cost and Liability associated with such Capital Improvement Project, (iii) shall be solely entitled to all the benefits and rights of use associated with such Capital Improvement Project and (iv) shall develop such Capital Improvement Project in a manner that does not interfere unreasonably with the operations of any other Series or the Partnership generally.   [Exhibit C – Page 5] 4.4 Nature of Right to Use. The right to use the Shared Assets as provided in this Exhibit C (i) is an integral, non-severable part of the Agreement, (ii) is an integral part of the Partnership Interests of the Series and the assets of the Series designated under the Agreement and (iii) shall not be deemed to be an executory contract or agreement that can be rejected or otherwise terminated in any bankruptcy, receivership or similar proceeding of the Partnership. 4.5 Valuation. In any valuation of the assets of a Series, the value of such assets shall include the continuing right to use the Shared Assets as provided in this Exhibit C. ARTICLE V FORCE MAJEURE 5.1 Force Majeure Event. (a) Subject to the following provisions of this Article V, a Series shall not be in default hereunder or responsible for any loss or damage to the other Series resulting from any delay in performing or failure to perform any obligation of such Series under this Exhibit C (other than payment obligations) to the extent such failure or delay is caused by a Force Majeure Event. (b) “Force Majeure Event” means the following events, conditions and circumstances, except to the extent any of the following is within the reasonable control of, could be sufficiently alleviated by the reasonable efforts of, or caused by the negligence, breach, default or misconduct of the Series claiming the Force Majeure Event:     (i) any act of God or the public enemy, fire, explosion, perils of the sea, flood, drought, war, terrorism, riot, sabotage or embargo, and any interruption of or delay in transportation, or any inadequacy or shortage or failure or breakdown of supply of raw materials or equipment resulting from the foregoing;     (ii) any labor disputes from whatever cause arising and whether or not the demands of the employees involved are within the power of the claiming Series to concede; or     (iii) compliance with any order, action, direction or request of any Governmental Authority or with any applicable law not brought about by any action or omission on the part of the Series claiming the Force Majeure Event. 5.2 Force Majeure Notice. The Series whose ability to perform is affected by a Force Majeure Event must, as a condition to its right to suspend its obligations under Section 5.1 of this Exhibit C, (i) be actually prejudiced by such Force Majeure Event and (ii) promptly give the other Series notice setting forth the particulars of the Force Majeure Event and, to the extent possible, the expected duration of the Force Majeure Event. Such notice shall also include a description of the steps taken and proposed to be taken to lessen and cure the Force Majeure Event. The cause of the Force Majeure Event shall so far as commercially reasonable be remedied with all reasonable dispatch, except that no Series shall be obligated to resolve any labor disputes other than as it shall determine to be in its best interests.   [Exhibit C – Page 6] ARTICLE VI MISCELLANEOUS 6.1 Conflict with Agreement. The terms of the Agreement, excluding this Exhibit C, shall govern to the extent of any inconsistency or conflict between the terms of the Agreement, excluding this Exhibit C, and this Exhibit C. 6.2 Amendments. The terms of this Exhibit C shall be amended to the extent required to conform with any amendment or modification to the other terms of the Agreement. 6.3 Governing Law. This Exhibit C shall be governed by and construed under the laws of the State of Delaware (without regard to conflict of laws principles), all rights and remedies being governed by said laws.   [Exhibit C – Page 7] Schedule 1 Shared Contracts 1. Canadian Association of Petroleum Producers contracts that are related to or necessary for the operation of both the Alberta Clipper Project and the assets or operations of the Series LH. 2. Power supply contracts that are related to or necessary for the operation of both the Alberta Clipper Project and the assets or operations of the Series LH. 3. Communication contracts that are related to or necessary for the operation of 4. Emergency response contracts that are related to or necessary for the operation of both the Alberta Clipper Project and the assets or operations of the Series LH.   [Exhibit C – Page 8] EXHIBIT B FORM OF FACILITY A1 A1 CREDIT AGREEMENT Dated as of [                 ], 2009 among as Borrower, as Lender TABLE OF CONTENTS             Page ARTICLE I DEFINITIONS AND ACCOUNTING TERMS 1.01    Defined Terms    1 1.02    Other Interpretive Provisions    19 1.03    Accounting Terms    19 1.04    Rounding    19 1.05    References to Agreements and Laws    20 ARTICLE II THE COMMITMENTS AND LOANS 2.01    Loans    20 2.02    Borrowings, Conversions and Continuations of Loans    20 2.03    Prepayments    21 2.04    Reduction or Termination of Commitments    21 2.05    Repayment of Loans    22 2.06    Applicable Rate    22 2.07    Interest    22 2.08    Fees    23 2.09    Computation of Interest and Fees    23 2.10    Evidence of Debt    23 2.11    Payments Generally    24 2.12    [Intentionally Omitted]    24 2.13    Inability to Determine Rates    24 2.14    Funding Losses    25 ARTICLE III CONDITIONS PRECEDENT TO LOANS 3.01    Conditions of Initial Loans    25 3.02    Conditions to all Loans    25 ARTICLE IV REPRESENTATIONS AND WARRANTIES 4.01    Existence, Qualification and Power; Compliance with Laws    26 4.02    Authorization; No Contravention    26 4.03    Governmental Authorization    26 4.04    Binding Effect    26 4.05    Financial Statements    26 4.06    No Default    27 ARTICLE V AFFIRMATIVE COVENANTS 5.01    Financial Statements    27 5.02    Payment of Obligations    27 5.03    Preservation of Existence, Etc.    28   i 5.04    Compliance with Laws    28 ARTICLE VI NEGATIVE COVENANTS 6.01    Liens    28 6.02    Investments    29 6.03    Indebtedness    30 6.04    Mergers; Sale of Assets    33 6.05    Consolidated Leverage Ratio    33 6.06    Indebtedness of Non-OLP Subsidiaries    34 6.07    Indebtedness of the Operating Partnership and the Operating Partnership Subsidiaries    34 ARTICLE VII 7.01    Events of Default    35 7.02    Remedies Upon Event of Default    36 ARTICLE VIII MISCELLANEOUS 8.01    Amendments, Etc.    36 8.02    Notices and Other Communications; Facsimile Copies    37 8.03    No Waiver; Cumulative Remedies    38 8.04    Payments Set Aside    38 8.05    Successors and Assigns    38 8.06    Interest Rate Limitation    39 8.07    Counterparts    39 8.08    Integration    39 8.09    Severability    39 8.10    Governing Law    39 8.11    Waiver of Right to Trial by Jury    40 8.12    USA PATRIOT Act Notice    40 8.13    ENTIRE AGREEMENT    40 8.14    Limited Recourse    40 SCHEDULES 4.05    —    Material Events 6.01    —    Existing Liens 6.03    —    Existing Indebtedness 8.02    —    Lender’s Office, Addresses for Notices EXHIBITS A    —    Form of Loan Notice   ii B    —    Form of Note C    —    Form of Assignment and Assumption Agreement D    —    Form of Subordination Agreement   iii A1 CREDIT AGREEMENT This A1 CREDIT AGREEMENT (this “Agreement”) dated as of [            ], 2009 is made and entered into by and among ENBRIDGE ENERGY PARTNERS, L.P., a Delaware limited partnership (the “Borrower”), and ENBRIDGE ENERGY COMPANY, INC., a Delaware corporation (the “Lender”). WHEREAS, the Lender and the Borrower desire to enter into this Agreement, whereby the Lender will make Loans (as defined below) to the Borrower from time to time up to a preapproved maximum amount; WHEREAS, the Borrower entered into the B1 Credit Agreement with Enbridge Energy, Limited Partnership, a Delaware limited partnership, on behalf of the Series AC, as borrower (the “Series AC”), dated as of the date hereof (as such agreement may be amended, supplemented or otherwise modified from time to time, the “B1 Credit Agreement”), whereby the Borrower will make loans to the Series AC from time to time in an amount equal to the Loans drawn by the Borrower from the Lender under this Agreement; WHEREAS, the Lender, the Borrower and the Series AC desire that the proceeds of the Loans made by the Lender to the Borrower under this Agreement be used to fund loans made by the Borrower to the Series AC under the B1 Credit Agreement, which will be used by the Series AC to fund a portion of the total costs to construct (a) the U.S. portion of the proposed 36-inch diameter crude oil pipeline from Hardisty, Alberta to Superior, Wisconsin, with an initial annual capacity of 450,000 barrels per day and (b) related terminals, interconnections, tanks and pump stations located in the United States (collectively, the “Alberta Clipper Project”); WHEREAS, the Lender has agreed to make the Loans subject to the terms and contained, the parties hereto covenant and agree as follows: ARTICLE I DEFINITIONS AND ACCOUNTING TERMS 1.01 Defined Terms. The following terms shall have the meanings set forth below: “2007 Credit Facility” means the Second Amended and Restated Credit Agreement, dated as of April 4, 2007, among the Borrower, Bank of America, as administrative agent, and the other agents and lenders party thereto, as amended, supplemented or modified from time to time, or any replacement facility thereof. “Acquired Assets” has the meaning set forth in the definition of “Incremental EBITDA”. “Acquired Subsidiary” has the meaning set forth in the definition of “Incremental EBITDA”.   1 “Acquisition Period” means the period beginning with the date of payment of the purchase price for a Specified Acquisition (the “Acquisition Closing Date”) and continuing through the earliest of (a) the last day of the second fiscal quarter following the quarter in which the Acquisition Closing Date occurs, (b) the date designated by the Borrower as the termination date of such Acquisition Period, or (c) the Quarter End Date on which the Borrower is in compliance with Section 6.05 as such compliance is determined as if such period was not the Acquisition Period. As used in this definition, “Specified Acquisition” means any one or more transactions (i) consummated during a consecutive 9-month period pursuant to which the Borrower or one or more of its Subsidiaries, or any combination of the foregoing, directly or indirectly, whether in the form of capital expenditure, an investment, a merger, a consolidation, an amalgamation or otherwise and whether through a solicitation of tender of equity interests, one or more negotiated block, market, private or other transactions, or any combination of the foregoing, acquires for an aggregate purchase price of not less than $50,000,000 (A) all or substantially all of the business or assets of any other Person or operating division or business unit of any other Person or (B) more than 50% of the equity interests in any other Person and (ii) designated by the Borrower to the Lender as a “Specified Acquisition” (such designation may be made at any time during an Acquisition Period that began on the Acquisition Closing Date for such Specified Acquisition); provided that following a designation of a Specified Acquisition, the Borrower may not designate a subsequent Specified Acquisition unless, after the end of the most recent Acquisition Period there shall have occurred at least one Quarter End Date on which the Borrower is in compliance with Section 6.05, as such compliance is determined as if such period was not an Acquisition Period. As used in this definition, “Quarter End Date” means the last date of a fiscal quarter. “Affiliate” means, as to any Person, any other Person directly or indirectly such Person. A Person shall be deemed to be “controlled by” any other Person if such other Person possesses, directly or indirectly, power to direct or cause the direction of the management and policies of such Person whether by contract or otherwise. “Agreement” has the meaning set forth in the introductory paragraph hereto. “Alberta Clipper Project” has the meaning set forth in the recitals hereto. “Applicable Rate” has the meaning specified in Section 2.06. “Attributable Indebtedness” means, on any date, in respect of any capital lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP. the Borrower and its Subsidiaries and Unrestricted Subsidiaries for the fiscal year ended December 31, 2008, and the related consolidated statements of income and cash flows for such fiscal year of such Persons. “B1 Commitment” means the “Commitment” as defined in the B1 Credit Agreement. “B1 Credit Agreement” has the meaning set forth in the recitals hereto.   2 “B1 Loan Notice” means “Loan Notice” as defined in the B1 Credit Agreement. “Bank of America” means Bank of America, N.A. as its “prime rate.” Such prime rate is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced prime rate. Any change in such prime rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change. If for any reason the “prime rate” set by Bank of America has not been announced for such day, then such rate as set and publicly announced by Wachovia for such day shall be used. “Borrower” has the meaning set forth in the introductory paragraph hereto, and includes its successors and assigns permitted hereby, if any. “Borrowing” means a borrowing consisting of simultaneous Loans of the same Type and having the same Interest Period made by the Lender pursuant to Section 2.01. which commercial banks are authorized to close under the Laws of, or are in fact closed in, either (a) the State of New York or (b) the City of Calgary, Alberta, Canada, and if such day relates to any Fixed Period Eurodollar Rate Loan, it must also be a day on which dealings in Dollar deposits are conducted by and between banks in the applicable offshore Dollar interbank market. “Closing Date” means the first date all the conditions precedent in Section 3.01 are satisfied or waived. “Commercial Operation Date” means the date on which a Material Project is substantially complete and commercially operable. “Commitment” means the Lender’s obligation to make Loans to the Borrower pursuant to Section 2.01 in an aggregate principal amount not to exceed $400,000,000, as such amount may be reduced or adjusted from time to time in “Consolidated” or “consolidated” when used with reference to a Subsidiary or an Unrestricted Subsidiary means that such Subsidiary or Unrestricted Subsidiary is consolidated for financial reporting purposes in accordance with GAAP. “Consolidated EBITDA” means, for any period, an amount equal to the sum of (a) Consolidated Net Income for such period, (b) consolidated interest expense deducted in determining such Consolidated Net Income, (c) the amount of taxes, based on or measured by income, used or included in the determination of such Consolidated Net Income, and (d) the amount of depreciation and amortization expense deducted in determining such Consolidated Net Income.   3 “Consolidated Funded Debt” means, as of any date of determination, for the Borrower and its Subsidiaries (for the avoidance of doubt, excluding the Unrestricted Subsidiaries) on a consolidated basis, the sum of (without duplication) the following: (a) the outstanding principal amount of all obligations, whether current or long-term, for borrowed money (including all Obligations hereunder); (b) that portion of obligations with respect to capital leases that are capitalized in the consolidated balance sheet of the Borrower and its Subsidiaries; and (c) without duplication, the unpaid principal amount of all Guarantee Obligations with respect to Indebtedness of the type specified in subsections (a) and (b) above of Persons other than the Borrower or any of its Subsidiaries and excluding in all cases (i) Qualifying Subordinated Indebtedness owing to an Affiliate of the Borrower and (ii) to the extent included in any of clauses (a) through (c) above, Designated Hybrid Securities. “Consolidated Net Income” means, for any period, the net income of the Borrower and its Subsidiaries (for the avoidance of doubt, excluding the Unrestricted Subsidiaries) from continuing operations (excluding gains or losses resulting from mark to market activity as a result of the implementation of Statement of Financial Accounting Standard 133, as amended) before extraordinary items (excluding gains or losses from Dispositions of assets) for that period determined on a consolidated basis; provided, for the purposes of the definition of Consolidated Operating Income, Consolidated Net Income shall be calculated by including the Unrestricted Subsidiaries. “Consolidated Net Worth” means, as to the Borrower at any date, the sum of (i) the amount of partners’ capital of the Borrower determined as of such date in accordance with GAAP, and (ii) Designated Hybrid Securities; provided, there shall be excluded, without duplication, from such determination (to the extent otherwise included therein) the amount of accumulated other comprehensive gain or loss as of such date determined in accordance with GAAP. “Consolidated Operating Income” means, for any period, (i) the sum of Consolidated Net Income and consolidated interest expense for such period less (ii) the sum of consolidated interest income and consolidated income classified as “Other” for such period, and in each of the foregoing instances, “consolidated” refers to the Borrower, its Subsidiaries and Unrestricted Subsidiaries on a consolidated basis determined in accordance with GAAP. pursuant to which such Person is obligated to perform an agreement or other undertaking. by either S&P or Moody’s (collectively, the “Debt Ratings”) of the Borrower’s such Debt Ratings shall apply (with Pricing Level 1 being the highest and Pricing Level 6 being the lowest), unless there is a split in Debt Ratings of more than one level, in which case the level that is one level lower than the higher Debt Rating shall apply.   4 “Debtor Relief Laws” means the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States of America or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally. “Default” means any event that, with the giving of any notice, the passage of time, or both, would be an Event of Default. “Default Rate” means an interest rate equal to (a) the Base Rate plus (b) the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per annum; provided, however, that with respect to a Fixed Period Eurodollar Rate Loan, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan plus 2% per annum, in each case to the fullest extent permitted by applicable Laws. “Delegate” means Enbridge Energy Management, L.L.C., the delegate of the General Partner, and its successors and permitted assigns. “Designated Hybrid Securities” means at the end of any fiscal quarter, the outstanding Hybrid Securities at such time in a face amount that does not exceed 15% of Total Capitalization at such time. “Disposition” or “Dispose” means the sale, transfer, license or other associated therewith. “Dollar” and “$” means lawful money of the United States of America. “EBITDA” means for any period and for any Person and its consolidated Subsidiaries the sum of (a) net income of such Person and its consolidated Subsidiaries from continuing operations (excluding gains or losses resulting (excluding gains or losses from dispositions of assets), and (b) to the extent deducted in determining net income of such Person and its consolidated Subsidiaries (i) all interest expense plus the portion of rent expense of such Person under capitalized leases that is treated as interest in accordance with GAAP, (ii) the amount of taxes, based on or measured by income, and (iii) the amount of depreciation and amortization expense, in each case of such Person and its consolidated Subsidiaries for such period. “Environmental Laws” means all Laws relating to environmental, health, safety and land use matters applicable to any property. “EPRM” means Enbridge Partners Risk Management, L.P., a Delaware limited partnership, and a Wholly-Owned Subsidiary.   5 “EPRM Swap Contracts” means Swap Contracts to which EPRM is a counterparty, provided that (a) no other Subsidiary of the Borrower is a counterparty thereto or has Guarantee Obligations with respect thereto, (b) EPRM engages in no business other than the entry into Swap Contracts and related documents, instruments and agreements, and the performance of obligations and duties, the taken of actions, and the exercise of rights, privileges, interests or benefits under and incidental thereto, and (c) EPRM’s assets consist solely of Swap Contracts and related documents, instruments and agreements, and rights, privileges, interests and benefits thereunder, and other assets related to, or needed or needful for, the performance of obligations, taking of actions or exercise of rights, privileges, interests or benefits thereunder or arising under, or in connection with, revenues and operations with respect thereto. “ERISA” means the Employee Retirement Income Security Act of 1974 and any rules and regulations issued pursuant thereto. “Event of Default” means any of the events or circumstances specified in Article VII. “Excess Swap Termination Value” means, as of any quarter-end date of determination, an amount equal to the excess of (a) the net aggregate Swap Termination Value as of such quarter-end date of (i) all Swap Contracts (other than EPRM Swap Contracts) pursuant to which one or more Subsidiaries of the Borrower are obligated as a counterparty and for which no other Subsidiary of the Borrower has a Guarantee Obligation with respect thereto, and (ii) all Swap Contracts for which one or more Subsidiaries of the Borrower has a Guarantee Obligation, in each case without duplication of any such Swap Contracts and Guarantee Obligations with respect thereto over (b) $150,000,000. “Excluded Subsidiary” means any Subsidiary which is subject to any Excluded Subsidiary Transfer Restrictions; provided, however, that a Subsidiary that is subject to Excluded Subsidiary Transfer Restrictions will not be deemed to be an Excluded Subsidiary by reason of such Excluded Subsidiary Transfer Restrictions if, after giving effect thereto, such Subsidiary is permitted to make the payments, loans, advances and transfers of the type described in clauses (1), (2), (3) and (4) of the definition of Intercompany Restrictions to the Borrower or to at least one other Subsidiary that is not subject to any Excluded Subsidiary Transfer Restrictions that restrict such Subsidiary’s ability to make such payments, loans, advances and transfers to the Borrower. “Excluded Subsidiary Transfer Restrictions” means restrictions of the type described in clauses (1), (2), (3), or (4) of the definition of Intercompany Restrictions, other than restrictions of the type described in clause (4) which are otherwise excepted by any of clauses (B)(4)(d.), (B)(4)(e.), (B)(4)(f.), (B)(4)(g.), or (B)(4)(h.), (a) which are set forth in agreements governing Refinancings of or other amendments to Indebtedness of the Borrower that were not set forth in the agreements governing such Indebtedness prior to such Refinancing or amendment, or (b) which would be Intercompany Restrictions absent the exception set forth in clause (B)(4)(c.) of Section 6.03(a)(i). “Federal Funds Rate” means, for any day, the rate per annum (rounded upwards to the nearest  1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on   6 Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate charged to Bank of America on such day on such transactions as determined by the Lender. “Financing Vehicle” has the meaning set forth in the definition of “Hybrid Securities.” “Fixed Period Eurodollar Rate” means, with respect to any Fixed Period Eurodollar Rate Loan for the Interest Period applicable to such Fixed Period Eurodollar Rate Loan, the rate per annum equal to the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by the Lender from time to time) at approximately 11:00 a.m., London time, two equivalent to such Interest Period. If such rate is not available at such time for any reason, then the “Fixed Period Eurodollar Rate” for such Interest Period shall equal the Fixed Period Eurodollar Rate (as defined in the 2007 Credit Facility) that applied to the most recent borrowing of Fixed Period Eurodollar Loans (as defined in the 2007 Credit Facility) under the 2007 Credit Facility. “Fixed Period Eurodollar Rate Loan” means a Loan that bears interest at a rate of interest based on the Fixed Period Eurodollar Rate. “Funded Debt” of any Person (an “Obligor”), means, as of any date of determination, the sum of (without duplication) the following: (a) the outstanding principal amount of all obligations of such Obligor, whether current or long-term, for borrowed money, (b) that portion of obligations of such Obligor with respect to capital leases that are capitalized in a balance sheet of such Obligor; and (c) without duplication, the unpaid principal amount of all Guarantee Obligations of such Obligor with respect to Indebtedness of the type specified in subsections (a) and (b) above of Persons other than such Obligor. the opinions and pronouncements of the Accounting Principles Board and the profession, that are applicable to the circumstances as of the date of determination, consistently applied. “General Partner” means Enbridge Energy Company, Inc., a Delaware corporation, and after the date hereof, any one or more Subsidiaries of Enbridge Inc., a corporation incorporated under the federal laws of Canada, that shall succeed Enbridge Energy Company, Inc. in the capacity as general partner of the Borrower. political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, administrative tribunal, central bank or other entity exercising