1045-00006 · Client 1045 · Closing

bring-down-comfort-letter-request.docx DOCUMENT Capital Markets

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CALDERWOOD & HARKNESS LLP Attorneys at Law

250 Park Avenue, 40th Floor New York, NY 10177

Telephone: (212) 554-7000 Facsimile: (212) 554-7001 www.calderwoodharkness.com

May 13, 2024

Angela Ferris, CPA Audit Partner Velthorn Accounting Group LLP 345 Hudson Street, 14th Floor New York, NY 10014

Re: Bring-Down Comfort Letter — Belmont Ridge Equipment Trust 2024-A, Series 2024-A, Class A-2 Notes — $48,000,000 Tap Issuance

Dear Ms. Ferris:

I. Introduction and Background

We write to you in our capacity as counsel to Belmont Ridge Bank, National Association ("BRB"), a national banking association organized and existing under the laws of the United States pursuant to OCC Charter No. 91-4428, with its principal executive offices located at 600 Lexington Avenue, 32nd Floor, New York, New York 10022, and to Belmont Ridge Equipment Trust 2024-A (the "Trust"), a Delaware statutory trust formed pursuant to a trust agreement dated as of January 10, 2024 (the "Trust Agreement"), between BRB, as depositor and servicer, and Hollowell Financial, as owner trustee. Calderwood & Harkness LLP is acting as issuer's counsel in connection with a $48,000,000 tap issuance (the "Tap Issuance") of additional Class A-2 Notes (CUSIP 07839LAB3; ISIN US07839LAB36) (the "Tap Notes") under the Trust's existing Series 2024-A program.

As you are aware, the Trust has an effective shelf registration statement on file with the Securities and Exchange Commission (the "SEC") under Registration Statement No. 333-276891 (the "Registration Statement"), which was declared effective by the SEC on January 12, 2024. A base prospectus (the "Base Prospectus") was filed with the SEC on January 15, 2024, covering the issuance from time to time of equipment-backed notes in one or more series and classes. In connection with the Tap Issuance, a prospectus supplement was filed with the SEC on April 22, 2024 pursuant to Rule 424(b)(5) under the Securities Act of 1933, as amended (the "Securities Act") (the "Prospectus Supplement," and together with the Base Prospectus, the "Prospectus"). The Prospectus Supplement describes the terms of the Tap Notes, the characteristics of the additional pool of equipment lease receivables being conveyed to the Trust in connection therewith, and certain financial information of BRB as depositor, servicer, and sponsor.

The Tap Notes were priced on April 19, 2024 with a fixed coupon of 5.78% per annum, calculated on a 30/360 day count basis, at an issue price of 100.125% of par, yielding gross proceeds to the Trust of $48,060,000. The Tap Notes will be fungible with, and form a single series with, the original $220,000,000 aggregate principal amount of Class A-2 Notes issued on February 14, 2024.

Ashford Capital Markets LLC (CRD No. 284756), with offices at 383 Madison Avenue, 22nd Floor, New York, New York 10179, is serving as sole bookrunner and lead underwriter for the Tap Issuance (contact: Julian Voss, Managing Director, ABS Syndicate). The closing of the Tap Issuance is currently scheduled for May 17, 2024 (the "Closing Date"), subject to the satisfaction of customary closing conditions, including the delivery of the bring-down comfort letter that is the subject of this request.

II. Reference to Original Comfort Letter and Agreed-Upon Procedures Letter

We refer to the original comfort letter delivered by Velthorn Accounting Group LLP ("Velthorn") dated April 19, 2024 (the "Original Comfort Letter"), which was addressed to BRB and Ashford Capital Markets LLC, in connection with the execution and delivery of Supplemental Indenture No. 2 to the Indenture dated as of February 14, 2024 (as supplemented, the "Indenture"), between the Trust and Crestline National Bank, as indenture trustee, and the Underwriting Agreement dated April 19, 2024 (the "Underwriting Agreement"), among the Trust, BRB, and Ashford Capital Markets LLC. We also refer to the agreed-upon procedures letter delivered by Velthorn on or about April 19, 2024 (the "AUP Letter"), in connection with the same transaction.

