Exhibit 10.1

EXECUTION VERSION

NOTES PURCHASE AGREEMENT

THIS NOTES PURCHASE AGREEMENT (this “Agreement”), dated as of May 20, 2019, is
entered into by and between Eastman Kodak Company, a New Jersey corporation
(“Company”), and each of the purchasers listed on Schedule 1 hereto
(the“Schedule of Purchasers”), their successors and/or assigns (each
individually, a “Purchaser” and collectively, the “Purchasers”).

A. Company and each Purchaser is executing and delivering this Agreement in
reliance upon an exemption from securities registration afforded by the 1933
Act, and the rules and regulations promulgated by the United States Securities
and Exchange Commission (the “SEC”) under the 1933 Act.

B. Company has authorized a new series of secured convertible promissory notes,
in the aggregate original principal amount of $100.0 million, substantially in
the form attached hereto as Exhibit A (the “Notes”), which Notes shall be
convertible into shares of Common Stock (as defined below), upon the terms and
subject to the limitations and conditions set forth in such Notes.

C. At the Closing (as defined below), the parties hereto shall execute and
deliver a Registration Rights Agreement, to be dated as of the Closing Date (as
defined below), in the form attached hereto as Exhibit B (the “Registration
Rights Agreement”), pursuant to which Company has agreed to provide certain
registration rights with respect to the Registrable Securities (as defined in
the Registration Rights Agreement), under the 1933 Act and the rules and
regulations promulgated thereunder, and applicable state securities laws.

D. This Agreement, the Notes, the Registration Rights Agreement, the Security
Agreement (as defined below), the Intercreditor Agreement, and all other
certificates, documents, agreements, resolutions and instruments delivered to
any party under or in connection with this Agreement, as the same may be amended
from time to time, are collectively referred to herein as the “Transaction
Documents.”

Certain capitalized terms used herein are defined in Attachment 1 hereto and
incorporated herein by reference.

NOW, THEREFORE, in consideration of the above recitals and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Company and each Purchaser hereby agree as follows:

1. Purchase and Sale of Securities.

1.1 Purchase of Securities. Company shall issue and sell to each Purchaser and
each Purchaser severally, but not jointly, agrees to purchase from Company on
the Closing Date (as defined below), a Note in the original principal amount as
is set forth opposite such Purchaser’s name in column 3 on the Schedule of
Purchasers, duly executed on behalf of Company and registered in the name of
such Purchaser or its designee. In consideration thereof, Purchaser shall pay
the Purchase Price (as defined below) to Company.

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1.2 Form of Payment. On the Closing Date (as defined below), each Purchaser
shall pay or cause to be paid the Purchase Price set forth opposite such
Purchaser’s name in column 4 on the Schedule of Purchasers (the “Purchase
Price”), to Company via wire transfer of immediately available funds against
delivery of a Note to such Purchaser.

1.3 Closing Date. Subject to the satisfaction (or written waiver) of the
conditions set forth in Section 5 and Section 6 below, the date of the issuance
and sale of the Notes pursuant to this Agreement (the “Closing Date”) shall be
May 24, 2019, or another mutually agreed upon date, which shall be a Business
Day. The closing of the transactions contemplated by this Agreement (the
“Closing”) shall occur on the Closing Date by means of the exchange by email of
signed .pdf documents, but shall be deemed for all purposes to have occurred at
the offices of Sullivan & Cromwell LLP, 125 Broad Street, New York, New York
10004.

1.4 Collateral for the Note. The Notes, together with Company’s obligations
under the Transaction Documents, shall be guaranteed by certain subsidiaries of
the Company, and secured by certain collateral of the Company and such
subsidiaries, as set forth in that certain Security Agreement substantially in
the form attached hereto as Exhibit C (the “Security Agreement”). The parties
acknowledge and agree that the collateral covered by the Security Agreement is
currently encumbered by a lien in favor of Bank of America, N.A. (“BAML”), as
administrative and collateral agent for the secured parties under that certain
Amended and Restated Security Agreement, dated as of May 26, 2016 (as amended
and restated, supplemented or otherwise modified from time to time, the “ABL
Agreement”) among Company, the lenders party thereto from time to time and BAML,
as administrative and collateral agent, and that such security interest of BAML
shall constitute a “Permitted Lien” under the Security Agreement.

2. Purchaser’s Representations and Warranties. Each Purchaser represents and
warrants to Company that as of the Closing Date:

2.1 such Purchaser is an entity duly formed, validly existing and in good
standing under the laws of the jurisdiction of its organization and has the
requisite power and authority to enter into and consummate the transactions
contemplated by the Transaction Documents to which it is a party and otherwise
to carry out its obligations hereunder and thereunder;

2.2 each of the Transaction Documents to which it is a party and the
transactions contemplated hereby and thereby have been duly and validly
authorized by such Purchaser and all necessary actions have been taken;

2.3 the Transaction Documents to which it is a party have been duly executed and
delivered by such Purchaser and constitute the legal, valid and binding
obligations of such Purchaser enforceable in accordance with its terms, except
as such enforceability may be limited by general principles of equity or to
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and
other similar laws relating to, or affecting generally, the enforcement of
applicable creditors’ rights and remedies;

 

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2.4 the execution and delivery by such Purchaser of the Transaction Documents to
which it is a party and the consummation by such Purchaser of the other
transactions contemplated by such Transaction Documents do not and will not
conflict with or result in a breach by such Purchaser of any of the terms or
provisions of, or constitute a default under (i) such Purchaser’s organizational
documents, each as currently in effect, (ii) any indenture, mortgage, deed of
trust, or other material agreement or instrument to which Purchaser is a party
or by which it or any of its properties or assets are bound, or (iii) any
existing applicable law, rule, or regulation or any applicable decree, judgment,
or order of any court, United States federal, state or foreign regulatory body,
administrative agency, or other governmental body having jurisdiction over such
Purchaser or any of its properties or assets;

2.5 such Purchaser is an “accredited investor” as that term is defined in Rule
501(a) of Regulation D of the 1933 Act;

2.6 such Purchaser understands that the Securities are being offered and sold to
it in reliance on specific exemptions from the registration requirements of
United States federal and state securities laws and that Company is relying in
part upon the truth and accuracy of, and such Purchaser’s compliance with, the
representations, warranties, agreements, acknowledgments and understandings of
such Purchaser set forth herein in order to determine the availability of such
exemptions and the eligibility of such Purchaser to acquire the Securities;

2.7 such Purchaser is acquiring the Securities, as principal for its own account
and not with a view to or for distributing or reselling the Securities or any
part thereof in violation of the 1933 Act or any applicable state securities law
and has no present intention of distributing any of the Securities in violation
of the 1933 Act, or any applicable state securities law;

2.8 such Purchaser understands that except as provided in the Registration
Rights Agreement (i) the Securities have not been and are not being registered
under the 1933 Act or any state securities laws, and may not be offered for
sale, sold, assigned or transferred unless (a) subsequently registered
thereunder, (b) such Purchaser shall have delivered to Company (if requested by
Company) an opinion of counsel, in a form reasonably acceptable to Company, to
the effect that such Securities to be sold, assigned or transferred may be sold,
assigned or transferred pursuant to an exemption from registration, or (c) such
Purchaser provides Company with reasonable assurance that such Securities can be
sold, assigned or transferred pursuant to Rule 144 or Rule 144A promulgated
under the 1933 Act (or a successor rule thereto (collectively, “Rule 144”); (ii)
any sale of the Securities made in reliance on Rule 144 may be made only in
accordance with the terms of Rule 144, and further, if Rule 144 is not
applicable, any resale of the Securities under circumstances in which the seller
(or the person through whom the sale is made) may be deemed to be an underwriter
(as that term is defined in the 1933 Act) may require compliance with some other
exemption under the 1933 Act or the rules and regulations of the SEC promulgated
thereunder; and (iii) neither Company nor any other person is under any
obligation to register the Securities under the 1933 Act or any state securities
laws or to comply with the terms and conditions of any exemption thereunder.
Notwithstanding the foregoing, the Securities may be pledged in connection with
a bona fide margin account or other loan or financing arrangement secured by the
Securities and such pledge of Securities shall not be deemed to be a transfer,
sale or assignment of the Securities hereunder, and no Purchaser effecting a
pledge of Securities will be required to provide Company with any notice thereof
or otherwise make any delivery to Company pursuant to this Agreement or any
other Transaction Document;

 

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2.9 such Purchaser has such knowledge, sophistication and experience in business
and financial matters so as to be capable of evaluating the merits and risks of
its investment in the Securities, has so evaluated the merits and risks of such
investment, and has sought such accounting, legal and tax advice as it has
considered necessary to make an informed investment decision with respect to its
investment in the Securities;

2.10 such Purchaser understands that no United States federal or state agency or
any other government or governmental agency has passed on or made any
recommendation or endorsement of the Securities or the fairness or suitability
of the investment in the Securities nor have such authorities passed upon or
endorsed the merits of the offering of the Securities;

2.11 such Purchaser acknowledges that it has had the opportunity to review the
Transaction Documents and Company’s filings with the SEC and has been afforded
(i) the opportunity to ask such questions as it has deemed necessary of, and to
receive answers from, representatives of Company concerning the transactions
contemplated by the Transaction Documents and the merits and risks of investing
in the Securities; (ii) access to information about Company and its financial
condition, results of operations, business, properties, management and prospects
sufficient to enable it to evaluate its investment; and (iii) the opportunity to
obtain such additional information that Company possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed investment
decision with respect to the investment;

2.12 such Purchaser is not purchasing the Securities as a result of any
advertisement, article, notice or other communication regarding the Securities
published in any newspaper, magazine or similar media or broadcast over
television or radio or presented at any seminar or, to such Purchaser’s
knowledge, any other general solicitation or general advertisement; and

2.13 neither Company nor any of its officers, directors, shareholders, members,
managers, employees, agents or representatives has made any representations or
warranties to any Purchaser or any of its officers, directors, employees, agents
or representatives except as expressly set forth in the Transaction Documents
and, in making its decision to enter into the transactions contemplated by the
Transaction Documents, such Purchaser is not relying on any representation,
warranty, covenant or promise of Company or its officers, directors, members,
managers, employees, agents or representatives other than as set forth in the
Transaction Documents.

3. Company’s Representations and Warranties. Company represents and warrants to
Purchaser that as of the Closing Date:

3.1 Company is a corporation duly organized, validly existing and in good
standing under the laws of its state of incorporation and has the requisite
corporate power to own its properties and to carry on its business as now being
conducted;

3.2 Company is duly qualified as a foreign corporation to do business and is in
good standing in each jurisdiction where the nature of the business conducted or
property owned by it makes such qualification necessary, except where failure to
do so would not reasonably be expected to have a Material Adverse Effect;

 

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3.3 immediately prior to the Closing, the authorized capital of the Company
consists of (i) 500,000,000 shares of Common Stock, of which 31,497,850 will be
reserved for issuance pursuant to the terms of this Agreement, and (ii) and
60,000,000 shares of preferred stock (the “Preferred Stock”). As of May 16,
2019, there were 43,000,688 shares of Common Stock issued and outstanding. All
of the outstanding shares of Common Stock have been duly authorized, are fully
paid and nonassessable and were issued in compliance with all applicable federal
and state securities laws. As of May 16, 2019 the Company held 627,254 shares of
Common Stock in its treasury. As of May 16, 2019, there were 2,000,000 shares of
Preferred Stock issued and outstanding and designated as Series A Preferred
Stock;

3.4 Company has registered its Common Stock under Section 12(b) of the 1934 Act,
and is obligated to file reports pursuant to Section 13 or Section 15(d) of the
1934 Act;

3.5 each of the Transaction Documents and the transactions contemplated hereby
and thereby, have been duly and validly authorized by Company and all necessary
actions have been taken;

3.6 the Transaction Documents have been or will be at Closing, duly executed and
delivered by Company and constitute the legal, valid and binding obligations of
Company enforceable in accordance with their terms, except as such
enforceability may be limited by general principles of equity or to applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation and other
similar laws relating to, or affecting generally, the enforcement of applicable
creditors’ rights and remedies and except to the extent the indemnification
provisions contained in the Registration Rights Agreement may be limited by
applicable federal or state securities laws;

3.7 the execution and delivery of the Transaction Documents by Company, the
issuance of Securities in accordance with the terms hereof, and the consummation
by Company of the other transactions contemplated by the Transaction Documents
do not and will not conflict with or result in a breach by Company of any of the
terms or provisions of, or constitute a default under (i) Company’s formation
documents or bylaws, each as currently in effect, (ii) any indenture, mortgage,
deed of trust, or other material agreement or instrument to which Company is a
party or by which it or any of its properties or assets are bound, including,
without limitation, any listing agreement for the Common Stock, or (iii) any
existing applicable law, rule, or regulation or any applicable decree, judgment,
or order of any court, United States federal, state or foreign regulatory body,
administrative agency, or other governmental body having jurisdiction over
Company or any of Company’s properties or assets;

3.8 assuming the accuracy of the representations of the Purchasers in Section 2
hereof, no further authorization, approval or consent of any court, governmental
body, regulatory agency, self-regulatory organization, or stock exchange or
market or the shareholders or any lender of Company is required to be obtained
by Company for the issuance of the Securities to Purchaser in accordance with
the Transaction Documents or the entering into of the Transaction Documents,
except with respect to compliance with any applicable rules of the New York
Stock Exchange (“NYSE”) and applicable New Jersey laws;

 

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3.9 assuming the accuracy of the representations of the Purchasers in Section 2
hereof, all consents, permits and approvals (governmental or otherwise) required
for the execution, delivery and performance by Company and each Grantor (as
defined in the Security Agreement) of the Transaction Documents and the
transactions contemplated thereby (other than the Shareholder Approval, and any
consents, permits and approvals required to effect the registration requirements
under the Registration Rights Agreement) have been duly obtained and are in full
force and effect, except as would not, individually or in the aggregate, have
material adverse effect on the business, condition (financial or otherwise),
operations, performance or properties of the Company and its consolidated
subsidiaries taken as a whole.

3.10 none of Company’s filings with the SEC contained, at the time they were
filed, any untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the statements made
therein, in light of the circumstances under which they were made, not
misleading;

3.11 Company has filed all reports, schedules, forms, statements and other
documents required to be filed by Company with the SEC under the 1934 Act on a
timely basis or has received a valid extension of such time of filing and has
filed any such report, schedule, form, statement or other document prior to the
expiration of any such extension;

3.12 Company and its subsidiaries conduct their business in accordance with all
applicable Laws and none of the Company or its subsidiaries is in violation of
any such Law, in each case, except as would not, individually or in the
aggregate, have a Material Adverse Effect;

3.13 there is no claim, action, suit, proceeding, arbitration, complaint, charge
or investigation before or by any court, public board or body pending or, to the
knowledge of Company, threatened against or affecting Company before or by any
governmental authority or non-governmental department, commission, board,
bureau, agency or instrumentality or any other person, wherein an unfavorable
decision, ruling or finding would have a Material Adverse Effect on Company or
which would adversely affect the validity or enforceability of, or the authority
or ability of Company to perform its obligations under, any of the Transaction
Documents;

3.14 neither Company, nor any of its affiliates, nor any person acting on its or
their behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D of the 1933 Act) in connection
with the offer or sale of the Securities;

3.15 (i) none of Company or any of its affiliates, nor any person acting on
their behalf has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under circumstances that
would (a) require registration of the issuance of any of the Securities under
the 1933 Act, whether through integration with prior offerings or otherwise, or
(b) cause this offering of Securities to require approval of shareholders of
Company for the purposes of the 1933 Act or under any applicable shareholder
approval provisions, including, without limitation, under the rules and
regulations of any exchange or automated quotation system on which any of the
securities of Company are listed or designated for quotation, except the
Shareholder Approval contemplated hereby, and (ii) other than as set forth in
the Registration Rights Agreement, none of Company, its affiliates nor any
person acting on their behalf will take any action or steps that would require
registration of the issuance of the Securities under the 1933 Act or cause the
offering of any of the Securities to be integrated with other offerings of
securities of Company;

 

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3.16 Company understands and acknowledges that its obligations to issue the
Conversion Shares pursuant to the terms of the Notes in accordance with this
Agreement and the Notes is absolute and unconditional regardless of the dilutive
effect that such issuance may have on the ownership interests of other
shareholders of Company;

3.17 when issued upon conversion of a Note in accordance with the terms of such
Note, the Conversion Shares will be duly authorized, validly issued, fully paid
for and non-assessable, free and clear of any security interest, mortgage,
pledge, lien, claim, charge or other encumbrance of any kind (other than as may
be granted by or in respect of the applicable Purchaser);

3.18 the Common Stock shall be listed or quoted for trading on NYSE;

3.19 no Purchaser nor any of its officers, directors, shareholders, members,
managers, employees, agents or representatives has made any representations or
warranties to Company or any of its officers, directors, employees, agents or
representatives except as expressly set forth in the Transaction Documents and,
in making its decision to enter into the transactions contemplated by the
Transaction Documents, Company is not relying on any representation, warranty,
covenant or promise of each Purchaser or its officers, directors, members,
managers, employees, agents or representatives other than as set forth in the
Transaction Documents;

3.20 since December 31, 2018, there have been no events or circumstances of any
kind that have had or would, individually or in the aggregate have a Material
Adverse Effect; provided that no event or circumstance disclosed in the
Company’s annual report on Form 10-K for the fiscal year ended December 31,
2018, nor any events or circumstances occurring in connection with the FPD Sale
shall be deemed to result or have resulted in a Material Adverse Effect; and

3.21 no “Bad Actor” disqualifying event described in Rule 506(d)(1)(i) to
(viii) of the 1933 Act (a “Disqualification Event”) is applicable to Company,
except for a Disqualification Event as to which Rule 506(d)(2)(ii) to (iv) or
(d)(3) is applicable.