executive, legislative, judicial,   7 government, and any corporation or other entity owned or controlled, through stock or capital ownership or otherwise, by any of the foregoing. “Guarantee Obligation” means, as to any Person, (a) any obligation, contingent or otherwise, of such Person guarantying or having the economic effect of guarantying any Indebtedness or other obligation payable or performable by obligation, or (iv) entered into for the purpose of assuring in any other manner the obligees in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligees against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person; provided, however, that the term “Guarantee Obligation” shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guarantee Obligation shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guarantying Person in good faith. “Hybrid Securities” means any trust preferred securities or deferrable interest subordinated debt with a maturity of at least 20 years, which provides for the optional or mandatory deferral of interest or distributions issued by the Borrower or a Financing Vehicle. “Financing Vehicle” means a business trust, limited liability company, limited partnership or similar entity (i) substantially all of the common equity, general partner or similar interests of which are owned (either directly or indirectly through one or more Wholly-Owned Subsidiaries) at all times by the Borrower, (ii) that has been formed for the sole purpose of issuing trust preferred securities or deferrable interest subordinated debt, and (iii) substantially all the assets of which consist of (A) subordinated debt of the Borrower and (B) payments made from time to time on such subordinated debt. In order for any trust preferred securities or deferrable interest subordinated debt to be considered “Hybrid Securities” for purposes of this Agreement, if the Borrower or any Financing Vehicle has issued any trust preferred securities or deferrable interest subordinated debt that it intends to treat as Hybrid Securities in connection with the calculations of Consolidated Funded Debt, Consolidated Net Worth or Total Capitalization, the Borrower shall have delivered to the Lender information sufficient to demonstrate that the terms of such trust preferred securities or deferrable interest subordinated debt, as the case may be, meet the criteria set forth in this definition. “Incremental EBITDA” means, (i) as to any Person which becomes a Subsidiary (an “Acquired Subsidiary”) as a result of an acquisition by the Borrower or a Subsidiary of such Acquired Subsidiary, EBITDA of such Person for the four full quarters ending immediately prior   8 to the acquisition of such Acquired Subsidiary, or (ii) in regard to the acquisition of all or substantially all of the business or assets of any Person or the operating division or business unit of any Person (an “Acquired Asset”) by the Borrower or a Subsidiary, EBITDA with respect to the Acquired Asset for the four full quarters ending immediately prior to the acquisition of such Acquired Asset, as reasonably determined by the Borrower and reasonably acceptable to the Lender. “Indebtedness” means, as to any Person at a particular time, all of the following (without duplication): similar instruments; (b) any direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), banker’s acceptances, bank (c) Intentionally Blank; (d) whether or not so included as liabilities in accordance with GAAP, all obligations of such Person to pay the deferred purchase price of property or services except trade accounts payable arising in the ordinary course of business of such Person, and indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse; (e) capital leases; (f) all Guarantee Obligations of such Person in respect of any of the foregoing; and (g) for the purposes of determining compliance with the applicable provisions of Sections 6.06 or 6.07, obligations of such Person under Swap Contracts, and Guarantee Obligations of such Person in respect of Swap Contracts, but only to the extent of Excess Swap Termination Value. For purposes of Section 6.06, Indebtedness of the Non-OLP Subsidiaries shall be calculated quarterly and include the Non-OLP Subsidiaries’ Ratable Share of Excess Swap Termination Value as of the relevant quarter-end date of determination, and for purposes of Section 6.07, Indebtedness of the Operating Partnership and the Operating Partnership Subsidiaries shall be calculated quarterly and include the Operating Partnership’s and the Operating Partnership Subsidiaries’ Ratable Share of Excess Swap Termination Value as of the relevant quarter-end date of determination. For all purposes hereof, the Indebtedness of any Person shall include, without duplication, the Indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person by its   9 governing agreements and applicable law except for customary exceptions acceptable to the Lender. The amount of any capital lease as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date. The amount of any net obligation under any Swap Contract, and the amount of any Guarantee Obligations in respect of any Swap Contract, on any date shall be deemed to be the Swap Termination Value of such Swap Contract as of such date. “In-Service Date” has the meaning set forth in the Tariff Term Sheet. “Intercompany Restrictions” has the meaning set forth in Section 6.03(a)(i). “Interest Payment Date” means, (a) as to any Fixed Period Eurodollar Rate Loan, Date; provided, however, that if any Interest Period for a Fixed Period Eurodollar Rate Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Base Rate Loan, the last Business Day of each March, June, September and December and the Maturity Date. “Interest Period” means, with respect to any Fixed Period Eurodollar Rate Loan, the period commencing on the date such Fixed Period Eurodollar Rate Loan is disbursed or converted to or continued as a Fixed Period Eurodollar Rate Loan and ending on the date one, two, three or six months thereafter, as selected by the Borrower in its Loan Notice; provided that: (i) any Interest Period applicable to any Fixed Period Eurodollar Rate Loan that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the immediately preceding Business Day; (ii) any Interest Period applicable to any Fixed Period Eurodollar Rate Loan such Interest Period) shall, subject to the provisions of clause (i) above, end on the last Business Day of the calendar month at the end of such Interest Period; and “Laws” means, collectively, all international, foreign, federal, state and local “Lender” has the meaning set forth in the introductory paragraph hereto, and includes its successors and assigns.   10 “Lender’s Office” means the Lender’s address and, as appropriate, account as set forth on Schedule 8.02, or such other address or account as the Lender may from time to time notify to the Borrower. “Lien” means any mortgage, pledge, hypothecation, collateral assignment, encumbrance, lien (statutory or other), charge, security interest or any other arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, a deposit arrangement and the filing of any financing statement under the Uniform Commercial Code or comparable Laws of any jurisdiction) for a creditor’s claim to be satisfied from assets or proceeds prior to the claims of other creditors or the owners, including, if applicable, the interest of a purchaser of accounts receivable but excluding the title of the lessor under any operating lease. “Loan” has the meaning set forth in Section 2.01. “Loan Documents” means this Agreement, each Note, and each Loan Notice. “Loan Notice” means written or telephonic notice of (a) a Borrowing of Loans, (b) a conversion of Loans from one Type to the other, or (c) a continuation of Loans as the same Type, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of a B1 Loan Notice or Exhibit A or if telephonic, shall be immediately followed by written notice in the form of a B1 Loan Notice or Exhibit A; provided, any such telephone notice shall be irrevocable when given notwithstanding that it is required to be so confirmed in writing. adverse effect upon, the operations, business, properties, financial condition, prospects or assets of the Borrower and its consolidated Subsidiaries (other than the Unrestricted Subsidiaries) taken as a whole; (b) a material impairment of the ability of the Borrower to pay any Obligation when due or otherwise to perform its material obligations under this Agreement or any Note; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against the Borrower of this Agreement or any Note. “Material Project” means any capital construction or expansion project of the Borrower or its Subsidiaries, the aggregate capital cost or budgeted capital cost of which, in each case, including capital costs expended prior to the acquisition of any such project by the Borrower or its Subsidiaries, as the case may be, exceeds $25,000,000.00. “Material Project EBITDA Adjustments” means, with respect to each Material Project (A) prior to the Commercial Operation Date of such Material Project (but including the fiscal quarter in which such Commercial Operation Date occurs) a percentage (based on the then-current completion percentage of such Material Project) of an amount to be approved by the Lender as the projected Consolidated EBITDA attributable to such Material Project for the first 12-month period following the scheduled Commercial Operation Date of such Material Project (such amount to be determined based on customer contracts relating to such Material Project (or negotiated settlements in place in connection with such Material Project which the Borrower has demonstrated to the reasonable satisfaction of the Lender have the same effect), the creditworthiness of the other parties to such contracts, and projected revenues from such   11 contracts, capital costs and expenses, scheduled Commercial Operation Date, oil and gas reserve and production estimates, commodity price assumptions and other factors deemed appropriate by the Lender) which may, at the Borrower’s option, be added to Consolidated EBITDA for the fiscal quarter in which construction or expansion of such Material Project commences and for each fiscal quarter thereafter until the Commercial Operation Date of such Material Project (including the fiscal quarter in which such Commercial Operation Date occurs, but without duplication of any actual Consolidated EBITDA attributable to such Material Project following such Commercial Operation Date); provided that if the actual Commercial Operation Date does not occur by the scheduled Commercial Operation Date (as used in this Agreement, references to “scheduled Commercial Operation Date” mean the scheduled Commercial Operation Date as reflected in the request from the Borrower to the Lender for approval of the applicable Material Project EBITDA Adjustments), then the foregoing amount shall be reduced, for quarters ending after the scheduled Commercial Operation Date to (but excluding) the first full quarter after the actual Commercial Operation Date, by the following percentage amounts depending on the period of delay (based on the actual period of delay or then-estimated delay, whichever is longer): (i) 90 days or less, 0%, (ii) longer than 90 days, but not more than 180 days, 25%, (iii) longer than 180 days but not more than 270 days, 50%, (iv) longer than 270 days but not more than 365 days, 75%, and (v) longer than 365 days, 100%; and (B) beginning with the first full fiscal quarter following the Commercial Operation Date of a Material Project and for the two immediately succeeding fiscal quarters, an amount to be approved by the Lender as the projected Consolidated EBITDA attributable to such Material Project (determined in the same manner set forth in clause (A) above) for the balance of the four full fiscal quarter period following such Commercial Operation Date, which may, at the Borrower’s option, be added to actual Consolidated EBITDA for such fiscal quarters. Notwithstanding the foregoing: (i) no such additions shall be allowed with respect to any Material Project unless: (a) to the extent Material Project EBITDA Adjustments will be made to Consolidated EBITDA in determining compliance with Section 6.05, the Borrower shall have delivered to the Lender a written request for Material Project EBITDA Adjustments setting forth (i) the scheduled Commercial Operation Date for such Material Project, (ii) information regarding such scheduled Commercial Operation Date sufficient to demonstrate that such date meets the criteria sets forth in the definition of Commercial Operation Date, (iii) pro forma projections of Consolidated EBITDA attributable to such Material Project, (iv) information, as applicable, regarding (A) customer contracts relating to such Material Project (or negotiated settlements in connection with such Material Project), (B) the creditworthiness of the other parties to such contracts or settlements, as the case may be, (C) projected revenues from such contracts or settlements, as the case may be, (D) projected capital costs and expenses, (E) oil and gas reserve and production estimates, and (F) commodity price assumptions, and (v) such other information previously requested by the Lender which it reasonably deemed necessary to approve such Material Project EBITDA Adjustments, and   12 (b) the Lender shall have approved (such approval not to be unreasonably withheld) such projections and shall have received such other information and documentation as the Lender may reasonably request, all in form and substance reasonably satisfactory to the Lender, and (ii) the aggregate amount of all Material Project EBITDA Adjustments during any period shall be limited to 25% of the total actual Consolidated EBITDA for such period (which total actual Consolidated EBITDA shall be determined without including any Material Project EBITDA Adjustments or any adjustments for acquisitions pursuant to clause (1) of the definition of Pro Forma EBITDA). “Material Subsidiary” means any Subsidiary that directly or through one or more Subsidiaries (a) owns assets with a book value equal to 10% or more of the book value of the consolidated assets of the Borrower, its Consolidated Subsidiaries and its Consolidated Unrestricted Subsidiaries, (b) contributed 10% or more of Consolidated Operating Income for any fiscal quarter during the four fiscal quarters most recently ended of the Borrower, its Consolidated Subsidiaries and its Consolidated Unrestricted Subsidiaries, or (c) is a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act of 1933, as amended, as such Regulation is in effect on any date of determination. A Subsidiary will be deemed to have become a Material Subsidiary on either (i) the date of its acquisition or formation, if after giving effect to such acquisition or formation, it constitutes a Material Subsidiary, as reasonably determined by the Borrower and reasonably acceptable to the Lender, or, if applicable (ii) the 75 th day following the end of each of the first 3 fiscal quarters of the Borrower or the 120th day following the end of each fiscal year of the Borrower, as applicable, if as of the immediately preceding quarter-end or year-end, as applicable, and based on the financial statements prepared for such ending quarterly or annual period, it constituted a Material Subsidiary, as reasonably determined by the Borrower and reasonably “Maturity Date” means the earlier to occur of (i) the Scheduled Maturity Date, and (ii) the date that is 180 days after the In-Service Date; provided that in no event shall the Maturity Date occur prior to the maturity date of the B1 Credit Agreement. “Moody’s” means Moody’s Investors Service, Inc. or any successor to the rating agency business thereof, or if no such successor, any other debt rating agency selected by the Borrower and approved by the Lender. “Mortgage” shall mean, collectively, the mortgage, security agreement and fixture filings between the Operating Partnership and the Trustee, each dated as of December 12, 1991, as amended, modified or supplemented from time to time and in effect, and covering assets located in Illinois, Indiana, Michigan, Minnesota, New York, North Dakota and Wisconsin. “Mortgage Note Agreements” shall mean, collectively, those certain Note Agreements, each dated as of December 12, 1991, between the Operating Partnership and each of the respective purchasers of the Mortgage Notes, as amended, supplemented or modified from time to time and in effect.   13 “Mortgage Notes” shall mean, collectively, the Operating Partnership’s 9.15% First Mortgage Notes due December 15, 2011, originally issued in the aggregate principal amount of $310,000,000 pursuant to the separate Mortgage Note Agreements, dated December 12, 1991, between the Operating Partnership and the institutional investors party thereto, together with any loan agreement and security documents executed in connection therewith, any and all instruments given in renewal, extension, modification or rearrangement of or in substitution or replacement for any one or more of the foregoing described promissory notes and other documents, whether given to the original purchaser thereof (or its designee) or any other Person and other documents. “Net Tangible Assets” means tangible assets of the Borrower and its Subsidiaries (for the avoidance of doubt, excluding the Unrestricted Subsidiaries) on a consolidated basis. “Non-OLP Consolidated Net Income” means, for any period, the net income of the Non-OLP Subsidiaries from continuing operations (excluding gains or losses resulting from mark to market activity as a result of the implementation of Statement of Financial Accounting Standard 133, as amended) before extraordinary items (excluding gains or losses from Dispositions of assets) for that period. “Non-OLP Indebtedness Limitation” has the meaning specified in Section 6.06. “Non-OLP Inter-Company Indebtedness” means Indebtedness owed by a Non-OLP Subsidiary to the Borrower or to a Wholly-Owned Non-OLP Subsidiary (other than, for the avoidance of doubt, an Unrestricted Subsidiary). “Non-OLP Pro Forma EBITDA” means, for any period, at the time of any determination thereof, without duplication, (a) Non-OLP Consolidated Net Income, plus (b) to the extent actually deducted in determining such Non-OLP Consolidated Net Income, interest expense (and in the case of capital leases the portion of rent expense that is treated as interest in accordance with GAAP), income taxes, depreciation and amortization for the Non-OLP Subsidiaries for such period, calculated on a pro forma basis making adjustments for acquisitions of any Person or all or substantially all of the business or assets of any other Person or the operating division or business unit of any Person made during such period, to the extent not reflected in such Non-OLP Consolidated Net Income. “Non-OLP Subsidiaries” means Subsidiaries (for the avoidance of doubt, excluding Unrestricted Subsidiaries) of the Borrower other than the Operating Partnership and Operating Partnership Subsidiaries. “Note” means, a promissory note made by the Borrower in favor of the Lender evidencing Loans made by such Lender, substantially in the form of Exhibit B. “Obligations” means all advances to, and debts, liabilities and obligations of the Borrower arising under any Loan Document, whether direct or indirect, and including interest that accrues after the commencement by or against the Borrower of any proceeding under any Debtor Relief Laws naming the Borrower as the debtor in such proceeding.   14 “OLP Indebtedness Limitation” has the meaning specified in Section 6.07. “OLP Inter-Company Indebtedness” means Indebtedness owed by the Operating Partnership or by an Operating Partnership Subsidiary to the Borrower, to the Operating Partnership, or to a Wholly-Owned Operating Partnership Subsidiary (other than, for the avoidance of doubt, an Unrestricted Subsidiary). “Operating Partnership” means Enbridge Energy, Limited Partnership, a Delaware limited partnership, a Subsidiary of the Borrower. “Operating Partnership Subsidiary” means any Subsidiary (for the avoidance of doubt, excluding Unrestricted Subsidiaries) of the Operating Partnership. certificate or articles of incorporation and the bylaws; (b) with respect to any limited liability company, the certificate of formation and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation with the secretary of state or other department in the state of its formation, in each case as amended from time to time. “Outstanding Amount” means, on any date, the aggregate outstanding principal amount of Loans after giving effect to any borrowings and prepayments or repayments of Loans occurring on such date. “Partnership Agreement” means the Third Amended and Restated Agreement of Limited Partnership of the Operating Partnership, dated as of the date hereof, as amended, supplemented or modified from time to time. “Person” means any individual, trustee, corporation, general partnership, limited partnership, limited liability company, joint stock company, trust, unincorporated organization, bank, business association, firm, joint venture or Governmental Authority. “Pro Forma EBITDA” means, at the time of any determination thereof, without duplication, Consolidated EBITDA for the preceding four quarters ending on such date (the “Subject Period”), calculated on a pro forma basis (1) at the Borrower’s option, making adjustments for acquisitions of any Person or all or substantially all of the business or assets of any other Person or the operating division or business unit of any Person made during such Subject Period, to the extent not reflected in such Consolidated Net Income, and (2) at the Borrower’s option, making Material Project EBITDA Adjustments. If any Subsidiary is an Excluded Subsidiary on both (i) the last day of a Subject Period and (ii) on the date (as used in this paragraph, the “Determination Date”) that is the earlier of (x) the date that the Borrower delivers financial statements pursuant to Section 5.01 for such Subject Period and (y) the date that the Borrower is required to deliver financial statements pursuant to Section 5.01, then the net income of such Subsidiary shall not be included in the calculation of Consolidated Net Income for such Subject Period and such Subsidiary’s interest expense, income taxes, depreciation and amortization shall not be added to Consolidated Net Income pursuant to clause (b) above. If a Subsidiary is not an Excluded Subsidiary on the last day of the Subject Period, or if such   15 Subsidiary is an Excluded Subsidiary on the last day of a Subject Period but is no longer an Excluded Subsidiary on the Determination Date, then such Subsidiary will not be considered an Excluded Subsidiary during any part of the Subject Period, its net income will be included in the calculation of Consolidated Net Income for the Subject Period to the same extent as if it had not been an Excluded Subsidiary during any part of the Subject Period, and its interest expense, income taxes, depreciation and amortization will be added to Consolidated Net Income pursuant to clause (b) above. For the avoidance of doubt, and by way of an example (but not exhaustive of all other applicable examples), the EBITDA for a Subject Period which is attributable to a Subsidiary, that at any time during that Subject Period was an Excluded Subsidiary, shall nonetheless be included in the Pro Forma EBITDA for such Subject Period if, on either the last day of the Subject Period or the Determination Date such Subsidiary is, for whatever reason, no longer an Excluded Subsidiary, including by reason of discharging the Indebtedness that imposed the applicable Excluded Subsidiary Transfer Restriction or Excluded Subsidiary Transfer Restrictions or having otherwise terminated the application of all related provisions that imposed such restriction or restrictions. “Qualifying Subordinated Indebtedness” means unsecured Indebtedness of the Borrower owing to a Subsidiary or other Affiliate of the Borrower (in each case, other than an Unrestricted Subsidiary), provided that (a) such Indebtedness has a maturity date of at least six months subsequent to the Maturity Date, (b) interest accruing on such Indebtedness is, at the option of the Borrower payable not in cash but in additional Indebtedness of like tenor and term, (c) no amortization of principal of such Indebtedness is scheduled prior to the date that is at least six months subsequent to the Scheduled Maturity Date, (d) no Subsidiary of the Borrower has any Guarantee Obligation or other repayment obligation with respect thereto, and (e) such Indebtedness is expressly subordinated to the Obligations under the Loan Documents pursuant to a subordination agreement in the form of Exhibit D hereto. “Ratable Share of Excess Swap Termination Value” means, as of any quarter-end date of determination: (a) for the Non-OLP Subsidiaries, an amount equal to (i) the sum of (A) the net aggregate Swap Termination Value of all Swap Contracts pursuant to which any Non-OLP Subsidiary is obligated as a counterparty and (B) the net aggregate Swap Termination Value of all Swap Contracts for which any Non-OLP Subsidiary has a Guarantee Obligation, in each case without duplication of any such Swap Contracts and Guarantee Obligations with respect thereto, divided by the sum of (A) the net aggregate Swap Termination Value of all Swap Contracts pursuant to which any Subsidiary is obligated as a counterparty and (B) the net aggregate Swap Termination Value of all Swap Contracts for which any Subsidiary has a Guarantee Obligation, in each case without duplication of any such Swap Contacts and Guarantee Obligations with respect thereto (the “Aggregate Subsidiary Swap Obligations”), times (ii) the Excess Swap Termination Value as of such date; and (b) for the Operating Partnership and the Operating