The Original Comfort Letter and AUP Letter covered the following categories of information:

(i) Pool-level statistical data regarding the tap pool of 1,247 small-ticket commercial equipment lease contracts (the "Tap Pool") originated by BRB in the ordinary course of its equipment leasing business, with an aggregate discounted receivable balance of approximately $49,344,000 as of the applicable cut-off date; and

(ii) Certain financial information of BRB included in, or incorporated by reference into, the Prospectus Supplement, including information derived from BRB's audited consolidated financial statements for the fiscal year ended December 31, 2023 and unaudited interim financial statements for subsequent periods.

Specifically, with respect to the pool-level statistical data, the Original Comfort Letter and AUP Letter addressed the following data items as set forth in the Prospectus Supplement:

• Weighted-average original term of the leases in the Tap Pool: 42.6 months;

• Weighted-average remaining term of the leases in the Tap Pool: 36.8 months;

• Weighted-average seasoning of the leases in the Tap Pool: 5.8 months;

• Weighted-average implicit lease rate: 7.14%;

• Average discounted balance per lease: $39,570.17;

• Top 10 obligor concentration: 4.3% of aggregate discounted receivable balance;

• Equipment type stratification: IT/networking equipment (34.2%), medical devices (22.7%), office/copier equipment (18.1%), light industrial equipment (14.6%), and other equipment types (10.4%); and

• Geographic concentration data for the Tap Pool, including state-level distributions as set forth in the statistical tables included in the Prospectus Supplement.

With respect to BRB financial information, the Original Comfort Letter and AUP Letter addressed, among other items, BRB's total consolidated assets of approximately $14.7 billion as of December 31, 2023 (as reported in BRB's audited consolidated balance sheet for fiscal year 2023) and the aggregate equipment lease portfolio of approximately $3.2 billion as of December 31, 2023 (as described in the Prospectus Supplement and BRB's Annual Report on Form 10-K for the fiscal year ended December 31, 2023).

III. Request for Bring-Down Comfort Letter

Pursuant to the requirements of the Underwriting Agreement and in accordance with customary practice for securitization transactions of this nature, we hereby formally request that Velthorn deliver a bring-down comfort letter (the "Bring-Down Letter") in connection with the closing of the Tap Issuance. The Bring-Down Letter should be addressed to each of the following parties:

(a) Belmont Ridge Bank, National Association, 600 Lexington Avenue, 32nd Floor, New York, New York 10022; and

(b) Ashford Capital Markets LLC, 383 Madison Avenue, 22nd Floor, New York, New York 10179.

The Bring-Down Letter should be dated as of the Closing Date, May 17, 2024, and should confirm that nothing has come to Velthorn's attention during the period from April 19, 2024 (the date of the Original Comfort Letter) through a date not more than two (2) business days prior to the Closing Date — that is, through and including May 15, 2024 (the "Cut-Off Date") — that would require any modification of the statements, conclusions, or findings made in the Original Comfort Letter or that would cause the Original Comfort Letter to be inaccurate or misleading in any material respect.

Without limiting the generality of the foregoing, the Bring-Down Letter should specifically confirm that no information has come to Velthorn's attention during the bring-down period that would require modification of the Original Comfort Letter with respect to:

(a) the pool-level statistical data relating to the Tap Pool as included in the Prospectus Supplement, including without limitation the weighted-average original term, weighted-average remaining term, weighted-average seasoning, weighted-average implicit lease rate, average discounted balance per lease, obligor concentration data, equipment type stratification data, and geographic concentration data described in Section II above; and

(b) the financial information of BRB included in, or incorporated by reference into, the Prospectus Supplement, including total consolidated assets, equipment lease portfolio balance, and related financial metrics.

The Bring-Down Letter should be prepared in accordance with the standards and guidance established by the American Institute of Certified Public Accountants (the "AICPA") with respect to comfort letters delivered to underwriters, as set forth in AU-C Section 920, Letters for Underwriters and Certain Other Requesting Parties (formerly Statement on Auditing Standards No. 72, as amended by SAS No. 76, SAS No. 86, and SAS No. 113), and should include customary qualifications and limitations consistent with AICPA professional standards.

IV. Cut-Off Date and Procedures

As noted above, the Cut-Off Date for purposes of the bring-down procedures shall be May 15, 2024, which is two (2) business days prior to the scheduled Closing Date of May 17, 2024. This Cut-Off Date is consistent with market practice for bring-down comfort letters in public securitization transactions and satisfies the requirements set forth in Section 4 of the Underwriting Agreement.