4. Additional Agreements.

4.1 Information Statement. In connection with its receipt of the approval of the
shareholders of Company (i) holding a majority of the issued and outstanding
shares of Common Stock to permit the issuance and conversion of all the Notes
into shares of Common Stock, as required by the rules of NYSE and
(ii) constituting holders of a majority of the issued and outstanding shares of
Common Stock not beneficially owned by the Purchasers, as required by New Jersey
law (the “Shareholder Approval”), Company covenants and agrees, as promptly as
reasonably practicable following the date hereof, to file a preliminary
information statement on Schedule 14C, pursuant to Regulation 14C promulgated
under the 1934 Act, with the SEC and thereafter, as promptly as reasonably
practicable, to send a definitive information statement on Schedule 14C to all
holders of Common Stock as of the record date for the Shareholder Approval (the
“Record Date”). The right to convert Notes into Common Stock contemplated by the
Shareholder Approval shall be effective 20 calendar days after the definitive
information statement is sent to all holders of Common Stock as of the Record
Date. Purchasers shall furnish to Company all information concerning the
Purchasers required by the 1934 Act to be set forth in the Schedule 14C.

 

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4.2 Use of Proceeds. Company shall use the proceeds from the sale of the
Securities to (i) refinance in full the total outstanding amounts under that
certain senior secured first lien term credit agreement, dated as of
September 3, 2013, among Company, the lenders party thereto, and JPMorgan Chase
Bank, N.A., as administrative agent and to pay fees and expenses in connection
with such refinancing and (ii) for general corporate purposes and working
capital needs of Company and its subsidiaries.

4.3 DTC Eligibility. To the extent that the Company receives a written request
from the Purchasers at any time within the period that is thirty (30) days
following the Closing Date, the Company agrees to cooperate in good faith and
use commercially reasonable efforts to (i) effect mutually acceptable amendments
to the Notes designed to permit, and work with the Purchasers to take any other
actions reasonably necessary to cause the Notes to be deposited in book-entry
form by or on behalf of the Company and registered in the name of Cede & Co, as
nominee of DTC, and (ii) facilitate eligibility of the Notes for clearance and
settlement through DTC.

5. Conditions to Company’s Obligation to Sell. The obligation of Company
hereunder to issue and sell the Securities to Purchaser at the Closing is
subject to the satisfaction, on or before the Closing Date, of each of the
following conditions; provided, that these conditions are for Company’s sole
benefit and may be waived by Company at any time in its sole discretion:

5.1 Each Purchaser shall have executed this Agreement, the Registration Rights
Agreement and each of the other Transaction Documents to which it is a party and
delivered the same to Company.

5.2 Each Purchaser shall have delivered the Purchase Price to Company in
accordance with Section 1.2 above.

5.3 The representations and warranties of each Purchaser set forth in Section 2
shall be true and correct in all material respects as of the date when made and
as of the Closing Date as though originally made at that time (except for
representations and warranties that speak as of a specific date, which shall be
true and correct as of such specific date), and each Purchaser shall have
performed, satisfied and complied in all material respects with the covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by such Purchaser at or prior to the Closing Date.

5.4 No order of any court, arbitrator or governmental or regulatory authority of
competent jurisdiction or other applicable law shall be in effect which makes
the Closing illegal, restrains, enjoins or otherwise prohibits or prevents or
purports to prohibit or prevent the Closing.

 

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6. Conditions to Purchaser’s Obligation to Purchase. The obligation of each
Purchaser hereunder to purchase the Securities at the Closing is subject to the
satisfaction, on or before the Closing Date, of each of the following
conditions; provided, that these conditions are for each Purchaser’s sole
benefit and may be waived by each Purchaser at any time in its sole discretion:

6.1 Company shall have executed this Agreement, the Note, and the Security
Agreement and delivered the same to each Purchaser.

6.2 Company shall have delivered to each Purchaser a fully executed Irrevocable
Letter of Instructions to Transfer Agent (the “TA Letter”) substantially in the
form attached hereto as Exhibit D acknowledged and agreed to in writing by
Company’s transfer agent (the “Transfer Agent”).

6.3 The representations and warranties of Company set forth in Section 3 hereof
shall be true and correct in all material respects as of the date when made and
as of the Closing Date as though originally made at that time (except for
representations and warranties that speak as of a specific date, which shall be
true and correct as of such specific date), and Company shall have performed,
satisfied and complied in all material respects with the covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied
with by Company at or prior to the Closing Date.

6.4 Company shall have delivered to each Purchaser fully executed copies of such
other Transaction Documents reasonably requested by the Purchasers or their
counsel prior to the Closing Date.

6.5 Company shall have delivered to each Purchaser a fully executed copy of the
Voting and Support Agreement entered into by and among the Company and the
holders of a majority of the Company’s Common Stock not beneficially owned by
the Purchasers, in connection with the Shareholder Approval.

6.6 Company shall have paid all fees, expenses and other amounts due and payable
on the Closing Date (which in the case of Purchasers, shall be limited to
reimbursement to the Purchasers of 50% of the reasonable and documented fees and
expenses of LockeLord LLP, counsel to the Purchasers in respect of the entry
into the Transaction Documents) under each Transaction Document, to the extent
invoiced at least one (1) Business Day prior to the Closing Date.

6.7 The Purchasers shall have received the following documents and instruments
(each in form and substance reasonably satisfactory to the Purchasers):

a) properly completed UCC financing statements and other filings and documents
required by law or the Transaction Documents to provide the collateral agent
(for the benefit of the Purchasers) with perfected liens in the Collateral (as
defined in the Security Agreement);

b) copies of customary UCC, tax lien, judgment and bankruptcy search reports
with respect to the Company and each other Grantor (as defined in the Security
Agreement);

c) a payoff letter in form and substance reasonably acceptable to the
Purchasers, evidencing repayment in full of the Prior Debt and release of all
liens granted in connection therewith, subject to application of the net
proceeds from the issuance of the Notes to such prepayment;

 

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d) copies of the ABL Agreement and all amendments thereto (including, without
limitation, an amendment to the ABL Agreement dated as of or prior to the
Closing Date, permitting the issuance of the Notes and related matters),
certified by a senior financial officer of the Company as being true, correct
and complete;

e) a customary legal opinion of each of (A) Sullivan & Cromwell LLP, special New
York counsel for the Company, (B) Day Pitney LLP, New Jersey counsel for the
Company and (C) the general counsel of the Company, with respect to the Company
and each other Grantor (as defined in the Security Agreement) as applicable;

f) a certificate of a senior financial officer of the Company who is familiar
with the historical and current financial condition of the Company and each
subsidiary thereof and has reviewed the financial information and projections
with respect thereto, certifying as to the solvency of the Company and its
subsidiaries on a consolidated basis, both before and after giving effect to the
consummation of the transactions contemplated by this Agreement and the other
Transaction Documents on the Closing Date; and

g) for Company and each other Grantor, such Person’s (A) charter (or similar
formation document), certified by the Secretary of State of such entity’s
jurisdiction of formation, (B) good standing certificates in its state of
incorporation (or formation) and in each such entity’s jurisdiction of
formation, (C) bylaws or limited liability company agreement (or similar
governing document), (D) resolutions of its board of directors (or similar
governing body) approving and authorizing such Person’s execution, delivery and
performance of the Transaction Documents to which it is party and the
transactions contemplated thereby, and (E) incumbency certificates of its
officers executing any of the Transaction Documents, all certified by its
secretary or an assistant secretary (or similar officer) as being in full force
and effect without modification; and

6.8 Company shall have delivered to each Purchaser a certificate of a senior
financial officer of the Company certifying that after giving effect to the
consummation transactions contemplated by the this Agreement and the other
Transaction Documents on the Closing Date (a) the representations and warranties
of the Company and any other Grantor (as defined in the Security Agreement)
contained in the Transaction Documents shall be true, correct and complete in
all material respects (except to the extent qualified by materiality, in which
case such representations and warranties shall be true and correct in all
respects); provided that any representation or warranty as of a specific date
shall only be true or correct in all material respects as of such date, and
(b) no Event of Default (as defined in the Notes) shall have occurred and be
continuing.

7. Reservation of Shares. From and after the date of receipt of the Shareholder
Approval, the Company will reserve shares of Common Stock from its authorized
and unissued Common Stock in such amount as may then be required to provide for
all issuances of Common Stock under the Notes (the “Share Reserve”). Company
shall further require the Transfer Agent to hold the shares of Common Stock
reserved pursuant to the Share Reserve exclusively for the benefit of the
Purchasers and to issue the corresponding shares to each Purchaser promptly upon
such Purchaser’s delivery of a conversion notice under a Note. Finally, Company
shall require the Transfer Agent to issue shares of Common Stock pursuant to the
Notes to the Purchasers out of its authorized and unissued shares, and not the
Share Reserve, to the extent shares of Common Stock have been authorized, but
not issued, and are not included in the Share Reserve.

 

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8. Miscellaneous. The provisions set forth in this Section 8 shall apply to this
Agreement, as well as all other Transaction Documents as if these terms were
fully set forth therein; provided, however, that in the event there is a
conflict between any provision set forth in this Section 8 and any provision in
any other Transaction Document, the provision in such other Transaction Document
shall govern.

8.1 Governing Law; Venue. This Agreement shall be construed and enforced in
accordance with the laws of the State of New York, without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of New
York or any other jurisdiction) that would cause the application of the laws of
any jurisdiction other than the State of New York. For any suit, action or other
proceeding arising in connection with any of the Transaction Documents (and
notwithstanding the terms (specifically including any governing law and venue
terms) of any transfer agent services agreement or other agreement between the
Transfer Agent and Company, such litigation specifically includes, without
limitation, any action between or involving Company and the Transfer Agent under
the TA Letter or otherwise related to Purchaser in any way (specifically
including, without limitation, any action where Company seeks to obtain an
injunction, temporary restraining order, or otherwise prohibit the Transfer
Agent from issuing shares of Common Stock to any Purchaser for any reason)),
each party hereto hereby (i) consents to and expressly submits to the exclusive
jurisdiction of the state courts of New York and to the jurisdiction of the
United States District Court for the Southern District of New York,
(ii) expressly submits to the exclusive venue of any such court for the purposes
hereof, (iii) agrees to not bring any such action (specifically including,
without limitation, any action where Company seeks to obtain an injunction,
temporary restraining order, or otherwise prohibit the Transfer Agent from
issuing shares of Common Stock to any Purchaser for any reason) outside of the
state courts of New York or the United States District Court for the Southern
District of New York, and (iv) waives any claim of improper venue and any claim
or objection that such courts are an inconvenient forum or any other claim,
defense or objection to the bringing of any such proceeding in such jurisdiction
or to any claim that such venue of the suit, action or proceeding is improper or
that the Transaction Documents or the subject matter thereof may not be enforced
in or by such court. Finally, Company covenants and agrees to name each
Purchaser as a party in interest in, and provide written notice to each
Purchaser in accordance with Section 8.8 below prior to bringing or filing, any
action (including, without limitation, any filing or action against any person
or entity that is not a party to this Agreement, including without, limitation
the Transfer Agent) that is related in any way to the Transaction Documents or
any transaction contemplated herein or therein, including without limitation,
any action brought by Company to enjoin or prevent the issuance of any shares of
Common Stock to each Purchaser by the Transfer Agent, and further agrees to
timely name each Purchaser as a party to any such action. Company acknowledges
that the governing law and venue provisions set forth in this Section 8.1 are
material terms to induce each Purchaser to enter into the Transaction Documents
and that but for Company’s agreements set forth in this Section 8.1, each
Purchaser would not have entered into the Transaction Documents.

 

11

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8.2 Remedies. Any Person having any rights under any provision of this Agreement
shall be entitled to enforce such rights specifically (without posting a bond or
other security), to recover damages by reason of any breach of any provision of
this Agreement and to exercise all other rights granted by law. Furthermore,
Company recognizes that in the event that it or any subsidiary fails to perform,
observe, or discharge any or all of its or such subsidiary’s (as the case may
be) obligations under the Transaction Documents, any remedy at law would
inadequate relief to the Purchasers. Company therefore agrees that the
Purchasers shall be entitled to specific performance and/or temporary,
preliminary and permanent injunctive or other equitable relief from any court of
competent jurisdiction in any such case without the necessity of proving actual
damages and without posting a bond or other security. The remedies provided in
this Agreement and the other Transaction Documents shall be cumulative and in
addition to all other remedies available under this Agreement and the other
Transaction Documents, at law or in equity (including a decree of specific
performance and/or other injunctive relief).

8.3 Counterparts. Each Transaction Document may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one instrument. The parties hereto confirm that any
electronic copy of another party’s executed counterpart of a Transaction
Document (or such party’s signature page thereof) will be deemed to be an
executed original thereof.

8.4 Headings. The headings of this Agreement are for convenience of reference
only and shall not form part of, or affect the interpretation of, this
Agreement.

8.5 Severability. In the event that any provision of this Agreement is invalid
or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform to such statute or rule of
law. Any provision hereof which may prove invalid or unenforceable under any law
shall not affect the validity or enforceability of any other provision hereof.

8.6 Entire Agreement. This Agreement, together with the other Transaction
Documents, contains the entire understanding of the parties with respect to the
matters covered herein and therein and, except as specifically set forth herein
or therein, neither Company nor any Purchaser makes any representation,
warranty, covenant or undertaking with respect to such matters. For the
avoidance of doubt, all prior term sheets or other documents between Company and
the Purchasers, or any affiliate thereof, related to the transactions
contemplated by the Transaction Documents (collectively, “Prior Agreements”),
that may have been entered into between Company and the Purchasers, or any
affiliate thereof, are hereby null and void and deemed to be replaced in their
entirety by the Transaction Documents. To the extent there is a conflict between
any term set forth in any Prior Agreement and the term(s) of the Transaction
Documents, the Transaction Documents shall govern.

8.7 Amendments and Waivers. No provision of this Agreement may be waived or
amended other than by an instrument in writing signed by the parties hereto. No
waiver of any provision or consent to any prohibited action shall constitute a
waiver of any other provision or consent to any other prohibited action, whether
or not similar. No waiver or consent shall constitute a continuing waiver or
consent or commit a party to provide a waiver or consent in the future except to
the extent specifically set forth in writing.

 

12

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8.8 Notices. Any notice required or permitted hereunder shall be given in
writing (unless otherwise specified herein) and shall be deemed effectively
given on the earliest of: (i) the date delivered, if delivered by personal
delivery as against written receipt therefor or by email to an executive officer
named below or such officer’s successor, or by facsimile (with successful
transmission confirmation which is kept by sending party), (ii) the earlier of
the date delivered or the third calendar day after deposit, postage prepaid, in
the United States Postal Service by certified mail, or (iii) the earlier of the
date delivered or the third calendar day after mailing by express courier, with
delivery costs and fees prepaid, in each case, addressed to each of the other
parties thereunto entitled at the following addresses (or at such other
addresses as such party may designate by five (5) calendar days’ advance written
notice similarly given to each of the other parties hereto):

If to Company:

Eastman Kodak Company

Attn: General Counsel

343 State Street

Rochester, New York 14650

Tel.: 585-724-4000

Fax: 585-724-1089

Email: roger.byrd@kodak.com

With a copy to (which copy shall not constitute notice):

Sullivan & Cromwell LLP

125 Broad Street

New York, NY 10005

Attn: S. Neal McKnight

Fax: 212-558-3588

Email: mcknightn@sullcrom.com

If to a Purchaser:

To the address set forth opposite such Purchaser’s name on Schedule I hereto,
with a copy (which copy shall not constitute notice) to its legal
representative, at the legal representative address set forth opposite such
Purchaser’s name on Schedule I hereto.

8.9 Successors and Assigns. This Agreement or any of the severable rights and
obligations inuring to the benefit of or to be performed by each Purchaser
hereunder may not be assigned by a Purchaser, in whole or in part, without the
Company’s prior written consent. Company may not assign its rights or
obligations under this Agreement or delegate its duties hereunder without the
prior written consent of the Purchasers.

8.10 No 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.

 

13

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8.11 Survival. The representations and warranties of Company and the Purchasers
contained in or made pursuant to this Agreement shall not survive the Closing or
termination of this Agreement. Company agrees to indemnify and hold harmless
each Purchaser and all its officers, directors, employees, attorneys, and agents
for loss or damage arising as a result of or related to any breach or alleged
breach by Company of any of its representations, warranties and covenants set
forth in this Agreement or any of its covenants and obligations under this
Agreement, including advancement of expenses as they are incurred.

8.12 Further Assurances. Each party shall do and perform, or cause to be done
and performed, all such further acts and things, and shall execute and deliver
all such other agreements, certificates, instruments and documents, as 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.

8.13 Purchasers’ Rights and Remedies Cumulative. All rights, remedies, and
powers conferred in this Agreement and the Transaction Documents are cumulative
and not exclusive of any other rights or remedies, and shall be in addition to
every other right, power, and remedy that Purchaser may have, whether
specifically granted in this Agreement or any other Transaction Document, or
existing at law, in equity, or by statute, and any and all such rights and
remedies may be exercised from time to time and as often and in such order as
Purchaser may deem expedient.

8.14 Attorneys’ Fees. In the event of any action at law or in equity to enforce
or interpret the terms of this Agreement or any of the other Transaction
Documents, the parties agree that the prevailing party shall be entitled to
reasonable attorneys’ fees, costs and necessary disbursements in addition to any
other relief to which such party may be entitled.

