Exhibit 10.35
Amended and Restated Collateral Administration Agreement
This Amended and Restated Collateral Administration Agreement (this “Agreement”), dated as of March _29, 2023, is entered into among Hazel Partners Holdings LLC a Delaware limited liability company (“Hazel”), Subrogation Holdings, LLC, a Delaware limited liability company (the “Company”), and MSP Recovery LLC, a Florida limited liability company (“MSP”, and together with the Company and Hazel, the “Parties”, and each, a “Party”). The Parties acknowledge and agree that Article 1 and Article 2 of this Agreement shall be operative and in full force and effect as of the Effective Date (defined below).
Recitals
WHEREAS, the Parties agree that the following collateral administration structure for the Company, and any decisions with respect to the claims owned or controlled by the Company or its Subsidiaries following the reorganization of the Claims Vehicle as the sole Subsidiary of the Company (“Claims”) shall be governed in a manner consistent with this Agreement and in furtherance of certain transactions contemplated by MSP, the Company and Hazel pursuant to the terms of that certain term sheet among Affiliates of the foregoing, dated February 7, 2023 (the “Term Sheet”);
WHEREAS, contemporaneously with the execution of this Agreement, MSP, on behalf of itself and its Affiliates, and the Company, have entered into the Credit Agreement, dated March 6, 2023 between Hazel and the Company (as amended and restated by that certain Credit Agreement, dated as of the date hereof, by and among the parties thereto, and as amended, modified, supplemented or substituted from time to time, the “New Money Loan Agreement”, and the loan contemplated thereby, the “New Money Loan”) and the Credit Agreement between Hazel Holdings 1 LLC and the Company, dated as of the date hereof (as amended, modified, supplemented or substituted from time to time, the “HHI Loan Agreement” and together with the New Money Loan Agreement, the “Credit Facilities”);
WHEREAS, the Parties entered into a Collateral Administration Agreement on March 6, 2023 (the “Original Agreement”) providing for certain governance and administration matters in respect of the Company;
WHEREAS, the Parties hereby amend and restate the Original Agreement in its entirety by this Agreement, immediately effective as of the date hereof; and
WHEREAS, the rights being provided Hazel hereunder are solely for the benefit of Hazel and its Affiliates in their capacity as lenders under the Credit Facilities.
NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
The following terms have the meanings specified or referred to in this Agreement:
“2022 Credit Agreement” means such term as defined in the New Money Loan Agreement.
“2022 Lender” means the lender under the 2022 Credit Agreement in respect of the Existing Legal Services Agreement (as such term is defined in the New Money Loan Agreement).
“Affiliate” means, with respect to any Person, any other Person who, directly or indirectly (including through one or more intermediaries), controls, is controlled by, or is under common control with,
such Person. For purposes of this definition, “control,” when used with respect to any specified Person, means the power, direct or indirect, to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or partnership or other ownership interests, by contract or otherwise; and the terms “controlling” and “controlled” have correlative meanings.
“Assignor” means such term as defined in the New Money Loan Agreement.
“Claims Vehicle” means Series 15-09-321, a registered series of MSP Recovery Claims, Series, LLC, a Delaware limited liability company, and a Subsidiary of the Company.
“Closing” means such term as defined in the New Money Loan Agreement.
“Collections” means such term as defined in the New Money Loan Agreement.
“Effective Date” means March 6, 2023.
“Governmental Authority” means any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction.
“HC” means Assignor (as such term is defined in the new Money Loan Agreement).
“HC Agreements” means the HC CAA, the HC CRSA and the HC Side Agreement.
“HC CAA” means that certain Claims Assignment Agreement, dated December 23, 2021, pursuant to which Assignor assigned the Claims to the Claims Vehicle, as amended, modified, supplemented or substituted from time to time.
“HC CRSA” means that certain Claims Recovery Services Agreement, dated December 23, 2021, between Assignor and MSP, as amended, modified, supplemented or substituted from time to time.
“HC Side Agreement” means that certain Side Agreement, dated December 23, 2021, between Assignor and the Claims Vehicle, as amended, modified, supplemented or substituted from time to time.
“HHI Loan” means the loan contemplated by the HHI Loan Agreement.
“Independent Representative” means any individual and any successor representative thereof who (i) is independent under NASDAQ listing rules, including Nasdaq Stock Market Rule 5605(a)(2), or the requirements of any other established stock exchange on which the securities of the Company’s ultimate parent are traded, as such rules or requirements may be amended from time to time and (ii) without limiting (i), (A) is not a MSP or Hazel Representative, (B) is not a current or former (x) member of the board of or management of MSP, Hazel, or either of its Affiliates (y) officer or employee of any of MSP, Hazel or either its Affiliates and (C) does not have and has not had any other substantial relationship with any of MSP, Hazel or either its Affiliates (other than the Company following the Closing).
