Contract analysis

Section 1.1 — Defined Terms As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not otherwise defined in this Agreement shall have the meanings assigned to such terms in the Indenture: "Account Bank" means Havenwood Bank, N.A., located at 227 West Monroe Street, Chicago, IL 60606, or any successor thereto appointed in accordance with the Indenture. "Advis

Section 1.2 — Rules of Construction (a) Unless the context otherwise requires, all capitalized terms used in this Agreement and not otherwise defined herein shall have the respective meanings assigned to such terms in the Indenture, and such definitions are incorporated herein by reference. (b) References in this Agreement to "Articles," "Sections," "Schedules," and "Exhibits" are to the Articles, Sections, Schedules

ARTICLE II — APPOINTMENT; DUTIES AND AUTHORITY OF THE COLLATERAL MANAGER

Section 2.1 — Appointment (a) The Issuer hereby appoints Driftwood Credit Management LLC as the collateral manager with respect to the Portfolio, and the Collateral Manager hereby accepts such appointment and agrees to perform the services and duties set forth in this Agreement, on the terms and subject to the conditions herein. (b) The appointment of the Collateral Manager shall be effective as of August 22, 2023 an

Section 2.2 — Duties of the Collateral Manager The Collateral Manager shall perform the following duties in connection with the management of the Portfolio: (a) Portfolio Selection. The Collateral Manager shall identify, evaluate, select, acquire, and manage a portfolio of broadly syndicated first-lien senior secured leveraged loans (primarily to U.S. obligors) and other eligible collateral obligations (as defined in

Section 2.3 — Authority of the Collateral Manager (a) The Issuer hereby grants to the Collateral Manager full discretionary authority to manage the collateral portfolio within the parameters and limitations set forth in the Indenture and this Agreement. Such authority shall include, without limitation, the authority to: (i) identify, evaluate, select, and acquire collateral obligations and eligible investments for in

Section 2.4 — Standard of Care (a) The Collateral Manager shall perform its duties hereunder with reasonable care, using a degree of skill and attention no less than that which the Collateral Manager exercises with respect to comparable assets that it manages for its own account or for other accounts with similar investment objectives and guidelines. The Collateral Manager shall act in a manner consistent with the cu

Section 2.5 — Compliance with Laws (a) The Collateral Manager shall comply with all applicable federal, state, and local laws, rules, and regulations in the performance of its duties under this Agreement, including, without limitation: (i) the Securities Act of 1933, as amended (the "Securities Act"); (ii) the Securities Exchange Act of 1934, as amended (the "Exchange Act"); (iii) the Advisers Act; and (iv) all appli

Section 2.6 — Collateral Manager Affiliates and Conflicts of Interest (a) The Parties acknowledge and agree that the Collateral Manager is a wholly owned subsidiary of Driftwood Absolute Return Fund Ltd. ("DARF"), a Cayman Islands exempted company. DARF and its affiliated entities manage approximately $6.8 billion in assets under management (as of the first quarter of 2023) across a range of investment strategies, in

Section 3.1 — Senior Collateral Management Fee (a) As compensation for its services under this Agreement, the Collateral Manager shall be entitled to receive a Senior Collateral Management Fee (the "Senior Collateral Management Fee") at a rate equal to 0.15% per annum of the aggregate outstanding principal balance of the collateral obligations and eligible investments in the Portfolio as of the last day of the applic

Section 3.2 — Subordinate Collateral Management Fee (a) In addition to the Senior Collateral Management Fee, the Collateral Manager shall be entitled to receive a Subordinate Collateral Management Fee (the "Subordinate Collateral Management Fee") at a rate equal to 0.35% per annum of the aggregate outstanding principal balance of the collateral obligations and eligible investments in the Portfolio as of the last day

Section 3.3 — Incentive Management Fee (a) In addition to the Senior Collateral Management Fee and the Subordinate Collateral Management Fee, the Collateral Manager shall be entitled to receive an Incentive Management Fee (the "Incentive Management Fee") equal to 20% of excess residual interest proceeds distributable to holders of the Subordinated Notes after such holders have achieved an internal rate of return of 1

Section 3.4 — Reimbursement of Expenses (a) The Issuer shall reimburse the Collateral Manager for all reasonable out-of-pocket expenses actually incurred by the Collateral Manager in connection with the performance of its duties under this Agreement, subject to the expense provisions and limitations set forth in the Indenture and the other Transaction Documents. Reimbursable expenses shall include, without limitation

Section 3.5 — No Other Compensation Except as expressly set forth in this Article III, the Collateral Manager shall not receive any other compensation, fee, or remuneration from the Issuer or from the assets of the Portfolio in connection with its services under this Agreement. Notwithstanding the foregoing, nothing in this Section 3.5 shall prohibit the Collateral Manager from receiving customary brokerage commissio