8.15 Waiver of Jury Trial. EACH PARTY TO THIS AGREEMENT IRREVOCABLY WAIVES ANY
AND ALL RIGHTS SUCH PARTY MAY HAVE TO DEMAND THAT ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT, ANY OTHER
TRANSACTION DOCUMENT, OR THE RELATIONSHIPS OF THE PARTIES HERETO BE TRIED BY
JURY. THIS WAIVER EXTENDS TO ANY AND ALL RIGHTS TO DEMAND A TRIAL BY JURY
ARISING UNDER COMMON LAW OR ANY APPLICABLE STATUTE, LAW, RULE OR REGULATION.
EACH PARTY FURTHER REPRESENTS AND WARRANTS THAT SUCH PARTY HAS REVIEWED THIS
WAIVER WITH ITS LEGAL COUNSEL, AND THAT SUCH PARTY IS KNOWINGLY AND VOLUNTARILY
WAIVING SUCH PARTY’S RIGHT TO DEMAND TRIAL BY JURY FOLLOWING CONSULTATION WITH
LEGAL COUNSEL.

8.16 Time is of the Essence. Time is expressly made of the essence with respect
to each and every provision of this Agreement and the other Transaction
Documents.

[Remainder of page intentionally left blank; signature page follows]

 

14

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IN WITNESS WHEREOF, the undersigned Purchasers and Company have caused this
Agreement to be duly executed as of the date first above written.

 

PURCHASERS: C2W PARTNERS MASTER FUND LIMITED

By: Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

/s/ Andrew R. McCarroll

  Name:   Andrew R. McCarroll   Title:   General Counsel LONGLEAF PARTNERS
SMALL-CAP FUND

By: Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

/s/ Andrew R. McCarroll

  Name:   Andrew R. McCarroll   Title:   General Counsel DESERET MUTUAL PENSION
TRUST

By: Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

/s/ Andrew R. McCarroll

  Name:   Andrew R. McCarroll   Title:   General Counsel

[Signature Page to Notes Purchase Agreement]

--------------------------------------------------------------------------------

COMPANY: EASTMAN KODAK COMPANY. By:  

/s/ David E. Bullwinkle

  Name: David E. Bullwinkle   Title:   Chief Financial Officer and Senior Vice
President

[Signature Page to Notes Purchase Agreement]

--------------------------------------------------------------------------------

ATTACHMENT 1

DEFINITIONS

“1933 Act” means the Securities Act of 1933, as amended.

“1934 Act” means the Securities Exchange Act of 1934, as amended.

“ABL Agreement” has the meaning set forth Section 1.4 of this Agreement.

“Agreement” has the meaning set forth in the preamble to this Agreement.

“BAML” has the meaning set forth in Section 1.4 of this Agreement.

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York are authorized or required by law to
remain closed.

“Closing” has the meaning set forth in Section 1.3 of this Agreement.

“Closing Date” has the meaning set forth in Section 1.3 of this Agreement.

“Common Stock” means (x) Company’s shares of common stock, $0.01 par value per
share, and (y) any capital stock into which such common stock shall have been
changed or any share capital resulting from a reclassification of such common
stock.

“Company” has the meaning set forth in the preamble to this Agreement.

“Conversion Shares” means all shares of Common Stock issuable upon conversion of
all or any portion of the Notes.

“Disqualification Event” has the meaning set forth in Section 3.20 of this
Agreement.

“FPD Sale” means the sale of assets constituting the Borrower’s “flexographic
packaging division” in any one transaction or a series of transactions.

“GAAP” means the generally accepted accounting principles in the United States
of America, as in effect from time to time.

“Intercreditor Agreement” means the intercreditor agreement, dated as of the
Closing Date, among BAML as representative with respect to the ABL Agreement,
Wilmington Trust, National Association as representative with respect to the
Notes, the Company and the grantors party thereto.

“Material Adverse Effect” means any circumstance, development, effect, change,
event, occurrence or state of facts that, individually or in the aggregate, has
had or would reasonably be expected to have a material adverse effect on (1) the
business, results of operations, assets, or financial condition of Company and
its subsidiaries taken as a whole; provided, however, that

--------------------------------------------------------------------------------

none of the following, and no circumstance, development, effect, change, event
or occurrence arising out of, or resulting from, the following, shall constitute
or be taken into account, individually or in the aggregate, in determining
whether a Material Adverse Effect has occurred or may occur: any effect, change,
event or occurrence that results from or arises in connection with (A) changes
in or conditions generally affecting the industry in which Company and its
subsidiaries operate, (B) general economic or regulatory, legislative or
political conditions or securities, credit, financial or other capital markets
conditions in any jurisdiction, (C) exchange rate conditions or fluctuations in
any jurisdiction, (D) any failure, in and of itself, by Company and its
subsidiaries to meet any internal or published projections, forecasts, estimates
or predictions in respect of revenues, earnings or other financial or operating
metrics for any period, (E) geopolitical conditions, the outbreak or escalation
of hostilities, any acts of war (whether or not declared), sabotage, terrorism
or man-made disaster, or any escalation or worsening of any of the foregoing,
(F) any volcano, tsunami, pandemic, hurricane, tornado, windstorm, flood,
earthquake or other natural disaster, (G) the execution and delivery of the
Transaction Documents or the public announcement or pendency of the transactions
contemplated thereby, (H) any change, in and of itself, in the market price,
credit ratings or trading volume of Company’s securities, (I) any change in GAAP
(or authoritative interpretation thereof), including accounting and financial
reporting pronouncements by the SEC and the Financial Accounting Standards Board
or applicable law, or (J) any action required to be taken by Company, or that
Company is required to take or to cause one of its subsidiaries to take pursuant
to the terms of the Transaction Documents (it being understood that the
exceptions in clauses (D) and (H) shall not be taken into account in determining
whether or not the underlying cause of any such failure or change referred to
therein (if not otherwise falling within any of the exceptions provided by
clauses (A) through (J) hereof) gives rise to a Material Adverse Effect);
provided, that the exceptions in clauses (A), (B), (E) and (F) above shall not
apply to the extent such circumstance, development, effect, change, event,
occurrence or state of facts has a materially disproportionate impact on Company
and its subsidiaries, taken as a whole, relative to other participants in the
industry in which Company and its subsidiaries operate, or (2) the ability of
Company and its subsidiaries to timely consummate the transactions contemplated
by the Transaction Documents.

“Notes” has the meaning set forth in Recital (B) to this Agreement.

“NYSE” has the meaning set forth in Section 3.8 of this Agreement.

“Preferred Stock” has the meaning set forth in Section 3.3 of this Agreement.

“Prior Agreements” has the meaning set forth in Section 8.6 of this Agreement.

“Prior Debt” means all outstanding amounts under that certain Senior Secured
First Lien Term Credit Agreement, dated as of September 3, 2013 (as amended,
restated, amended and restated or otherwise modified from time to time), among
Company, the lenders party thereto, and JPMorgan Chase Bank, N.A., as
administrative agent.

“Purchase Price” has the meaning set forth in Section 1.2 of this Agreement.

“Purchaser” has the meaning set forth in the preamble to this Agreement.

--------------------------------------------------------------------------------

“Record Date” has the meaning set forth in Section 4.1 of this Agreement.

“Registration Rights Agreement” has the meaning set forth in Recital (C) to this
Agreement.

“Rule 144” has the meaning set forth in Section 2.8 of this Agreement.

“SEC” has the meaning set forth in Recital (A) to this Agreement.

“Security Agreement” has the meaning set forth in Section 1.4 of this Agreement.

“Securities” means the Notes and the Conversion Shares.

“Share Reserve” has the meaning set forth in Section 7 of this Agreement.

“Shareholder Approval” has the meaning set forth in Section 4.1 of this
Agreement.

“TA Letter” has the meaning set forth in Section 6.2 of this Agreement.

“Transaction Documents” has the meaning set forth in Recital (D) to this
Agreement.

“Transfer Agent” has the meaning set forth in Section 6.2 of this Agreement.

--------------------------------------------------------------------------------

SCHEDULE 1

SCHEDULE OF PURCHASERS

 

(1)

   (2)      (3)    

(4)

 

(5)

Purchaser

   Purchase Price      Original Principal
Amount of Notes    

Address and Facsimile Number

 

Legal Representative’s

Address and Facsimile

Number

Longleaf Partners

Small-Cap Fund

   $ 93,215,000      $ 93,215,000    

c/o Southeastern Asset Management, Inc.

6410 Poplar Avenue, Suite 900,

Memphis, TN 38119

Attention: Andrew R. McCarroll

Email: amccarroll@SEasset.com

Facsimile: (901) 260-0885

 

LockeLord LLP

Brookfield Place,
200 Vesey Street, 20th Floor

New York, NY 10281

Attn: Robert Evans

Email: robert.evans@lockelord.com

Facsimile: 212-303-2754

C2W Partners Master

Fund Limited

   $ 5,000,000      $ 5,000,000    

c/o Southeastern Asset Management, Inc.

6410 Poplar Avenue, Suite 900,

Memphis, TN 38119

Attention: Andrew R. McCarroll

Email: amccarroll@SEasset.com

Facsimile: (901) 260-0885

 

LockeLord LLP

Brookfield Place,
200 Vesey Street, 20th Floor

New York, NY 10281

Attn: Robert Evans

Email: robert.evans@lockelord.com

Facsimile: 212-303-2754

Deseret Mutual

Pension Trust

   $ 1,785,000      $ 1,785,000    

c/o Southeastern Asset Management, Inc.

6410 Poplar Avenue, Suite 900,

Memphis, TN 38119

Attention: Andrew R. McCarroll

Email: amccarroll@SEasset.com

Facsimile: (901) 260-0885

 

LockeLord LLP

Brookfield Place,
200 Vesey Street, 20th Floor

New York, NY 10281

Attn: Robert Evans

Email: robert.evans@lockelord.com

Facsimile: 212-303-2754

  

 

 

    

 

 

     

TOTAL

   $ 100,000,000      $ 100,000,000         

 

 

    

 

 

     

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EXHIBIT A

FORM OF SECURED CONVERTIBLE PROMISSORY NOTE

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NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION.
THESE SECURITES AND THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE
ARE BEING ISSUED IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT, AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.

THIS NOTE HAS BEEN ISSUED WITH “ORIGINAL ISSUE DISCOUNT” (WITHIN THE MEANING OF
SECTION 1272 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED). UPON WRITTEN
REQUEST, THE ISSUER WILL PROMPTLY MAKE AVAILABLE TO ANY HOLDER OF THIS NOTE THE
FOLLOWING INFORMATION: (1) THE ISSUE PRICE AND DATE OF THE NOTE, (2) THE AMOUNT
OF ORIGINAL ISSUE DISCOUNT ON THE NOTE AND (3) THE YIELD TO MATURITY OF THE
NOTE. HOLDERS SHOULD CONTACT THE CHIEF FINANCIAL OFFICER AT 343 STATE STREET,
ROCHESTER NEW YORK 14650.

SECURED CONVERTIBLE PROMISSORY NOTE

 

Effective Date: [•], 2019    U.S. $[•]

FOR VALUE RECEIVED, EASTMAN KODAK COMPANY, a New Jersey corporation (“Company”),
promises to pay to [•], a [•], or its successors or assigns (“Holder”), $[•] and
any interest (including any default interest), fees and charges, accrued
hereunder on the Maturity Date in accordance with the terms set forth herein.

This Secured Convertible Promissory Note (this “Note”) is issued and made
effective as of May [•], 2019 (the “Effective Date”). This Note is one of a
series issued pursuant to that certain Notes Purchase Agreement dated May 20,
2019 (the “Purchase Agreement”), as the same may be amended from time to time,
by and between Company, Holder and the other purchasers listed on Schedule 1
thereto (the “Other Holders”).

Certain capitalized terms used herein are defined in Attachment 1 hereto and
incorporated herein by reference.

The purchase price for this Note shall be $[•] (the “Purchase Price”). The
Purchase Price shall be payable by Holder by wire transfer of immediately
available funds on the date hereof in accordance with the Purchase Agreement.

This Note is subject to the following additional provisions:

1. Payment; Prepayment.

1.1 Payment of Interest.

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  (a)

The Company shall pay interest on the Outstanding Balance at the rate of five
(5) percent (5%) per annum (the “Interest Rate”) from the Effective Date until
the Outstanding Balance is paid in full. Interest shall be payable in cash on
each Conversion Date (as to that portion of the Outstanding Balance being
converted) and on the Maturity Date; provided that (i) any interest payable by
the Company on a Conversion Date (as to that portion of the Outstanding Balance
being converted) may, at the election of the Company, be paid in the form of
additional Conversion Shares (as defined below) at the then-applicable
Conversion Rate and (ii) pending any such payment, interest shall accrue and not
be payable and no interest shall be payable on accrued interest. All interest
calculations hereunder shall be computed on the basis of a 365-day year and
shall be payable in accordance with the terms of this Note. Interest will be
paid to the person in whose name this Note is registered on the records of the
Company regarding registration and transfers of this Note (the “Note Register”).

 

  (b)

Upon the occurrence and during the continuance of any Event of Default, at the
election of Holder by written notice to the Company, this Note shall bear
interest at the Default Rate.

1.2 Payments Generally. All payments owing hereunder shall be in lawful money of
the United States of America or to the extent provided for herein, in additional
Conversion Shares, and delivered to Holder at the address or bank account
furnished to Company for that purpose. All payments shall be applied first to
(i) costs of collection, if any, then to (ii) fees and charges, if any, then to
(iii) accrued and unpaid interest, and thereafter, to (iv) principal.

1.3 Prepayment. Notwithstanding the foregoing, in the event of a Fundamental
Transaction, for a period of thirty (30) days immediately following the
expiration of the Holder Fundamental Transaction Conversion Period (the
“Fundamental Transaction Prepayment Election Period”), Company shall have the
right but not the obligation to prepay all of the Outstanding Balance (less such
portion of the Outstanding Balance for which Company has received a Holder
Conversion Notice (as defined below) from Holder prior to commencement of the
Fundamental Transaction Prepayment Election Period and where the applicable
Conversion Shares have not yet been delivered) at par, plus accrued and unpaid
interest thereon (the “Fundamental Transaction Prepayment Option”).

2. Security and Guarantees. This Note is guaranteed by certain subsidiaries of
Company (the “Subsidiary Grantors”) and secured by certain assets of the Company
and the Subsidiary Grantors pursuant to that certain Guarantee and Collateral
Agreement dated as of even date herewith (the “Security Agreement”), executed by
Company and the Subsidiary Grantors in favor of the Collateral Agent,
encumbering certain property and assets of the Company and the subsidiaries of
the Company party thereto, as more specifically set forth therein. The Holder
hereby consents to the appointment of the Collateral Agent and agrees to be
bound by and subject to the terms of the Security Agreement, and pursuant to the
Security Agreement, each Holder of Notes has appointed the Collateral Agent to
act in that capacity on behalf of the Secured Parties (as defined in the
Security Agreement), on the terms provided therein. The Holder also hereby
consents to the appointment of the Collateral Agent as Second Priority
Representative under the Intercreditor Agreement.

 

2

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3. Registration of Transfers and Exchanges.

3.1 Different Denominations. This Note is exchangeable for an equal aggregate
principal amount of Notes of different authorized denominations, as requested by
the Holder surrendering the same. No service charge will be payable for such
registration of transfer or exchange.

3.2 Investment Representations. This Note has been issued subject to certain
investment representations of the original Holder set forth in the Purchase
Agreement and may be transferred or exchanged only in compliance with the
Purchase Agreement and applicable federal and state securities laws and
regulations.

3.3 Reliance on Note Register. Prior to due presentment for transfer to the
Company of this Note, the Company and any agent of the Company may treat the
person in whose name this Note is duly registered on the Note Register as the
owner hereof for the purpose of receiving payment as herein provided and for all
other purposes, whether or not this Note is overdue, and neither the Company nor
any such agent shall be affected by notice to the contrary.

4. Company Covenants. Following the Closing Date, and until all of Company’s
obligations under all of the Transaction Documents are paid and performed in
full (other than contingent obligations for which no claim has been made), or
within the time frames otherwise specifically set forth below, Company will at
all times comply with the following covenants:

4.1 Dividends and Distributions. Company shall not, directly or indirectly,
(i) declare or pay any dividend or distribution (whether in cash, securities or
other property) on, or (ii) redeem, repurchase or otherwise acquire, or pay or
make any monies available for a sinking fund for, any Common Stock without the
prior written consent of the Required Holders; provided that the foregoing
limitations shall not apply to (x) redemptions, purchases or other acquisitions
of shares of Common Stock in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of any one or more
employees, officers, directors, managers or consultants of, or to, the Company
or any of its subsidiaries; (y) an exchange, redemption, reclassification or
conversion of any class or series of Common Stock for any class or series of
Common Stock that ranks equal or junior to the applicable class or series of
Common Stock; or (z) any dividend in the form of stock, warrants, options or
other rights where the dividended stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks equal or junior to the applicable stock on which
the dividend is being paid.

4.2 Additional Debt. Other than Permitted Debt, Company shall not, and shall not
permit any of its subsidiaries to, enter into, create, incur or otherwise
assume, any debt for borrowed money, without the prior written consent of the
Required Holders, which consent shall not be unreasonably withheld, delayed or
conditioned.

 

3

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4.3 Additional Liens. Other than Permitted Liens, Company shall not, and shall
not permit any of its subsidiaries to, directly or indirectly enter into,
create, incur, assume or suffer to exist any Liens on or with respect to any of
any of its property or assets now owned or hereafter acquired, to secure debt
for borrowed money of the Company or any other person, without the prior written
consent of the Required Holders.