Partnership Subsidiaries, an amount equal to (i) the sum of (A) the net aggregate Swap Termination Value of all Swap Contracts pursuant to which any of the Operating Partnership or any Operating Partnership Subsidiary is obligated as a counterparty and (B) the net aggregate Swap Termination Value of all Swap Contracts for which any of the Operating Partnership or any Operating Partnership   16 Subsidiary has a Guarantee Obligation, in each case without duplication of any such Swap Contracts and Guarantee Obligations with respect thereto, divided by the Aggregate Subsidiary Swap Obligations (as defined in clause (a) above), times (ii) the Excess Swap Termination Value as of such date. “Refinancing” means, with respect to any Indebtedness, the extension, refinancing, renewal, replacement, defeasance or refunding of such Indebtedness. “Responsible Officer” means the president, chief financial officer, chief accountant, controller, treasurer, assistant treasurer, secretary or assistant secretary of the Borrower, the General Partner or the Delegate. Companies, Inc. or any successor to the rating agency business thereof, or if no such successor, any other debt rating agency selected by the Borrower and approved by the Lender. “Scheduled Maturity Date” means July 1, 2011. “Senior Indenture” means that certain Indenture dated September 15, 1998 providing for the issuance of senior debt securities of the Operating Partnership, which indenture is between the Operating Partnership, as issuer, and JPMorgan Chase Bank, N.A., successor to The Chase Manhattan Bank, as trustee. “Senior Unsecured Notes” means, collectively, the following: (a) the 7% senior notes due 2018 in the aggregate principal amount of $100,000,000 issued by the Operating Partnership pursuant to the Senior Indenture; (b) the 7  1/8% senior notes due 2028 in the aggregate principal amount of $100,000,000 issued by the Operating Partnership pursuant to the Senior Indenture; (c) the 7.9% senior notes due 2012 in the aggregate principal amount of $100,000,000 issued by the Operating Partnership pursuant to the Senior Indenture; and (d) such other senior unsecured notes issued by the Operating Partnership on or after the Closing Date pursuant to the Senior Indenture. “Series AC” has the meaning set forth in the recitals hereto. the Borrower. In the definition of “Unrestricted Subsidiaries”, the term “Subsidiary” means each Subsidiary of the Borrower. In all other provisions of this Credit Agreement and the other Loan Documents, the term “Subsidiary” does not include any Unrestricted Subsidiary. commodity options,   17 forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement. “Swap Termination Value” means, in respect of each Swap Contract, after taking into account the effect of any netting agreement related to such Swap Contract, (a) for any date on or after the date there has been an early termination of the transactions under such Swap Contract and a termination value has been determined in accordance therewith, such termination value, and (b) for any date prior to the date referenced in clause (a) the amount determined as the mark-to-market value for such Swap Contract, as determined based upon one or dealer in such Swap Contract (which may include the Lender). “Tariff Term Sheet” shall mean the Alberta Clipper U.S. Term Sheet dated June 28, 2007 and approved by the U.S. Federal Energy Regulatory Commission by the letter dated August 28, 2008 (124 FERC ¶ 61,200 (2008)), as the same may be “Threshold Amount” means $25,000,000. “Total Capitalization” means, at any date, the total of (i) Consolidated Funded Debt plus (ii) Consolidated Net Worth. “Type” means, with respect to a Loan, its character as a Base Rate Loan or a Fixed Period Eurodollar Rate Loan. “Unrestricted Subsidiaries” means any Subsidiary of the Borrower that is designated to the Lender in writing by the Borrower as an Unrestricted Subsidiary after the date hereof; provided, however, that no Subsidiary may be designated as an Unrestricted Subsidiary if, (a) on the effective date of designation, a Default or Event of Default has occurred and is continuing, (b) the creation, formation or acquisition of such Subsidiary would not otherwise be permitted under Section 6.04 hereof, (c) the creation, acquisition or formation of such Subsidiary would not be permitted under the Mortgage Note Agreements or any other material contract or agreement to which the Borrower is a party, or (d) based on the financial statements most recently delivered pursuant to Section 5.01 or the good faith determination by the Borrower, such Subsidiary is a Material Subsidiary. If an Unrestricted Subsidiary becomes a Material Subsidiary, such Subsidiary shall no longer be deemed an Unrestricted Subsidiary.   18 “Wachovia” means Wachovia Bank, National Association, or any successor thereof. “Wholly-Owned” when used to describe a Subsidiary means that all of the equity of such Subsidiary is wholly owned by the Borrower, either directly or indirectly through another wholly-owned Subsidiary of the Borrower. 1.02 Other Interpretive Provisions. (a) The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms. (b) (i) The words “herein” and “hereunder” and words of similar import when used in any Loan Document shall refer to such Loan Document as a whole and not to any particular provision thereof. (ii) Unless otherwise specified herein, Article, Section, Exhibit and Schedule references are to this Agreement. (iii) The term “including” is by way of example and not limitation. (iv) The term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced. (v) The verb “continue,” and its usage in correlative forms, with reference to a Default or an Event of Default, shall mean that such Default or Event of Default has occurred and continues and, if applicable, after the passage of the applicable notice or cure period continues uncured, unwaived or otherwise unremedied, or with respect to the event or circumstance giving rise thereto, and after the passage of the applicable notice or cure period, continues uncured, unwaived or otherwise unremedied. (c) In the computation of periods of time from a specified date to a later including.” (d) Section headings herein and the other Loan Documents are included for 1.03 Accounting Terms. All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data number).   19 1.05 References to Agreements and Laws. Unless otherwise expressly provided herein, (a) references to documents (including the Loan Documents) shall be deemed to include all subsequent amendments, restatements, extensions, supplements and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications are not prohibited by any Loan Document, and (b) references to any Law shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Law. ARTICLE II THE COMMITMENTS AND LOANS 2.01 Loans. Subject to the terms and conditions set forth herein, the Lender agrees to make loans (each a “Loan”) to the Borrower on the Closing Date and on one Business Day per month (or more frequently, if agreed by the Lender in the Lender’s sole discretion) during the period from the Closing Date to the Maturity Date, in an aggregate amount for all Loans not to exceed at any time outstanding the amount of the Lender’s Commitment. Any Loans that have been prepaid or repaid may not be reborrowed. 2.02 Borrowings, Conversions and Continuations of Loans. (a) Each Borrowing, each conversion of Loans from one Type to the other, and each continuation of Loans as the same Type shall be made upon the Borrower’s irrevocable notice to the Lender. Each such notice must be received by the Lender not later than 11:00 a.m., Mountain Standard Time or Mountain Daylight Time (as applicable), (i) three Business Days prior to the requested date of any such Borrowing of, conversion to or continuation of any such Fixed Period Eurodollar Rate Loans or of any conversion of any such Fixed Period Eurodollar Rate Loans to Base Rate Loans, and (ii) on the requested date of any Borrowing of Base Rate Loans. Each Loan Notice shall specify (A) whether the Borrower is requesting a Borrowing, a conversion of Loans from one Type to the other, or a continuation of Loans as the same Type, (B) the requested date of the Borrowing, (C) the principal amount of Loans to be borrowed, converted or continued, (D) the Type of Loans to be borrowed or to which existing Loans are to be converted, and (E) if applicable, the duration of the Interest Period with respect thereto. If the Borrower fails to specify a Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Loans shall be made or continued as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Fixed Period Eurodollar Rate Loans. If the Borrower requests a Borrowing of, conversion to, or continuation of Fixed Period Eurodollar Rate Loans in any such Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month. (b) Following receipt of a Loan Notice and the Borrower’s satisfaction of the conditions in Section 3.01 or Section 3.02, as applicable, the Lender shall make the funds available to the Borrower either by wire transfer of such funds, in each case in accordance with instructions provided to the Lender by the Borrower.   20 (c) The parties hereto agree that if Series AC delivers a copy of a B1 Loan Notice to the Lender substantially contemporaneously with the delivery of such B1 Loan Notice to the Borrower, such B1 Loan Notice shall be deemed by the Lender and the Borrower to constitute a Loan Notice provided by the Borrower to the Lender in accordance with Section 2.02(a). (d) Except as otherwise provided herein, a Fixed Period Eurodollar Rate Loan may be continued or converted only on the last day of the Interest Period for such Fixed Period Eurodollar Rate Loan. During the existence of a Default or Event of Default, no Loans may be requested as, converted to or continued as Fixed Period Eurodollar Rate Loans without the consent of the Lender, and the Lender may demand that any or all of the then outstanding Fixed Period Eurodollar Rate Loans be converted to Base Rate Loans at the end of the respective Interest Periods therefor, if at the end of such periods, a Default or an Event of Default is then in existence. (e) The Lender shall promptly notify the Borrower of the interest rate applicable to any Fixed Period Eurodollar Rate Loan upon determination of such interest rate. The determination of the Fixed Period Eurodollar Rate by the Lender shall be conclusive in the absence of manifest error. The Lender shall notify the Borrower of any change in its referenced prime rate used in change. 2.03 Prepayments. (a) The Borrower may, upon notice to the Lender, at any time or from time to time voluntarily prepay Loans in whole or in part without premium or penalty; provided that such notice must be received by the Lender not later than 11:00 a.m., Mountain Standard Time or Mountain Daylight Time (as applicable), (i) three Business Days prior to any date of prepayment of Fixed Period Eurodollar Rate Loans, and (ii) one Business Day prior to any date of prepayment of Base Rate Loans. Each such notice shall specify the date and amount of such prepayment and the Type(s) of Loans to be prepaid. If such notice is given by Any prepayment of Fixed Period Eurodollar Rate Loans shall be accompanied by all accrued interest thereon, together with any additional amounts required pursuant to Section 2.14. (b) On each date on or after the Closing Date upon which the Borrower receives any payment or prepayment of principal or interest under the B1 Credit Agreement, the Borrower shall prepay the Loans in an amount equal to 100% of the amount received by the Borrower as such payment or prepayment. 2.04 Reduction or Termination of Commitments. The Borrower may, upon notice to the Lender, terminate the Commitment, or permanently reduce the Commitment. Once reduced in accordance with this Section, the Commitment may not be increased. If the B1   21 Commitment is terminated or permanently reduced in accordance with the B1 Credit Agreement, the Commitment shall automatically be terminated or permanently reduced by an amount equal to the amount of the reduction of the B1 Commitment. 2.05 Repayment of Loans. Subject to Section 8.14, the Borrower shall repay to the Lender on the Maturity Date the aggregate principal amount of Loans outstanding on such date. 2.06 Applicable Rate. The “Applicable Rate” under this Agreement shall be the following percentages per annum, based upon the Debt Rating as set forth below: Applicable Rate   Pricing Level    Debt Ratings S&P/Moody’s    Facility Fee Rate     Applicable Rate for Eurodollar Loans     Applicable Rate for Base Rate Loans    Utilization Fee Rate   1    A/A2 or higher    .045 %    .180 %    0    .05 %  2    A-/A3    .050 %    .200 %    0    .05 %  3    BBB+/Baa1    .070 %    .230 %    0    .05 %  4    BBB/Baa2    .090 %    .310 %    0    .05 %  5    BBB-/Baa3    .110 %    .440 %    0    .05 %  6    Lower than BBB-/Baa3 or unrated    .125 %    .575 %    0    .10 %  Initially, the Applicable Rate shall be determined based upon the Debt Rating of BBB/Baa2. Thereafter, each change in the Applicable Rate resulting from a publicly announced change in the Debt Rating shall be effective during the period commencing on the date of the public announcement thereof and ending on the date immediately preceding the effective date of the next such change. 2.07 Interest. (a) Subject to the provisions of subsection (b) below, (i) each Fixed Period Eurodollar Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Fixed Period Eurodollar Rate for such Interest Period plus the Applicable Rate; and (ii) each Base Rate Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate. (b) In the event any amount due hereunder or under any other Loan Document (including, without limitation, any interest payment) is not paid when due (whether by acceleration or otherwise), the Borrower shall pay interest on such unpaid amount (including, without limitation, interest on interest) at a fluctuating interest rate per annum equal to the Default Rate to the fullest extent permitted by applicable Law. Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand. (c) Subject to Section 8.14, interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein; provided that if the Borrower delivers a Loan Notice in accordance with Section 2.02(a) with respect to the interest due on an Interest Payment Date prior to the Maturity Date and satisfies the conditions set forth in Section 3.02 on such Interest Payment Date, the interest   22 payment due on such Interest Payment Date may be paid from the proceeds of a Loan in an equivalent amount, unless such amount would exceed the Commitment existing on such date. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law. 2.08 Fees. (a) Facility Fee. Subject to Section 8.14, the Borrower shall pay to the Lender a facility fee equal to the applicable facility fee rate based on the Debt Rating as set forth in the definition of Applicable Rate multiplied by the actual daily amount of the Commitment, regardless of usage. The facility fee shall accrue at all times from the Closing Date until the Maturity Date and shall be due and payable quarterly in arrears on the last Business Day of each March, June, September and December, commencing with the first such date to occur after the Closing Date, and on the Maturity Date. The facility fee shall be calculated quarterly in arrears, and if there is any change in the Debt Rating during any quarter, the facility fee shall be computed separately for each period during such quarter that each such Debt Rating was in effect. The facility fee shall accrue at all times, including at any time during which one or more of the conditions in Article III are not met. (b) Utilization Fee. Subject to Section 8.14, the Borrower shall pay to the Lender a utilization fee equal to the applicable utilization fee rate based on the Debt Rating as set forth in the definition of Applicable Rate multiplied by the actual daily aggregate Outstanding Amount of Loans for each day that such aggregate Outstanding Amount exceeds 50% of the Commitment. The utilization fee occur after the Closing Date, and on the Maturity Date. The utilization fee shall be calculated quarterly in arrears. The utilization fee shall accrue at all times, including at any time during which one or more of the conditions in Article III are not met. 2.09 Computation of Interest. Computation of interest on Base Rate Loans shall be calculated on the basis of a year of 365 or 366 days, as the case may be, and the actual number of days elapsed. Computation of all other types of interest and all fees shall be calculated on the basis of a year of 360 days and the actual number of days elapsed, which results in a higher yield to the payee thereof than a method based on a year of 365 or 366 days. Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it is made shall bear interest for one day. 2.10 Evidence of Debt. The Loans made by the Lender shall be evidenced by one or more accounts or records maintained by the Lender. The accounts or records maintained by the Lender shall be conclusive absent manifest error of the amount of the Loans made by the Lender to the Borrower and the interest and payments thereon. Any failure so to record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Loans. Upon the request of the Lender, the Loans may be evidenced by a Note, in addition to such accounts or records. The Lender may attach schedules to the Note and endorse thereon the date, Type (if applicable), amount and maturity of the applicable Loans and payments with respect thereto.   23 2.11 Payments Generally. (a) Except as set forth in Section 8.14, all payments to be made by the Borrower shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the Lender at the Lender’s Office in Dollars and in immediately available funds not later than 12:00 noon, Mountain Standard Time or Mountain Daylight Time (as applicable), on the date specified herein. All payments received by the Lender after 12:00 noon, Mountain Standard Time or Mountain Daylight Time (as applicable), shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue. (b) Subject to the definition of “Interest Period,” if any payment to be made by (c) If at any time insufficient funds are received by and available to the Lender to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied (i) first, toward costs and expenses incurred by the Lender, (ii) second, toward repayment of interest and fees then due hereunder, and (iii) third, toward repayment of principal then due hereunder. (d) Nothing herein shall be deemed to obligate the Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by the Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner. 2.12 [Intentionally Omitted.] 2.13 Inability to Determine Rates. If the Lender determines in connection with any request for a Fixed Period Eurodollar Rate Loan or a conversion to or continuation thereof that (a) Dollar deposits are not being offered to banks in the applicable offshore Dollar market for the applicable amount and Interest Period of such Fixed Period Eurodollar Rate Loan, (b) adequate and reasonable means do not exist for determining the Fixed Period Eurodollar Rate for such Fixed Period Eurodollar Rate Loan, or (c) the Fixed Period Eurodollar Rate for such Fixed Period Eurodollar Rate Loan does not adequately and fairly reflect the cost to the Lender of funding such Fixed Period Eurodollar Rate Loan, the Lender will promptly notify the Borrower. Thereafter, the obligation of the Lender to make or maintain Fixed Period Eurodollar Rate Loans shall be suspended until the Lender revokes such notice. Upon receipt of such notice, the Borrower may, without liability for any attendant breakage costs, revoke any pending request for a Borrowing, conversion or continuation of Fixed Period Eurodollar Rate Loans or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate Loans in the amount specified therein.   24 2.14 Funding Losses. Upon demand of the Lender from time to time (which demand shall be accompanied by a certificate of such Lender setting forth in reasonable detail the amount demanded, the bases therefor and the calculations in respect thereto, which shall be conclusive in the absence of manifest error), the Borrower shall, subject to Section 8.14, promptly compensate the Lender for and hold the Lender harmless from any loss, cost or expense incurred by it as a result of: (a) any continuation, conversion, payment or prepayment of any Loan made to such Borrower other than a Base Rate Loan on a day other than the last day of the reason of acceleration, or otherwise); Lender to make a Loan) to prepay, borrow, continue or convert any Loan made to the Borrower other than a Base Rate Loan on the date or in the amount notified by the Borrower; or (c) any loss of anticipated profits and any loss or expense arising from the All of the Borrower’s obligations under this Section 2.14 shall survive termination of the Commitment and payment in full of all the other Obligations. ARTICLE III CONDITIONS PRECEDENT TO LOANS 3.01 Conditions of Initial Loan. The obligation of the Lender to make its initial Loan hereunder is subject to the Lender’s receipt of executed counterparts of this Agreement, sufficient in number for distribution to the Lender and the Borrower, each of which shall be originals, facsimiles or other electronic reproduction (followed promptly by originals) unless otherwise specified, and properly executed by a Responsible Officer. 3.02 Conditions to all Loans. The obligation of the Lender to honor any Loan Notice (other than a Loan Notice requesting only a conversion of Loans to the other Type, or a continuation of Fixed Period Eurodollar Rate Loans as the same Type) is subject to the condition precedent that no Default or Event of Default shall exist or would result from such proposed Borrowing and the satisfaction of the conditions precedent to borrowing set forth in Section 3.1(b) of the B1 Credit Agreement. Each Loan Notice submitted by the Borrower shall be deemed to be a representation and warranty that the condition specified in Section 3.02 has been satisfied on and as of the date of the applicable Borrowing.   25 ARTICLE IV REPRESENTATIONS AND WARRANTIES The Borrower represents and warrants as set forth below: 4.01 Existence, Qualification and Power; Compliance with Laws. (a) The Borrower is duly organized, validly existing and has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to own its assets, carry on its business and to execute, deliver, and perform its obligations under the Loan Documents to which it is a party. (b) The Borrower and each Subsidiary is in compliance with all Laws (including Environmental Laws), except in each case referred to in clause (a) or this clause (b), to the extent that failure to do so could not reasonably be expected 4.02 Authorization; No Contravention. The execution, delivery and performance by the Borrower of each Loan Document has been duly authorized by all necessary corporate or other organizational action, and does not and will not (a) violate the terms of any of the Borrower’s Organization Documents, (b) result in any breach of, constitute a default under, or require, pursuant to the express provisions thereof, the creation of any consensual Lien on the properties of the Borrower under, any Contractual Obligation to which the Borrower is a party or any order, injunction, writ or decree of any Governmental Authority to which the Borrower or its property is subject, or (c) violate any Law, in each case with respect to the preceding clauses (a) through (c), which would reasonably be 4.03 Governmental Authorization. No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority is required to be obtained or made by the Borrower by any material statutory law or regulation applicable to it as a condition to the execution, delivery or performance by, or enforcement against, the Borrower of any Loan Document. 4.04 Binding Effect. This Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by the Borrower. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, subject as to enforcement to bankruptcy, insolvency, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles. 4.05 Financial Statements. Borrower and its Subsidiaries and Unrestricted Subsidiaries as of the date thereof and their results of operations for the period covered thereby in except as otherwise expressly noted therein; and (iii) together with the footnotes thereto, reflect all material indebtedness and other liabilities, direct or contingent, of the Borrower and its Subsidiaries and Unrestricted Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness in accordance with GAAP consistently applied throughout the period covered thereby.   26 (b) Other than as set forth on Schedule 4.05, since the date of the Audited Financial Statements to the Closing Date, there has been no event or circumstance that has, or could reasonably be expected to have, a Material Adverse Effect. 