ARTICLE IV — REPRESENTATIONS AND WARRANTIES

Section 4.1 — Representations and Warranties of the Collateral Manager The Collateral Manager hereby represents and warrants to the Issuer, as of the date hereof and as of the Closing Date, as follows: (a) Organization and Good Standing. The Collateral Manager is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware, and has all requisite limited li

Section 4.2 — Representations and Warranties of the Issuer The Issuer hereby represents and warrants to the Collateral Manager, as of the date hereof and as of the Closing Date, as follows: (a) Organization and Good Standing. The Issuer is an exempted company duly incorporated, validly existing, and in good standing under the laws of the Cayman Islands, Cayman Registration No. EX-382916, and has all requisite corpora

ARTICLE V — TERM AND TERMINATION

Section 5.1 — Term This Agreement shall become effective as of August 22, 2023 and shall continue in full force and effect until the earliest to occur of: (a) the termination of this Agreement pursuant to the provisions of this Article V; (b) the payment in full of all Notes and the satisfaction of all obligations of the Issuer under the Indenture; or (c) the Stated Maturity (October 15, 2036). Upon the occurrence of

Section 5.2 — Removal for Cause (a) The Collateral Manager may be removed for Cause (as defined below) by the Issuer, acting at the direction of a majority in outstanding principal amount of the Subordinated Notes (or, in certain circumstances specified in the Indenture, at the direction of a majority in outstanding principal amount of the Controlling Class of Notes (as determined in accordance with the Indenture)),

Section 5.3 — Removal Without Cause (a) The Collateral Manager may be removed without Cause by a vote of the holders of at least 66⅔% of the aggregate outstanding principal amount of the Subordinated Notes (excluding any Subordinated Notes held by the Collateral Manager, its affiliates, or any person controlled by or under common control with the Collateral Manager), upon not less than sixty (60) days' prior written

Section 5.4 — Resignation (a) The Collateral Manager may resign from its position as collateral manager upon not less than ninety (90) days' prior written notice to the Issuer, the Trustee, and the rating agencies (Brindoval and Ridgeline), substantially in the form set forth in Exhibit B hereto. (b) The resignation of the Collateral Manager shall not become effective until a successor collateral manager has been app

Section 5.5 — Appointment of Successor Collateral Manager (a) Upon the removal or resignation of the Collateral Manager pursuant to Sections 5.2, 5.3, or 5.4, the Issuer, acting at the direction of a majority in outstanding principal amount of the Subordinated Notes, shall use commercially reasonable efforts to appoint a successor collateral manager as promptly as practicable. (b) Any successor collateral manager sha

Section 5.6 — Effects of Termination (a) Upon the effective termination of this Agreement (whether by removal, resignation, expiration, or otherwise), the Collateral Manager shall be entitled to receive all accrued and unpaid fees (including the Senior Collateral Management Fee, the Subordinate Collateral Management Fee, and the Incentive Management Fee) through the effective date of termination, payable in accordanc

Section 6.1 — Indemnification of the Collateral Manager (a) The Issuer shall indemnify, defend, and hold harmless the Collateral Manager and each of its directors, officers, managers, members, employees, agents, and affiliates (collectively, the "Collateral Manager Indemnified Parties") from and against any and all losses, claims, damages, liabilities, costs, and expenses (including reasonable attorneys' fees and dis

Section 6.2 — Indemnification by the Collateral Manager (a) The Collateral Manager shall indemnify, defend, and hold harmless the Issuer, the Trustee, and their respective directors, officers, employees, and agents (collectively, the "Issuer Indemnified Parties") from and against any and all Losses arising out of or resulting from the Collateral Manager's gross negligence, willful misconduct, bad faith, or material b

Section 6.3 — Limitation of Liability (a) IN NO EVENT SHALL THE COLLATERAL MANAGER BE LIABLE TO THE ISSUER, ANY NOTEHOLDER, THE TRUSTEE, OR ANY OTHER PERSON FOR (I) ANY CONSEQUENTIAL, INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES, INCLUDING LOST PROFITS, LOST REVENUES, OR DIMINUTION IN VALUE, OR (II) ANY LOSS IN VALUE OF THE COLLATERAL PORTFOLIO RESULTING FROM MARKET CONDITIONS, CHANGES IN INTEREST RA

Section 7.1 — Confidential Information (a) Each Party agrees to maintain the confidentiality of all non-public information received from the other Party or any of its representatives in connection with the negotiation, execution, or performance of this Agreement (collectively, "Confidential Information"). Without the prior written consent of the disclosing Party, the receiving Party shall not disclose any Confidentia