4.4 Reporting.

 

  (a)

So long as each Holder beneficially owns any of the Securities and for at least
twenty (20) Trading Days thereafter, Company will timely file on the applicable
deadline all reports required to be filed with the U.S. Securities and Exchange
Commission pursuant to Sections 13 or 15(d) of the Securities Exchange Act, and
will take all reasonable action under its control to ensure that adequate
current public information with respect to Company, as required in accordance
with Rule 144 promulgated under the Securities Act (or a successor rule thereto)
(“Rule 144”), is publicly available, and will not terminate its status as an
issuer required to file reports under the Exchange Act even if the Exchange Act
or the rules and regulations thereunder would permit such termination.

 

  (b)

As soon as practicable and in any event within five (5) Business Days after the
Company has knowledge of the occurrence of any Event of Default, Company shall
furnish to Holder a statement of an officer of the Company setting forth details
of such Event of Default and the action that the Company has taken and/or
proposes to take with respect thereto.

 

  (c)

The Company shall provide notice to the Holder within three (3) Business Days of
the execution, delivery, or receipt by the Company of any material amendment,
consent, waiver or modification to the ABL Agreement or any material agreement
related thereto, along with copies of all such documents, agreements or
instruments executed, delivered, or received in connection therewith.

4.5 Dispositions. The Company shall not Dispose of any assets, or permit any of
its subsidiaries to dispose of any assets, in each case, without the prior
written consent of the Required Holders, other than (i) as permitted pursuant to
Section 5.02(e) of the ABL Agreement as in effect on the date hereof, and
without regard to any amendment or waiver of such provisions hereafter and
(ii) the disposition previously identified to the Holders as “Project Dragon”,
provided, that no dispositions related to Project Dragon shall be permitted
under this Note until such time as “Project Dragon” shall have been approved by
the Board of Directors of the Company (including affirmative votes in favor
therefor of Jeffrey D. Engelberg and R. Todd Bradley, or such successor
directors agreed upon by the Company and Southeastern).

 

4

--------------------------------------------------------------------------------

5. Holder Optional Conversions.

5.1 Holder Conversions. Subject to Section 5.2 and Section 13 below, Holder has
the right at any time after the Effective Date until the Outstanding Balance has
been paid in full (other than during any Fundamental Transaction Prepayment
Election Period), at its election, to convert (a “Holder Conversion”) all or any
portion of the Outstanding Balance into shares (the shares received in each
instance of conversion being referred to herein as “Conversion Shares”) of fully
paid and non-assessable common stock, $0.01 par value per share (“Common
Stock”), of Company as per the following conversion formula: the number of
Conversion Shares equals the portion of the Outstanding Balance being converted
(the “Conversion Amount”) divided by $1,000, and multiplied by the Conversion
Rate.

5.2 Fundamental Transaction Conversions.

(a) Upon occurrence of a Fundamental Transaction, Holder has the right to
convert all or any portion of the Outstanding Balance as follows: (i) at any
time during a Holder Fundamental Transaction Conversion Period, Holder shall
have the right to either (1) make a Holder Conversion pursuant to Section 5.1
above or (2) receive, for each Conversion Share that would have been issuable
upon such conversion immediately prior to the occurrence of such Fundamental
Transaction, the number of shares of common stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and any
additional consideration (the “Alternate Consideration”) receivable as a result
of such Fundamental Transaction by a holder of the number of shares of Common
Stock for which this Note is convertible immediately prior to such Fundamental
Transaction; and (ii) following the expiration of a Holder Fundamental
Transaction Conversion Period and the Fundamental Transaction Prepayment
Election Period, in the event that the Company has not elected to exercise the
Fundamental Transaction Prepayment Option as set forth in Section 1.3, Holder
shall have the right to receive, for each Conversion Share that would have been
issuable upon such conversion immediately prior to the occurrence of such
Fundamental Transaction, the number of shares of common stock of the successor
or acquiring corporation or of the Company, if it is the surviving corporation,
and any Alternate Consideration receivable as a result of such Fundamental
Transaction by a holder of the number of shares of Common Stock for which this
Note is convertible immediately prior to such Fundamental Transaction.

(b) In the event of a conversion pursuant to clause (a)(i)(2) or clause (a)(ii)
above, the determination of the Conversion Rate shall be appropriately adjusted
to apply to such Alternate Consideration based on the amount of Alternate
Consideration issuable in respect of one (1) share of Common Stock in such
Fundamental Transaction, and the Company shall apportion the Conversion Rate
among the Alternate Consideration in a reasonable manner reflecting the relative
value of any different components of the Alternate Consideration. If holders of
Common Stock are given any choice as to the securities, cash or property to be
received in a Fundamental Transaction, then the Holder shall be given the same
choice as to the Alternate Consideration it receives upon any conversion of this
Note following such Fundamental Transaction. The Company shall cause any
successor entity in a Fundamental Transaction in which the Company is not the
survivor (the “Successor Entity”) to assume in writing all of the obligations of
the Company under this Note and the other Transaction Documents in accordance
with the provisions of this Section

 

5

--------------------------------------------------------------------------------

pursuant to written agreements in form and substance reasonably satisfactory to
the Holder and approved by the Holder (without unreasonable delay) prior to such
Fundamental Transaction and shall, at the option of Holder, deliver to the
Holder in exchange for this Note a security of the Successor Entity evidenced by
a written instrument substantially similar in form and substance to this Note
which is convertible for a corresponding number of shares of capital stock of
such Successor Entity (or its parent entity) equivalent to the shares of Common
Stock acquirable and receivable upon conversion of this Note (without regard to
any limitations on the conversion of this Note) prior to such Fundamental
Transaction, and with a conversion rate which applies the Conversion Rate
hereunder to such shares of capital stock (but taking into account the relative
value of the shares of Common Stock pursuant to such Fundamental Transaction and
the value of such shares of capital stock, such number of shares of capital
stock and such conversion rate being for the purpose of protecting the economic
value of this Note immediately prior to the consummation of such Fundamental
Transaction), and which is reasonably satisfactory in form and substance to the
Holder. Upon the occurrence of any such Fundamental Transaction, the Successor
Entity shall succeed to, and be substituted for (so that from and after the date
of such Fundamental Transaction, the provisions of this Note and the other
Transaction Documents referring to the “Company” shall refer instead to the
Successor Entity), and may exercise every right and power of the Company and
shall assume all of the obligations of the Company under this Note and the other
Transaction Documents with the same effect as if such Successor Entity had been
named as the Company herein.

5.3 Conversion Notices. Conversion notices in the form attached hereto as
Exhibit A (each, a “Holder Conversion Notice”) may be effectively delivered to
Company by any method set forth in the “Notices” section of the Purchase
Agreement, and all Holder Conversions shall be cashless and not require further
payment from Holder. Company shall deliver the Conversion Shares from any Holder
Conversion to Holder in accordance with Section 10 below.

5.4 Conversion Rate. The Conversion Rate shall be 314.9785 shares of Common
Stock per each $1,000 principal amount of Notes, as such rate may be adjusted as
set forth in this Note (the “Conversion Rate”).

6. Mandatory Conversions.

6.1 The Company shall have the right, at its option, to cause all of the
Outstanding Balance to be converted into Common Stock at the Conversion Rate
then in effect, with the number of shares of Common Stock to be issued being
equal to the Outstanding Balance divided by $1,000, and multiplied by the
Conversion Rate, and with cash being paid in lieu of any fractional share
pursuant to Section 13. The Company may exercise its right to cause a mandatory
conversion pursuant to this Section 6 only if the Closing Sale Price of the
Common Stock equals or exceeds 150% of the Conversion Price for at least 45
Trading Days (whether or not consecutive) in a period of 60 consecutive Trading
Days, including the last Trading Day of such 60-day period, ending on, and
including, the Trading Day immediately preceding the Business Day on which the
Company issues a press release announcing the mandatory conversion as described
in Section 6.2.

 

6

--------------------------------------------------------------------------------

6.2 To exercise the mandatory conversion right described in Section 6.1, the
Company shall publish a press release on the Company’s website or through such
other public medium as the Company may use at that time, prior to the open of
business on the first Trading Day following any date on which the Company makes
a conversion election pursuant to Section 6.1, announcing such a mandatory
conversion and including the information specified in Section 6.3. The Company
shall also give notice to the Holder pursuant to Section 20 hereof (not later
than three Business Days after the date of the press release) of the mandatory
conversion announcing the Company’s intention to convert the Outstanding
Balance. The conversion date with respect to such mandatory conversion will be a
date selected by the Company (the “Mandatory Conversion Date”) and will be no
later than 30 calendar days after the date on which the Company issues the press
release described in this Section 6.2.

6.3 In addition to any information required by applicable law or regulation, the
press release described in Section 6.2 shall state, as appropriate: (i) the
Mandatory Conversion Date; (ii) the number of shares of Common Stock to be
issued upon conversion of each of the Notes; and (iii) that interest on the
Notes will cease to accrue on the Mandatory Conversion Date.

6.4 On and after the Mandatory Conversion Date, interest shall cease to accrue
on the Notes called for a mandatory conversion pursuant to this Section 6 and
all rights of Holders of such Notes shall terminate except for the right to
receive the whole shares of Common Stock issuable upon conversion thereof with a
cash payment in lieu of any fractional share of Common Stock in accordance with
Section 9 and any accrued and unpaid interest.

7. Defaults and Remedies.

7.1 Defaults. The following are events of default under this Note (each, an
“Event of Default”): (a) (i) Company fails to pay any principal due under this
Note when the same becomes due and payable, (ii) Company fails to pay any
interest, fees, charges, or any other amount when due and payable hereunder and
such failure is not cured within three (3) Business Days, or (iii) Company fails
to pay fees, charges or any other amount when due and payable hereunder and such
failure is not cured within three (3) Business Days after notice of such failure
is given by the Holder to the Company; (b) Company fails to deliver any
Conversion Shares in accordance with the terms hereof and such failure is not
cured within three (3) Trading Days; (c) a receiver, trustee or other similar
official shall be appointed over Company or a material part of its assets and
such appointment shall remain uncontested for twenty (20) days or shall not be
dismissed or discharged within sixty (60) days; (d) Company becomes insolvent or
generally fails to pay, or admits in writing its inability to pay, its debts as
they become due, subject to applicable grace periods, if any; (e) Company makes
a general assignment for the benefit of creditors; (f) Company files a petition
for relief under any bankruptcy, insolvency or similar law (domestic or
foreign); (g) an involuntary bankruptcy proceeding is commenced or filed against
Company and is not dismissed within sixty (60) days; (h) (i) Company or any
pledgor, trustor, or guarantor of this Note defaults or otherwise fails to
observe or perform any term, covenant or agreement contained in Section 4 hereof
(other than Section 4.4); or (ii) the Company or any pledgor, trustor, or
guarantor of this Note defaults or otherwise fails to observe or perform any
other covenant, obligation, condition or agreement of Company or such pledgor,
trustor, or guarantor contained herein or in any other Transaction Document,
other than those specifically set forth in this Section 7.1 and Section 4 of

 

7

--------------------------------------------------------------------------------

the Purchase Agreement and such default or failure remains uncured for a period
of ten (10) days after written notice to Company by Holder of such default or
failure; (i) any representation, warranty or other statement made or furnished
by or on behalf of Company or any pledgor, trustor, or guarantor of this Note to
Holder herein, in any Transaction Document, or otherwise in connection with the
issuance of this Note is false, incorrect, incomplete or misleading in any
material respect when made or furnished; (j) Company fails to maintain the Share
Reserve and such failure continues for five (5) days after written notice to
Company by Holder of such failure; (k) a final and non-appealable judgment is
entered against Company or any of its property or other assets for more than
$25,000,000 and such judgment shall remain unvacated, unbonded or unstayed for a
period of sixty (60) days, unless otherwise consent to by Holder; (l) the
Company fails to be DWAC Eligible at any time after the six (6) month
anniversary of the Closing Date; (m) with respect to any debt for borrowed money
of the Company or any of its subsidiaries (excluding the debt outstanding under
this Note) that is outstanding in a principal amount of at least (i) $25,000,000
in the aggregate in the case of debt for borrowed money of the Company or any of
its subsidiaries that are Domestic Subsidiaries and (ii) $50,000,000 in the
aggregate in the case of debt for borrowed money of subsidiaries that are
Foreign Subsidiaries, (1) the Company or any of its subsidiaries shall fail to
pay any principal of or premium or interest on such debt when the same becomes
due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in, or agreed to pursuant to the
terms of, the agreement or instrument relating to such debt; or (2) any such
debt shall be declared to be due and payable, or required to be prepaid or
redeemed (other than by a regularly scheduled required prepayment or
redemption), purchased or defeased, or an offer to prepay, redeem, purchase or
defease such debt shall be required to be made, in each case prior to the stated
maturity thereof; provided that in each case of sub-clauses (1) and (2) above,
the Event of Default shall be deemed to have been cured if the Company enters
into a waiver, amendment or extension with the requisite holders of such debt
with respect to such failure or event or condition or such demand, acceleration
or mandatory repurchase, prepayment, defeasance or redemption of such debt; and
provided further that this clause (m) shall not apply to any of the following
events: (1) any change of control offer made within 60 days after an acquisition
with respect to the Company or an acquired business, and effectuated pursuant to
the applicable debt instrument, (2) any default under debt of an acquired
business if such default is cured, or such debt is repaid, within 60 days after
the acquisition of such business so long as no other creditor accelerates or
commences any kind of enforcement action in respect of such debt, (3) mandatory
prepayment requirements arising from the receipt of net cash proceeds from debt,
dispositions (including casualty losses, governmental takings and other
involuntary dispositions), equity issuances or excess cash flow, (4) prepayments
required by the terms of debt as a result of customary provisions in respect of
illegality, replacement of lenders and gross-up provisions for taxes, increased
costs, capital adequacy and other similar customary requirements and (5) any
voluntary prepayment, redemption or other satisfaction of debt that becomes
mandatory in accordance with the terms of such debt solely as the result of the
Company or any subsidiary delivering a prepayment, redemption or similar notice
with respect to such prepayment, redemption or other satisfaction; or (n) any
material provision of the Security Agreement or any material provision of any
other Transaction Document shall for any reason cease to be valid and binding on
or enforceable against the Company, or the Company shall so state in writing.

 

8

--------------------------------------------------------------------------------

7.2 Remedies. At any time and from time to time after Holder becomes aware of
the occurrence of any Event of Default, the Required Holders may accelerate this
Note by written notice to Company, with the Outstanding Balance becoming
immediately due and payable in cash. Notwithstanding the foregoing, upon the
occurrence of any Event of Default described in clauses (c), (d), (e), (f) or
(g) of Section 7.1, the Outstanding Balance as of the date of acceleration shall
become immediately and automatically due and payable in cash, without any
written notice required by the Required Holders. For the avoidance of doubt,
Holder may continue making Holder Conversions at any time following an Event of
Default until such time as the Outstanding Balance is paid in full. In
connection with acceleration as described herein, the Required Holders need not
provide, and Company hereby waives, any presentment, demand, protest or other
notice of any kind, and the Required Holders may immediately and without
expiration of any grace period enforce any and all of its rights and remedies
hereunder and all other remedies available to it under applicable law. Such
acceleration may be rescinded and annulled by the Required Holders at any time
prior to payment hereunder and Holder shall have all rights as holder of the
Note until such time, if any, as Holder receives full payment pursuant to this
Section 7.2. No such rescission or annulment shall affect any subsequent Event
of Default or impair any right consequent thereon. The Required Holders may not
commence or prosecute the enforcement of, any rights and remedies with respect
to the Collateral, in each case, under any Transaction Document or pursuant to
any applicable law, including, without limitation, the exercise of any rights of
set-off, recoupment or credit bidding, and the exercise of any rights or
remedies of a secured creditor under the Uniform Commercial Code, the Bankruptcy
Code (including credit bidding rights) or other similar creditors’ rights,
bankruptcy, insolvency, reorganization or similar laws of any applicable
jurisdiction, unless the Required Holders have requested the Collateral Agent to
pursue such remedy. Nothing herein shall limit the right of the Required Holders
to pursue any other remedies available to it at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief
with respect to Company’s failure to timely deliver Conversion Shares upon
Conversion of the Note as required pursuant to the terms hereof.

8. Certain Conversion Rate Adjustments. The Conversion Rate shall be adjusted,
without duplication, upon the occurrence of any of the following events:

8.1 If the Company exclusively issues shares of Common Stock as a dividend or
distribution on all shares of its Common Stock, or if the Company effects a
share split or share combination, the Conversion Rate shall be adjusted based on
the following formula:

 

LOGO [g752945dsp31.jpg]

where,

CR0 = the Conversion Rate in effect immediately prior to the close of business
on the Record Date for such dividend or distribution, or immediately prior to
the open of business on the Adjustment Effective Date of such share split or
share combination, as the case may be;

 

9

--------------------------------------------------------------------------------

CR1 = the Conversion Rate in effect immediately after the close of business on
the Record Date for such dividend or distribution, or immediately after the open
of business on the Adjustment Effective Date of such share split or share
combination, as the case may be;

OS0 = the number of shares of Common Stock outstanding immediately prior to the
close of business on the Record Date for such dividend or distribution, or
immediately prior to the open of business on the Adjustment Effective Date of
such share split or share combination, as the case may be; and

OS1 = the number of shares of Common Stock outstanding immediately after giving
effect to such dividend or distribution, or such share split or share
combination, as the case may be.