4.06 No Default. Neither the Borrower nor any Material Subsidiary is in default under any Contractual Obligation which could be reasonably expected to have a Material Adverse Effect. No Default or Event of Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any other Loan Document. ARTICLE V AFFIRMATIVE COVENANTS So long as the Lender shall have any Commitment hereunder or any Loan or other Obligation shall remain unpaid, the Borrower shall, and shall cause each Subsidiary to: 5.01 Financial Statements. Deliver to the Lender: (a) as soon as available, a consolidated balance sheet of the Borrower and its Subsidiaries and Unrestricted Subsidiaries as at the end of such fiscal year, and the related consolidated statements of income and cash flows for such fiscal year on Form 10-K as filed with the Securities and Exchange Commission, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail, audited and accompanied by a report and opinion of an selected by the Borrower, which report and opinion shall be prepared in accordance with GAAP and shall not be subject to any qualifications or exceptions as to the scope of the audit nor to any qualifications and exceptions not reasonably acceptable to the Lender; and (b) as soon as available, a consolidated balance sheet of the Borrower and its Subsidiaries and Unrestricted Subsidiaries as at the end of each of the first three fiscal quarters and the related consolidated statements of income and cash flows for such fiscal quarter and for the portion of the Borrower’s fiscal year then ended, on Form 10-Q as filed with the Securities and Exchange Commission, setting forth in each case in comparative form the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the previous fiscal year, all in reasonable detail. Documents required to be delivered pursuant to subsections (a) or (b) (to the extent any such documents are included in materials otherwise filed with the Securities and Exchange Commission) may be delivered electronically and if so Borrower posts such documents, or provides a link thereto, on the Borrower’s website on the Internet at the website address listed on Schedule 8.02; or (ii) on the Electronic Data Gathering, Analysis, and Retrieval system (“EDGAR”) of 5.02 Payment of Obligations. Pay and discharge as the same shall become due and proceedings and adequate reserves in accordance with GAAP are being maintained by the Borrower or relevant Subsidiary; (b) all material lawful   27 all Indebtedness, as and when due and payable, but subject to any subordination Indebtedness. 5.03 Preservation of Existence, Etc. Except in a transaction permitted by Section 6.04 or pursuant to statutory conversions to another form of entity as permitted by applicable Law, preserve, renew and maintain in full force and effect its legal existence and good standing under the Laws of the jurisdiction of its organization; and except where it will not have a Material Adverse Effect, take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business and preserve or renew all of its registered patents, trademarks, trade names and service marks. 5.04 Compliance with Laws. Comply in all material respects with the requirements of all Laws applicable to it or to its business or property, except in such instances in which (a) such requirement of Law is being contested in good faith or a bona fide dispute exists with respect thereto or (b) the failure to comply therewith could not be reasonably expected to have a Material Adverse Effect. ARTICLE VI NEGATIVE COVENANTS So long as the Lender has any Commitment hereunder or any Loan or other Obligation shall remain unpaid, the Borrower shall not, nor shall it permit any 6.01 Liens. Create, incur, assume or suffer to exist, any Lien upon any of its than the following: (b) Liens existing on the date hereof and listed on Schedule 6.01 and any renewals or extensions thereof, provided that the property covered thereby is not increased and any renewal or extension of the obligations secured or benefited thereby is permitted by Section 6.03; by appropriate proceedings, if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP; appropriate proceedings, if adequate reserves with respect thereto are (e) Liens incurred or pledges or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other social security legislation, other than any Lien imposed by ERISA;   28 (f) Liens incurred or deposits to secure the performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal bonds (including surety and appeal bonds related to judgments only to the extent permitted by clause (h) of this Section 6.01), performance bonds and other obligations of a like nature incurred in the ordinary course of business; (g) easements, rights-of-way, restrictions and other similar charges or encumbrances which, in each case are granted, entered into or created in the ordinary course of business of such Person; (h) attachments or other Liens securing judgments for the payment of money not constituting an Event of Default or securing appeal or other surety bonds related to such judgments; (i) Liens pursuant to any Mortgage or Mortgage Note Agreement or any “Security Document”, as that term is defined in the Mortgage Note Agreement; (j) Liens on property not covered by any Mortgage securing obligations under Swap Contracts, provided that the amount of such obligations shall not exceed at any time an aggregate amount equal to one percent (1%) of Net Tangible Assets; (k) Liens on (i) property or shares of equity interests of a Person that becomes a Subsidiary after the Closing Date, or (ii) Acquired Assets acquired by the Borrower or a Subsidiary after the Closing Date, including any acquisition by means of merger or consolidation with or into the Borrower or a Subsidiary which is permitted by Section 6.04; provided (A) such Liens were in existence at the time such Person becomes a Subsidiary or at the time of such acquisition of such Acquired Assets, (B) such Liens were not created in contemplation of the acquisition of such Person or such Acquired Assets, (C) such Liens do not encumber property other than property owned by such Person or the Acquired Assets then acquired, (D) if, as a result of the acquisition, the Indebtedness secured by such Liens is or becomes Indebtedness of the Borrower but not Indebtedness of any Subsidiary, then the aggregate principal amount of Indebtedness secured thereby shall not exceed the Incremental EBITDA of the Acquired Subsidiary or such Acquired Assets, and (E) the Borrower shall have demonstrated in writing to the reasonable satisfaction of the Lender that the secured Indebtedness created, incurred, assumed or permitted to exist referred to in the preceding clause (D) was permitted pursuant to Section 6.03; (l) Liens on property or assets of any Subsidiary securing Indebtedness of such Subsidiary owing to the Borrower; and (m) in addition to Liens permitted by the foregoing clauses (a) through (l), other Liens securing Indebtedness, provided that in no event will the aggregate amount of Indebtedness secured by such other Liens exceed at any time an amount equal to 1% of Net Tangible Assets. 6.02 Investments. Purchase or otherwise acquire the capital stock or other equity of any other Person if such purchase or other acquisition violates the Borrower’s partnership agreement.   29 6.03 Indebtedness. Create, incur, assume or permit to exist any Indebtedness, except that: (a) The Borrower may create, incur, assume or permit to exist Indebtedness as follows: (i) Indebtedness if (A) after giving effect thereto, (1) no Event of Default shall have occurred and be continuing and (2) the Borrower shall be in compliance with Section 6.05, and (B) the agreements governing such Indebtedness do not contain terms, conditions, covenants or events of default that restrict, on terms materially more restrictive than provided in the Loan Documents, the ability of any Subsidiary to: (1) pay distributions or dividends to the Borrower or any Subsidiary on its capital stock or other equity or with respect to any other interest or participation in, or measured by, its profits, (2) to pay any amounts owed to the Borrower or any Subsidiary, (3) to make loans or advances to the Borrower or any Subsidiary or (4) to transfer any of its properties or assets to the Borrower or any Subsidiary (contractual provisions that restrict any of the foregoing abilities of any Subsidiary, other than restrictions existing under or by reason of a. Indebtedness in effect on the Closing Date and Refinancings thereof, b. applicable Laws, c. instruments governing Indebtedness or capital stock or other equity of a Person or property acquired by the Borrower or a Subsidiary (except to the extent such Indebtedness was incurred in contemplation of such acquisition), d. customary non-assignment provisions in contracts, licenses and leases entered into in the ordinary course of business,   30 e. provisions contained in documents creating Liens permitted by Section 6.01 which restrict the ability of the Borrower or a Subsidiary to transfer the assets that are subject to such Liens, f. provisions in documents, other than those included in the preceding clause (e), creating purchase money obligations for property acquired in the ordinary course of business, which restrict the ability of the Borrower or a Subsidiary to transfer the assets acquired with the proceeds of such purchase money financing, g. customary provisions in bona fide contracts for the sale of property or assets, h. provisions with respect to the disposition or distribution of assets in joint venture agreements or other similar agreements entered into in the ordinary course of business, and i. any Hybrid Security or indenture, document, agreement or security entered into or issued in connection with a Hybrid Security and constituting a restriction or condition on an issuer of any Hybrid Security from taking any of the actions set forth in clauses (1) through (4) of this Section, are collectively referred to as “Intercompany Restrictions”); (ii) Indebtedness of the Borrower on the Closing Date and described in Schedule 6.03; (iii) Qualifying Subordinated Indebtedness; (iv) Indebtedness hereunder or under any other Loan Document; (v) Indebtedness secured by Liens that are permitted to be created, incurred, assumed or suffered to exist pursuant to Section 6.01(m); and (vi) the Refinancing, in whole or part, of Indebtedness incurred in compliance with the foregoing clauses of this Section 6.03(a), provided that, no such Indebtedness is increased at the time of any such Refinancing, other than by the additional amount of premium, if any, and accrued interest on such Indebtedness and reasonable expenses incurred in connection therewith, provided that no governing agreement with respect to any Indebtedness incurred in compliance with clause (iii) or (v) of this Section 6.03(a), or Refinancing of any Indebtedness incurred pursuant to clause (iii) or (v) of this Section 6.03(a), shall contain Intercompany Restrictions.   31 (b) The Non-OLP Subsidiaries may create, incur, assume or permit to exist Indebtedness as follows: (i) Indebtedness of the Non-OLP Subsidiaries on the Closing Date and described in Schedule 6.03; (ii) Indebtedness of a Person which is in existence at the time it becomes a Subsidiary or Indebtedness assumed by a Subsidiary in connection with its acquisition of a Person or its acquisition of all or substantially all of the business or assets of any Person or the operating division or business unit of any Person provided that such Indebtedness is in existence at the time of such acquisition, provided that such Indebtedness was not incurred in contemplation of the acquisition of such Person or such property; (iii) other Indebtedness (including Hybrid Securities issued by a Financing Vehicle and Indebtedness of the type included in clause (g) of the definition of Indebtedness); (iv) Refinancing of Indebtedness incurred pursuant to clause (i), (ii) or (iii) of this Section 6.03(b), provided that no such Indebtedness is increased at the time of any such Refinancing, other than by the additional amount of premium, if any, and accrued interest on such Indebtedness and reasonable expenses incurred in connection therewith; and (v) Indebtedness owed to the Borrower or to any other Non-OLP Subsidiary (other than, for the avoidance of doubt, an Unrestricted Subsidiary); provided that no governing agreement with respect to any Indebtedness otherwise permitted by this Section 6.03(b) shall contain Intercompany Restrictions. (c) The Operating Partnership and the Operating Partnership Subsidiaries may create, incur, assume or permit to exist, for so long as the Operating Partnership is regulated by the Federal Energy Regulatory Commission or any other governmental utility regulatory body, the following Indebtedness: (i) Indebtedness of the Operating Partnership and the Operating Partnership Subsidiaries on the Closing Date and described in Schedule 6.03; (ii) other Indebtedness (including Hybrid Securities issued by a Financing Indebtedness); (iii) Refinancing of Indebtedness incurred pursuant to clause (i) or (ii) of this Section 6.03(c), provided that no such Indebtedness is increased at the time of any such Refinancing, other than by the additional amount of premium, if any, and accrued interest on such Indebtedness and reasonable expenses incurred in connection therewith; and   32 (iv) Indebtedness owed to the Borrower or to the Operating Partnership or to an Operating Partnership Subsidiary (other than, for the avoidance of doubt, an Unrestricted Subsidiary); permitted by this Section 6.03(c) shall contain Intercompany Restrictions. For purposes of determining compliance with this Section 6.03, if an item of Indebtedness meets the criteria of more than one of the categories of Indebtedness permitted above, the Borrower will, it its discretion, classify (or later classify) in whole or in part such item of Indebtedness in any manner that complies with this Section 6.03, and such item of Indebtedness or a portion thereof may be classified (or later upon written notice to the Lender reclassified) in whole or in part as having been incurred under more than one of the applicable clauses above. 6.04 Mergers; Sale of Assets. Merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease (as a lessor) or otherwise dispose of (in one transaction or in a series of related transactions) all (or substantially all) of its assets, or all or substantially all of the stock of or other equity interest in any of its Subsidiaries (in each case, whether now owned or hereafter acquired), unless: (a) at the time thereof and immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing, and (b) if the Borrower is involved in any such transaction, it is the surviving or resultant entity or the recipient of any such sale, transfer, lease or other disposition of assets, and if a Subsidiary is involved in any such transaction, such Subsidiary is the surviving or resultant entity or the recipient of any such sale, transfer, lease or other disposition of assets; provided, however, that in no event shall any such merger, consolidation, sale, transfer, lease or other disposition whether or not otherwise permitted by this Section 6.04 have the effect of releasing the Borrower from any of its obligations and liabilities under this Agreement. 6.05 Consolidated Leverage Ratio. As of the end of each applicable four-quarter period, the Borrower shall maintain a ratio of (a)(i) Consolidated Funded Debt plus, without duplication, (ii) the principal amount of Funded Debt owed by the Borrower to Subsidiaries which does not constitute Qualifying Subordinated Indebtedness to (b) Pro Forma EBITDA of no greater than (i) during an Acquisition Period 5.50 to 1.00, and (ii) during any period other than an Acquisition Period as follows: (A) for periods ending on or before March 31, 2010, 5.25 to 1.00, and (B) for periods ending June 30, 2010 and thereafter, 5.00 to 1.00; provided, that if at the end of any such applicable four-quarter period the Borrower shall not have maintained such ratio, the Borrower will have a period of 30 days following the later of the date a Responsible Officer has knowledge that such ratio has not been satisfied at the end of such period and 30 days following the end of such period, to cure such failure on a pro forma basis by satisfying the following clauses (i) or (ii), or any combination of such clauses, by (1) obtaining an equity contribution which qualifies as equity under GAAP or (2) incurring Qualifying Subordinated Indebtedness in a sufficient amount that had the Borrower had such additional equity or Qualifying Subordinated Indebtedness proceeds, or a combination of both, at or prior to the end date of such applicable four-quarter period, the Borrower would have been in compliance with this Section 6.05 for such four-quarter period and, if the Borrower obtains such equity or such Qualifying Subordinated   33 Indebtedness proceeds, or any combination thereof, during such cure period, but in no event shall such period end later than 60 days following the end of the corresponding ending four-quarter period, then it will be deemed to be in compliance with this Section 6.05 as of the end of such four quarter period. 6.06 Indebtedness of Non-OLP Subsidiaries. As of the end of each fiscal quarter, the aggregate amount of Indebtedness of the Non-OLP Subsidiaries (other than Non-OLP Inter-Company Indebtedness) shall not exceed an amount (the “Non-OLP Indebtedness Limitation”) equal to 0.5 times Non-OLP Pro Forma EBITDA for the four quarters then ended; provided, that to the extent that such Indebtedness of the Non-OLP Subsidiaries does exceed the Non-OLP Indebtedness Limitation (the amount of such excess being referred to this Section 6.06 as “excess Indebtedness”) at quarter-end, the Non-OLP Subsidiaries may cure such excess Indebtedness by satisfying the following clause (i) or clause (ii), or any combination of such clauses, within 30 days following the later of the date a Responsible Officer has knowledge of such non-compliance and 30 days following the end of such quarter (but in no event shall the cure period extend beyond the date that is 60 days after the end of such quarter) (i) by receiving an infusion of cash or cash equivalents in an amount that (when added to all other cash and cash equivalents then being held by Non-OLP Subsidiaries pursuant to this Section 6.06) equals such excess Indebtedness (or portion thereof cured pursuant to this clause (i)), which cash or cash equivalents shall be held by Non-OLP Subsidiaries until the calculation is done pursuant to this Section 6.06 at the end of the next quarter, or (ii) by reducing the aggregate outstanding amount of Indebtedness of the Non-OLP Subsidiaries by an amount equal to such excess Indebtedness less the amount of cash or cash equivalents infused for such quarter-end pursuant to the preceding clause (i), if any. If the Non-OLP Subsidiaries so timely cure such excess Indebtedness by making such infusion or reduction, or both as applicable, the Non-OLP Subsidiaries shall be deemed to be in compliance with this Section 6.06 as of such quarter-end date. 6.07 Indebtedness of the Operating Partnership and the Operating Partnership Subsidiaries. As of the end of each fiscal quarter, the aggregate amount of Indebtedness of the Operating Partnership and the Operating Partnership Subsidiaries (other than OLP Inter-Company Indebtedness) shall not exceed an amount (the “OLP Indebtedness Limitation”) equal to 60% of the outstanding consolidated capitalization (calculated without regard to noncash adjustments to equity) of the Operating Partnership and the Operating Partnership Subsidiaries as of such quarter-end date; provided, that to the extent that outstanding Subsidiaries (other than OLP Inter-Company Indebtedness) does exceed the OLP Indebtedness Limitation (the amount of such excess being referred to this Section 6.07 as “excess Indebtedness”) at quarter-end, the Operating Partnership and the Operating Partnership Subsidiaries may cure such excess Indebtedness by satisfying the following clause (i) or clause (ii), or any combination of such clauses, within 30 days following the later of the date a Responsible Officer has knowledge of such non-compliance and 30 days following the end of such quarter (but in no event shall the cure period extend beyond the date that is 60 days after the end of such quarter): (i) by receiving an infusion of cash or cash equivalents in an amount that (when added to all other cash and cash equivalents then being held by the Operating Partnership and the Operating Partnership Subsidiaries pursuant to this Section 6.07) equals such excess Indebtedness (or portion thereof cured pursuant to this clause (i)), which cash or cash equivalents shall be held by the Operating Partnership and the   34 Operating Partnership Subsidiaries until the calculation is done pursuant to this Section 6.07 at the end of the next quarter, or (ii) by reducing the aggregate outstanding amount of Indebtedness of the Operating Partnership and the Operating Partnership Subsidiaries by an amount equal to such excess quarter-end pursuant to the preceding proviso, if any. If the Operating Partnership and the Operating Partnership Subsidiaries so timely cure such excess Indebtedness by making such infusion or reduction, or both as applicable, the Operating Partnership and the Operating Partnership Subsidiaries shall be deemed to be in compliance with this Section 6.07 as of such quarter-end date. ARTICLE VII 7.01 Events of Default. Any of the following shall constitute an Event of Default: (a) Non-Payment. The Borrower fails to pay (i) when and as required to be paid herein, any amount of principal of any Loan, or (ii) within five Business Days after the same becomes due, any interest on any Loan, or any facility, utilization or other fee due hereunder, or any other amount payable hereunder or under any other Loan Document; provided, in each case, that the Borrower shall have received sufficient funds under the B1 Credit Agreement to make such payment; or (b) Specific Covenants. The Borrower shall fail to perform, observe or comply with any term, covenant or agreement contained in any of Sections 6.05, 6.06 and 6.07; or (c) Cross-Default. (i) The Borrower or any Subsidiary other than, for the avoidance of doubt, an Unrestricted Subsidiary (A) fails to make any payment when due (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise), inclusive of any grace, extension, forbearance or similar period, in respect of any Indebtedness having an aggregate principal amount (including undrawn or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than the Threshold Amount, or (B) fails to observe or perform any other agreement or condition relating to any such Indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, for a period beyond the applicable grace, cure, extension, forbearance or other similar period the effect of which default or other event is to cause, or to permit the holder or holders of such Indebtedness (or the beneficiary or beneficiaries of any applicable Guarantee Obligation (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such Indebtedness to be demanded or to become due or to be repurchased or redeemed (automatically or otherwise) prior to its stated maturity, or such Guarantee Obligation to become payable or cash collateral in respect thereof to be demanded; or (ii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of default under such Swap Contract as to which the Borrower or any Subsidiary other than, for the avoidance of doubt, an Unrestricted Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which the Borrower or any Subsidiary other than, for the avoidance of doubt, an Unrestricted Subsidiary is   35 Value owed by the Borrower or such Subsidiary other than, for the avoidance of doubt, an Unrestricted Subsidiary as a result thereof is greater than the Threshold Amount; or (d) Insolvency Proceedings, Etc. The Borrower or any Material Subsidiary relating to any such Person or to all or any part of its property is instituted without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding. 7.02 Remedies Upon Event of Default. If any Event of Default occurs and is then continuing, the Lender may: (a) declare the Commitment of the Lender to make Loans to be terminated, whereupon such commitment and obligation shall be terminated; hereby expressly waived by the Borrower; and (c) exercise on behalf of itself all rights and remedies available to it under the Loan Documents or applicable law to enforce its rights to the proceeds of any repayment by Series AC under the B1 Credit Agreement; provided, however, that upon the occurrence of any event specified in subsection (d) of Section 7.01 with respect to the Borrower, the obligation of the Lender to make Loans shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, in each case without further act of the Lender; provided further, that the sole recourse for the Lender’s repayment of any and all Obligations under this Agreement shall be the repayment proceeds received by the Borrower pursuant to the B1 Credit Agreement. Notwithstanding anything to the contrary in this Agreement, under no circumstances shall the Borrower be liable to the Lender for any amounts due under this Agreement in excess of the amounts received by the Borrower pursuant to the B1 Credit Agreement, nor shall Borrower be obligated to make any payment due under this Agreement at any time that Borrower shall not have received sufficient funds pursuant to the B1 Credit Agreement to make such payment at such time. ARTICLE VIII MISCELLANEOUS 8.01 Amendments, Etc. No amendment or waiver of any provision of this Agreement therefrom, shall   36 be effective unless in writing signed by the Lender and the Borrower, and each 8.02 Notices and Other Communications; Facsimile Copies. telephone shall be made to the applicable telephone number, as follows: if to the Borrower or the Lender, to the address, telecopier number, electronic mail address or telephone number specified for such Person on Schedule 8.02; (b) Electronic Communications. Notices and other communications to the Lender may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites), provided that the foregoing shall not apply to notices to the Lender if such Lender has notified the Borrower that it is incapable of receiving notices by electronic communication. Unless the Lender otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided that if such notice or other communication is not (c) Change of Address, Etc. Each of the Borrower and the Lender may change its address, telecopier, e-mail address or telephone number for notices and other communications hereunder by notice to the other party hereto. (d) Effectiveness of Facsimile Documents and Signatures. Signature pages to Loan Documents may be delivered by facsimile transmission or electronic mail. The effectiveness of any such documents and signatures shall, subject to applicable Law, have the same force and effect as manually-signed originals and shall be binding on the Borrower and the   37 Lender. The Lender may also require that any such documents and signatures be confirmed by a manually-signed original thereof; provided, however, that the failure to request or deliver the same shall not limit the effectiveness of any document or signature delivered by facsimile transmission or electronic mail. 8.03 No Waiver; Cumulative Remedies. No failure by the Lender to exercise, and no delay by such Person in exercising, any right, remedy, power or privilege privilege. The rights, remedies, powers and privileges herein or therein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by Law. 8.04 Payments Set Aside. To the extent that the Borrower makes a payment to the Lender and such payment or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Lender in its discretion) to be proceeding under any Debtor Relief Law or otherwise, then to the extent of such recovery, the obligation or part thereof originally intended to be satisfied not been made. 8.05 Successors and Assigns. successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Lender. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto and their respective successors and assigns permitted hereby) any legal (b) Assignments by Lender. The Lender may at any time assign all of its rights and obligations under this Agreement (including all of its Commitment and the Loans at the time owing to it). The party to each assignment shall execute and deliver to the Lender an Assignment and Assumption Agreement substantially in the form of Exhibit C. No such assignment shall be made to the Borrower or any of the Subsidiaries. No such assignment shall be made to a natural person. From and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and have the rights and obligations of the Lender under this Agreement, and the assigning Lender thereunder shall be released from its obligations under this Agreement and shall cease to be a party hereto, but shall continue to be entitled to the benefits of Section 2.14 with respect to facts and circumstances occurring prior to the effective date of such assignment. Upon request, the Borrower (at its expense) shall execute and deliver new or replacement Notes to the assignee Lender, and if the assigning Lender holds a Note, it shall, contemporaneous with the Borrower’s delivery of a new or replacement Note, deliver such Note to the Borrower, marked “Cancelled”.   38 8.06 Interest Rate Limitation. Notwithstanding anything to the contrary Loan Documents shall not exceed the maximum amount, or be computed at a rate that exceeds the maximum rate, of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If the Lender shall contract for, charge, receive, reserve or take interest in an amount or at a rate that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower, and in no event shall the Borrower or any other Person ever be liable for unearned interest or ever be required to pay interest in excess of the Maximum Rate. In determining whether the interest contracted for, charged, received, reserved or taken by the fee, or premium rather than interest, (b)exclude voluntary prepayments and the unequal parts the total amount of interest throughout the contemplated term of the Obligations. If the Laws of the State of Texas are applicable for purposes of determining the “Maximum Rate”, then that term means the “indicated rate ceiling” from time to time in effect under Chapter 303 of the Texas Finance Code. The Borrower agrees that Chapter 346 of the Texas Finance Code does not apply to any Borrowing. 8.07 Counterparts. This Agreement may be executed in one or more counterparts and by the different parties hereto on separate counterparts, each of which the same instrument. 8.08 Integration. This Agreement, together with the other Loan Documents, comprises the complete and integrated agreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter. In the event of any conflict between the provisions of this Agreement and those of any other Loan Document, the provisions of this Agreement shall control; provided that the inclusion of supplemental rights or remedies in favor of the Lender in any other Loan Document shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint participation of the respective parties thereto and shall be construed neither against nor in favor of any party, but rather in accordance with the fair meaning thereof. 8.09 Severability. Any provision of this Agreement and the other Loan Documents unenforceability without invalidating the remaining provisions thereof, and any render unenforceable such provision in any other jurisdiction. 8.10 Governing Law. (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.   39 (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN MANHATTAN OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER AND THE LENDER EACH CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE BORROWER AND THE LENDER EACH IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO. 8.11 Waiver of Right to Trial by Jury. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE 8.12 USA PATRIOT Act Notice. The Lender hereby notifies the Borrower that (signed into law October 26, 2001)) (the “Act”), it may be required to obtain, allow the Lender, as applicable, to identify the Borrower in accordance with the Act. 8.13 ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. 8.14 Limited Recourse. Neither any director, officer or employee of the Borrower or any of its Affiliates nor any partner thereof, shall have any liability for any obligation of the Borrower under this Agreement or for any claim based on, in respect of, or by reason of, such obligation or its creation. It is acknowledged by the parties hereto that (a) the sole source of payment on the Obligations shall be the proceeds of the payments received by the Borrower under the B1 Credit Agreement and (b) notwithstanding anything in this Agreement or any other Loan Document to the contrary, Borrower shall only be liable to Lender for the Obligations to the extent Borrower has received funds under the B1 Credit Agreement to satisfy such Obligations. (Signature pages follow)   40 executed and delivered by their proper and duly authorized officers as of the   ENBRIDGE ENERGY PARTNERS, L.P.,   By:   Enbridge Energy Management, L.L.C., as delegate of Enbridge Energy Company, Inc., its general partner   By:       Name:       Title:     as Lender By:     Name:     Title:       Signature Page to A1 Credit Agreement SCHEDULE 4.05 MATERIAL EVENTS [None.]   Schedule 4.05 to A1 Credit Agreement SCHEDULE 6.01 EXISTING LIENS [None.]   Schedule 6.01 to A1 Credit Agreement SCHEDULE 6.03 EXISTING INDEBTEDNESS   (a) Existing Indebtedness of the Borrower Commercial paper from time to time issued by the Borrower pursuant to its commercial paper program from time to time in effect. 5.875% senior notes due 2016 in the aggregate principal amount of $300 million. 5.35% senior notes due 2014 in the aggregate principal amount of $200 million. 6.30% senior notes due 2034 in the aggregate principal amount of $100 million. 4.75% senior notes due 2013 in the aggregate principal amount of $200 million. 5.95% senior notes due 2033 in the aggregate principal amount of $200 million. 6.50% Series A notes due 2018 in the aggregate principal amount of $400 million. 7.50% Series A notes due 2038 in the aggregate principal amount of $400 million. 9.875% senior notes due 2019 in the aggregate principal amount of $500 million. 8.05% Fixed/Floating Rate Junior Subordinated Notes due 2067 in the aggregate principal amount of $400 million. Senior unsecured zero coupon notes due 2022, issued for initial proceeds of $200 million and yielding 5.36% on a semi-annual compound basis. The 2007 Credit Facility. Credit Agreement, dated as of December 18, 2007, between the Borrower and Enbridge (U.S.) Inc. Credit Agreement, dated as of April 9, 2009, among the Borrower, Barclays Bank PLC, as administrative agent, and the other agents and lenders party thereto. Credit Agreement, dated as of April 9, 2009, between the Borrower and Enbridge (U.S.) Inc., as administrative agent and as lender.   (b) Existing Indebtedness of Non-OLP Subsidiaries None.   Schedule 6.03 to A1 Credit Agreement (c) Existing Indebtedness of the Operating Partnership and the Operating Partnership Subsidiaries The Mortgage Notes. The Senior Unsecured Notes.   Schedule 6.03 to A1 Credit Agreement SCHEDULE 8.02 LENDER’S OFFICE, CERTAIN ADDRESSES FOR NOTICES BORROWER   1100 Louisiana, Suite 3300 Houston, Texas 77002-5217 Attention:    Chris Kaitson    Associate General Counsel Telephone:    713.650.8900 Facsimile:    713.650.2232 Electronic Mail:            [email protected] With a copy to: c/o Enbridge Inc. 3000, 425-1st Street SW T2P 3L8 Attention:    Vern Yu    Treasurer Telephone:    403.231.3946 Facsimile:    403.231.4848 Electronic Mail:            [email protected]   ENBRIDGE ENERGY COMPANY, INC. Enbridge Energy Company, Inc. [                                                     ] [                                                     ] [                                                     ] [                                                     ] Attention:   [                                                             ]   [                                                             ] Telephone:   [                                                             ] Facsimile:   [                                                             ] Electronic Mail:     [                                                           ]   Schedule 8.02 to A1 Credit Agreement With a copy to: Attention:   [                                                             ] Telephone:   [                                                             ] Facsimile:   [                                                             ] Electronic Mail:     [                                                           ]   Schedule 8.02 to A1 Credit Agreement EXHIBIT A FORM OF LOAN NOTICE Date:             ,          To: Enbridge Energy Company, Inc., as Lender Ladies and Gentlemen: Reference is made to that certain A1 Credit Agreement, dated as of [                   ], 2009 (as amended, restated, extended, supplemented or otherwise therein being used herein as therein defined), between Enbridge Energy Partners, L.P. (the “Borrower”) and the Lender from time to time party thereto. ¨  A Borrowing of Loans                    ¨  A conversion or continuation of Loans 2. In the amount of $                     3. Comprised of                                                                                              Type of Loan requested 4. For Fixed Period Eurodollar Rate Loans: with an Interest Period of          months. After giving effect to the Borrowing requested, the aggregate amount for all Loans do not exceed the amount of the Lender’s Commitment.   BORROWER ENBRIDGE ENERGY PARTNERS, L.P.,   By:   Enbridge Energy Management, L.L.C., as delegate of Enbridge Energy Company, Inc., its general partner   By:       Name:       Title:       Exhibit A to A1 Credit Agreement EXHIBIT B FORM OF NOTE   $400,000,000.00    [                    ], 2009 the order of Enbridge Energy Company, Inc. (the “Lender”), on the Maturity Date (as defined in the Credit Agreement referred to below) the principal amount of four hundred million Dollars ($400,000,000.00), or such lesser principal amount of Loans (as defined in such Credit Agreement) due and payable by the Borrower to the Lender on the Maturity Date under that certain A1 Credit Agreement, dated as of [                   ], 2009 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement;” the terms defined therein being used herein as therein defined), between the Borrower and the Lender from time to time party thereto. such interest rates, and at such times as are specified in the Credit Agreement. All payments of principal of and interest on this Note shall be made to the Lender in Dollars in immediately available funds at the Lender’s Office. If any rate set forth in the Credit Agreement. This Note is one of the Notes referred to in the Credit Agreement, is entitled to the benefits thereof and is subject to optional prepayment in whole or in part as provided therein. During the continuance of one or more of the Events of Default specified in the Credit Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Credit Agreement. Loans made by the Lender shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary course of business. The Lender may also attach schedules to this Note and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto.   Exhibit B to A1 Credit Agreement   ENBRIDGE ENERGY PARTNERS, L.P. By:     By:       Name:       Title:       Exhibit B to A1 Credit Agreement   Date    Type of Loan Made    Amount of Loan Made    End of Interest Period    Amount of Principal or Interest Paid This Date    Outstanding Principal Balance This Date    Notation Made By                                                                                                                                                                                                                                                                                                                                                                                                                                                   Exhibit B to A1 Credit Agreement EXHIBIT C the Effective Date set forth below and is entered into by and between the Assignor identified in item 1 below (the “Assignor”) and the Assignee identified in item 2 below (the “Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full. Assignor as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the facility identified below and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by the Assignor to the Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Each such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.   1.    Assignor:      2.    Assignee:      3.    Borrower:    Enbridge Energy Partners, L.P. 4.    Credit Agreement:    The A1 Credit Agreement, dated as of [                   ], 2009, between Enbridge Energy Partners, L.P. and Enbridge Energy Company, Inc. 5.    Assigned Interest:   Assignor    Assignee    Facility Assigned    Aggregate Amount of Commitment/Loans for all Lenders    Amount of Commitment/Loans Assigned    CUSIP Number                                 Exhibit C to A1 Credit Agreement [6.    Trade Date:    ]1       Effective Date:                 , 20       [TO BE INSERTED BY ASSIGNOR AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF     Name:     Title:       Name:     Title:         1   Exhibit C to A1 Credit Agreement ANNEX 1 TO ASSIGNMENT AND ASSUMPTION ASSIGNMENT AND ASSUMPTION requirements to be an assignee under Section 8.05(b) of the Credit Agreement, represented by the Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire the Assigned Interest, is Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest, (vi) it has, independently and without reliance upon the Lender and based on such analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest, and (vii) if it is a foreign Lender, attached of the Credit Agreement, duly completed and executed by the Assignee; and Assignor and based on such documents and information as it shall deem accordance with the terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.   Exhibit C to A1 Credit Agreement 2. Payments. From and after the Effective Date, the Borrower shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have   Exhibit C to A1 Credit Agreement EXHIBIT D FORM OF SUBORDINATION AGREEMENT This AGREEMENT made as of the              day of             ,        by                                         , a                          (the “Subordinated Creditor”), in favor Enbridge Energy Company, Inc., a Delaware corporation (the “Senior Lender”). WHEREAS, Enbridge Energy Partners, L.P., a Delaware limited partnership (the “Obligor”), is or may become indebted to the Senior Lender under or in connection with the Credit Agreement (defined below); and WHEREAS, the Subordinated Creditor is or may become a lender to the Obligor; and WHEREAS, the Subordinated Creditor has agreed to postpone and subordinate the Indebtedness of the Obligor owed to the Subordinated Creditor and listed on Annex A attached hereto, and all interest, fees and other amounts owing in connection therewith (the “Obligor Debt”) on the terms and provisions herein set forth. NOW, THEREFORE, in consideration of the sum of $1.00 now paid by the Senior Lender and other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged by the Subordinated Creditor), the Subordinated Creditor hereby agrees as follows: ARTICLE 1 INTERPRETATION 1.1 Definitions. In this Agreement, including the recitals, capitalized terms used herein, and not otherwise defined herein, shall have the meanings attributed to such terms in the A1 Credit Agreement dated as of [                   ], 2009, between Enbridge Energy Partners, L.P., as Borrower, and the Lender from time to time party thereto (as such agreement may be amended, modified, supplemented, restated or refinanced from time to time, the “Credit Agreement”). In addition, the following terms shall have the following meanings: (a) “Beneficiary” means, at each relevant time of determination, each of (i) the holders of Senior Indebtedness and (ii) the holders of other senior unsecured debt of the Obligor for the benefit of whom a subordination agreement in form and substance substantially the same as this Agreement has been executed and delivered by the Subordinated Creditor and is in effect (“Other Senior Indebtedness”)2; and in each case that any such holders or group thereof are represented by an agent, shall mean such agents for the benefit of such respective holders. (b) “Beneficiary Indebtedness” means, at each relevant time of determination, the aggregate outstanding amount of Senior Indebtedness and Other Senior Indebtedness of the Obligor owed to any Beneficiary.   2 Clause (i) of the definition of “Beneficiary” in the subordination agreement delivered for the benefit of holders of Other Senior Indebtedness may read as follows: “(i) the holders of Senior Indebtedness for the benefit of whom a subordination agreement has been executed and delivered by the Subordinated Creditor and is in effect,”.   Exhibit D to A1 Credit Agreement (c) “Obligor Debt” has the meaning set forth in the third WHEREAS clause of this Agreement. (d) “Other Senior Indebtedness” has the meaning set forth in Section 1.1(a). (e) “Senior Indebtedness” means the aggregate of all Obligations owing from time to time by the Obligor to the Senior Lender under the Credit Agreement and the other Loan Documents, whether present or future, direct or indirect, contingent or otherwise (including any interest accruing thereon after the date of filing any petition by or against the Obligor in connection with any bankruptcy or other proceeding and any other interest that would have accrued thereon but for the commencement of such proceeding). (f) “Subordinated Indebtedness” means the aggregate Obligor Debt owing from time to time by the Obligor to the Subordinated Creditor, whether present or future, direct or indirect, contingent or otherwise. 1.2 Headings. The division of this Agreement into articles, sections, paragraphs and other subdivisions and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation hereof. 1.3 Interpretation. In this Agreement: (a) the terms “this Agreement”, “hereof”, “herein”, “hereunder” and similar expressions refer, unless otherwise specified, to this Subordination Agreement taken as a whole and not to any particular article, section, subsection or paragraph; (b) words importing the singular number or masculine gender shall include the plural number or the feminine or neuter genders, and vice versa; (c) all references to “Articles” and “Sections” refer, unless otherwise specified, to articles, sections, subsections or paragraphs of this Agreement, as the case may be; and (d) words and terms denoting inclusiveness (such as “include” or “includes” or “including”), whether or not so stated, are not limited by their context or by the words or phrases which precede or succeed them. 1.4 Governing Law. This Agreement shall be governed by and interpreted in accordance with the laws of the State of New York. The Subordinated Creditor irrevocably submits to the non-exclusive jurisdiction of the courts of the State of New York and the United States Federal courts sitting in Southern District of the State of New York, without prejudice to the rights of the Senior Lender to take proceedings in any other jurisdiction. 1.5 Severability. If any provision of this Agreement shall be invalid, illegal or unenforceable in any respect in any jurisdiction, it shall not affect the validity, legality or enforceability of such provision in any other jurisdiction or the validity, legality or enforceability of any other provision of this Agreement.   Exhibit D to A1 Credit Agreement 1.6 Time of the Essence. Time shall be of the essence of this Agreement. ARTICLE 2 POSTPONEMENT AND SUBORDINATION OF PAYMENT 2.1 General Postponement and Subordination. Except as specifically provided for in Article 3: (a) the Subordinated Indebtedness shall be and is hereby expressly postponed and made subordinate in right of payment to the prior payment in full in cash of the Senior Indebtedness and termination of the Commitments under the Credit Agreement; and (b) the Subordinated Creditor shall not accept any repayment, prepayment or other satisfaction of all or any portion of the Subordinated Indebtedness (whether in cash, property or securities) prior to the payment in full in cash of the Senior Indebtedness and termination of the Commitments under the Credit Agreement. 2.2 Priority of Senior Indebtedness on Dissolution or Insolvency. In the event of any dissolution, winding up, liquidation, readjustment, reorganization, bankruptcy, insolvency, receivership or other similar proceedings (a “Proceeding”) relating to the Obligor, or any of its property (whether voluntary or involuntary, partial or complete), or any other marshalling of the assets and liabilities of the Obligor, the Beneficiary Indebtedness shall first be paid in full in cash before the Subordinated Creditor shall be entitled to receive or retain any payment or distribution in respect of the Subordinated Indebtedness. In such event, in order to implement the foregoing, but subject always to the provisions of Section 7.1(a): (a) the Subordinated Creditor shall promptly file a claim or claims, in the form required in such proceedings, for the full outstanding amount of the Subordinated Indebtedness, and shall cause said claim or claims to be approved and all payments and other distributions in respect thereof to be made directly to the Beneficiaries, ratably according to the aggregate amounts remaining unpaid on account of the Beneficiary Indebtedness held by each of them; (b) the Subordinated Creditor hereby irrevocably agrees that the Beneficiaries may, at their sole discretion, in the name of the Subordinated Creditor or otherwise, demand, sue for, collect, receive and receipt for any and all such payments or distributions, and any such receipts shall be distributed to the Beneficiaries according to the aggregate amounts remaining unpaid on account of the respective Beneficiary Indebtedness held by them, and file, prove and vote or consent in any Proceeding with respect to any and all claims of the Subordinated Creditor relating to the Subordinated Indebtedness; (c) In any bankruptcy or other Proceeding in respect of the Obligor, the Subordinated Creditor shall not, unless otherwise agreed by the Beneficiaries, (i) file any motion, application or other pleading seeking affirmative relief, including without limitation for the appointment of a trustee or examiner, for the conversion of the case to a   Exhibit D to A1 Credit Agreement liquidation proceeding, for the substantive consolidation of the Obligor’s bankruptcy case with the case of any other entity, for the creation of a separate official committee representing only the Subordinated Creditor or any other form of affirmative relief of any other kind or nature, or (ii) file any objection or other responsive pleading opposing any relief requested by any Beneficiary; and (d) The Subordinated Creditor shall execute and deliver to the Beneficiaries or their representative such further proofs of claim, assignments of claim and other instruments confirming the authorization referred to in the foregoing clause (b), and any powers of attorney confirming the rights of the Beneficiaries arising hereunder, and shall take such other actions as may be requested by the Beneficiaries or their representative in order to enable the Beneficiaries or their representative to enforce any and all claims in respect of the Subordinated Indebtedness. Payments Held in Trust. If, notwithstanding the provisions of this Agreement, any payment or distribution of any character (whether in cash, securities, or other property) or any security shall be received by the Subordinated Creditor in contravention of the terms of this Agreement, such payment, distribution or security shall not be commingled with any asset of the Subordinated Creditor, shall be held in trust for the benefit of, and shall be paid over or delivered or transferred to, the Beneficiaries, or their representative, ratably according to the aggregate amounts remaining unpaid on account of the Beneficiary Indebtedness held by each of them, for application to the payment of all Beneficiary Indebtedness then remaining unpaid, until all such Beneficiary Indebtedness shall have been paid in full. Payment in Full on Senior Indebtedness. For purposes of this Agreement, the Senior Indebtedness shall not be deemed to have been paid in full until the Senior Lender shall have received full payment of the Senior Indebtedness in cash and all Commitments of the Senior Lender under the Credit Agreement shall have irrevocably terminated. 