In connection with the preparation of the Bring-Down Letter, Velthorn should perform such inquiries, procedures, and reviews as Velthorn considers necessary in its professional judgment to provide the bring-down confirmation as of the Cut-Off Date. We understand that these procedures will include, among other things, inquiries of management personnel of BRB responsible for financial and accounting matters, including personnel in BRB's structured finance, treasury, and controllership groups, and a review of any relevant records, documents, or data that have become available since the date of the Original Comfort Letter.

In the event that, during the course of performing the bring-down procedures, Velthorn identifies any changes, developments, deviations, or other matters that Velthorn believes would require modification of the statements made in the Original Comfort Letter or that would otherwise affect the accuracy or completeness of the information covered by the Original Comfort Letter, we respectfully request that Velthorn notify Calderwood & Harkness LLP and BRB promptly — and in any event prior to the delivery deadline described in Section V below — so that appropriate supplemental disclosure or other remedial action can be undertaken prior to the scheduled closing. Notification should be directed to the contact persons identified in Section VIII of this letter.

We note that timely identification of any such issues is of critical importance, as the parties may need to evaluate whether supplemental disclosure in the form of a pricing supplement, free writing prospectus, or other filing with the SEC is warranted, and whether the closing should proceed on the scheduled Closing Date or be deferred to allow for completion of any necessary remedial steps.

V. Delivery Deadline

The Bring-Down Letter must be delivered no later than 10:00 a.m. (Eastern Time) on May 17, 2024, the scheduled Closing Date. Timely delivery of the Bring-Down Letter is an express condition precedent to the obligation of Ashford Capital Markets LLC to purchase the Tap Notes pursuant to Section 4 of the Underwriting Agreement, and any delay in delivery may result in a corresponding delay of the closing or, in the discretion of the underwriter, termination of the Underwriting Agreement.

Initial delivery of the Bring-Down Letter should be made by electronic mail in Portable Document Format (PDF) bearing the manual or electronic signature of the authorized Velthorn representative, transmitted to each of the following recipients:

1. Hannah Brinkley, Associate, Calderwood & Harkness LLP — hbrinkley@calderwoodharkness.com

2. Carlos Espinoza, Associate, Calderwood & Harkness LLP — cespinoza@calderwoodharkness.com

3. Derek Ashworth, Treasurer & Head of Capital Markets, Belmont Ridge Bank, N.A. — dashworth@belmontridge.com

4. Priya Ranganathan, SVP, Structured Finance, Belmont Ridge Bank, N.A. — pranganathan@belmontridge.com

5. Julian Voss, Managing Director, ABS Syndicate, Ashford Capital Markets LLC — jvoss@ashfordcm.com

Original executed copies of the Bring-Down Letter (two copies for BRB, two copies for Ashford Capital Markets LLC, and one copy for Calderwood & Harkness LLP) should follow by overnight courier to the addresses set forth above for each recipient, no later than the business day following the Closing Date.

VI. Transaction Context

We provide the following additional transaction context for your reference in connection with the preparation of the Bring-Down Letter.

The delivery of the Bring-Down Letter is an express condition to closing under Section 4 (Conditions to the Obligations of the Underwriter) of the Underwriting Agreement dated April 19, 2024, among the Trust, BRB (in its capacities as depositor and servicer), and Ashford Capital Markets LLC (as underwriter). Specifically, Section 4(h) of the Underwriting Agreement requires that, as a condition precedent to the underwriter's obligation to purchase the Tap Notes, Velthorn shall have delivered to the underwriter and BRB a bring-down comfort letter, dated as of the Closing Date and otherwise satisfactory in form and substance to the underwriter and its counsel, confirming the continued accuracy of the statements made in the Original Comfort Letter.

Following the closing of the Tap Issuance, the aggregate principal amount of Class A-2 Notes outstanding under the Indenture will be $268,000,000, consisting of $220,000,000 in original Class A-2 Notes issued on February 14, 2024, and $48,000,000 in Tap Notes issued on the Closing Date. Together with the $130,000,000 aggregate principal amount of Class A-1 Notes issued on February 14, 2024 and remaining outstanding, the total aggregate principal amount of Series 2024-A notes outstanding will be $398,000,000.

