Contract analysis

ARTICLE I — DEFINITIONS AND INTERPRETATION

Section 1.01 — Defined Terms As used in this Agreement, the following terms shall have the following meanings: "Adequate Protection Payments" means the monthly current-pay interest payments to the Non-Driftwood Pre-Petition First Lien Lenders on $88,000,000 of Pre-Petition First Lien Loans at the non-default contract rate of SOFR plus 425 basis points per annum, as more fully described in Section 2.13(c) and as autho

Section 1.02 — Interpretation For purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires: (a) The words "hereof," "herein," "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. (b) References to any Article, Section, Schedule, or Exhibit are references

Section 1.03 — Accounting Terms Except as otherwise expressly provided herein, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP. Financial statements and other financial information required to be delivered hereunder shall be prepared in accordance with GAAP, applied on a basis consistent with the Borrowers' historical accounting practices, as modified

Section 1.04 — UCC Terms Terms used herein but not otherwise defined herein that are defined in the UCC shall have the meanings assigned to them in Article 1 or Article 9 of the UCC, as applicable, as in effect in the State of Delaware from time to time.

Section 1.05 — Rates (a) The interest rate on DIP Loans is based on Adjusted Term SOFR, which incorporates the SOFR Floor of 4.00% per annum. In no event shall Adjusted Term SOFR for any Interest Period be deemed to be less than the SOFR Floor. (b) If Term SOFR for any Interest Period is unavailable or ceases to be published, the DIP Lender and the Borrowers shall negotiate in good faith to establish a replacement be

Section 2.01 — DIP Loans (a) New Money DIP Tranche. Subject to the terms and conditions of this Agreement and the DIP Orders, the DIP Lender agrees to make term loans to the Borrowers in an aggregate principal amount of $43,000,000 (the "New Money DIP Tranche"), available in two draws as follows: (i) Draw 1. Upon entry of the Interim DIP Order and satisfaction of the conditions precedent set forth in Section 4.01, th

Section 2.02 — Borrowing Mechanics (a) Borrowing Notice. Each borrowing of DIP Loans under the New Money DIP Tranche shall be made upon delivery by the Borrowers to the DIP Lender of a written borrowing notice (each, a "Borrowing Notice"), substantially in the form of Exhibit A attached hereto, not later than 11:00 a.m. (New York time) on the Business Day that is two (2) Business Days prior to the requested date of b

Section 2.03 — Interest (a) Applicable Rate. Each DIP Loan shall bear interest at a rate per annum equal to Adjusted Term SOFR for the applicable Interest Period plus the Applicable Rate of 900 basis points (9.00%). The SOFR Floor is 4.00% per annum, resulting in a minimum all-in interest rate of 13.00% per annum (4.00% plus 9.00%). As of the Closing Date, with Term SOFR at approximately 5.33%, the effective all-in i

Section 2.04 — Fees (a) Commitment Fee. The Borrowers shall pay to the DIP Lender a commitment fee equal to 2.00% of the total Commitment ($75,000,000 multiplied by 2.00%, equaling $1,500,000). The Commitment Fee shall be fully earned upon execution of this Agreement and shall be payable upon entry of the Interim DIP Order. The Commitment Fee was paid from the proceeds of Draw 1 on September 15, 2023. The Commitment

Section 2.05 — Repayment and Maturity (a) All outstanding Obligations, including all principal, accrued and unpaid interest, the Exit Fee, and all other amounts owing hereunder, shall be due and payable in full on the Maturity Date. (b) The Maturity Date is the earliest to occur of: (i) September 8, 2024 (twelve months from the Petition Date); (ii) the Effective Date of a confirmed Chapter 11 plan of the Borrowers; (

Section 2.06 — Voluntary Prepayment (a) The Borrowers may prepay all or any portion of the outstanding DIP Loans at any time without premium or penalty (other than the Exit Fee payable pursuant to Section 2.04(b) and any breakage costs payable pursuant to Section 3.03), upon not less than three (3) Business Days' prior written notice to the DIP Lender (or one (1) Business Day in the case of a prepayment in connection