Any adjustment made under this Section 8.1 shall become effective immediately
after the close of business on the Record Date for such dividend or
distribution, or immediately after the open of business on the Adjustment
Effective Date for such share split or share combination, as the case may be. If
any dividend or distribution of the type described in this Section 8.1 is
declared but not so paid or made, the Conversion Rate shall be immediately
readjusted, effective as of the date the Board of Directors of the Company
determines not to pay such dividend or distribution, to the Conversion Rate that
would then be in effect if such dividend or distribution had not been declared.

8.2 If the Company distributes to all or substantially all holders of its Common
Stock any rights, options or warrants entitling them, for a period expiring not
more than 45 days immediately following the announcement date of such
distribution, to purchase or subscribe for shares of its Common Stock at a price
per share that is less than the average of the Closing Sale Prices of the Common
Stock over the 10 consecutive Trading Day period ending on, and including, the
Trading Day immediately preceding the Ex-Date of such distribution, the
Conversion Rate shall be increased based on the following formula:

 

LOGO [g752945dsp32.jpg]

where,

CR0 = the Conversion Rate in effect immediately prior to the close of business
on the Record Date for such distribution;

CR1 = the Conversion Rate in effect immediately after the close of business on
the Record Date for such distribution;

OS0 = the number of shares of Common Stock outstanding immediately prior to the
close of business on the Record Date for such distribution;

 

10

--------------------------------------------------------------------------------

X = the total number of shares of Common Stock issuable pursuant to such rights,
options or warrants; and

Y = the number of shares of Common Stock equal to the aggregate price payable to
exercise such rights, options or warrants, divided by the average of the Closing
Sale Prices of the Common Stock over the 10 consecutive Trading Day period
ending on, and including, the Trading Day immediately preceding the Ex-Date of
such distribution.

Any increase made under this Section 8.2 shall be made successively whenever any
such rights, options or warrants are distributed and shall become effective
immediately after the close of business on the Record Date for such
distribution. To the extent that shares of Common Stock are not delivered after
the expiration of such rights, options or warrants, the Conversion Rate shall be
readjusted, effective as of the date of such expiration, to the Conversion Rate
that would then be in effect had the increase with respect to the distribution
of such rights, options or warrants been made on the basis of delivery of only
the number of shares of Common Stock actually delivered. If such rights, options
or warrants are not so distributed, the Conversion Rate shall be decreased,
effective as of the date the Board of Directors of the Company determines not to
make such distribution, to be the Conversion Rate that would then be in effect
if such Record Date for such distribution had not occurred. If such rights,
options or warrants are only exercisable upon the occurrence of certain
triggering events, then the Conversion Rate shall not be adjusted until the
triggering events occur.

For purposes of this Section 8.2, in determining whether any rights, options or
warrants entitle the holders to subscribe for or purchase shares of Common Stock
at less than such average of the Closing Sale Prices of the Common Stock for the
10 consecutive Trading Day period ending on, and including, the Trading Day
immediately preceding the Ex-Date of such distribution, and in determining the
aggregate offering price of such shares of Common Stock, there shall be taken
into account any consideration received by the Company for such rights, options
or warrants and any amount payable on exercise or conversion thereof, the value
of such consideration, if other than cash, to be determined by the Board of
Directors of the Company.

8.3 If the Company makes distributions to all or substantially all holders of
its Common Stock consisting of shares of its capital stock, evidence of debt or
other assets or properties, excluding:

(1) dividends or other distributions (including share splits), rights, options
or warrants as to which an adjustment is effected in Section 8.1 or 8.2 above or
in Section 8.4 below;

(2) dividends or other distributions covered by Section 8.4 below; and

(3) Spin-offs (as defined below) to which the provisions set forth below in this
Section 8.3 shall apply,

the Conversion Rate shall be increased based on the following formula:

 

11

--------------------------------------------------------------------------------

LOGO [g752945dsp34i.jpg]

where:

CR0 = the Conversion Rate in effect immediately prior to the close of business
on the Record Date for such distribution;

CR1 = the Conversion Rate in effect immediately after the close of business on
the Record Date for such distribution;

M = the average of the Closing Sale Prices of the Common Stock for the 10
consecutive Trading Day period ending on, and including, the Trading Day
immediately preceding the Ex-Date for such distribution; and

F = the fair market value, as determined by the Board of Directors of the
Company, of the portion of those assets, securities, rights, warrants or options
to be distributed in respect of each share of Common Stock immediately prior to
the open of business on the Ex-Date for such distribution.

Any increase pursuant to this Section 8.3 shall become effective immediately
after the close of business on the Record Date for such distribution. If such
distribution is not so paid or made, the Conversion Rate shall be decreased,
effective as of the date the Board of Directors of the Company determines not to
pay or make such distribution, to be the Conversion Rate that would then be in
effect if such distribution had not been declared.

Notwithstanding the foregoing, if “F” (as defined above) is equal to or greater
than “M” (as defined above), in lieu of the foregoing increase, Holder shall
receive, at the same time and upon the same terms as holders of the Common
Stock, the amount of cash that such Holder would have received as if such Holder
owned a number of shares of Common Stock equal to the Conversion Rate on the
Record Date for such distribution.

With respect to an adjustment pursuant to this Section 8.3 where there has been
a payment of a dividend or other distribution of the Common Stock in shares of
capital stock of any class or series, or similar equity interest, of or relating
to a subsidiary or other business unit, where such capital stock or similar
equity interest is listed or quoted (or will be listed or quoted upon
consummation of the spin-off) on a U.S. national securities exchange, which is
referred to herein as a “Spin-off,” the Conversion Rate will be increased based
on the following formula:

 

LOGO [g752945page148.jpg]

 

 

12

--------------------------------------------------------------------------------

where:

CR1 = the Conversion Rate in effect immediately after the open of business on
the effective date for the Spin-off;

CR0 = the Conversion Rate in effect immediately prior to the open of business on
the effective date for the Spin-off;

F = the average of the Closing Sale Prices of the capital stock or similar
equity interest distributed to holders of Common Stock applicable to one share
of Common Stock over the first 10 consecutive Trading Day period immediately
following, and including, the effective date for the Spin-off (such period, the
“Valuation Period”); and

MP = the average of the Closing Sale Prices of the Common Stock over the
Valuation Period.

The adjustment to the Conversion Rate under the preceding paragraph of this
Section 8.3 will become effective immediately after the open of business on the
day after the last day of the Valuation Period. For purposes of determining the
Conversion Rate in respect of any conversion during the 10 Trading Days
commencing on the effective date for any Spin-off, references within the portion
of this Section 8.3 related to Spin-offs to 10 consecutive Trading Days shall be
deemed replaced with such lesser number of Trading Days as have elapsed from,
and including, the effective date for such Spin-off to, but excluding, the
relevant Conversion Date.

8.4 If the Company makes any cash dividend or distribution to all or
substantially all holders of its Common Stock, the Conversion Rate will be
increased based on the following formula:

 

LOGO [g752945dsp35.jpg]

where,

CR0 = the applicable Conversion Rate in effect immediately prior to the close of
business on the Record Date for such dividend or other distribution;

CR1 = the applicable Conversion Rate in effect immediately after the close of
business on the Record Date for such dividend or other distribution;

SP0 = the average of the Closing Sale Prices of the Company’s Common Stock over
the 10 consecutive Trading Day period ending on, and including, the Trading Day
immediately preceding the Ex-Date for such dividend or other distribution; and

C = the amount in cash per share the Company pays or distributes to holders of
its Common Stock.

 

13

--------------------------------------------------------------------------------

An adjustment on the Conversion Rate made pursuant to Section 8.4 shall become
effective immediately after the close of business on the Record Date for the
applicable dividend or other distribution. If any dividend or other distribution
described in this Section 8.4 is declared but not so paid or made, the new
Conversion Rate shall be readjusted to the Conversion Rate that would then be in
effect if such dividend or other distribution had not been declared.

If “C” as set forth above is equal to or greater than “SP0” as set forth above,
in lieu of the foregoing adjustment, the Holder shall receive, at the same time
and upon the same terms as holders of the Company’s Common Stock, the amount of
cash that Holder would have received if such Holder owned a number of shares of
the Company’s Common Stock equal to the applicable Conversion Rate in effect
immediately prior to the close of business on the Record Date for such cash
dividend or other distribution.

8.5 If the Company or any of its subsidiaries makes a payment in respect of a
tender offer or exchange offer for the Common Stock and the cash and value of
any other consideration included in the payment per share of the Common Stock
exceeds the average of the Closing Sale Price of the Common Stock over the 10
consecutive Trading Day period commencing on, and including, the Trading Day
next succeeding the last date on which tenders or exchanges may be made pursuant
to such tender or exchange offer, the Conversion Rate shall be increased based
on the following formula:

 

LOGO [g752945dsp36.jpg]

where,

CR0 = the Conversion Rate in effect immediately prior to the close of business
on the last Trading Day of the 10 consecutive Trading Day period commencing on,
and including, the Trading Day next succeeding the date such tender or exchange
offer expires;

CR1 = the Conversion Rate in effect immediately after the close of business on
the last Trading Day of the 10 consecutive Trading Day period commencing on, and
including, the Trading Day next succeeding the date such tender or exchange
offer expires;

AC = the aggregate value of all cash and any other consideration (as determined
by the Board of Directors of the Company) paid or payable for shares of Common
Stock purchased in such tender or exchange offer;

OS0 = the number of shares of Common Stock outstanding immediately prior to the
date such tender or exchange offer expires (prior to giving effect to the
purchase of all shares of Common Stock accepted for purchase or exchange in such
tender or exchange offer);

OS1 = the number of shares of Common Stock outstanding immediately after the
date such tender or exchange offer expires (after giving effect to the purchase
of all shares of Common Stock accepted for purchase or exchange in such tender
or exchange offer); and

 

14

--------------------------------------------------------------------------------

SP1 = the average of the Closing Sale Prices of the Common Stock over the 10
consecutive Trading Day period commencing on, and including, the Trading Day
next succeeding the date such tender or exchange offer expires.

The increase to the Conversion Rate under this Section 8.5 shall occur at the
close of business on the 10th Trading Day immediately following, and including,
the Trading Day next succeeding the date such tender or exchange offer expires;
provided that, for purposes of determining the Conversion Rate, in respect of
any conversion during the 10 Trading Days immediately following, and including,
the Trading Day next succeeding the date that any such tender or exchange offer
expires, references within this Section 8.5 to 10 consecutive Trading Days shall
be deemed to be replaced with such lesser number of consecutive Trading Days as
have elapsed between the date such tender or exchange offer expires and the
relevant Conversion Date.

In the event that the Company or one of its subsidiaries is obligated to
purchase shares of Common Stock pursuant to any such tender offer or exchange
offer, but the Company or such subsidiary is permanently prevented by applicable
law from effecting any such purchases, or all such purchases are rescinded, then
the Conversion Rate shall be readjusted to be such Conversion Rate that would
then be in effect if such tender offer or exchange offer had not been made. For
the avoidance of doubt, this Section 8.5 shall not apply if the Company
otherwise acquires shares of Common Stock, including, but not limited to,
through an open market purchase in compliance with Rule 10b-18 promulgated under
the Exchange Act or through an “accelerated share repurchase” on customary
terms.

8.6 Without limiting any provision hereof, if the Company at any time on or
after the Effective Date subdivides (by any stock split, stock dividend,
recapitalization or otherwise) one or more classes of its outstanding shares of
Common Stock into a greater number of shares, the Conversion Rate in effect
immediately prior to such subdivision will be proportionately reduced. Without
limiting any provision hereof, if the Company at any time on or after the
Effective Date combines (by combination, reverse stock split or otherwise) one
or more classes of its outstanding shares of Common Stock into a smaller number
of shares, the Conversion Rate in effect immediately prior to such combination
will be proportionately increased. Any adjustment pursuant to this Section 8.6
shall become effective immediately after the effective date of such subdivision
or combination. If any event requiring an adjustment under this Section 8.6
occurs during the period that a Conversion Rate (as defined below) is calculated
hereunder, then the calculation of such Conversion Rate shall be adjusted
appropriately to reflect such event.

8.7 In addition to those adjustments required by Section 8.1 through
Section 8.6, and to the extent permitted by applicable law and subject to the
applicable rules of the NYSE, the Company from time to time may (but is not
required to) increase the Conversion Rate by any amount for a period of at least
20 Business Days or any longer period permitted or required by law if the
increase is irrevocable during that period and the Board of Directors of the
Company determines that such increase would be in the Company’s best interest.
In addition, the Company may (but is not required to) increase the Conversion
Rate to avoid or diminish any income tax to holders of the Common Stock or
rights to purchase Common Stock in connection with a dividend or distribution of
shares (or rights to acquire shares) or similar event. Whenever the Conversion

 

15

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Rate is increased pursuant to any of the preceding two sentences, the Company
shall mail to the Holder at its last address appearing on the Note Register of
the Company a notice of the increase at least 15 days prior to the date the
increased Conversion Rate takes effect, and such notice shall state the
increased Conversion Rate and the period during which it will be in effect.

8.8 Calculations. All calculations and other determinations under the foregoing
Section 8.1 through Section 8.6 shall be made by the Company and shall be made
to the nearest one-ten thousandth (1/10,000th) of a share. No adjustment to the
Conversion Rate shall be made if it results in a Conversion Price that is less
than the par value (if any) of the Common Stock. The Company shall not take any
action that would result in the Conversion Price being less than the par value
(if any) of the Common Stock without giving effect to the previous sentence.

9. No Fractional Shares. No fractional shares of Common Stock or securities
representing fractional shares of Common Stock shall be delivered upon
conversion, whether voluntary or mandatory, of the Notes. Instead, the Company
will make a cash payment to each Holder of the Notes that would otherwise be
entitled to a fractional share based on the Closing Sale Price of the Common
Stock on the relevant Conversion Date.

10. Method of Conversion Share Delivery. On or before the close of business on
the fifth (5th) Trading Day following the date of delivery of a Holder
Conversion Notice (the “Delivery Date”), Company shall, provided it is DWAC
Eligible at such time and such Conversion Shares are eligible for delivery via
DWAC, deliver or cause its transfer agent to deliver the applicable Conversion
Shares electronically via DWAC to the account designated by Holder in the
applicable Holder Conversion Notice. If Company is not DWAC Eligible or such
Conversion Shares are not eligible for delivery via DWAC, it shall deliver to
Holder or its broker (as designated in the Holder Conversion Notice), via
reputable overnight courier, a certificate representing the number of shares of
Common Stock equal to the number of Conversion Shares to which Holder shall be
entitled, registered in the name of Holder or its designee. For the avoidance of
doubt, Company has not met its obligation to deliver Conversion Shares by the
Delivery Date unless Holder or its broker, as applicable, has actually received
the certificate representing the applicable Conversion Shares no later than the
close of business on the relevant Delivery Date pursuant to the terms set forth
above. Moreover, and notwithstanding anything to the contrary herein or in any
other Transaction Document, in the event Company or its transfer agent refuses
to deliver any Conversion Shares without a restrictive securities legend to
Holder on grounds that such issuance is in violation of Rule 144, Company shall
deliver or cause its transfer agent to deliver the applicable Conversion Shares
to Holder with a restricted securities legend, but otherwise in accordance with
the provisions of this Section 10. In conjunction therewith, Company will also
deliver to Holder a written explanation from its counsel or its transfer agent’s
counsel opining as to why the issuance of the applicable Conversion Shares
violates Rule 144; provided, Holder acknowledges that any Conversion Shares
issued prior to the six (6) month anniversary of the Closing Date will bear a
restrictive securities legend, and Company shall have no obligation to deliver
any such opinion letter for any Conversion occurring prior to the six (6) month
anniversary of the Closing Date.

 

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11. Conversion Delays. If Company fails to deliver Conversion Shares in
accordance with the timeframe stated in Section 10, Holder may at any time prior
to receiving the applicable Conversion Shares rescind in whole or in part such
Conversion, with a corresponding increase to the Outstanding Balance (any
returned amount will tack back to the Effective Date for purposes of determining
the holding period under Rule 144).

12. Ownership Limitation. Notwithstanding anything to the contrary contained in
this Note or the other Transaction Documents, Company shall not effect any
conversion of this Note requested by Holder, and Holder shall not have the right
to convert any portion of this Note, and shall not deliver a Holder Conversion
Notice, to the extent that after giving effect to such conversion would cause
Holder (together with its affiliates) to beneficially own a number of shares
exceeding the number of shares of Common Stock permitted to be acquired by the
Holder pursuant to the Shareholder Agreement (the “Maximum Percentage”). For
purposes of this section, beneficial ownership of Common Stock will be
determined pursuant to Section 13(d) of the Exchange Act.

13. Shareholder Approval. Notwithstanding anything to the contrary contained in
this Note or the other Transaction Documents, Company and Holder agree that
until the Company has obtained the approval of the issuance of the Notes, the
conversion features of the Notes and the issuance of the Conversion Shares as
provided herein by those shareholders of the Company who as of the relevant
Record Date (i) hold of record at least a majority of the issued and outstanding
Common Stock and (ii) constitute the holders of at least a majority of the
issued and outstanding Common Stock not beneficially owned by any of the holders
of the Notes (collectively, the “Shareholder Approval”), the Notes shall not be
convertible into shares of Common Stock and Holder shall not submit any Holder
Conversion Notice. The Company shall notify Holder in writing when Shareholder
Approval has been obtained.

14. Opinion of Counsel. In the event that an opinion of counsel is needed for
any matter related to this Note, Holder has the right to have any such opinion
provided by its counsel.