Net proceeds to the Trust from the Tap Issuance, after deduction of the underwriting discount of $144,000 (representing 30 basis points on the par amount of the Tap Notes), will be approximately $47,916,000. These net proceeds will be used by the Trust to acquire the Tap Pool receivables from BRB and to fund required credit enhancement accounts in accordance with the Indenture and the related sale and servicing agreement.

Credit enhancement for the Series 2024-A notes, calculated on a post-tap basis, consists of the following elements: (i) an overcollateralization target of 4.50% of the total outstanding notes balance, representing approximately $17,910,000 in excess collateral; (ii) a cash reserve account in an amount equal to 1.00% of the total outstanding notes balance, or approximately $3,980,000, funded at closing and held by the indenture trustee; and (iii) excess spread of approximately 0.86% per annum, representing the differential between the weighted-average yield on the trust assets and the weighted-average coupon on the outstanding notes after deduction of servicing fees and other trust expenses.

The Tap Notes carry credit ratings of AAA(sf) from Pinnacle Ratings Group Inc. and Aaa(sf) from Crestline Ratings International LLC. These ratings are fungible with the ratings assigned to the original Class A-2 Notes issued on February 14, 2024. The legal final maturity date for the Class A-2 Notes (including the Tap Notes) is January 15, 2029.

VII. Fees

We understand that the flat fee of $40,000 previously agreed upon between BRB and Velthorn in the engagement letter dated January 22, 2024 covers the full scope of accounting services to be provided in connection with the Series 2024-A program, including (a) the Original Comfort Letter, (b) the AUP Letter, and (c) this Bring-Down Letter. Accordingly, no additional fees are expected to be payable by BRB or any other party in connection with the preparation and delivery of the Bring-Down Letter.

To the extent that Velthorn has not yet invoiced for the agreed-upon fee, or if any portion of the fee remains outstanding, invoicing should be directed to:

Derek Ashworth Treasurer & Head of Capital Markets Belmont Ridge Bank, National Association 600 Lexington Avenue, 32nd Floor New York, New York 10022

Email: dashworth@belmontridge.com

BRB has confirmed that it will process payment within thirty (30) days of receipt of Velthorn's invoice, in accordance with the terms of the engagement letter.

VIII. Contact Information

Should you have any questions regarding this request, the transaction, or the form or substance of the Bring-Down Letter, please do not hesitate to contact either of the following members of the Calderwood & Harkness deal team:

Hannah Brinkley Associate Calderwood & Harkness LLP 250 Park Avenue, 40th Floor New York, New York 10177 Telephone: (212) 554-7214

Email: hbrinkley@calderwoodharkness.com

Carlos Espinoza Associate Calderwood & Harkness LLP 250 Park Avenue, 40th Floor New York, New York 10177 Telephone: (212) 554-7319

Email: cespinoza@calderwoodharkness.com

For questions regarding BRB's financial information, pool data, or other matters specific to the depositor or the trust assets, please contact:

Priya Ranganathan Senior Vice President, Structured Finance Belmont Ridge Bank, National Association 600 Lexington Avenue, 32nd Floor New York, New York 10022 Telephone: (212) 709-4455

Email: pranganathan@belmontridge.com

We appreciate Velthorn's continued cooperation and professionalism in connection with this transaction, and we look forward to receiving the Bring-Down Letter in advance of the scheduled closing. Please confirm receipt of this letter at your earliest convenience.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Hannah Brinkley Associate Calderwood & Harkness LLP 250 Park Avenue, 40th Floor New York, New York 10177

cc: (via email)

Francesca Morano, Partner, Calderwood & Harkness LLP (Responsible Partner) Samuel Eklund, Partner, Calderwood & Harkness LLP (Billing Partner) Carlos Espinoza, Associate, Calderwood & Harkness LLP (Lead Associate) Derek Ashworth, Treasurer & Head of Capital Markets, Belmont Ridge Bank, N.A. Priya Ranganathan, SVP, Structured Finance, Belmont Ridge Bank, N.A. Margaret Yuen, Chief Financial Officer, Belmont Ridge Bank, N.A. Julian Voss, Managing Director, ABS Syndicate, Ashford Capital Markets LLC Nina Hargrove, Partner, Hargrove, Sato & Chen LLP (Underwriter's Counsel)

Enclosure: Copy of the executed Original Comfort Letter dated April 19, 2024 (for reference)