2.3 Legend on Subordinated Debt Instruments. The Subordinated Creditor shall, substantially simultaneously with the execution and delivery hereof, cause a conspicuous legend to be placed on each of the instruments evidencing Subordinated Indebtedness to the following effect: “This instrument and the indebtedness evidenced hereby is subordinated, in the manner and to the extent set forth in an agreement dated             ,        (as such agreement may from time to time be amended, restated, modified, or supplemented, the “Subordination Agreement”), by the maker and payee of this instrument in favor of the “Lender” referred to therein, to all Senior Indebtedness as defined therein), and each holder of this instrument, by its acceptance hereof, shall be bound by the Subordination Agreement.” and upon request by the Senor Lender deliver a copy of each of the instruments evidencing Subordinated Debt, as so marked, to the Lender within 60 days following such request. 2.4 Application of Payments. All payments and distributions received by the Senior Lender in respect of the Subordinated Indebtedness, to the extent received in or converted into   Exhibit D to A1 Credit Agreement cash, may be applied by the Senior Lender first to the payment of any and all expenses (including reasonable legal fees and expenses) paid or incurred by the Senior Lender in enforcing this Agreement, or in endeavoring to collect or realize upon any of the Subordinated Indebtedness or any collateral security therefor, and any balance thereof shall, solely as between the Subordinated Creditor and the Senior Lender, be applied by the Senior Lender in such order of application as the Senior Lender may from time to time select, toward the payment of the Senior Indebtedness remaining unpaid. ARTICLE 3 PERMITTED PAYMENTS 3.1 Permitted Payments. At any time other than during the continuation of a Default or Event of Default under the Credit Agreement, the Subordinated Creditor shall, subject to Section 2.2, be entitled to receive payments on account of any Subordinated Indebtedness in accordance with the terms of such Subordinated Indebtedness. ARTICLE 4 SUBROGATION 4.1 Restriction on Subrogation. The Subordinated Creditor shall not exercise any rights which it may acquire by way of subrogation or contribution under this Agreement, as a result of any payment made hereunder or otherwise, until this Agreement has ceased to be effective in accordance with Section 7.1(a). 4.2 Transfer by Subrogation. If (a) the Senior Lender receives payment of any of the Subordinated Indebtedness, (b) the Senior Indebtedness has been paid in full in cash and (c) there are no further Commitments outstanding under the Credit Agreement, then the Senior Lender will, at the Subordinated Creditor’s request and expense, execute and deliver to the Subordinated Creditor appropriate documents, without recourse and without representation or warranty (except as to their right to transfer such Senior Indebtedness and related security free of encumbrances created by the Senior Lender), necessary to evidence the transfer by subrogation to the Subordinated Creditor of an interest in its Senior Indebtedness and any security held therefor resulting from such payment of the Subordinated Indebtedness to the Senior Lender. ARTICLE 5 DEALINGS WITH BORROWER 5.1 Restriction Dealings by Subordinated Creditor. Except with the prior written consent of the Senior Lender, the Subordinated Creditor shall not: (a) assign all or any portion of the Subordinated Indebtedness in favor of any Person other than the Senior Lender unless such Person has agreed in writing with the Senior Lender to be bound by the provisions hereof in the place and stead of the Subordinated Creditor; or (b) commence, or join with any other Person in commencing, any Proceeding respecting the Obligor or any Subsidiary of the Obligor.   Exhibit D to A1 Credit Agreement 5.2 Permitted Dealings by Senior Lender. Notwithstanding anything in this Agreement, the Subordinated Creditor acknowledges that the Senior Lender shall be entitled to: (a) lend monies or otherwise extend credit or accommodations to the Obligor as part of the Senior Indebtedness or otherwise; (b) agree to any change in, amendment to, waiver of, or departure from, any term of the Credit Agreement or any other Loan Document including, without limitation, any amendment, renewal or extension of such agreement or increase in the payment obligations of the Obligor under any such Loan Documents; (c) grant time, renewals, extensions, releases, discharges or other indulgences or forbearances to the Obligor in respect of the Senior Indebtedness; (d) waive timely and strict compliance with or refrain from exercising any rights under or relating to the Senior Indebtedness; (e) accept or make any compositions, arrangements, plans of reorganization or compromises with any Person as the Senior Lender may deem appropriate in connection with the Senior Indebtedness; (f) change, whether by addition, substitution, removal, succession, assignment, grant of participation, transfer or otherwise, the Senior Lender; (g) acquire, give up, vary, exchange, release, discharge or otherwise deal with or fail to deal with any security interests, guaranties or collateral relating to any Senior Indebtedness, this Agreement or any other Loan Document or allow the Obligor or any other Person to deal with the property which is subject to such security interests, guaranties or collateral, all as the Senior Lender may deem appropriate; and/or (h) abstain from taking, protecting, securing, registering, filing, recording, renewing, perfecting, insuring or realizing upon any security interests, guaranties or collateral for any Senior Indebtedness; and no loss in respect of any of the security interests or guaranties received or held for and on behalf of the Senior Lender, whether occasioned by fault, omission of negligence of any kind, whether of the Senior Lender or otherwise, shall in any way limit or impair the liability of the Subordinated Creditor or the rights of the Senior all of which may be done without notice to or consent of the Subordinated Creditor and without impairing, releasing or otherwise affecting any rights or obligations of the Subordinated Creditor hereunder or any rights of the Senior Lender hereunder. ARTICLE 6 REPRESENTATIONS AND WARRANTIES 6.1 Representations and Warranties. The Subordinated Creditor hereby represents and warrants to the Senior Lender that: (a) the Subordinated Creditor is a [corporation] duly incorporated or amalgamated, as the case may be, and validly existing under the laws of its jurisdiction of incorporation or amalgamation, as the case may be;   Exhibit D to A1 Credit Agreement (b) the Subordinated Creditor has all necessary [corporate] power and authority to enter into this Agreement; (c) the Subordinated Creditor has taken all necessary [corporate] action to authorize the creation, execution, delivery and performance of this Agreement; (d) this Agreement constitutes a valid and legally binding obligation of the Subordinated Creditor, enforceable against the Subordinated Creditor in accordance with its terms, subject as to enforcement to bankruptcy, insolvency, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and general equity principles; and (e) neither the execution and delivery of this Agreement, nor compliance with the terms and conditions hereof (i) will result in a violation of the articles or by-laws of the Subordinated Creditor or any resolutions passed by the board of directors or shareholders of the Subordinated Creditor or any applicable law, order, judgment, injunction, award or decree; (ii) will result in a breach of, or constitute a default under, any loan agreement, indenture, trust deed or any other material agreement or instrument to which the Subordinated Creditor is a party or by which its or its assets are bound; or (iii) requires any approval or consent of any governmental authority having jurisdiction except such as have already been obtained and are in full force and effect. ARTICLE 7 CONTINUING SUBORDINATION 7.1 Continuing Subordination; Reinstatement. This Subordination Agreement shall create a continuing subordination and shall: (a) remain in full force and effect until the Senior Lender has received payment in cash of the full amount of the Senior Indebtedness and no further Commitments are outstanding under the Credit Agreement; provided, however, that Section 5.1(b) shall remain in effect until 91 days after such time; (b) be binding upon the Subordinated Creditor and its successors and assigns; and (c) inure, together with the rights and remedies of the Senior Lender, to the benefit of and be enforceable by the Senior Lender and its successors and assigns for their benefit and for the benefit of any other Person entitled to the benefit of any Loan Documents from time to time, including any permitted assignee of some or all of the Loan Documents. Subordinated Creditor agrees that following such termination this Subordination Agreement shall be automatically reinstated if for any reason any payment made on the Senior Indebtedness is rescinded or must be otherwise restored by the Senior Lender, whether as a result of any proceedings in bankruptcy or reorganization or otherwise.   Exhibit D to A1 Credit Agreement 7.2 Other Obligations Not Affected. The subordination provided for herein is in addition to and not in substitution for any other agreement or any other security by whomsoever given or at any time held by the Senior Lender in respect of the Senior Indebtedness, and the Senior Lender shall at all times have the right to proceed against or realize upon all or any portion of any other agreement or any security or any other monies or assets to which the Senior Lender may become entitled or have a claim in such order and in such manner as the Senior Lender in its sole discretion may deem appropriate. 7.3 Acknowledgment of Documentation. The Subordinated Creditor hereby acknowledges that it is familiar with and understands the terms of the Credit Agreement and all other Loan Documents. The Subordinated Creditor shall ensure that the Obligor provides such copies as the Subordinated Creditor wishes to receive of all amendments, modifications or supplements to any of the aforementioned documents and of any other documents, instruments or agreements which are executed in the future pursuant to which Senior Indebtedness may arise. The Senior Lender shall not in any manner have any obligation to ensure such receipt nor shall lack of receipt in any way affect the absolute and unconditional nature of the Subordinated Creditor’s obligations hereunder in respect of the Senior Indebtedness thereby created or arising. ARTICLE 8 GENERAL PROVISIONS 8.1 Notices. All notices and other communications provided for hereunder shall be given in the form and manner prescribed by Section 8.02 of the Credit Agreement. All such notices to the Subordinated Creditor may be given to the Borrowers on behalf of the Subordinated Creditor and shall be sufficiently delivered if so given. 8.2 Amendments and Waivers. (a) No provision of this Agreement may be amended, waived, discharged or terminated orally nor may any breach of any of the provisions of this Agreement be waived or discharged orally, and any such amendment, waiver, discharge or termination may only be made in writing signed by the Senior Lender, and if such amendment is intended to bind the Subordinated Creditor, by the Subordinated Creditor. (b) No failure on the part of any party to exercise, and no delay in exercising, any right, power or privilege hereunder shall operate as a waiver thereof unless specifically waived in writing, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise (c) Any waiver of any provision of this Agreement or consent to any departure by any party therefrom shall be effective only in the specific instance and for the specific purpose for which given and shall not in any way be or be construed as a waiver of any future requirement.   Exhibit D to A1 Credit Agreement 8.3 Assignment by Lenders. The Subordinated Creditor acknowledges and agrees that the Senior Lender shall have the right to assign, sell, participate or otherwise transfer all or any portion of its rights and benefits under the Loan Documents (including this Agreement) without the consent of the Subordinated Creditor. This Agreement shall extend to and inure to the benefit of the Senior Leader and its respective successors and permitted assigns. 8.4 Assignment and Certain Other Actions by Subordinated Creditor. Until payment in full of the Senior Indebtedness, the Subordinated Creditor shall not, without the prior written consent of the Senior Lender (which consent may be arbitrarily withheld), (a) accelerate the maturity of the Subordinated Indebtedness to a date that is earlier than six (6) months after the Maturity Date as defined in the Credit Agreement; (b) take any collateral security or guarantees for any Subordinated Indebtedness; or (c) sell, assign, transfer, endorse, pledge, encumber or otherwise dispose of any of the Subordinated Indebtedness, unless the Subordinated Creditor gives the Senior Lender written notice thereof and such sale, transfer, endorsement, pledge, encumbrance or other disposition is to an Affiliate of the Obligor and is made expressly subject to this Subordination Agreement. 8.5 Further Assurances. The Subordinated Creditor shall, at the request of the Senior Lender but at the expense of the Subordinated Creditor, do all such further acts and things and execute and deliver all such further documents as the Senior Lender may reasonably require in order to fully perform and carry out the terms of this Agreement. 8.6 Counterparts. This Agreement may be executed in one or more counterparts, 8.7 Waiver of Right to Trial by Jury. EACH PARTY TO THIS AGREEMENT HEREBY RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE IN WITNESS WHEREOF the Subordinated Creditor has caused this Agreement to be executed by its duly authorized representative(s) as of the date first above written.   Per:     Name:   Title:     Exhibit D to A1 Credit Agreement Per:     Name:   Title:     Exhibit D to A1 Credit Agreement ACKNOWLEDGMENT The undersigned hereby acknowledges the terms of the above Subordination Agreement and covenants not to participate in any violation thereof.     By:       Name:       Title:       Exhibit D to A1 Credit Agreement ANNEX A Indebtedness   Exhibit D to A1 Credit Agreement EXHIBIT C FORM OF FACILITY B1 B1 CREDIT AGREEMENT This B1 CREDIT AGREEMENT (this “Agreement”), dated as of the [      ] day of [            ], 2009 (the “Closing Date”), is executed by and between Enbridge Energy, Limited Partnership, a Delaware limited partnership, on behalf of the Series AC (the “Borrower”), and Enbridge Energy Partners, L.P., a Delaware limited partnership (the “Lender”). RECITALS WHEREAS, the Lender has entered into a Credit Agreement with Enbridge Energy Company, Inc. (“EECI”), dated as of the date hereof (as such agreement may be amended, supplemented or otherwise modified from time to time, the “A1 Credit Agreement”), whereby EECI will make loans to the Lender from time to time; to time in an amount equal to the loan proceeds received by the Lender from EECI under the A1 Credit Agreement; WHEREAS, EECI, the Lender and the Borrower desire that the proceeds of the Loans made by the Lender to the Borrower under this Agreement (as funded from the proceeds of the loans made by EECI to the Lender under the A1 Credit Agreement) be used by the Borrower to fund a portion of the total costs to construct (a) the U.S. portion of the proposed 36-inch diameter crude oil pipeline from Hardisty, Alberta to Superior, Wisconsin, with an initial annual capacity of 450,000 barrels per day and (b) related terminals, interconnections, tanks and pump stations located in the United States (collectively, the “Alberta Clipper Project”); WHEREAS, the Lender has agreed to make Loans to the Borrower up to a preapproved maximum amount on the terms and conditions set out herein; NOW THEREFORE, in consideration of the mutual covenants and agreements contained ARTICLE 1 INTERPRETATION; DEFINITIONS   1.1 The division of this Agreement into Articles and Sections and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Agreement. The terms “this Agreement,” “hereof,” “hereunder” and similar expressions refer to this Agreement and not to any particular Article, Section or other portion hereof and include any agreement supplemental hereto. Unless something in the subject matter or context is inconsistent therewith, references herein to Articles, Sections and Annexes are to Articles, Sections and Annexes of or attached to this Agreement.   -1- 1.2 Words importing the singular number only shall include the plural and vice versa, words importing the masculine gender shall include the feminine and neuter genders and vice versa.   1.3 As used in this Agreement, the following terms shall have the meanings set forth below:     (a) “2007 Credit Facility” shall mean the Second Amended and Restated Credit Agreement, dated as of April 4, 2007, among the Lender, Bank of America, as thereof.     (b) “A1 Commitment” shall mean the “Commitment” as defined in the A1 Credit Agreement.     (c) “A1 Credit Agreement” shall have the meaning set forth in the recitals hereto.     (d) “Agreement” shall have the meaning set forth in the preamble hereto.     (e) “Alberta Clipper Project” shall have the meaning set forth in the recitals hereto.     (f) “Applicable Rate” shall have the meaning set forth in Section 3.5.     (g) “Bank of America” shall mean Bank of America, N.A.     (h) “Base Rate” shall mean for any day a fluctuating rate per annum equal to the interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate.” Such prime rate is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, prime rate. Any change in such prime rate announced by Bank of America shall     (i) “Base Rate Loan” shall mean a Loan that bears interest based on the Base Rate.     (j) “Borrower” shall have the meaning set forth in the preamble hereto.     (k) “Borrowing” shall mean a borrowing consisting of simultaneous Loans of the same Type and having the same Interest Period made by the Lender pursuant to Section 2.1.     (l) “Business Day” shall mean any day other than a Saturday, Sunday, or other day on   2       (m) “Closing Date” shall have the meaning set forth in the preamble hereto.     (n) “Commitment” shall have the meaning set forth in Section 2.1 hereof.     (o) “Credit Facility” shall have the meaning set forth in Section 2.1 hereof.     (p) “Debt Rating” shall mean, as of any date of determination, the rating as Borrower’s non-credit-enhanced, senior unsecured long-term debt; provided that if a Debt Rating is issued by each of the foregoing rating agencies, then the higher of such Debt Ratings shall apply (with Pricing Level 1 being the highest and Pricing Level 6 being the lowest), unless there is a split in Debt Ratings     (q) “Debtor Relief Laws” shall mean the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States of America or other applicable jurisdictions from time to time in effect and     (r) “Default” shall mean any event that, with the giving of any notice, the passage of time, or both, would be an Event of Default.     (s) “Default Rate” shall mean an interest rate equal to (a) the Base Rate plus (b) the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per annum; provided, however, that with respect to a Fixed Period Eurodollar Rate Loan, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan plus 2% per annum, in each case to the fullest extent permitted by applicable Laws.     (t) “Dollar” and “$” shall mean lawful money of the United States of America.     (u) “EECI” shall have the meaning set forth in the recitals hereto.     (v) “Event of Default” shall have the meaning set forth in Article 6 hereof.     (w) “Federal Funds Rate” shall mean, for any day, the rate per annum (rounded System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day;   3   Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate charged to Bank of America on such day on such transactions as determined by the Lender.     (x) “Fixed Period Eurodollar Rate” shall mean, with respect to any Fixed Period Eurodollar Rate Loan for the Interest Period applicable to such Fixed Period Eurodollar Rate Loan, the rate per annum equal to the British Bankers     (y) “Fixed Period Eurodollar Rate Loan” shall mean a Loan that bears interest at a rate of interest based on the Fixed Period Eurodollar Rate.     (z) “GAAP” shall mean United States generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and     (aa) “General Partners” shall mean, collectively, Enbridge Pipelines (Lakehead) L.L.C., a Delaware limited liability company, and Enbridge Pipelines (Wisconsin) Inc., a Wisconsin corporation.     (bb) “Governmental Authority” shall mean any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, administrative powers or functions of or pertaining to government, and any corporation or other entity owned or controlled, through stock or capital ownership or otherwise, by any of the foregoing.     (cc) “Guarantee Obligation” shall mean, as to any Person, (a) any obligation, contingent or otherwise, of such Person guarantying or having the economic effect of guarantying any Indebtedness or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or   4       (dd) “In-Service Date” shall have the meaning set forth in the Tariff Term Sheet.     (ee) “Indebtedness” shall mean, as to any Person at a particular time, all of the following (without duplication):     (i) all obligations of such Person for borrowed money and all obligations of similar instruments;     (ii) any direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), banker’s acceptances, bank     (iii) whether or not so included as liabilities in accordance with GAAP, all     (iv) capital leases; and   5   (v) all Guarantee Obligations of such Person in respect of any of the foregoing. expressly made non-recourse to such Person by its governing agreements and applicable Law except for customary exceptions acceptable to the Lender.     (ff) “Interest Payment Date” shall mean, (a) as to any Fixed Period Eurodollar Rate Loan, the last day of each Interest Period applicable to such Loan and the Maturity Date; provided, however, that if any Interest Period for a Fixed Period     (gg) “Interest Period” shall mean, with respect to any Fixed Period Eurodollar Rate Loan, the period commencing on the date such Fixed Period Eurodollar Rate Loan is disbursed or converted to or continued as a Fixed Period Eurodollar Rate selected by the Borrower in its Loan Notice; provided that:   that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the immediately preceding Business Day;   Period; and       (hh) “Law” shall mean, collectively, all international, foreign, federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the     (ii) “Lender” shall have the meaning set forth in the preamble hereto.   6   (jj) “Lender’s Office” shall mean the Lender’s address and, as appropriate, account as set forth on Annex I, or such other address or account as the Lender may from time to time notify to the Borrower.     (kk) “Lien” shall mean any mortgage, pledge, hypothecation, collateral assignment, encumbrance, lien (statutory or other), charge, security interest or any other arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, a deposit arrangement and the filing of any financing statement under the Uniform Commercial Code or comparable Laws of any jurisdiction) for a creditor’s claim to be satisfied from assets or proceeds prior to the claims of other creditors or the owners, including, if applicable, the interest of a purchaser of accounts receivable but excluding the title of the lessor under any operating lease.     (ll) “Loan Notice” shall mean written or telephonic notice of (a) a Borrowing of Loans, (b) a conversion of Loans from one Type to the other, or (c) a continuation of Loans as the same Type, pursuant to Section 3.1(a), which, if in writing, shall be substantially in the form of Annex IV hereto or if telephonic, shall be immediately followed by written notice in the form of Annex IV; provided, any such telephone notice shall be irrevocable when given notwithstanding that it is required to be so confirmed in writing.     (mm) “Loans” shall have the meaning set forth in Section 2.1 hereof.     (nn) “Maturity Date” shall mean the earlier to occur of (a) the date that is 180 days after the In-Service Date and (b) July 1, 2011.     (oo) “Moody’s” shall mean Moody’s Investors Service, Inc. or any successor to the rating agency business thereof, or if no such successor, any other debt rating agency selected by the Borrower and approved by the Lender.     (pp) “Mortgage Note Agreements” shall mean, collectively, those certain Note Agreements, each dated as of December 12, 1991, between the Partnership and each of the respective purchasers of the Mortgage Notes, as amended, supplemented or modified from time to time and in effect.     (qq) “Mortgage Notes” shall mean, collectively, the Partnership’s 9.15% First Agreements, dated December 12, 1991, between the Partnership and the   7   (rr) “Mortgage Notes Termination Date” shall mean the date on which all obligations under the Mortgage Notes shall have been repaid and all Mortgage Notes shall have terminated or expired.     (ss) “Note” shall mean a promissory note made by the Borrower in favor of the Lender evidencing Loans made by such Lender, substantially in the form of Annex III.     (tt) “Outstanding Amount” shall mean, on any date, the aggregate outstanding principal amount of Loans after giving effect to any borrowings and prepayments or repayments of Loans occurring on such date.     (uu) “Partnership” shall mean Enbridge Energy, Limited Partnership, a Delaware limited partnership.     (vv) “Partnership Agreement” shall mean the Third Amended and Restated Agreement of Limited Partnership of the Partnership, dated as of the date hereof, as amended, supplemented or modified from time to time.     (ww) “Person” shall mean any individual, trustee, corporation, general partnership, limited partnership, limited liability company, joint stock company, trust, unincorporated organization, bank, business association, firm, joint venture or Governmental Authority.     (xx) “S&P” shall mean Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. or any successor to the rating agency business thereof, or if no such successor, any other debt rating agency selected by the Borrower and approved by the Lender.     (yy) “Senior Debt” shall have the meaning set forth in Section 9.2 hereto.     (zz) “Senior Indenture” shall mean that certain Indenture dated September 15, 1998 providing for the issuance of senior debt securities of the Partnership, which indenture is between the Partnership, as issuer, and JPMorgan Chase Bank, N.A., successor to The Chase Manhattan Bank, as trustee.     (aaa) “Senior Unsecured Notes” shall mean, collectively, the following: (a) the 7% senior notes due 2018 in the aggregate principal amount of $100,000,000 issued by the Partnership pursuant to the Senior Indenture; (b) the 7  1/8% senior Partnership pursuant to the Senior Indenture; (c) the 7.9% senior notes due 2012 in the aggregate principal amount of $100,000,000 issued by the Partnership pursuant to the Senior Indenture; and (d) such other senior unsecured notes issued by the Partnership on or after the Closing Date pursuant to the Senior Indenture.     (bbb) “Subordinated Debt” shall have the meaning set forth in Section 9.1 hereto.   8   (ccc) “Tariff Term Sheet” shall mean the Alberta Clipper U.S. Term Sheet dated     (ddd) “Type” shall mean, with respect to a Loan, its character as a Base Rate Loan or a Fixed Period Eurodollar Rate Loan.     (eee) “Wachovia” shall mean Wachovia Bank, National Association, or any successor thereof. ARTICLE 2 THE CREDIT FACILITY   2.1 Subject to the satisfaction of the conditions set forth in Section 3.1(b), the Lender shall make loans pursuant to this Agreement (“Loans”) in Dollars to the Borrower on the Closing Date and on one Business Day per month (or more frequently, if agreed by the Lender in the Lender’s sole discretion) during the period from the Closing Date to the Maturity Date upon receipt from the Borrower of Loan Notices in accordance with Section 3.1(a), which Loans (collectively, the “Credit Facility”) shall not exceed in the aggregate the lesser of (a) the aggregate amount of the A1 Commitment, and (b) four hundred million Dollars ($400,000,000) (such amount set forth in clause (b), as such amount may be reduced or adjusted from time to time in accordance with this Agreement, the Lender’s “Commitment”).   2.2 The Loans shall be unsecured, and prior to the Mortgage Notes Termination Date, the Loans shall be subordinate to all Senior Debt in accordance with Article 9 hereof.   2.3 The Credit Facility is being made available for the financing of a portion of the total costs to construct the Alberta Clipper Project, and the proceeds of the Loans shall be used only to pay such construction costs.   2.4 Any Loans that have been prepaid or repaid may not be reborrowed. ARTICLE 3 LOANS, INTEREST AND FEES   3.1 Borrowings, Conversions and Continuations of Loans.     (a) Each Borrowing, each conversion of Loans from one Type to the other, and each irrevocable notice to the Lender and to the “Lender” as defined in the A1 Credit Agreement. Each such notice must be received by the Lender and the “Lender” as defined in the A1 Credit Agreement not later than 11:00 a.m., Mountain Standard Time or Mountain Daylight Time (as applicable), (i) three Business Days prior to the requested date of any such Borrowing of, conversion to or continuation of any such Fixed Period Eurodollar Rate Loans or of any conversion of any such Fixed Period Eurodollar Rate Loans to Base Rate Loans,   9   and (ii) on the requested date of any Borrowing of Base Rate Loans. Each Loan Notice shall specify (A) whether the Borrower is requesting a Borrowing, a conversion of Loans from one Type to the other, or a continuation of Loans as the same Type, (B) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (C) the principal amount of Loans to be borrowed, converted or continued, (D) the Type of Loans to be borrowed or to which existing Loans are to be converted, and (E) if applicable, the duration of the Interest Period with respect thereto. If the Borrower fails to specify a Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Loans shall be made or continued as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of     (b) Following receipt of a Loan Notice from the Borrower, if (i) no Default or Event of Default exists or would result from the proposed Borrowing and (ii) the Lender has received immediately available funds from an identical loan from the “Lender” as defined in the A1 Credit Agreement in the amount of such requested Loan pursuant to the A1 Credit Agreement, the Lender shall make the funds available to the Borrower by either wire transfer of such funds or other customary method used by the parties hereto and their Affiliates, in each case, in accordance with instructions provided to the Lender by the Borrower.     (c) The Lender agrees that substantially contemporaneously with the delivery of a Loan Notice in accordance with Section 3.1(a), the Borrower may deliver a copy of such Loan Notice to EECI and that such copy so delivered to EECI shall be deemed by the Lender to constitute a loan notice provided by the Lender to EECI under the A1 Credit Agreement.   may be continued or converted only on the last day of the Interest Period for such Fixed Period Eurodollar Rate Loan. During the existence of a Default or Event of Default, no Loans may be requested as, converted to or continued as Fixed Period Eurodollar Rate Loans without the consent of the Lender, and the Lender may demand that any or all of the then outstanding Fixed Period Eurodollar Rate Loans be converted to Base Rate Loans at the end of the respective Interest Periods therefor, if at the end of such periods, a Default or an Event of Default is then in existence.   change.   10 3.2 Prepayments. The Borrower may, upon notice to the Lender and to the “Lender” as defined in the A1 Credit Agreement, at any time or from time to time provided that such notice must be received by the Lender and the “Lender” as defined in the A1 Credit Agreement not later than 10:00 a.m., Mountain Standard any date of prepayment of Fixed Period Eurodollar Rate Loans, and (ii) one Business Day prior to any date of prepayment of Base Rate Loans. Each such notice shall specify the date and amount of such prepayment and the Type(s) of Loans to be prepaid. If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. Any prepayment of Fixed Period Eurodollar Rate Loans shall be accompanied by all accrued interest thereon, together with any additional amounts required pursuant to Section 3.12.   3.3 Reduction or Termination of Commitments. The Borrower may, upon notice to reduced in accordance with this Section 3.3, the Commitment may not be increased.   3.4 Repayment of Loans. The Borrower shall repay to the Lender on the Maturity Date the aggregate principal amount of Loans outstanding on such date.   3.5 Applicable Rate. The “Applicable Rate” under this Agreement shall be the   Applicable Rate   Pricing Level       Facility Fee Rate     Applicable Rate for Eurodollar Loans     Applicable Rate for Base Rate Loans    Utilization   0    .10 %    3.6 Interest.     (a)   11       (b) In the event any amount due hereunder or under any Note (including, without limitation, any interest payment) is not paid when due (whether by acceleration or otherwise), the Borrower shall pay interest on such unpaid amount (including, without limitation, interest on interest) at a fluctuating interest rate per annum equal to the Default Rate to the fullest extent permitted by applicable Law. Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.   herein; provided that if the Borrower delivers a Loan Notice in accordance with Section 3.1(a) with respect to the interest due on an Interest Payment Date prior to the Maturity Date and no Default or Event of Default exists or would result from the proposed Borrowing, the interest payment due on such Interest Payment Date may be paid from the proceeds of a Loan in an equivalent amount, unless such amount would exceed the Commitment existing on such date. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.   3.7 Fees.     (a) Facility Fee. The Borrower shall pay to the Lender a facility fee equal to the applicable facility fee rate based on the Debt Rating as set forth in the definition of Applicable Rate multiplied by the actual daily amount of the Commitment, regardless of usage. The facility fee shall accrue at all times from the Closing Date until the Maturity Date and shall be due and payable quarterly in arrears on the last Business Day of each March, June, September and December, commencing with the first such date to occur after the Closing Date, and on the Maturity Date. The facility fee shall be calculated quarterly in arrears, and if there is any change in the Debt Rating during any quarter, the facility fee shall be computed separately for each period during such quarter that each such Debt Rating was in effect. The facility fee shall accrue at all times, including at any time during which one or more of the conditions set forth in Section 3.1(b) are not met.     (b) Utilization Fee. The Borrower shall pay to the Lender a utilization fee equal to the applicable utilization fee rate based on the Debt Rating as set forth in the definition of Applicable Rate multiplied by the actual daily aggregate Outstanding Amount of Loans for each day that such aggregate Outstanding Amount exceeds 50% of the Commitment. The utilization fee shall be due and payable quarterly in   12   Maturity Date. The utilization fee shall be calculated quarterly in arrears. The utilization fee shall accrue at all times, including at any time during which one or more of the conditions set forth in Section 3.1(b) are not met.   3.8 Computation of Interest. Computation of interest on Base Rate Loans shall be   3.9 Evidence of Debt. The Loans made by the Lender shall be evidenced by one or respect thereto.   3.10 Payments Generally.     (a) All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the Lender at the Lender’s Office in Dollars and in immediately available funds not later than 11:00 a.m., Mountain Standard Time or Mountain Daylight Time (as applicable), on the date specified herein. All payments received by the Lender after 11:00 a.m., Mountain Standard Time or Mountain Daylight Time (as applicable), shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue.       (c) If at any time insufficient funds are received by and available to the Lender to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied (i) first, toward costs and expenses incurred by the Lender,   13   including costs and expenses owed by the Lender under the A1 Credit Agreement, (ii) second, toward repayment of interest and fees then due hereunder, and (iii) third, toward repayment of principal then due hereunder.     3.11 Inability to Determine Rates. If the Lender determines in connection with   3.12 Funding Losses. Upon demand of the Lender from time to time (which demand detail the amount demanded, the basis therefor and the calculations in respect Borrower shall promptly compensate the Lender for and hold the Lender harmless from any loss, cost or expense incurred by it as a result of:   such Borrower other than a Base Rate Loan on a day other than the last day of       (c) including any loss of anticipated profits and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained.   14 All of the Borrower’s obligations under this Section 3.12 shall survive termination of the Commitment and payment in full of all the other amounts owed hereunder. ARTICLE 4 PAYMENT OF WITHHOLDING TAXES AND OTHER CHARGES   4.1 All payments required under this Agreement or in respect of the Note, whether in respect of principal, interest (including interest at the Default Rate) or any other obligation, shall be made in full, in Dollars without any deduction or withholding on account of taxes, set-off, counter-claim, duties or other charges of any nature or kind whatsoever, unless the Borrower is prohibited by applicable Law from doing so in which event the Borrower shall pay an additional amount such that the net amount received by the Lender shall be the amount which would have been received by the Lender if no such deduction or withholding had been made. ARTICLE 5 COVENANTS OF THE BORROWER So long as any obligation is outstanding under this Agreement or the Note, or the Credit Facility is available hereunder, the Borrower covenants and agrees with the Lender that, unless the Lender otherwise consents in writing, it shall:   5.1 Punctually pay the principal of all Loans, all interest thereon and all other amounts required to be paid hereunder and under the Note.   5.2 Observe, perform and comply with all applicable laws except to the extent that non-compliance would not reasonably be expected to have a material adverse effect on the business of the Borrower or its ability to perform its covenants hereunder.   5.3 Cause to be paid or discharged all lawful taxes, assessments and government charges or Liens imposed on earnings, labor or materials which might result in a Lien or charge upon the property or assets of the Borrower, unless such taxes, assessments, charges or Liens are being contested in good faith.   5.4 Obtain and maintain in full force and effect all of its material agreements, rights, franchises, operations, contracts and other arrangements and all material authorizations, approvals, consents, licenses, exemptions, filings, registrations, notarizations and other requirements of any Governmental Authority required or reasonably necessary to carry on its business, except to the extent that the failure to have or maintain the same would not reasonably be expected to have a material adverse effect on the business of the Borrower or its ability to perform its covenants hereunder.   5.5 Not create, incur, assume or permit to exist any Indebtedness, other than the Indebtedness listed on Annex II hereto.   15 ARTICLE 6 EVENTS OF DEFAULT default under this Agreement (each such event being herein referred to as an “Event of Default”):   6.1 The Borrower fails to pay any amount due to the Lender under this Agreement or the Note when such amount becomes due and payable and the Partnership and the other series of the Partnership subsequently fail to pay such amount within one (1) Business Day following such failure by the Borrower.   6.2 The Borrower fails to perform or observe any covenant or obligation herein or in the Note (other than a covenant or condition whose breach is specifically dealt with elsewhere in this Article 6) and such failure remains unremedied for ten (10) days following notice of such failure by the Lender to the Borrower or such longer period as may be agreed by the Lender having regard to the subject matter of the failure.   6.3 The Borrower or the Partnership ceases to maintain its existence.   6.4 Any judgment or order for the payment of money in excess of fifteen million Dollars ($15,000,000) is rendered against the Borrower and either (a) enforcement proceedings have been commenced by a creditor upon the judgment or order, or (b) there is any period of fifteen (15) consecutive days during which a stay of enforcement of the judgment or order by reason of a pending appeal or otherwise is not in effect.   6.5 The Partnership (a) becomes insolvent or generally not able to pay its debts as they become due, (b) admits in writing its inability to pay its debts generally or makes a general assignment for the benefit of creditors, (c) institutes or has instituted against it any proceeding seeking (i) to adjudicate it bankrupt or insolvent, (ii) liquidation, winding up, reorganization, arrangement, adjustment, protection, relief or composition of it or its debts under any Law relating to bankruptcy, insolvency, reorganization or relief of debtors including any plan of compromise or arrangement or other corporate proceeding involving its creditors, or (iii) the entry of an order for it or for any substantial part of its properties and assets, and in the case of any such proceeding instituted against it (but not instituted by it), either the proceeding remains undismissed or unstayed for a period of thirty (30) days, or any of the actions sought in such proceeding (including the entry of an order for relief against it or the appointment of a receiver, trustee, custodian or other similar official for it or for any substantial part of its properties and assets) occurs, or (d) takes any limited partnership action to authorize any of the above actions. ARTICLE 7 REMEDIES Upon the occurrence and continuance of any Event of Default, and prior to the Mortgage Notes Termination Date, subject to Article 9, the Lender may, in its sole and absolute discretion upon written notice to the Borrower:   16 7.1 Declare the whole or any portion of the Loans then outstanding unpaid and all accrued and unpaid interest thereon to be immediately due and payable.   7.2 Exercise any right or recourse and/or proceed by any action, suit or remedy or proceeding permitted by Law and proceed to exercise any and all rights hereunder, at such times and in such manner as the Lender may consider expedient.   7.3 The foregoing remedies shall be without, except as may be required by applicable law, any additional notice, presentment, demand, protest, notice of protest, dishonor or any other action. These rights and remedies of the Lender hereunder are cumulative and are in addition to and not in substitution for any other rights or remedies provided by applicable law.   7.4 The Borrower shall, on demand, indemnify and reimburse the Lender for all reasonable costs, losses, expenses and liabilities which the Lender may sustain or incur as a consequence of the occurrence and continuance of any Event of Default hereunder. ARTICLE 8 NO RECOURSE AGAINST OTHERS; OBLIGATION OF THE PARTNERSHIP   8.1 Neither any director, officer or employee of the Borrower, nor any partner of the Partnership or, except as set forth below, any series of the Partnership, as such, shall have any liability for any obligations of the Borrower under this Agreement or for any claim based on, in respect of, or by reason of, such obligation or its creation.   8.2 The Borrower has executed this Agreement for internal record keeping convenience; however, this Agreement is an obligation of the Partnership generally and of each series of the Partnership, to the extent provided in Section 3.4(c) of the Partnership Agreement, to which the Lender is a party. ARTICLE 9 SUBORDINATION   9.1 The Indebtedness evidenced by this Agreement (the “Subordinated Debt”) is subordinate and junior in right of payment to all Senior Debt of the Partnership   9.2 For all purposes of the subordination provisions in this Article 9, the term “Senior Debt” shall mean all principal of, Make Whole Amount (as defined in the Mortgage Notes), if any, interest on, and all fees, expenses and other amounts then due and payable with respect to the Mortgage Notes.   9.3 Upon the happening of an event of default with respect to any Senior Debt, as defined therein or in the instrument under which the same is outstanding, which occurs at the maturity thereof or which automatically accelerates or permits the holders thereof to accelerate the maturity thereof, then, unless and until such event of default shall have been remedied or waived or shall have ceased to exist, no direct or indirect payment (in cash, property or securities or by set-off or otherwise) shall be made on account of the   17   principal of, or premium, if any, or interest on the Subordinated Debt, or as a sinking fund for the Subordinated Debt, or in respect of any redemption, retirement, purchase or other acquisition of any of the Subordinated Debt.   9.4 In the event of     (a) any insolvency, bankruptcy, receivership, liquidation, reorganization, readjustment, composition or other similar proceeding relating to the Partnership or any series of the Partnership or their respective properties, or their respective creditors as a receiver for them,     (b) any proceeding for the liquidation, dissolution or other winding-up of the Partnership or any series of the Partnership, voluntary or involuntary, whether or not involving insolvency or bankruptcy proceedings,     (c) any assignment by the Partnership or any series of the Partnership for the benefit of creditors, or     (d) any other marshalling of the assets of the Partnership or any series of the Partnership, all Senior Debt (including any interest thereon accruing at the legal rate after the commencement of any such proceedings and any additional interest that would have accrued thereon but for the commencement of such proceedings) shall first be paid in full before any payment or distribution, whether in cash, securities or other property, shall be made to any holder of the Subordinated Debt on account of the Subordinated Debt. Any payment or distribution, whether in cash, securities or other property (other than securities of the Partnership or any series of the Partnership or any other Person provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in these subordination provisions with respect to Subordinated Debt, to the payment of all Senior Debt at the time outstanding and to any securities issued in respect thereof under any such plan of subordination provisions) be payable or deliverable in respect of this Subordinated Debt shall be paid or delivered directly to the holders of Senior Debt in accordance with the priorities then existing among such holders until have accrued thereon but for the commencement of such proceedings) shall have been paid in full.   9.5 In the event that any holder of Subordinated Debt shall have the right to declare the Subordinated Debt due and payable as a result of the occurrence of any one or more defaults in respect thereof, under circumstances when the terms of Section 9.4 are not applicable, such holder shall not declare such Subordinated Debt due and payable or otherwise to be in default and shall take no action at Law or in equity in respect of any such default unless and until all Senior Debt shall have been paid in full.   18 9.6 If any payment or distribution of any character or any security, whether in cash, securities or other property (other than securities of the Partnership or any series of the Partnership or any other Person provided for by a plan of reorganization or readjustment), shall be received by a holder of Subordinated Debt in contravention of any of the terms hereof and before all the Senior Debt shall have been paid in full, such payment or distribution or security shall be received in trust for the benefit of, and shall be paid over or delivered and transferred to, the holders of the Senior Debt at the time outstanding in accordance with the priorities then existing among such holders for application to the payment of all Senior Debt remaining unpaid, to the extent necessary to pay all such Senior Debt in full. In the event of the failure of any holder of the Subordinated Debt to endorse or assign any such payment, distribution or security, each holder of Senior Debt is hereby irrevocably authorized to endorse or assign the same.   9.7 No present or future holder of any Senior Debt shall be prejudiced in the right to enforce subordination of Subordinated Debt by any act or failure to act on the part of the Partnership or any series of the Partnership. Nothing contained herein shall impair, as between the Borrower and the Partnership, on the one hand, and the holder of this Subordinated Debt, on the other hand, the obligation of the Borrower and, to the extent described in Section 8.2, the Partnership to pay to the holder hereof the principal hereof and interest hereon as and when the same shall become due and payable in accordance with the terms hereof, or prevent the holder of the Subordinated Debt from exercising all rights, powers and remedies otherwise permitted by applicable Law or hereunder upon a default or Event of Default hereunder, all subject to the rights of the holders of the Senior Debt to receive cash, securities or other property otherwise payable or deliverable to the holders of Subordinated Debt as provided in this Article 9.   9.8 Upon the payment in full of all Senior Debt, the holders of Subordinated Debt shall be subrogated to all rights of any holders of Senior Debt to receive any further payments or distributions applicable to the Senior Debt until the Subordinated Debt shall have been paid in full, and, for purposes of such subrogation, no payment or distribution received by the holders of Senior Debt of cash, securities or other property to which the holders of the Subordinated Debt would have been entitled except for these subordination provisions shall, as between the Borrower and the Partnership and their respective creditors other than the holders of Subordinated Debt, on the one hand, and the holders of Subordinated Debt, on the other, be deemed to be a payment or distribution by the Borrower or the Partnership to or on account of Senior Debt. ARTICLE 10 AMENDMENT AND WAIVER   10.1 No amendment or waiver of this Agreement shall be binding unless executed in writing by the Borrower and the Lender.   