15. Absolute Obligation. Except as expressly provided herein, no provision of
this Note shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of and accrued interest, as applicable,
on this Note at the time, place and rate and in the currency herein prescribed.
This Note is a direct debt obligation of the Company.

16. Governing Law; Venue. This Note shall be construed and enforced in
accordance with, and all questions concerning the construction, validity,
interpretation and performance of this Note shall be governed by, the internal
laws of the State of New York, without giving effect to any choice of law or
conflict of law provision or rule (whether of the State of New York or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the State of New York. The provisions set forth in the Purchase
Agreement to determine the proper venue for any disputes are incorporated herein
by this reference.

17. Cancellation. After repayment or conversion of the entire Outstanding
Balance, this Note shall be deemed paid in full, shall automatically be deemed
canceled, and shall not be reissued.

 

17

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18. Amendments; Waivers. The prior written consent of each of the parties hereto
shall be required for any amendment to, or waiver of any provision of, this
Note. No waiver of any provision or consent to any prohibited action shall
constitute a waiver of any other provision or consent to any other prohibited
action, whether or not similar. No waiver or consent shall constitute a
continuing waiver or consent or commit a party to provide a waiver or consent in
the future except to the extent specifically set forth in writing.

19. Assignments. Neither party may assign or transfer this Note or any interest
herein without the prior written consent of the other party hereto (and any
purported transfer without such consent shall be null and void). If at the time
of any transfer of this Note or any shares of Common Stock issued upon
conversion of this Note, the transfer of such Securities shall not be either
(a) registered pursuant to an effective registration statement under the
Securities Act and under applicable state securities or blue sky laws or
(b) eligible for resale without volume or manner-of-sale restrictions or current
public information requirements pursuant to Rule 144, the Company may require,
as a condition of allowing such transfer, that Holder or transferee, as the case
may be, to comply with the transfer restrictions set forth on the restrictive
legend on the face of such Security. Any assignee or transferee of Holder who
acquires this Note in accordance with the terms hereof shall be deemed to be the
“Holder” hereunder and shall be deemed to have agreed to be bound by the terms
of this Note as “Holder”.

20. Accession to Security Agreement. Any assignee or transferee of Holder who
acquires this Note in accordance with the terms hereof, shall accede to the
Security Agreement and shall enter into such documentation as may reasonably be
required by the Collateral Agent and the Company to evidence such person’s
accession to the Security Agreement.

21. Notices. Whenever notice is required to be given under this Note, unless
otherwise provided herein, such notice shall be given in accordance with the
subsection of the Purchase Agreement titled “Notices.”

22. Severability. If any part of this Note is construed to be in violation of
any law, such part shall be modified to achieve the objective of Company and
Holder to the fullest extent permitted by law and the balance of this Note shall
remain in full force and effect.

23. Intercreditor Agreement. Reference is made to the Intercreditor Agreement.
Notwithstanding anything herein to the contrary, the liens and security
interests granted to the Collateral Agent pursuant to this Note and the Security
Agreement and the exercise of any right or remedy by the Collateral Agent
hereunder, in each case, with respect to the Collateral are subject to the
limitations and provisions of the Intercreditor Agreement. In the event of any
inconsistency between the terms or conditions of this Note or the Security
Agreement and the terms and conditions of the Intercreditor Agreement, the terms
and conditions of the Intercreditor Agreement shall control.

[Remainder of page intentionally left blank; signature page follows]

 

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IN WITNESS WHEREOF, Company has caused this Note to be duly executed as of the
Effective Date.

 

COMPANY: EASTMAN KODAK COMPANY. By:       Name:   Title:

 

ACKNOWLEDGED, ACCEPTED AND AGREED: HOLDER: [•]   By:       Name:   Title:

[Signature Page to Convertible Promissory Note]

 

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ATTACHMENT 1

DEFINITIONS

For purposes of this Note, the following terms shall have the following
meanings:

“ABL Agreement” means that certain Amended and Restated Credit Agreement, dated
as of May 26, 2016 (as amended and restated, supplemented or otherwise modified
from time to time) among the Company, the lenders party thereto from time to
time and Bank of America, N.A., as administrative and collateral agent.

“Adjustment Effective Date” means the first date on which the shares of the
Common Stock trade on the applicable exchange or market, regular way, reflecting
the relevant share split or share combination, as applicable.

“Alternate Consideration” has the meaning set forth in Section 5.2(a) of this
Note.

“Bankruptcy Code” means the United States Bankruptcy Code (11 U.S.C. §101 et
seq.), as amended from time to time.

“Bloomberg” means Bloomberg L.P. (or if that service is not then reporting the
relevant information regarding the Common Stock, a comparable reporting service
of national reputation selected by Holder and reasonably satisfactory to
Company).

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York are authorized or required by law to
remain closed.

“Closing Date” means May [•], 2019.

“Closing Sale Price” of the Common Stock on any date means the closing sale
price per share (or if no closing sale price is reported, the average of the
closing bid and ask prices or, if more than one in either case, the average of
the average closing bid and the average closing ask prices) on such date as
reported in composite transactions for the principal United States national or
regional securities exchange on which the Common Stock is traded or, if the
Common Stock is not listed for trading on a United States national or regional
securities exchange on the relevant date, the last quoted bid price for the
Common Stock in the over-the-counter market on the relevant date, as reported by
OTC Markets Group Inc. or a similar organization. In the absence of such a
quotation, the Closing Sale Price shall be the average of the mid-point of the
last bid and ask prices for the Common Stock on the relevant date from each of
at least three nationally recognized independent investment banking firms
selected by the Company for this purpose.

“Collateral” has the meaning set forth in the Security Agreement.

“Collateral Agent” means Wilmington Trust, National Association, as collateral
agent (in such capacity, together with any successors and assigns) under the
Security Agreement.

“Common Stock” has the meaning set forth in Section 5.1 of this Note.

 

Attachment 1 to Convertible Promissory Note, Page 1

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“Company” has the meaning set forth in the preamble to this Note.

“Conversion” means a Holder Conversion under Section 5.

“Conversion Amount” has the meaning set forth in Section 5.1 of this Note.

“Conversion Date” means with respect to any Holder Conversion, the date on which
a Conversion shall be effected as set forth in the applicable Holder Conversion
Notice, and with respect to any mandatory conversion pursuant to Section 6, the
Mandatory Conversion Date.

“Conversion Price” means an amount equal to $1,000 divided by the Conversion
Rate.

“Conversion Rate” has the meaning set forth in Section 5.4 of this Note.

“Conversion Shares” has the meaning set forth in Section 5.1 of this Note.

“Conversion Share Value” means the product of the number of Conversion Shares
deliverable pursuant to any Holder Conversion Notice multiplied by the Closing
Sale Price of the Common Stock on the Delivery Date for such Holder Conversion.

“Default Rate” means, at any time, the Interest Rate plus two percent (2%).

“Delivery Date” has the meaning set forth in Section 10 of this Note.

“Disposition” or “Dispose” means the sale, transfer, exclusive license, lease or
other disposition (including any sale and leaseback transaction), whether in one
transaction or in a series of related transactions, of any property (including
any equity interests) by any person, including any sale, assignment, transfer or
other disposal, with or without recourse, of any notes or accounts receivable;
provided, that, for the avoidance of doubt, an issuance of equity interests is
not a Disposition; provided, further, for the avoidance of doubt, that a
non-exclusive license of intellectual property in the ordinary course of
business shall be deemed not to be a Disposition.

“Domestic Subsidiary” means any subsidiary of the Company organized under the
laws of the United States of America or any state thereof or the District of
Columbia.

“DTC” means the Depository Trust Company or any successor thereto.

“DTC/FAST Program” means the DTC’s Fast Automated Securities Transfer program.

“DWAC” means the DTC’s Deposit/Withdrawal at Custodian system.

“DWAC Eligible” means that (a) Company’s Common Stock is eligible at DTC for
full services pursuant to DTC’s operational arrangements, including without
limitation transfer through DTC’s DWAC system; (b) Company has been approved
(without revocation) by DTC’s underwriting department; (c) Company’s transfer
agent is approved as an agent in the DTC/FAST Program; (d) the Conversion Shares
are otherwise eligible for delivery via DWAC other than due to the actions or
status of Holder; and (e) Company’s transfer agent does not have a policy
prohibiting or limiting delivery of the Conversion Shares via DWAC.

 

Attachment 1 to Convertible Promissory Note, Page 2

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“Effective Date” has the meaning set forth in the preamble to this Note.

“Event of Default” has the meaning set forth in Section 7.1 of this Note.

“Ex-Date” when used with respect to any issuance, dividend or distribution on
the Common Stock, means the first date on which the Common Stock trades on the
applicable exchange or in the applicable market, regular way, without the right
to receive such issuance, dividend or distribution from the Company or, if
applicable, from the seller of the Common Stock on such exchange or market (in
the form of due bills or otherwise) as determined by such exchange or market.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Foreign Subsidiary” means any subsidiary of the Company organized under the
laws of a jurisdiction other than the United States of America or any state
thereof or the District of Columbia.

“Fundamental Change” shall be deemed to have occurred at any time after the
original issuance of this Note, if any of the following occurs:

(i) a “person” or “group” within the meaning of Section 13(d) of the Exchange
Act, other than (1) the Company, its subsidiaries or the employee benefit plans
of the Company and its subsidiaries and (2) Permitted Holders, becomes the
direct or indirect “beneficial owner,” as defined in Rule 13d-3 under the
Exchange Act, of more than 50% of the Voting Stock, provided that a Fundamental
Change will be deemed to have occurred if a Permitted Holder Group becomes the
direct or indirect “beneficial owner,” as defined in Rule 13d-3 under the
Exchange Act, of more than 70% of the Voting Stock;

(ii) the consummation of (A) any recapitalization, reclassification or change of
the Common Stock (other than changes resulting from a subdivision or
combination) as a result of which the Common Stock would be converted into, or
exchanged for, stock, other securities, other property or assets; (B) any share
exchange, consolidation or merger of the Company pursuant to which the Common
Stock will be converted into cash, securities or other property; or (C) any
sale, lease or other transfer in one transaction or a series of transactions of
all or substantially all of the consolidated assets of the Company and its
subsidiaries, taken as a whole, to any person other than one of the Company’s
subsidiaries; provided, however, that any merger solely for the purpose of
changing the Company’s jurisdiction of incorporation to the United States of
America, any State thereof or the District of Columbia, and resulting in a
reclassification, conversion or exchange of outstanding shares of Common Stock
solely into shares of Common Stock of the surviving entity, shall not be a
Fundamental Change; provided further that any transaction described in this
clause (ii) in which the holders of the Company’s Common Stock immediately prior
to such transaction own, directly or indirectly, more than 50% of the common
stock of the continuing corporation or transferee or the parent thereof
immediately after such transaction in substantially the same proportions as such
ownership immediately prior to such transaction shall not be a Fundamental
Change pursuant to this clause (ii);

 

Attachment 1 to Convertible Promissory Note, Page 3

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(iii) the Common Stock ceases to be listed or quoted on any of the New York
Stock Exchange, the NASDAQ Global Select Market or the NASDAQ Global Market (or
any of their respective successors); or

(iv) the stockholders of the Company approve any plan or proposal for the
liquidation or dissolution of the Company;

provided, however, that a transaction or transactions described in clause (i) or
(ii) above shall not constitute a Fundamental Change, if at least 90% of the
consideration received or to be received by holders of the Common Stock of the
Company, excluding cash payments for fractional shares and cash payments made
pursuant to dissenters’ appraisal rights, in connection with such transaction or
transactions consists of shares of common stock that are listed or quoted on any
of the New York Stock Exchange, the NASDAQ Global Select Market or the NASDAQ
Global Market (or any of their respective successors) or will be so listed or
quoted when issued or exchanged in connection with such transaction or
transactions and as a result of such transaction or transactions this Note
becomes convertible into such consideration pursuant to the terms hereof.

“Fundamental Transaction” means a Fundamental Change or a Reorganization Event,
as applicable.

“Fundamental Transaction Prepayment Election Period” has the meaning set forth
in Section 1.3 of this Note.

“Fundamental Transaction Prepayment Option” has the meaning set forth in
Section 1.3 of this Note.

“GAAP” means the generally accepted accounting principles in the United States
of America, as in effect from time to time.

“Holder Fundamental Transaction Conversion Period” means the period of thirty
(30) days from and including the date of consummation of a Fundamental Change.

“Holder” has the meaning set forth in the preamble to this Note.

“Holder Conversion” has the meaning set forth in Section 5.1 of this Note.

“Holder Conversion Notice” has the meaning set forth in Section 5.3 of this
Note.

“Intercreditor Agreement” has the meaning set forth in the Purchase Agreement.

 

Attachment 1 to Convertible Promissory Note, Page 4

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“Lien” means, with respect to any asset (other than securities), (a) any
mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or
security interest in, on or for such asset and (b) the interest of a vendor or a
lessor under any conditional sale agreement, capital lease or title retention
agreement (or any lease having substantially the same economic effect as the
foregoing) relating to such asset; provided that in no event shall an operating
lease be deemed to constitute a Lien solely as a result of a change in GAAP,
after the Effective Date.

“Mandatory Conversion Date” has the meaning set forth in Section 6.2 of this
Note.

“Maturity Date” means November 1, 2021 or, at the Company’s election following a
Qualified Refinancing, (i) in the event of a Qualified Refinancing consisting of
an extension of the mandatory redemption date of the Series A Preferred Stock or
an issuance of debt, any date no later than the date that is thirty (30) days
prior to the maturity date or mandatory redemption date, as applicable, of the
extended Series A Preferred Stock or such debt, but in no event later than
November 1, 2024, or (ii) in the event of a Qualified Refinancing consisting of
an issuance of equity, any date that is no later than November 1, 2024.

“Maximum Percentage” has the meaning set forth in Section 13 of this Note.

“Notes” means this Note, together with each other note issued to Other Holders
pursuant to the terms of the Purchase Agreement.

“Note Register” has the meaning set forth in Section 1.1 of this Note.

“NYSE” means the New York Stock Exchange.

“Other Holders” has the meaning set forth in the preamble to this Note.

“Outstanding Balance” means as of any date of determination, the Purchase Price,
as reduced or increased, as the case may be, pursuant to the terms hereof for
payment, Conversion, offset, or otherwise, accrued but unpaid interest,
collection and enforcements costs (including attorneys’ fees) incurred by
Holder, transfer, stamp, issuance and similar taxes and fees related to
Conversions, and any other fees or charges incurred under this Note.

“Permitted Debt” means (i) debt incurred under the ABL Agreement, and any other
replacement, refinancing, restructuring, extension, renewal or refinancing
thereof (whether through one or more credit facilities or other debt issuances
pursuant to the ABL Agreement or any other agreement, contract or indenture),
(ii) intercompany debt between or among the Company and its subsidiaries,
(iii) debt incurred in connection with acquisitions of any property, assets or
line of business by the Company or its subsidiaries that is permitted pursuant
to the terms of the ABL Agreement, including, for avoidance of doubt, debt
incurred in connection with the acquisition previously identified to the Holders
as “Project Fox”, provided, that debt incurred in connection with the
acquisition known as “Project Fox” shall only be permitted to be incurred after
“Project Fox” shall have been approved by the Board of Directors of the Company
(including affirmative votes in favor therefor of Jeffrey D. Engelberg and R.
Todd Bradley, or such successor directors agreed upon by the Company and
Southeastern), (iv) debt incurred in

 

Attachment 1 to Convertible Promissory Note, Page 5

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connection with the disposition previously identified to the Holders as “Project
Dragon”, provided, that no debt shall be permitted to be incurred in connection
with “Project Dragon” hereunder until such time as “Project Dragon” shall have
been approved by the Board of Directors of the Company (including affirmative
votes in favor therefor of Jeffrey D. Engelberg and R. Todd Bradley, or such
successor directors agreed upon by the Company and Southeastern), (v) debt that
is subordinated to the obligations of the Company under the Transaction
Documents on terms that are reasonably satisfactory to the Required Holders,
(vi) debt permitted pursuant to the terms of the ABL Agreement, including for
avoidance of doubt, debt incurred by subsidiaries of the Company organized under
the laws of any jurisdiction outside of the United States and (vii) any
modification, refinancing, refunding, renewal, replacement, exchange or
extension of the foregoing.

“Permitted Holders” shall mean, at any time, each of (i) Blackstone Holdings I
L.P., (“Blackstone”), (ii) affiliates controlled by Blackstone, (iii) Longleaf
Partners Small Cap Fund (“Longleaf”), (iv) affiliates controlled by Longleaf,
(v) Moses Marx individually and his controlled affiliates, (vi) K.F. Investors
LLC and its affiliates, (vii) George Karfunkel individually and his controlled
affiliates, (viii) George Karfunkel Family LLC and any affiliates thereof,
(ix) Locust Street Funding LLC and any affiliates thereof, (x) Southeastern
Asset Management, Inc. and its affiliates (xi) C2W Partners Master Fund Limited
and any affiliates thereof, (xii) Deseret Mutual Pension Trust and any
affiliates thereof, (xiii) Chesed Foundation of America and any affiliates
thereof, (xiv) Marneu Holding Company and any affiliates thereof, (xv) United
Equities Commodities Company and any affiliates thereof, (xvi) Momar Corporation
and any affiliates thereof and (xvii) any group (within the meaning of
Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor
provision) the members of which include any of the Permitted Holders specified
in clauses (i) through (xvi) above and that, directly or indirectly, hold or
acquire beneficial ownership of the Voting Stock (a “Permitted Holder Group”),
so long as (1) each member of the Permitted Holder Group has voting rights
proportional to the percentage of ownership interests held or acquired by such
member and (2) no person or other “group” (other than Permitted Holders
specified in clauses (i) through (x) above) beneficially owns more than 50% on a
fully diluted basis of the Voting Stock held by the Permitted Holder Group
(without giving effect to any attribution rules).