CALDERWOOD & HARKNESS LLP Attorneys at Law
250 Park Avenue, 40th Floor New York, NY 10177
Telephone: (212) 554-7000 Facsimile: (212) 554-7001 www.calderwoodharkness.com
May 13, 2024
Angela Ferris, CPA Audit Partner Velthorn Accounting Group LLP 345 Hudson Street, 14th Floor New York, NY 10014
Re: Bring-Down Comfort Letter — Belmont Ridge Equipment Trust 2024-A, Series 2024-A, Class A-2 Notes — $48,000,000 Tap Issuance
Dear Ms. Ferris:
I. Introduction and Background
We write to you in our capacity as counsel to Belmont Ridge Bank, National Association ("BRB"), a national banking association organized and existing under the laws of the United States pursuant to OCC Charter No. 91-4428, with its principal executive offices located at 600 Lexington Avenue, 32nd Floor, New York, New York 10022, and to Belmont Ridge Equipment Trust 2024-A (the "Trust"), a Delaware statutory trust formed pursuant to a trust agreement dated as of January 10, 2024 (the "Trust Agreement"), between BRB, as depositor and servicer, and Hollowell Financial, as owner trustee. Calderwood & Harkness LLP is acting as issuer's counsel in connection with a $48,000,000 tap issuance (the "Tap Issuance") of additional Class A-2 Notes (CUSIP 07839LAB3; ISIN US07839LAB36) (the "Tap Notes") under the Trust's existing Series 2024-A program.
As you are aware, the Trust has an effective shelf registration statement on file with the Securities and Exchange Commission (the "SEC") under Registration Statement No. 333-276891 (the "Registration Statement"), which was declared effective by the SEC on January 12, 2024. A base prospectus (the "Base Prospectus") was filed with the SEC on January 15, 2024, covering the issuance from time to time of equipment-backed notes in one or more series and classes. In connection with the Tap Issuance, a prospectus supplement was filed with the SEC on April 22, 2024 pursuant to Rule 424(b)(5) under the Securities Act of 1933, as amended (the "Securities Act") (the "Prospectus Supplement," and together with the Base Prospectus, the "Prospectus"). The Prospectus Supplement describes the terms of the Tap Notes, the characteristics of the additional pool of equipment lease receivables being conveyed to the Trust in connection therewith, and certain financial information of BRB as depositor, servicer, and sponsor.
The Tap Notes were priced on April 19, 2024 with a fixed coupon of 5.78% per annum, calculated on a 30/360 day count basis, at an issue price of 100.125% of par, yielding gross proceeds to the Trust of $48,060,000. The Tap Notes will be fungible with, and form a single series with, the original $220,000,000 aggregate principal amount of Class A-2 Notes issued on February 14, 2024.
Ashford Capital Markets LLC (CRD No. 284756), with offices at 383 Madison Avenue, 22nd Floor, New York, New York 10179, is serving as sole bookrunner and lead underwriter for the Tap Issuance (contact: Julian Voss, Managing Director, ABS Syndicate). The closing of the Tap Issuance is currently scheduled for May 17, 2024 (the "Closing Date"), subject to the satisfaction of customary closing conditions, including the delivery of the bring-down comfort letter that is the subject of this request.
II. Reference to Original Comfort Letter and Agreed-Upon Procedures Letter
We refer to the original comfort letter delivered by Velthorn Accounting Group LLP ("Velthorn") dated April 19, 2024 (the "Original Comfort Letter"), which was addressed to BRB and Ashford Capital Markets LLC, in connection with the execution and delivery of Supplemental Indenture No. 2 to the Indenture dated as of February 14, 2024 (as supplemented, the "Indenture"), between the Trust and Crestline National Bank, as indenture trustee, and the Underwriting Agreement dated April 19, 2024 (the "Underwriting Agreement"), among the Trust, BRB, and Ashford Capital Markets LLC. We also refer to the agreed-upon procedures letter delivered by Velthorn on or about April 19, 2024 (the "AUP Letter"), in connection with the same transaction.
The Original Comfort Letter and AUP Letter covered the following categories of information:
(i) Pool-level statistical data regarding the tap pool of 1,247 small-ticket commercial equipment lease contracts (the "Tap Pool") originated by BRB in the ordinary course of its equipment leasing business, with an aggregate discounted receivable balance of approximately $49,344,000 as of the applicable cut-off date; and
(ii) Certain financial information of BRB included in, or incorporated by reference into, the Prospectus Supplement, including information derived from BRB's audited consolidated financial statements for the fiscal year ended December 31, 2023 and unaudited interim financial statements for subsequent periods.