19 10.2 No waiver of any provision of this Agreement or the Note shall constitute a waiver of any other provision hereof or thereof, nor shall any waiver of any provision of this Agreement or the Note constitute a continuing waiver unless otherwise expressly provided.   10.3 No act or omission (except in accordance with Section 10.1 hereof) by the Lender with respect to any breach or default by the Borrower shall extend to or be taken in any manner whatsoever to constitute a waiver with respect to such breach or default or with respect to any subsequent breach or default whether of the same nature or of a different nature, or the rights arising therefrom. ARTICLE 11 ASSIGNMENT   11.1 This Agreement and the Note shall be binding upon the Borrower and the Lender and their respective successors and permitted assigns, and shall enure to the benefit of the Borrower and the Lender and their respective successors and permitted assigns. Neither the Borrower nor the Lender, nor their respective successors and permitted assigns, may assign or transfer any rights or obligations under either this Agreement or the Note without the prior written consent of the other, such consent in no case to be unreasonably withheld. The other party’s signature on a legal document transferring or assigning either this Agreement or the Note shall be considered prior written consent. ARTICLE 12 NOTICES   12.1 All notices, consents, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly delivered and shall be effective: (a) if delivered by facsimile transmission at the applicable facsimile number set forth on Annex I hereto or at such other facsimile number as may be communicated from time to time by such party, upon confirmation of receipt; or, (b) if mailed by first class mail to the applicable address set forth on Annex I hereto, or to such other address as may be communicated from time to time by such party, within five (5) Business Days after such communication is deposited in the mail. ARTICLE 13 FURTHER ASSURANCES   13.1 Whether before or after the happening of an Event of Default, the Borrower shall at its own expense do, make, execute or deliver, or cause to be done, made, executed or delivered, all such further acts, documents and things in connection with this Agreement as the Lender may reasonably require from time to time for the purpose of giving effect to this Agreement, all immediately upon the request of the Lender.   20 ARTICLE 14 ENTIRE AGREEMENT   14.1 This Agreement and the Note constitute the entire agreement between the parties regarding the subject matter hereof and supersede and replace any prior understandings, written and verbal agreements or arrangements.   14.2 There are no warranties, conditions, or representations (including any that may be implied by statute) and there are no agreements in connection with the subject matter hereof except as specifically set forth or referred to in this Agreement and the Note. No reliance is placed on any warranty, representation, opinion, advice or assertion of fact made either prior to, contemporaneous with, or after entering into this Agreement, or any amendment or supplement thereto, by the Borrower or the Lender or its directors, officers, employees or agents, to the other or its directors, officers, employees or agents, except to the extent that the same has been reduced to writing and included as a term of this Agreement, and neither the Borrower nor the Lender has been induced to enter into this Agreement, the Note or any amendment or supplement by reason of any such warranty, representation, opinion, advice or assertion of fact. Accordingly, there shall be no liability, either in tort or in contract, assessed in relation to any such warranty, representation, opinion, advice or assertion of fact, except to the extent specifically set forth or referred to in this Agreement or the Note. ARTICLE 15 GENERAL MATTERS   15.1 Except where otherwise expressly provided, all amounts in this Agreement are stated and shall be paid in United States currency.   15.2 Any provisions of this Agreement prohibited by the laws of any jurisdiction without invalidating the remaining terms hereof and no such invalidity shall affect the obligation of the Borrower to pay the principal amount and any accrued and unpaid interest at the time outstanding under this Agreement or the Note.   15.3 Time is of the essence of this Agreement.   15.4 The Borrower shall pay all out-of-pocket expenses incurred or otherwise payable by the Lender, and the Lender (as defined in the A1 Credit Agreement), in connection with preparation, negotiation, execution and delivery of this Agreement, the Note, the A1 Credit Agreement, and the other Loan Documents (as defined in the A1 Credit Agreement), including any amendments, modifications and waivers with respect thereto, and in connection with the enforcement or protection of the Lender’s, and the Lender’s (as defined in the A1 Credit Agreement), rights in connection with this Agreement, the Note, the A1 Credit Agreement and the other Loan Documents (as defined in the A1 Credit Agreement).   21 ARTICLE 16 COUNTERPARTS   16.1 This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which taken together shall be deemed to constitute one and the same instrument. ARTICLE 17 GOVERNING LAW AND ATTORNMENT   17.1 This Agreement shall be governed by and interpreted and enforced in accordance with the laws of the State of New York, as applied to contracts made and performed within the State of New York and the federal laws of the United States of America applicable therein, without regard to principles of conflict of laws. ARTICLE 18 FACSIMILE AND COUNTERPART   18.1 An executed counterpart of this Agreement may be delivered by facsimile or other electronic transmission, and such delivery shall be effective as delivery of a manually executed counterpart of this Agreement.   22 Executed as of the date first set forth above.   ENBRIDGE ENERGY, LIMITED PARTNERSHIP, on behalf of the Series AC By:   Enbridge Pipelines (Lakehead) L.L.C.,   its managing general partner   By:       Name:       Title:     ENBRIDGE ENERGY PARTNERS, L.P. By:   Enbridge Energy Management, L.L.C., as delegate of Enbridge Energy Company, Inc.,     Name:       Title:     Signature Page to B1 Credit Agreement   ANNEX I   NOTICE INFORMATION   SERIES AC OF ENBRIDGE ENERGY, LIMITED PARTNERSHIP Address:    [                                         ] Contact:    [                                         ] Fax:    [                                         ] ENBRIDGE ENERGY PARTNERS, L.P.    Address:    [                                         ] Contact:    [                                         ] Fax:    [                                         ] Annex I to B1 Credit Agreement ANNEX II PERMITTED INDEBTEDNESS Mortgage Notes. Senior Unsecured Notes. C1 Credit Agreement, dated as of [                    ], 2009, between the Lender and the Borrower. Springing Guarantees (as defined in the Partnership Agreement) Annex II to B1 Credit Agreement ANNEX III PROMISSORY NOTE   U.S. $400,000,000.00   [                    ], 2009 FOR VALUE RECEIVED, Enbridge Energy, Limited Partnership, a limited partnership organized under the laws of the state of Delaware, on behalf of the Series AC (the “Borrower”), hereby promises to pay to Enbridge Energy Partners, L.P. (the “Lender”), the principal sum of U.S. $400,000,000.00 or such lesser amount as shall equal the aggregate unpaid principal amount of the Loans made by the Lender to the Borrower pursuant to the B1 Credit Agreement dated [                    ], 2009 (as may be amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), in lawful money of the United States of America and in immediately available funds, on the dates and in the principal amounts provided in the Credit Agreement, and to pay interest on the unpaid principal amount of such Loans, in like money and funds, for the period commencing on the date of each such Loan until such Loan shall be paid in full, at the rates per annum and on the dates provided in the Credit Agreement. In addition to and cumulative of any payments required to be made against this Note pursuant to the Credit Agreement (but without duplication thereof), this Note, including all principal and accrued interest then unpaid, shall be due and payable on the Maturity Date. All payments under this Note shall be applied in the manner set forth in the Credit Agreement. The Borrower waives presentment, demand, notice of dishonor, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note. No delay or omission on the part of the holder hereof in exercising any right hereunder shall operate as a waiver of such right or any other right under this Note. No waiver of any right shall be effective unless in writing and signed by the holder, nor shall a waiver on one occasion be construed as a bar to or waiver of any such right on any future occasion. The Borrower will pay on demand all costs of collection and legal fees paid or incurred by the holder in enforcing the obligations of the Borrower hereunder. State of New York without regard to its choice of law principles. The Borrower hereby irrevocably authorizes the Lender to make (or cause to be made) appropriate notations on the grid attached to this Note (or any continuation of such grid), which notations, if made, shall evidence, inter alia, the date of, the outstanding principal of, and the interest rate to the loans evidenced hereby. Such notations shall be conclusive and binding on the Borrower, absent manifest error; provided, however, that the failure of the Lender to make any such notations shall not limit or otherwise affect any obligations of the Borrower hereunder and under the Credit Agreement. Annex III to B1 Credit Agreement This Note is the promissory note referred to in the Credit Agreement and is subject to the terms, conditions and provisions of the Credit Agreement including those respecting prepayments, all as provided in the Credit Agreement and incorporated herein by reference with the same force and effect as if such terms, conditions and provisions were set forth herein. The Borrower has executed this Note for internal record keeping convenience; however, this Agreement is an obligation of the Partnership generally and of each series of the Partnership, to the extent provided in Section 3.4(c) of the Partnership Agreement, to which the Lender is a party. Date as of the date first set forth above.   ENBRIDGE ENERGY, LIMITED PARTNERSHIP, on behalf of the Series AC By:   Enbridge Pipelines (Lakehead) L.L.C.,   its managing general partner   By:       Name:       Title:       Annex III to B1 Credit Agreement PROMISSORY NOTE Loans and Principal Payments   Date    Type of Loan Made    Amount of Loan Made    End of Interest Period    Amount of Principal or Interest Prepaid This Date    Unpaid Principal Balance This Date    Notation Made By                                                                                                                                                                                                                                                                                                                                                                                                                                                   Annex III to B1 Credit Agreement ANNEX IV FORM OF LOAN NOTICE Date:                     ,            To: Enbridge Energy Partners, L.P., as Lender Ladies and Gentlemen: Reference is made to that certain B1 Credit Agreement, dated as of defined therein being used herein as therein defined), between Enbridge Energy, Limited Partnership, on behalf of the Series AC (the “Borrower”) and the Lender from time to time party thereto. ¨ A Borrowing of Loans      ¨ A conversion or continuation of Loans 3. Comprised of                                                                      Type of Loan requested    months.   BORROWER: ENBRIDGE ENERGY, LIMITED PARTNERSHIP, on behalf of Series AC   By:   Enbridge Pipelines (Lakehead)     Name:       Title:     Annex IV to B1 Credit Agreement EXHIBIT D FORM OF FACILITY C1 C1 CREDIT AGREEMENT This C1 CREDIT AGREEMENT (this “Agreement”), dated as of the [    ] day of Enbridge Energy, Limited Partnership, a Delaware limited partnership, on behalf of the Series AC (the “Borrower”), and Enbridge Energy Partners, L.P., a Delaware limited partnership (the “Lender”). RECITALS WHEREAS, the Lender and the Borrower desire that the proceeds of the Loans made by the Lender to the Borrower under this Agreement be used by the Borrower to fund a portion of the total costs to construct (a) the U.S. portion of the proposed 36-inch diameter crude oil pipeline from Hardisty, Alberta to Superior, (b) related terminals, interconnections, tanks and pump stations located in the United States (collectively, the “Alberta Clipper Project”); ARTICLE 1 INTERPRETATION; DEFINITIONS       forth below:   thereof.     (b) “Agreement” shall have the meaning set forth in the preamble hereto.   -1-   (c) “Alberta Clipper Project” shall have the meaning set forth in the recitals hereto.     (d) “Applicable Rate” shall have the meaning set forth in Section 3.5.     (e) “Bank of America” shall mean Bank of America, N.A.     (f)     (g) “Base Rate Loan” shall mean a Loan that bears interest based on the Base Rate.     (h) “Borrower” shall have the meaning set forth in the preamble hereto.     (i) “Borrowing” shall mean a borrowing consisting of simultaneous Loans of the Section 2.1.     (j) “Business Day” shall mean any day other than a Saturday, Sunday, or other day on which commercial banks are authorized to close under the Laws of, or are Alberta, Canada, and if such day relates to any Fixed Period Eurodollar Rate Loan, it must also be a day on which dealings in Dollar deposits are conducted by and between banks in the applicable offshore Dollar interbank market.     (k) “Closing Date” shall have the meaning set forth in the preamble hereto.     (l) “Commitment” shall have the meaning set forth in Section 2.1 hereof.     (m) “Credit Facility” shall have the meaning set forth in Section 2.1 hereof.     (n) “Debt Rating” shall mean, as of any date of determination, the rating as   2   (o) “Debtor Relief Laws” shall mean the Bankruptcy Code of the United States     (p) “Default” shall mean any event that, with the giving of any notice, the     (q) “Default Rate” shall mean an interest rate equal to (a) the Base Rate plus     (r) “Dollar” and “$” shall mean lawful money of the United States of America.     (s) “Event of Default” shall have the meaning set forth in Article 6 hereof.     (t)     (u) “Fixed Period Eurodollar Rate” shall mean, with respect to any Fixed   3   (v) “Fixed Period Eurodollar Rate Loan” shall mean a Loan that bears interest     (w) “GAAP” shall mean United States generally accepted accounting principles     (x) “General Partners” shall mean, collectively, Enbridge Pipelines (Lakehead) L.L.C., a Delaware limited liability company, and Enbridge Pipelines (Wisconsin) Inc., a Wisconsin corporation.     (y) “Governmental Authority” shall mean any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality,     (z) “Guarantee Obligation” shall mean, as to any Person, (a) any obligation, directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligees in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligees against loss in Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person; provided, however, that the term “Guarantee Obligation” shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guarantee Obligation shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guarantying Person in good faith.   4   (aa) “In-Service Date” shall have the meaning set forth in the Tariff Term Sheet.     (bb) “Indebtedness” shall mean, as to any Person at a particular time, all of   similar instruments;         foregoing.     (cc) “Interest Payment Date” shall mean, (a) as to any Fixed Period Eurodollar     (dd) “Interest Period” shall mean, with respect to any Fixed Period Eurodollar   preceding Business Day;   5 Period; and       (ee) “Law” shall mean, collectively, all international, foreign, federal,     (ff) “Lender” shall have the meaning set forth in the preamble hereto.     (gg) “Lender’s Office” shall mean the Lender’s address and, as appropriate,     (hh) “Lien” shall mean any mortgage, pledge, hypothecation, collateral     (ii) “Loan Notice” shall mean written or telephonic notice of (a) a Borrowing of shall be   6   immediately followed by written notice in the form of Annex IV; provided, any such telephone notice shall be irrevocable when given notwithstanding that it is required to be so confirmed in writing.     (jj) “Loans” shall have the meaning set forth in Section 2.1 hereof.     (kk) “Maturity Date” shall mean the earlier to occur of (a) the date that is     (ll) “Moody’s” shall mean Moody’s Investors Service, Inc. or any successor to     (mm) “Mortgage Note Agreements” shall mean, collectively, those certain Note     (nn) “Mortgage Notes” shall mean, collectively, the Partnership’s 9.15% First     (oo) “Mortgage Notes Termination Date” shall mean the date on which all     (pp) “Note” shall mean a promissory note made by the Borrower in favor of the III.     (qq) “Outstanding Amount” shall mean, on any date, the aggregate outstanding     (rr) “Partnership” shall mean Enbridge Energy, Limited Partnership, a Delaware limited partnership.     (ss) “Partnership Agreement” shall mean the Third Amended and Restated   7   (tt) “Person” shall mean any individual, trustee, corporation, general     (uu) “S&P” shall mean Standard & Poor’s Ratings Services, a division of The     (vv) “Senior Debt” shall have the meaning set forth in Section 9.2 hereto.     (ww) “Senior Indenture” shall mean that certain Indenture dated September 15,     (xx) Indenture.     (yy) “Subordinated Debt” shall have the meaning set forth in Section 9.1 hereto.     (zz) “Tariff Term Sheet” shall mean the Alberta Clipper U.S. Term Sheet dated     (aaa) “Type” shall mean, with respect to a Loan, its character as a Base Rate     (bbb) “Wachovia” shall mean Wachovia Bank, National Association, or any successor thereof. ARTICLE 2 THE CREDIT FACILITY   the “Credit Facility”) shall not exceed two hundred million Dollars ($200,000,000) (as such amount may be reduced or adjusted from time to time in accordance with this Agreement, the Lender’s “Commitment”).   8 Article 9 hereof.     ARTICLE 3     (D) the Type of Loans to be borrowed or to which existing Loans are to be converted, and (E) if applicable, the duration of the Interest Period with respect thereto. If the Borrower fails to specify a Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Loans shall be made or continued as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Fixed Period Eurodollar Rate Loans. If the Borrower requests a Borrowing of, conversion to, or continuation of Fixed Period Eurodollar Rate Loans in any such Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.     (b) Following receipt of a Loan Notice from the Borrower, if no Default or Event of Default exists or would result from the proposed Borrowing, the Lender shall make the funds available to the Borrower by either wire transfer of such funds or other customary method used by the parties hereto and their Affiliates, in each case, in accordance with instructions provided to the Lender by the Borrower.   9   (c) Except as otherwise provided herein, a Fixed Period Eurodollar Rate Loan     (d) The Lender shall promptly notify the Borrower of the interest rate change.   3.2 Prepayments. The Borrower may, upon notice to the Lender, at any time or from time to time voluntarily prepay Loans in whole or in part without premium or penalty; provided that such notice must be received by the Lender not later than 10:00 a.m., Mountain Standard Time or Mountain Daylight Time (as applicable), (i) three Business Days prior to any date of prepayment of Fixed Period Eurodollar Rate Loans, and (ii) one Business Day prior to any date of prepayment of Base Rate Loans. Each such notice shall specify the date and amount of such prepayment and the Type(s) of Loans to be prepaid. If such notice specified therein. Any prepayment of Fixed Period Eurodollar Rate Loans shall be accompanied by all accrued interest thereon, together with any additional amounts required pursuant to Section 3.12.   increased.       Applicable Rate   Pricing Level       Facility Fee Rate     Applicable Rate for Eurodollar Loans     Applicable Rate for Base Rate Loans    Utilization   0    .10 %    10   3.6 Interest.         3.7 Fees.     (a) Facility Fee. The Borrower shall pay to the Lender a facility fee equal to the   11       (b) Utilization Fee. The Borrower shall pay to the Lender a utilization fee equal to the applicable utilization fee rate based on the Debt Rating as set forth in the definition of Applicable Rate multiplied by the actual daily aggregate Outstanding Amount of Loans for each day that such aggregate Outstanding Amount exceeds 50% of the Commitment. The utilization fee shall be June, September and December, commencing with the first such date to occur after the Closing Date, and on the Maturity Date. The utilization fee shall be calculated quarterly in arrears. The utilization fee shall accrue at all times, including at any time during which one or more of the conditions set forth in   and all fees, shall be calculated on the basis of a year of 360 days and the   respect thereto.   3.10 Payments Generally.     (a)   12     reflected in computing interest or fees as the case may be.   hereunder.           13   obtained. hereunder. ARTICLE 4 PAYMENT OF WITHHOLDING TAXES AND OTHER CHARGES   ARTICLE 5 COVENANTS OF THE BORROWER     hereunder.     5.4 Authority required or reasonably necessary to carry   14   on its business, except to the extent that the failure to have or maintain the same would not reasonably be expected to have a material adverse effect on the business of the Borrower or its ability to perform its covenants hereunder.   ARTICLE 6 EVENTS OF DEFAULT           the above actions.   15 ARTICLE 7 REMEDIES     expedient.     Default hereunder. ARTICLE 8     ARTICLE 9 SUBORDINATION       16 9.3 Upon the happening of an event of default with respect to any Senior Debt, as defined therein or in the instrument under which the same is outstanding, which occurs at the maturity thereof or which automatically accelerates or permits the holders thereof to accelerate the maturity thereof, then, unless and until such event of default shall have been remedied or waived or shall have ceased to exist, no direct or indirect payment (in cash, property or securities or by set-off or otherwise) shall be made on account of the principal of, or premium, if any, or interest on the Subordinated Debt, or as a sinking fund for the Subordinated Debt, or in respect of any redemption, retirement, purchase or other acquisition of any of the Subordinated Debt.           the Partnership,   17         18 ARTICLE 10 AMENDMENT AND WAIVER     otherwise expressly provided.   ARTICLE 11 ASSIGNMENT   ARTICLE 12 NOTICES   ARTICLE 13 FURTHER ASSURANCES     19 ARTICLE 14 ENTIRE AGREEMENT     ARTICLE 15 GENERAL MATTERS     Note.     payable by the Lender in connection with preparation, negotiation, execution and delivery of this Agreement and the Note, including any amendments, modifications and waivers with respect thereto, and in connection with the enforcement or protection of the Lender’s rights in connection with this Agreement and the Note. ARTICLE 16 COUNTERPARTS     20 ARTICLE 17 GOVERNING LAW AND ATTORNMENT   of laws. ARTICLE 18 FACSIMILE AND COUNTERPART     21   ENBRIDGE ENERGY, LIMITED     Name:       Title:         Name:       Title:     Signature Page to C1 Credit Agreement   ANNEX I   NOTICE INFORMATION   [                                         ] Contact:    [                                         ] Fax:    [                                         ] Fax:    [                                         ]   Annex I to C1 Credit Agreement ANNEX II PERMITTED INDEBTEDNESS Mortgage Notes. Senior Unsecured Notes. B1 Credit Agreement, dated as of [                    ], 2009, between the Annex II to C1 Credit Agreement ANNEX III PROMISSORY NOTE   U.S. $200,000,000.00   [                    ], 2009 “Lender”), the principal sum of U.S. $200,000,000.00 or such lesser amount as Lender to the Borrower pursuant to the C1 Credit Agreement dated any future occasion.   Annex III to C1 Credit Agreement       Name:       Title:       Annex III to C1 Credit Agreement PROMISSORY NOTE Loans and Principal Payments   Date    Type of Loan Made    Amount of Loan Made    End of Interest Period    Amount of Principal or Interest Prepaid This Date    Unpaid Principal Balance This Date    Notation Made By                                                                                                                                                                                                                                                                                                                                                                                                                                                   Annex III to C1 Credit Agreement ANNEX IV FORM OF LOAN NOTICE Date:                     ,            Ladies and Gentlemen: Reference is made to that certain C1 Credit Agreement, dated as of 3. Comprised of                                                                      Type of Loan requested    months.       Name:       Title:     Annex IV to C1 Credit Agreement