“Permitted Liens” means (i) Liens created under the ABL Agreement, and any other
replacement, refinancing, restructuring, extension, renewal or refinancing
thereof (whether through one or more credit facilities or other debt issuances
pursuant to the ABL Agreement or any other agreement, contract or indenture),
(ii) Liens relating to intercompany borrowings between or among Company and its
subsidiaries, (iii) any Lien on any property or asset of Company or any of its
subsidiaries existing as of the Closing Date; provided that (x) such Lien shall
not apply to any other property or asset of Company or any subsidiary (other
than proceeds thereof and extensions or improvements to any such property)
unless otherwise permitted by the Holders and (y) such Lien shall secure only
those obligations which it secures on the Closing Date and extensions,
refinancings, restructurings, renewals and replacements thereof that do not
increase the outstanding principal amount thereof (other than by an amount equal
to accrued interest and any fees, costs and expenses incurred in connection
therewith), the obligations thereunder or the property or assets securing such
obligations, (iv) Liens incurred in connection with acquisitions of any
property, assets or line of business by the Company or its subsidiaries in

 

Attachment 1 to Convertible Promissory Note, Page 6

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each case, that are permitted pursuant to the terms of the ABL Agreement,
including, for avoidance of doubt, Liens incurred in connection with the
acquisition previously identified to the Holders as “Project Fox”, provided,
that liens incurred in connection with the acquisition known as “Project Fox”
shall only be permitted to be incurred under this Note after “Project Fox” shall
have been approved by the Board of Directors of the Company (including
affirmative votes in favor therefor of Jeffrey D. Engelberg and R. Todd Bradley,
or their successors), (v) Liens incurred in connection with the disposition
previously identified to the Holders as “Project Dragon”, provided, that no
liens shall be permitted to be incurred hereunder in connection with “Project
Dragon” until such time as “Project Dragon” has been approved by the Board of
Directors of the Company (including affirmative votes in favor therefor of
Jeffrey D. Engelberg and R. Todd Bradley, or such successor directors agreed
upon by the Company and Southeastern) and (vi) Liens on secured debt permitted
pursuant to the terms of the ABL Agreement, including for avoidance of doubt,
Liens to secure debt incurred by subsidiaries of the Company organized under the
laws of any jurisdiction outside of the United States.

“Purchase Agreement” has the meaning set forth in the preamble to this Note.

“Purchase Price” has the meaning set forth in the preamble to this Note.

“Qualified Refinancing” means (i) an extension of the mandatory redemption date
of the Company’s Series A Preferred Stock, (ii) a debt issuance of the Company
having a maturity date on or after November 30, 2021, the proceeds of which are
used to pay the redemption price for the remaining outstanding amount of the
Company’s Series A Preferred Stock, or (iii) an equity issuance of the Company,
the proceeds of which are used to pay the redemption price for the remaining
outstanding amount of the Company’s Series A Preferred Stock; provided that any
repayment, prepayment, redemption or repurchase of such equity securities shall
not be required to occur prior to November 30, 2021.

“Record Date” shall mean, with respect to any dividend, distribution or other
transaction or event in which the holders of the Common Stock (or other
applicable security) have the right to receive any cash, securities or other
property or in which the Common Stock (or such other security) is exchanged for
or converted into any combination of cash, securities or other property, the
date fixed for determination of holders of the Common Stock (or such other
security) entitled to receive such cash, securities or other property (whether
such date is fixed by the Board of Directors of the Company, statute, contract
or otherwise).

“Registration Rights Agreement” mean the Registration Rights Agreement dated as
of even date herewith among the Company and each of the purchasers party
thereto.

“Reorganization Event” means the occurrence of any of the following: (i) any
recapitalization, reclassification or change of the Common Stock (other than
changes resulting from a subdivision or combination); (ii) any consolidation,
merger or combination involving the Company; (iii) any sale, lease or other
transfer to a third party of the consolidated assets of the Company and the
Company’s subsidiaries substantially as an entirety; or (iv) any statutory share
exchange, in each case, as a result of which the Common Stock is converted into,
or exchanged for, stock, other securities, other property or assets (including
cash or any combination thereof).

 

Attachment 1 to Convertible Promissory Note, Page 7

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“Required Holders” means (i) prior to the Closing Date, each purchaser entitled
to purchase Notes pursuant to the terms of the Purchase Agreement, and (ii) on
or after the Closing Date, holders of at least a majority of aggregate principal
amount of Notes then outstanding.

“Rule 144” has the meaning set forth in Section 4.4 of this Note.

“Security Agreement” has the meaning set forth in Section 2 of this Note.

“Securities” has the meaning set forth in the Purchase Agreement.

“Securities Act” means the Securities Act of 1933, as amended.

“Series A Preferred Stock” means the Company’s 5.50% Series A Convertible
Preferred Stock.

“Shareholder Agreement” means that certain Shareholder Agreement, dated
April 17, 2017, by and among the Company and certain Longleaf Partners Small-Cap
Fund, C2W Partners Master Fund Limited, Deseret Mutual Pension Trust and
Southeastern Asset Management, Inc., as amended pursuant to the Amendment and
Waiver, dated as of the date hereof, and as may be further amended, amended and
restated, supplemented or otherwise modified from time to time.

“Shareholder Approval” has the meaning set forth in Section 13 of this Note.

“Share Reserve” has the meaning set forth in the Purchase Agreement.

“Southeastern” means Southeastern Asset Management, Inc.

“Spin-off” has the meaning set forth in Section 8.3 of this Note.

“Subsidiary Grantors” has the meaning set forth in Section 2 of this Note.

“Successor Entity” has the meaning set forth in Section 5.2(b) of this Note.

“Trading Day” means any day on which the New York Stock Exchange (or such other
principal market for the Common Stock) is open for trading.

“Transaction Documents” has the meaning set forth in the Purchase Agreement.

“Uniform Commercial Code” has the meaning set forth in the Security Agreement.

“Valuation Period” has the meaning set forth in Section 8.3 of this Note.

“Voting Stock” of any person as of any date means the Capital Stock of such
person that is at the time entitled to vote in the election of the Board of
Directors or other appropriate governing body of such person.

 

Attachment 1 to Convertible Promissory Note, Page 8

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“VWAP” means the volume weighted average price of the Common Stock on the
principal market for a particular Trading Day or set of Trading Days, as the
case may be, as reported by Bloomberg.

[Remainder of page intentionally left blank]

 

Attachment 1 to Convertible Promissory Note, Page 9

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EXHIBIT A

 

[•]

   Date:

Eastman Kodak Company.

Attn: General Counsel

343 State Street

Rochester, NY 14650

HOLDER CONVERSION NOTICE

The above-captioned Holder hereby gives notice to Eastman Kodak Company, a New
Jersey corporation (the “Company”), pursuant to that certain Secured Convertible
Promissory Note made by Company in favor of Holder on [•], 2019 (the “Note”),
that Holder elects to convert the portion of the Note balance set forth below
into fully paid and non-assessable shares of Common Stock of Company as of the
Conversion Date specified below. Said conversion shall be based on the
Conversion Price set forth below. In the event of a conflict between this Holder
Conversion Notice and the Note, the Note shall govern, or, in the alternative,
at the election of Holder in its sole discretion, Holder may provide a new form
of Holder Conversion Notice to conform to the Note. Capitalized terms used in
this notice without definition shall have the meanings given to them in the
Note.

A. Conversion Date: ____________

B. Holder Conversion #: ____________

C. Conversion Amount: ____________

D. Conversion Rate: _______________

E. Conversion Shares: _______________ (C divided by $1,000 and multiplied by D)

F. Remaining Outstanding Balance of Note: ____________*

 

*

Subject to adjustments for corrections, defaults, interest and other adjustments
permitted by the Transaction Documents, the terms of which shall control in the
event of any dispute between the terms of this Holder Conversion Notice and such
Transaction Documents.

Please transfer the Conversion Shares electronically (via DWAC) to the following
account:

 

Broker:                                         
                                       Address:   

 

DTC#:                                         
                                          

 

Account #:                                          
                                  

 

Account Name:                                                                   
  

 

To the extent the Conversion Shares are not able to be delivered to Holder
electronically via the DWAC system, deliver all such certificated shares to
Holder via reputable overnight courier after receipt of this Holder Conversion
Notice (by facsimile transmission or otherwise) to:

 

 

[Signature Page Follows]

 

Exhibit A to Convertible Promissory Note, Page 1

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Sincerely,

Holder:

[•]   By:  

 

  Name:   Title:

 

Exhibit A to Convertible Promissory Note, Page 2

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EXHIBIT B

FORM OF REGISTRATION RIGHTS AGREEMENT

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REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (the “Agreement”), dated as of [•], 2019, is
entered into by and between EASTMAN KODAK COMPANY a New Jersey corporation (the
“Company”) and the investors listed on Exhibit 1 to the Purchase Agreement (as
defined below) (each, a “Purchaser” and collectively, the “Purchasers”).

WITNESSETH:

WHEREAS, the Company and the Purchasers have entered into a Notes Purchase
Agreement, dated as of May 20, 2019, (the “Purchase Agreement”), whereunder,
among other things, the Purchasers agreed to purchase the Notes (the “Notes”)
from the Company, and

WHEREAS, the execution of this Agreement by the Company and its delivery to the
Purchasers is required by the Purchase Agreement,

NOW THEREFORE, in consideration of the premises and the covenants and agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which the parties hereto acknowledge, the parties agree as
follows:

ARTICLE 1. DEFINITIONS

Capitalized terms used and not otherwise defined herein shall have the meanings
given to such terms in the Purchase Agreement or the Notes, as applicable. As
used in this Agreement, the following terms shall have the following meanings:

“Business Day” means any day except Saturday, Sunday and any day which shall be
a legal holiday or a day on which banking institutions in the States of New York
or New Jersey generally are authorized or required by law or other government
action to close.

“Commission” means the United States Securities and Exchange Commission.

“Common Stock” means the Company’s Common Stock, par value $0.01 per share.

“Company Indemnified Parties” has the meaning set forth in Section 6.2.

“Conversion Shares” means those shares of Common Stock issuable upon conversion
of all or any portion of the Notes.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

“Filing Date” means the date on which the Registration Statement is initially
filed.

“Indemnified Party” shall have the meaning set forth in Section 6.3.

“Indemnifying Party” shall have the meaning set forth in Section 6.3.

“Inspector” shall have the meaning set forth in Section 4.3.

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“Losses” shall have the meaning set forth in Section 6.1.

“Person” means any individual, corporation, partnership, trust, limited
liability company, association or other entity.

“Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.

“Prospectus” means the prospectus included in the Registration Statement
(including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by the
Registration Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference in such Prospectus.

“Purchase Agreement” has the meaning set forth in the Recitals.

“Purchaser Indemnified Parties” has the meaning set forth in Section 6.1.

“Registrable Securities” means the Conversion Shares; provided, that any such
securities shall cease to constitute “Registrable Securities” upon the earliest
to occur of: (A) the date on which such securities are disposed of pursuant to
the Registration Statement; (B) the date on which such securities become
eligible for sale under Rule 144, without restriction thereunder and restrictive
legends have been removed from all certificates representing the applicable
Registrable Securities; and (C) the date on which such securities cease to be
outstanding.

“Registration Statement” means any registration statement contemplated by this
Agreement, including (in each case) the Prospectus, amendments and supplements
to such registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference in
such registration statement.

“Rule 144” means Rule 144 promulgated by the Commission under the Securities
Act, as such Rule may be amended from time to time, or any similar or successor
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

“Rule 158” means Rule 158 promulgated by the Commission under the Securities
Act, as such Rule may be amended from time to time, or any similar or successor
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

“Rule 415” means Rule 415 promulgated by the Commission under the Securities
Act, as such Rule may be amended from time to time, or any similar or successor
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

 

2

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“Rule 462” means Rule 462 promulgated by the Commission under the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same
effect as such Rule

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

ARTICLE 2. RESALE REGISTRATION STATEMENT

2.1 Registration Statement. Subject to Section 2.3, the Company shall use its
commercially reasonable efforts to, as soon as reasonably practicable following
the earlier to occur of (i) the conversion in full of the Outstanding Balance of
the Notes into Conversion Shares in accordance with the terms of the Notes and
(ii) the date that is six months prior to the Maturity Date, prepare and file
with the Commission the Registration Statement, which shall be a “resale”
registration statement providing for the resale of the Registrable Securities
pursuant to an offering to be made on a delayed or continuous basis under Rule
415. The Registration Statement shall be on Form S-3 and shall cover to the
extent allowable under the Securities Act and the rules promulgated thereunder,
such indeterminate number of additional shares of Common Stock resulting from
stock splits, stock dividends or similar transactions of and/or from the
Registrable Securities and adjustments in the number of shares of Common Stock
into which each share of is convertible made pursuant to the terms of the Notes.
The Registration Statement may not include securities other than the Registrable
Securities without the prior written consent of the Purchasers. The Company
shall use its reasonable best efforts to cause the Registration Statement to be
declared effective under the Securities Act and to keep the Registration
Statement continuously effective under the Securities Act until the earlier of
(x) the date when all Registrable Securities covered by such Registration
Statement have been sold or (y) the date on which all Registrable Securities
then held by the Purchasers may be sold without restriction pursuant to Rule
144, as determined by counsel satisfactory to the Company in a written opinion
addressed to the Company and its transfer agent.

2.2 Certain Matters.

(a) In the event that, due to limits imposed by the Commission, the Company is
unable on the Registration Statement to register for resale under Rule 415 of
Regulation C under the Securities Act all of the Registrable Securities that it
has agreed to file pursuant to the first sentence of Section 2.1, the Company
shall include in the Registration Statement, which may be a subsequent
Registration Statement if the Company is required, or determines that it is
desirable, to withdraw the original Registration Statement and file a new
Registration Statement in order to rely on Rule 415 with respect to the full
such amount of the Registrable Securities permitted by the Commission.

(b) In the event that Form S-3 is not available for the registration of the
resale of Registrable Securities hereunder, the Company shall register the
resale of the Registrable Securities on Form S-1 or another appropriate form,
and undertake to register the resale of the Registrable Securities on Form S-3
as soon as such form is available.

 

3

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2.3 Blackout Period. The Company may postpone the filing or effectiveness of any
Registration Statement (or amendment or supplement thereto) or suspend the use
or effectiveness of any Registration Statement (and in each case suspend any
other related action otherwise contemplated hereunder) for a reasonable
“blackout period” if the board of directors of the Company determines in good
faith that such registration or the sale by the Purchasers of Registrable
Securities under such Registration Statement at such time (i) would adversely
affect a pending or proposed significant corporate event, proposed financing or
negotiations, proposed offering of Common Stock by the Company on its behalf or
pursuant to the Registration Rights Agreement dated September 3, 2013 between
the Company and stockholders specified in such agreement, discussions or pending
proposals with respect thereto or (ii) would require the disclosure of material
non-public information the disclosure of which at such time would, in the good
faith judgment of the board of directors of the Company, be materially adverse
to the interests of the Company; provided that the filing or effectiveness of a
Registration Statement (or amendment or supplement thereto) by the Company may
not be postponed and the use or effectiveness of any Registration Statement may
not be suspended (A) in the case of clause (i) above, for more than ten
(10) days after the abandonment or consummation of any of the pending or
proposed significant corporate event, proposed financing or the negotiations,
discussions or pending proposals with respect thereto; (B) in the case of clause
(ii) above, until the earlier to occur of the filing by the Company of its next
succeeding Form 10-K or Form 10-Q or the date upon which such information is
otherwise publicly disclosed by the Company; or (C) in any event, in the case of
either clause (i) or (ii) above, for more than 90 days after the date of the
determination of the board of directors of the Company; provided that the
Company may not postpone the filing or effectiveness of a Registration Statement
(or amendment or supplement thereto) or suspend the use or effectiveness of any
Registration Statement for more than an aggregate of 90 days in any 365-day
period. In addition to the foregoing, the Company shall have the right to
suspend the Purchasers’ ability to use a Prospectus in connection with
non-underwritten sales off of a Registration Statement during each of its
regular quarterly blackout periods applicable to directors and senior officers
under the Company’s policies in existence from time to time. The Company shall
not be required to effectuate an underwritten offering (during such a regular
quarterly blackout period or otherwise) to the extent the Company reasonably
concludes, after consultation in good faith with the relevant Purchasers, that
the Company cannot provide adequate, timely disclosure or satisfy other
underwriting conditions in connection with such offering without undue burden.

2.4 Demand Rights for Shelf Takedowns. Subject to Sections 2.3 and 8.4, upon the
written demand of the relevant Purchaser(s), the Company will facilitate in the
manner described in this Agreement a “takedown” of Registerable Securities off
of the Registration Statement; provided that the Purchasers may not,
individually or collectively, make such demand more than four times in the
aggregate; and provided, furthermore, that any demand for an underwritten
offering of Conversion Shares shall have an aggregate market value (based on the
most recent closing pricing of the Common Stock into which the Notes are
convertible at the time of the demand) of at least $50 million. If a demand by
any Purchaser has been made for a shelf takedown, no further demands may be made
so long as such offering is still being pursued.

 

4

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ARTICLE 3. NOTICES, CUTBACKS AND OTHER MATTERS

3.1 Notifications Regarding Request for Takedown. In order for any Purchaser to
initiate a shelf takedown off of the Registration Statement, such Purchaser(s)
must so notify the Company in writing indicating the number of Registrable
Securities sought to be offered and sold in such takedown and the proposed plan
of distribution. Pending any required public disclosure by the Company and
subject to applicable legal requirements, the parties will maintain the
confidentiality of all notices and other communications regarding any such
proposed takedown.