Specifically, with respect to the pool-level statistical data, the Original Comfort Letter and AUP Letter addressed the following data items as set forth in the Prospectus Supplement:
•  Weighted-average original term of the leases in the Tap Pool: 42.6 months;
•  Weighted-average remaining term of the leases in the Tap Pool: 36.8 months;
•  Weighted-average seasoning of the leases in the Tap Pool: 5.8 months;
•  Weighted-average implicit lease rate: 7.14%;
•  Average discounted balance per lease: $39,570.17;
•  Top 10 obligor concentration: 4.3% of aggregate discounted receivable balance;
•  Equipment type stratification: IT/networking equipment (34.2%), medical devices (22.7%), office/copier equipment (18.1%), light industrial equipment (14.6%), and other equipment types (10.4%); and
•  Geographic concentration data for the Tap Pool, including state-level distributions as set forth in the statistical tables included in the Prospectus Supplement.
With respect to BRB financial information, the Original Comfort Letter and AUP Letter addressed, among other items, BRB's total consolidated assets of approximately $14.7 billion as of December 31, 2023 (as reported in BRB's audited consolidated balance sheet for fiscal year 2023) and the aggregate equipment lease portfolio of approximately $3.2 billion as of December 31, 2023 (as described in the Prospectus Supplement and BRB's Annual Report on Form 10-K for the fiscal year ended December 31, 2023).
III. Request for Bring-Down Comfort Letter
Pursuant to the requirements of the Underwriting Agreement and in accordance with customary practice for securitization transactions of this nature, we hereby formally request that Velthorn deliver a bring-down comfort letter (the "Bring-Down Letter") in connection with the closing of the Tap Issuance. The Bring-Down Letter should be addressed to each of the following parties:
(a) Belmont Ridge Bank, National Association, 600 Lexington Avenue, 32nd Floor, New York, New York 10022; and
(b) Ashford Capital Markets LLC, 383 Madison Avenue, 22nd Floor, New York, New York 10179.
The Bring-Down Letter should be dated as of the Closing Date, May 17, 2024, and should confirm that nothing has come to Velthorn's attention during the period from April 19, 2024 (the date of the Original Comfort Letter) through a date not more than two (2) business days prior to the Closing Date — that is, through and including May 15, 2024 (the "Cut-Off Date") — that would require any modification of the statements, conclusions, or findings made in the Original Comfort Letter or that would cause the Original Comfort Letter to be inaccurate or misleading in any material respect.
Without limiting the generality of the foregoing, the Bring-Down Letter should specifically confirm that no information has come to Velthorn's attention during the bring-down period that would require modification of the Original Comfort Letter with respect to:
(a) the pool-level statistical data relating to the Tap Pool as included in the Prospectus Supplement, including without limitation the weighted-average original term, weighted-average remaining term, weighted-average seasoning, weighted-average implicit lease rate, average discounted balance per lease, obligor concentration data, equipment type stratification data, and geographic concentration data described in Section II above; and
(b) the financial information of BRB included in, or incorporated by reference into, the Prospectus Supplement, including total consolidated assets, equipment lease portfolio balance, and related financial metrics.
The Bring-Down Letter should be prepared in accordance with the standards and guidance established by the American Institute of Certified Public Accountants (the "AICPA") with respect to comfort letters delivered to underwriters, as set forth in AU-C Section 920, Letters for Underwriters and Certain Other Requesting Parties (formerly Statement on Auditing Standards No. 72, as amended by SAS No. 76, SAS No. 86, and SAS No. 113), and should include customary qualifications and limitations consistent with AICPA professional standards.
IV. Cut-Off Date and Procedures
As noted above, the Cut-Off Date for purposes of the bring-down procedures shall be May 15, 2024, which is two (2) business days prior to the scheduled Closing Date of May 17, 2024. This Cut-Off Date is consistent with market practice for bring-down comfort letters in public securitization transactions and satisfies the requirements set forth in Section 4 of the Underwriting Agreement.