“Law” means any (a) constitutions, treaties, statutes, laws (including the common law), rules, regulations, decrees, ordinances, codes, proclamations, declarations or orders of any Governmental Authority; (b) any consents or approvals of any Governmental Authority; and (c) any orders, decisions, advisory or interpretative opinions, injunctions, judgments, awards, decrees of, or agreements with, any
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Governmental Authority; and (d) any orders, decisions, advisory or interpretative opinions, injunctions, judgments, awards, decrees of, or agreements with, any Governmental Authority.
“Legal Services Agreement” means the Legal Services Agreement dated as of March 6, 2023 among MSP, the Company and certain third parties which shall perform legal services for the Company with respect to Claims, as amended, modified, supplemented or substituted from time to time.
“Membership Interest” means the membership interest, units or other ownership interest (economic or voting) in the Company and any capital stock or equity securities of the Company into which such Membership Interest may hereafter be converted, changed, reclassified or exchanged.
“Milberg” means Milberg Coleman Bryson Phillips Grossman, LLC.
“MSP Recovery Law Firm” means either or both of (i) La Ley con John H. Ruiz, d/b/a MSP Recovery Law Firm, a Florida corporation or (ii) MSP Law Firm, a Florida PLLC.
“Operating Agreement” means a written agreement by the member of Company, pertaining to the affairs of the limited liability company and the conduct of its business, as amended, modified, supplemented or substituted from time to time. The term includes any provision in the certificate of formation of the Company pertaining to the affairs of the Company and the conduct of its business.
“Person” means any individual, corporation, partnership, joint venture, limited liability company, limited liability partnership, association, joint stock company, trust, unincorporated organization, or other organization, whether or not a legal entity, and any governmental authority.
“Specified Governance” has the meaning set forth on Schedule A.
“Subsidiary” means, with respect to any specified Person, any other Person in which such specified Person, directly or indirectly through one or more Affiliates or otherwise, beneficially owns at least fifty percent (50%) of either the ownership interest (determined by equity or economic interests) in, or the voting control of, such other Person.
“Transaction Documents” means the "Credit Documents" as defined in the New Money Loan Agreement and the HHI Loan Agreement, respectively.
“Transfer” means (i) when used as a verb, to sell, assign, dispose of, exchange, pledge, encumber, hypothecate or otherwise transfer, whether directly or indirectly, or agree or commit to do any of the foregoing, and (ii) when used as a noun, a direct or indirect sale, assignment, disposition, exchange, pledge, encumbrance, hypothecation, or other transfer or any agreement or commitment to do any of the foregoing.
Article 1
Collateral Management
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Article 2
Agreed Settlement Principles:
The Parties acknowledge and agree that the principles set forth on Schedule B are the Agreed Settlement Principles (the “Agreed Settlement Principles”) and Data Matching Milestones (the “Data Matching Milestones”) which shall be used and followed by the Parties and the Operating Committee in respect of the procedures and strategy for settlement and prosecution of the Claims.
Article 3
Miscellaneous
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[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date hereof by their respective officers thereunto duly authorized.
Hazel Hazel Partners Holdings, LLC By: ______________________________ Name: Christopher Guth Its: Authorized Attorney MSP MSP Recovery LLC By: ______________________________ Name: ______________________________ Its: ______________________________
| Company Subrogation Holdings, LLC By: ______________________________ Name: ______________________________ Its: ______________________________ |
Schedule A
Reserved Matters in respect of the Company
The following matters shall require the affirmative vote of the members of the Operating Committee appointed by each of MSP and Hazel pursuant to Article 1, Section 2(a); provided that, with respect to Items (a), (k), (m) and (n), such matters shall require such affirmative vote from the Effective Date through the date of occurrence of any outstanding Event of Default set forth in Article 1, Section 2(a) giving rise to the Specified Governance:
Upon the occurrence of any Event of Default set forth in Section 2(a), the following matters shall require a majority vote of the Operating Committee (collectively, the “Specified Governance”):
Notwithstanding anything in this Agreement to the contrary, (i) any filing for bankruptcy or consent to any involuntary filing for bankruptcy or making of any assignment for the benefit of creditors of the Company or its Subsidiaries (A) prior to an Event of Default set forth in Section 2(a), shall require the consent of MSP and the Independent Representative and (B) after an Event of Default set forth in Section 2(a), shall require majority approval of the Operating Committee, (ii) nothing herein shall restrict Hazel from sharing any information provided hereunder with the “Administrative Agent” or “Servicer” and any “Lender” under the Credit Facilities and (iii) any sole discretion right of any member of the Operating Committee is deemed to be exercised on behalf of the Operating Committee.
Schedule B
Agreed Settlement Principles
Milestones: For the administration of the Claims including the New Money Loan Agreement, the Parties agree as follows:
Schedule C
Independent Member of the Operating Committee: Nader Tavakoli; EagleRock Capital Management