Section 2.07 — Mandatory Prepayment (a) Asset Dispositions. Subject to the provisions of the DIP Orders, the Borrowers shall prepay the DIP Loans in an amount equal to 100% of the net cash proceeds received by any Borrower from any sale, transfer, or other disposition of assets outside the ordinary course of business (other than any sale, transfer, or disposition of assets of Ridgeline Community Bank or Excluded Asse

Section 2.08 — Application of Payments All amounts received by the DIP Lender in respect of the Obligations (whether from voluntary prepayments, mandatory prepayments, payments at maturity, or proceeds of Collateral) shall be applied in the following order: First, to the payment of all costs and expenses (including Lender's Professional Fees) then due and payable under this Agreement; Second, to the payment of all ac

Section 2.09 — Use of Proceeds (a) Draw 1 Proceeds. The proceeds of Draw 1 ($18,000,000) shall be used solely for the following purposes: (i) working capital and general corporate purposes of the Borrowers, in accordance with the Budget; (ii) funding of the Adequate Protection Reserve in the amount of $3,500,000, in accordance with Section 2.13(d); (iii) payment of the Commitment Fee in the amount of $1,500,000, in a

Section 2.10 — DIP Superpriority Claims (a) Pursuant to Section 364(c)(1) of the Bankruptcy Code and the DIP Orders, all Obligations constitute allowed superpriority administrative expense claims against each Borrower and each Borrower's estate (the "DIP Superpriority Claims"), with priority in payment over any and all other administrative expense claims and all claims of any kind or nature whatsoever against each Bo

Section 2.11 — Roll-Up Mechanics (a) Upon entry of the Final DIP Order and satisfaction of the conditions precedent set forth in Section 4.03, $32,000,000 of the DIP Lender's Pre-Petition First Lien Loan claims shall be deemed satisfied by the deemed extension of DIP Loans in the same amount. Following such roll-up, the DIP Lender's Pre-Petition First Lien Loan claims in the amount of $32,000,000 shall be extinguishe

Section 2.12 — Priming (a) Pursuant to Section 364(d) of the Bankruptcy Code and the DIP Orders, the DIP Liens are priming liens, senior in priority to the Pre-Petition Liens and all other liens and security interests in the Collateral, whether arising before or after the Petition Date. (b) The Pre-Petition First Lien Lenders have consented to, or have been found by the Bankruptcy Court to be adequately protected aga

Section 2.13 — Adequate Protection As adequate protection for the interests of the Non-Driftwood Pre-Petition First Lien Lenders in the Collateral, and as a condition to the priming authorized by the DIP Orders, the following adequate protection package is provided: (a) Replacement Liens. The Non-Driftwood Pre-Petition First Lien Lenders shall receive replacement liens on and security interests in the Collateral, pur

Section 2.14 — Carve-Out (a) Notwithstanding the DIP Liens, the DIP Superpriority Claims, and the Replacement Liens, the following amounts (collectively, the "Carve-Out") shall have priority over the DIP Liens, the DIP Superpriority Claims, and the Replacement Liens: (i) All unpaid fees of the Clerk of the Bankruptcy Court and fees payable to the U.S. Trustee pursuant to 28 U.S.C. Section 1930(a)(6), together with in

Section 2.15 — Challenge Period (a) The Committee shall have seventy-five (75) days from the date of entry of the Final DIP Order (i.e., from October 13, 2023, such period expiring on December 27, 2023) to investigate and, if warranted, commence a challenge or action with respect to: (i) the validity, enforceability, perfection, priority, or extent of the Pre-Petition Liens; or (ii) the validity or propriety of the R

ARTICLE III — TAXES; INCREASED COSTS; YIELD PROTECTION

Section 3.01 — Taxes (a) All payments made by the Borrowers hereunder shall be made free and clear of, and without deduction or withholding for, any and all present or future taxes, levies, imposts, deductions, charges, or withholdings, and all liabilities (including interest, penalties, and additions to tax) with respect thereto (collectively, "Taxes"), unless such deduction or withholding is required by applicable