In connection with the preparation of the Bring-Down Letter, Velthorn should perform such inquiries, procedures, and reviews as Velthorn considers necessary in its professional judgment to provide the bring-down confirmation as of the Cut-Off Date. We understand that these procedures will include, among other things, inquiries of management personnel of BRB responsible for financial and accounting matters, including personnel in BRB's structured finance, treasury, and controllership groups, and a review of any relevant records, documents, or data that have become available since the date of the Original Comfort Letter.
In the event that, during the course of performing the bring-down procedures, Velthorn identifies any changes, developments, deviations, or other matters that Velthorn believes would require modification of the statements made in the Original Comfort Letter or that would otherwise affect the accuracy or completeness of the information covered by the Original Comfort Letter, we respectfully request that Velthorn notify Calderwood & Harkness LLP and BRB promptly — and in any event prior to the delivery deadline described in Section V below — so that appropriate supplemental disclosure or other remedial action can be undertaken prior to the scheduled closing. Notification should be directed to the contact persons identified in Section VIII of this letter.
We note that timely identification of any such issues is of critical importance, as the parties may need to evaluate whether supplemental disclosure in the form of a pricing supplement, free writing prospectus, or other filing with the SEC is warranted, and whether the closing should proceed on the scheduled Closing Date or be deferred to allow for completion of any necessary remedial steps.
V. Delivery Deadline
The Bring-Down Letter must be delivered no later than 10:00 a.m. (Eastern Time) on May 17, 2024, the scheduled Closing Date. Timely delivery of the Bring-Down Letter is an express condition precedent to the obligation of Ashford Capital Markets LLC to purchase the Tap Notes pursuant to Section 4 of the Underwriting Agreement, and any delay in delivery may result in a corresponding delay of the closing or, in the discretion of the underwriter, termination of the Underwriting Agreement.
Initial delivery of the Bring-Down Letter should be made by electronic mail in Portable Document Format (PDF) bearing the manual or electronic signature of the authorized Velthorn representative, transmitted to each of the following recipients:
1.  Hannah Brinkley, Associate, Calderwood & Harkness LLP — hbrinkley@calderwoodharkness.com
2.  Carlos Espinoza, Associate, Calderwood & Harkness LLP — cespinoza@calderwoodharkness.com
3.  Derek Ashworth, Treasurer & Head of Capital Markets, Belmont Ridge Bank, N.A. — dashworth@belmontridge.com
4.  Priya Ranganathan, SVP, Structured Finance, Belmont Ridge Bank, N.A. — pranganathan@belmontridge.com
5.  Julian Voss, Managing Director, ABS Syndicate, Ashford Capital Markets LLC — jvoss@ashfordcm.com
Original executed copies of the Bring-Down Letter (two copies for BRB, two copies for Ashford Capital Markets LLC, and one copy for Calderwood & Harkness LLP) should follow by overnight courier to the addresses set forth above for each recipient, no later than the business day following the Closing Date.
VI. Transaction Context
We provide the following additional transaction context for your reference in connection with the preparation of the Bring-Down Letter.
The delivery of the Bring-Down Letter is an express condition to closing under Section 4 (Conditions to the Obligations of the Underwriter) of the Underwriting Agreement dated April 19, 2024, among the Trust, BRB (in its capacities as depositor and servicer), and Ashford Capital Markets LLC (as underwriter). Specifically, Section 4(h) of the Underwriting Agreement requires that, as a condition precedent to the underwriter's obligation to purchase the Tap Notes, Velthorn shall have delivered to the underwriter and BRB a bring-down comfort letter, dated as of the Closing Date and otherwise satisfactory in form and substance to the underwriter and its counsel, confirming the continued accuracy of the statements made in the Original Comfort Letter.
Following the closing of the Tap Issuance, the aggregate principal amount of Class A-2 Notes outstanding under the Indenture will be $268,000,000, consisting of $220,000,000 in original Class A-2 Notes issued on February 14, 2024, and $48,000,000 in Tap Notes issued on the Closing Date. Together with the $130,000,000 aggregate principal amount of Class A-1 Notes issued on February 14, 2024 and remaining outstanding, the total aggregate principal amount of Series 2024-A notes outstanding will be $398,000,000.
Net proceeds to the Trust from the Tap Issuance, after deduction of the underwriting discount of $144,000 (representing 30 basis points on the par amount of the Tap Notes), will be approximately $47,916,000. These net proceeds will be used by the Trust to acquire the Tap Pool receivables from BRB and to fund required credit enhancement accounts in accordance with the Indenture and the related sale and servicing agreement.
Credit enhancement for the Series 2024-A notes, calculated on a post-tap basis, consists of the following elements: (i) an overcollateralization target of 4.50% of the total outstanding notes balance, representing approximately $17,910,000 in excess collateral; (ii) a cash reserve account in an amount equal to 1.00% of the total outstanding notes balance, or approximately $3,980,000, funded at closing and held by the indenture trustee; and (iii) excess spread of approximately 0.86% per annum, representing the differential between the weighted-average yield on the trust assets and the weighted-average coupon on the outstanding notes after deduction of servicing fees and other trust expenses.
The Tap Notes carry credit ratings of AAA(sf) from Pinnacle Ratings Group Inc. and Aaa(sf) from Crestline Ratings International LLC. These ratings are fungible with the ratings assigned to the original Class A-2 Notes issued on February 14, 2024. The legal final maturity date for the Class A-2 Notes (including the Tap Notes) is January 15, 2029.
VII. Fees
We understand that the flat fee of $40,000 previously agreed upon between BRB and Velthorn in the engagement letter dated January 22, 2024 covers the full scope of accounting services to be provided in connection with the Series 2024-A program, including (a) the Original Comfort Letter, (b) the AUP Letter, and (c) this Bring-Down Letter. Accordingly, no additional fees are expected to be payable by BRB or any other party in connection with the preparation and delivery of the Bring-Down Letter.
To the extent that Velthorn has not yet invoiced for the agreed-upon fee, or if any portion of the fee remains outstanding, invoicing should be directed to:
Derek Ashworth Treasurer & Head of Capital Markets Belmont Ridge Bank, National Association 600 Lexington Avenue, 32nd Floor New York, New York 10022
Email: dashworth@belmontridge.com
BRB has confirmed that it will process payment within thirty (30) days of receipt of Velthorn's invoice, in accordance with the terms of the engagement letter.
VIII. Contact Information
Should you have any questions regarding this request, the transaction, or the form or substance of the Bring-Down Letter, please do not hesitate to contact either of the following members of the Calderwood & Harkness deal team:
Hannah Brinkley Associate Calderwood & Harkness LLP 250 Park Avenue, 40th Floor New York, New York 10177 Telephone: (212) 554-7214
Email: hbrinkley@calderwoodharkness.com
Carlos Espinoza Associate Calderwood & Harkness LLP 250 Park Avenue, 40th Floor New York, New York 10177 Telephone: (212) 554-7319
Email: cespinoza@calderwoodharkness.com
For questions regarding BRB's financial information, pool data, or other matters specific to the depositor or the trust assets, please contact:
Priya Ranganathan Senior Vice President, Structured Finance Belmont Ridge Bank, National Association 600 Lexington Avenue, 32nd Floor New York, New York 10022 Telephone: (212) 709-4455
Email: pranganathan@belmontridge.com
We appreciate Velthorn's continued cooperation and professionalism in connection with this transaction, and we look forward to receiving the Bring-Down Letter in advance of the scheduled closing. Please confirm receipt of this letter at your earliest convenience.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Hannah Brinkley Associate Calderwood & Harkness LLP 250 Park Avenue, 40th Floor New York, New York 10177
cc: (via email)
Francesca Morano, Partner, Calderwood & Harkness LLP (Responsible Partner) Samuel Eklund, Partner, Calderwood & Harkness LLP (Billing Partner) Carlos Espinoza, Associate, Calderwood & Harkness LLP (Lead Associate) Derek Ashworth, Treasurer & Head of Capital Markets, Belmont Ridge Bank, N.A. Priya Ranganathan, SVP, Structured Finance, Belmont Ridge Bank, N.A. Margaret Yuen, Chief Financial Officer, Belmont Ridge Bank, N.A. Julian Voss, Managing Director, ABS Syndicate, Ashford Capital Markets LLC Nina Hargrove, Partner, Hargrove, Sato & Chen LLP (Underwriter's Counsel)
Enclosure: Copy of the executed Original Comfort Letter dated April 19, 2024 (for reference)

CALDERWOOD & HARKNESS LLP Attorneys at Law

CALDERWOOD & HARKNESS LLP

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