3.2 Plan of Distribution, Underwriters and Counsel. If the Registrable
Securities are proposed to be sold in an underwritten offering, the relevant
Purchaser(s) will be entitled to determine the plan of distribution and select
the managing underwriters, in each case subject to the consent of the Company
(not to be unreasonably withheld), and such Purchaser(s) will also be entitled
to select counsel for the Purchasers (which may be the same as counsel for the
Company).

3.3 Cutbacks. If the Registrable Securities are proposed to be sold in an
underwritten offering and the managing underwriters advise the Company and the
Purchasers that, in their opinion, the number of Registrable Securities
requested to be included in an underwritten offering exceeds the amount that can
be sold in such offering without adversely affecting the distribution of the
Registrable Securities being offered, such offering will include only the number
of Registrable Securities that the managing underwriters advise can be sold in
the offering.

3.4 Withdrawals. If the relevant Purchaser(s) has or have demanded a registered
underwritten offering to be conducted, such Purchaser(s) may, no later than the
time at which the public offering price and underwriters’ discount are
determined with the managing underwriter, decline to sell all or any portion of
the Registrable Securities being offered for the Purchasers’ account; provided
that if any Purchaser declines to sell, in whole or in part, the Registrable
Securities being offered for the Purchasers’ account, then the demand for such
underwritten offering shall count as a demand for purposes of Section 2.4 of
this Agreement unless such Purchaser reimburses the Company for all reasonable
out-of-pocket expenses incurred by the Company in connection with such
underwritten offering.

3.5 Lockups. In connection with any underwritten offering of Registrable
Securities, the Company and the Purchasers will agree (in the case of the
Company, with respect to the Common Stock and any rights related thereto, and in
the case of the Purchasers, with respect to the Registrable Securities held
respectively held by them and any rights related thereto) to be bound by
customary lockup restrictions in the applicable underwriting agreement.

ARTICLE 4. FACILITATING REGISTRATIONS AND OFFERINGS

4.1 Registration Statements. In connection with any Registration Statement, the
Company will:

(a) (i) prepare and file with the Commission the Registration Statement covering
the applicable Registrable Securities pursuant to Section 2.1 of this Agreement,
(ii) file amendments thereto as warranted, (iii) seek the effectiveness thereof,
and (iv) file with the Commission such Prospectuses as may be required, all in
consultation with the demanding Purchasers (or their representatives) and as
reasonably necessary in order to permit the offer and sale of such Registrable
Securities in accordance with the applicable plan of distribution;

 

5

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(b) (1) within a reasonable time prior to the filing of any Registration
Statement, any Prospectus, any amendment to any Registration Statement, any
amendment or supplement to a Prospectus or any issuer free writing prospectus
covering Registrable Securities, provide copies of such documents to the
demanding Purchasers (or their representatives) and to the underwriter or
underwriters of an underwritten offering, if applicable, and to their respective
counsel; fairly consider such reasonable changes in any such documents prior to
or after the filing thereof as the counsel to the demanding Purchasers or the
underwriter or the underwriters may request; and make such of the
representatives of the Company as shall be reasonably requested by the demanding
Purchasers or any underwriter available for discussion of such documents; and

(2) within a reasonable time prior to the filing of any document which is to be
incorporated by reference into any Registration Statement or a Prospectus
covering Registrable Securities, provide copies of such document to counsel for
the demanding Purchasers and underwriters; fairly consider such reasonable
changes in such document prior to or after the filing thereof as counsel for
such demanding Purchasers or such underwriter shall request; and make such of
the representatives of the Company as shall be reasonably requested by such
counsel available for discussion of such document;

(c) use its commercially reasonable efforts to cause any Registration Statement
and the related Prospectus and any amendment or supplement thereto, as of the
effective date of such Registration Statement, amendment or supplement and
during the distribution of the registered Registrable Securities (x) to comply
in all material respects with the requirements of the Securities Act and the
rules and regulations of the Commission and (y) not to contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein (in the case of any
Prospectus or form of prospectus or supplement thereto, in the light of the
circumstances under which they were made) not misleading;

(d) notify the Purchasers promptly, and, if requested by the Purchasers, confirm
such advice in writing, (i) when any Registration Statement has become effective
and when any post-effective amendments and supplements thereto become effective
if such Registration Statement or post-effective amendment is not automatically
effective upon filing pursuant to Rule 462, (ii) of the issuance by the
Commission or any U.S. state securities authority of any stop order, injunction
or other order or requirement suspending the effectiveness of any Registration
Statement or the initiation of any proceedings for that purpose, (iii) if,
between the effective date of any Registration Statement and the closing of any
sale of securities covered thereby pursuant to any agreement to which the
Company is a party, the representations and warranties of the Company contained
in such agreement cease to be true and correct in all material respects or if
the Company receives any notification with respect to the suspension of the
qualification of the Registrable Securities for sale in any jurisdiction or the
initiation of any proceeding for such purpose, and (iv) of the happening of any
event during the period any Registration Statement is effective as a result of
which such Registration Statement or the related Prospectus contains any untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided that the Purchasers, upon receiving written notice of an event
described in clauses (ii) to (iv) of this Section 4.1(d), shall discontinue (and
direct any other person

 

6

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making offers and sales of Registrable Securities on its behalf to discontinue)
offers and sales of Registrable Securities pursuant to any Registration
Statement (other than those pursuant to a plan in effect prior to such event and
that complies with Rule 10b5-1 under the Exchange Act) until it is advised in
writing by the Company that the use of the applicable Prospectus may be resumed
and is furnished with an amended or supplemented Prospectus;

(e) furnish counsel for each underwriter, if any, and for the Purchasers with
copies of any written correspondence with the Commission or any state securities
authority relating to the Registration Statement or Prospectus;

(f) otherwise use its commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission, including making available
to its security holders an earnings statement covering at least 12 months which
shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar provision then in force); and

(g) use its commercially reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of any Registration Statement at the earliest
possible time.

4.2 Shelf Takedowns. In connection with any shelf takedown that is demanded by
the relevant Purchaser(s), the Company will:

(a) cooperate with the selling Purchasers and the sole underwriter or managing
underwriter of an underwritten offering, if any, to facilitate the timely
preparation and delivery of certificates representing the Registrable Securities
to be sold and not bearing any restrictive legends; and enable such Registrable
Securities to be in such denominations (consistent with the provisions of the
governing documents thereof), and registered in such names as the selling
Purchasers or the sole underwriter or managing underwriter of an underwritten
offering of Registrable Securities, if any, may reasonably request at least five
days prior to any sale of such Registrable Securities;

(b) furnish to the relevant Purchaser(s) and to each underwriter, if any,
participating in the relevant offering, without charge, as many copies of the
applicable Prospectus, including each preliminary prospectus, and any amendment
or supplement thereto and such other documents as such Purchaser(s) or
underwriter may reasonably request in order to facilitate the public sale of the
Registrable Securities, subject to the other provisions of this Agreement; the
Company hereby consents to the use of the Prospectus, including each preliminary
prospectus, by such Purchaser(s) and each underwriter in connection with the
offering and sale of the Registrable Securities covered by the Prospectus or the
preliminary prospectus;

(c) (i) use its commercially reasonable efforts to register or qualify the
Registrable Securities being offered and sold under all applicable U.S. state
securities or “blue sky” laws of such jurisdictions as each underwriter shall
reasonably request; (ii) use reasonable efforts to keep each such registration
or qualification effective during the period such Registration Statement is
required to be kept effective; and (iii) do any and all other acts and things
which may be reasonably necessary or advisable to enable each such underwriter,
if any, and/or the Purchasers to consummate the disposition in each such
jurisdiction of such Registrable Securities owned by the Purchasers; provided,
however, that the Company shall not be obligated to qualify as a foreign

 

7

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corporation or as a dealer in securities in any jurisdiction in which it is not
so qualified, to subject itself to taxation in any such jurisdiction, or to
consent to be subject to general service of process (other than service of
process in connection with such registration or qualification or any sale of
Registrable Securities in connection therewith) in any such jurisdiction;

(d) if the listing of such Registrable Securities is then permitted under the
rules of such exchange, use its commercially reasonable efforts to cause all
Registrable Securities being offered and sold pursuant to this Agreement to be
qualified for inclusion in or listed on The New York Stock Exchange or any
securities exchange on which the Common Stock issued by the Company are then so
qualified or listed if so requested by the demanding Purchaser(s) or if so
requested by the underwriter or underwriters of an underwritten offering of
Registrable Securities, if any;

(e) cooperate and assist in any filings required to be made with The New York
Stock Exchange or other securities exchange and, solely with regard to an
underwritten shelf takedown, in the performance of any reasonable due diligence
investigation by the underwriters;

(f) solely with regard to an underwritten shelf takedown, use its commercially
reasonable efforts to facilitate the distribution and sale of any Registrable
Securities to be offered pursuant to this Agreement, including without
limitation by making road show presentations, holding meetings with and making
calls to potential investors and taking such other actions as shall be
reasonably requested by the demanding Purchaser(s) or the lead managing
underwriter;

(g) solely with regard to an underwritten shelf takedown, enter into
underwriting agreements in customary form (including provisions with respect to
indemnification and contribution in customary form) and take all other customary
and appropriate actions in order to expedite or facilitate the disposition of
such Registrable Securities and in connection therewith:

1. make such representations and warranties to the selling Purchaser(s) and the
underwriters in such form, substance and scope as are customarily made by
issuers to underwriters in similar underwritten offerings;

2. obtain opinions of counsel to the Company and updates thereof (which counsel
and opinions (in form, scope and substance) shall be reasonably satisfactory to
the lead managing underwriter) addressed to the underwriters and, if reasonably
obtainable, the selling Purchaser(s) covering the matters customarily covered in
opinions delivered in similar underwritten offerings; and

3. obtain “cold comfort” letters and updates thereof from the Company’s
independent certified public accountants addressed to the underwriters, and, if
reasonably obtainable, the selling Purchaser(s), which letters shall be
customary in form and shall cover matters of the type customarily covered in
“cold comfort” letters to underwriters in connection with similar underwritten
offerings.

4.3 Due Diligence. In connection with each registration and offering of
Registrable Securities to be sold by the Purchasers, the Company will, in
accordance with customary practice, make reasonably available for inspection by
representatives of the Purchaser and underwriters and any counsel or accountant
retained by the Purchaser or underwriters (each, an “Inspector”) all relevant
financial and other records, pertinent corporate documents and properties of the
Company and

 

8

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cause appropriate officers, managers and employees of the Company to supply all
information reasonably requested by any such representative, underwriter,
counsel or accountant in connection with their due diligence exercise. Such
access to information, documents, personnel and other matters shall be provided
to such participants, at such times and in such manner as are customary for
offerings of the relevant type and as do not unreasonably burden the Company or
unreasonably interfere with its operations. With respect to all information,
documents and other matters provided or made accessible by the Company in
connection with a registered offering hereunder, each Inspector shall agree in
writing to hold such information in strict confidence and subject to applicable
legal requirements, at all times prior to the public disclosure thereof by the
Company.

4.4 Information from the Purchasers. The Purchasers shall, as promptly as
reasonably practicable, furnish to the Company such information regarding itself
as is required to be included in any Registration Statement or to maintain the
effectiveness of any Registration Statement, the ownership of Registrable
Securities by the Purchasers and the proposed distribution by the Purchasers of
such Registrable Securities as the Company may from time to time reasonably
request in writing, and shall execute such documents in connection with such
registration as the Company may reasonably request. Each selling Purchaser
participating in a registered offering hereunder shall do so on the terms and
conditions applicable to such offering and the applicable plan of distribution;
provided that no such selling Purchaser shall be required to make any
representations or warranties to or agreements with the Company or the
underwriters other than representations, warranties or agreements regarding such
selling Purchaser and such selling Purchaser’s Registrable Securities.
Notwithstanding any other provision of this Agreement, the Company shall not be
required to file any Registration Statement or include Registrable Securities
therein unless it has received from the Purchasers, within a reasonable period
of time prior to the anticipated Filing Date of such Registration Statement, all
requested information required to be included in the Registration Statement.

ARTICLE 5. REGISTRATION EXPENSES

All fees and expenses incident to the performance of or compliance with this
Agreement by the Company, except as and to the extent specified in this
Section 5, shall be borne by the Company whether or not the Registration
Statement is filed or becomes effective and whether or not any Registrable
Securities are sold pursuant to the Registration Statement. The fees and
expenses referred to in the foregoing sentence shall include, without
limitation, and to the extent applicable (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to be made with each securities exchange or market on which Registrable
Securities are required hereunder to be listed, if any, (B) with respect to
filing fees required to be paid to the Financial Industry Regulatory Authority
and (C) in compliance with state securities or Blue Sky laws (including, without
limitation, fees and disbursements of counsel for the Purchaser(s) in connection
with Blue Sky qualifications of the Registrable Securities and determination of
the eligibility of the Registrable Securities for investment under the laws of
such jurisdictions as the Company may designate)), (ii) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing of
prospectuses is requested by the Company), (iii) messenger, telephone and
delivery expenses, (iv) Securities Act liability insurance, if the Company
elects to purchase such insurance, and (v) fees and expenses of all other
Persons retained by the Company in connection with the consummation of the
transactions contemplated by this Agreement, including, without limitation,

 

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the Company’s independent public accountants (including the expenses of any
comfort letters or costs associated with the delivery by independent public
accountants of a comfort letter or comfort letters). In addition, the Company
shall be responsible for all of its internal expenses incurred in connection
with the consummation of the transactions contemplated by this Agreement
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual
audit, the fees and expenses incurred in connection with the listing of the
Registrable Securities on any securities exchange if required hereunder. The
Company shall not be responsible for any underwriters’, brokers’ and dealers’
discounts and commissions, transfer taxes or other similar fees incurred by
Purchaser in connection with the sale of the Registrable Securities.

ARTICLE 6. INDEMNIFICATION

6.1 Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless each Purchaser, its
officers, directors, employees and affiliates, each Person who controls such
Purchaser (within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) and the officers, directors and employees of each such
controlling Person (collectively, the “Purchaser Indemnified Parties”), to the
full extent permitted by applicable law, from and against any and all losses,
claims, damages, liabilities, costs (including, without limitation, costs of
preparation and attorneys’ and expert witnesses’ fees) and expenses
(collectively, “Losses”) (as determined by a court of competent jurisdiction in
a final judgment not subject to appeal or review), to which such Purchaser
Indemnified Parties may become subject under the Securities Act or otherwise,
arising out of or relating to any violation of securities laws or untrue or
alleged untrue statement of a material fact contained in any Registration
Statement, any Prospectus or any form of prospectus or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out of or
relating to any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein (in the case of any
Prospectus or form of prospectus or supplement thereto, in the light of the
circumstances under which they were made) not misleading, except to the extent,
but only to the extent, that such untrue statements or omissions are based
solely upon information regarding the relevant Purchaser(s) furnished in writing
to the Company by such Purchaser(s) expressly for use therein. The Company shall
notify such Purchaser(s) promptly of the institution, threat or assertion of any
Proceeding of which the Company is aware in connection with the transactions
contemplated by this Agreement. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of any such
Purchaser(s), the directors and officers of such Purchaser(s), or controlling
Person of the Purchaser(s), and shall survive the transfer of such securities
held by such Purchaser(s).

6.2 Indemnification by Purchaser. Each Purchaser, severally and not jointly,
shall indemnify and hold harmless the Company, its directors, officers and
employees, each Person who controls the Company (within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors, officers and employees of such controlling Persons (collectively, the
“Company Indemnified Parties”), to the full extent permitted by applicable law,
from and against all Losses (as determined by a court of competent jurisdiction
in a final judgment not subject to appeal or review), to which the Company
Indemnified Parties may become subject under the Securities Act or otherwise,
arising solely out of or based solely upon any untrue statement of a material
fact contained in any Registration Statement, any Prospectus, or any form of
prospectus,

 

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or in any amendment or supplement thereto, or arising solely out of or based
solely upon any omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus or form
of prospectus or supplement thereto, in the light of the circumstances under
which they were made) not misleading, to the extent, but only to the extent,
that such untrue statement or omission is contained in any information so
furnished in writing by such Purchaser to the Company specifically for inclusion
in the Registration Statement or such Prospectus. Notwithstanding anything to
the contrary contained herein, each Purchaser shall be liable under this
Section 6.2 for only that amount as does not exceed the net proceeds to such
Purchaser as a result of the sale of Registrable Securities pursuant to such
Registration Statement.

6.3 Conduct of Indemnification Proceedings. If any Proceeding shall be brought
or asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party promptly shall notify the Person from whom
indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying
Party shall be entitled to assume the defense thereof, including the employment
of counsel reasonably satisfactory to the Indemnified Party and the payment of
all fees and expenses incurred in connection with defense thereof; provided,
that the failure of any Indemnified Party to give such notice shall not relieve
the Indemnifying Party of its obligations or liabilities pursuant to this
Agreement, except (and only) to the extent that it shall be finally determined
by a court of competent jurisdiction (which determination is not subject to
appeal or further review) that such failure shall have proximately and
materially adversely prejudiced the Indemnifying Party.

An Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Indemnified
Parties unless: (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses; or (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (3) the named
parties to any such Proceeding (including any impleaded parties) include both
such Indemnified Party and the Indemnifying Party, and such parties shall have
been advised by counsel that a conflict of interest is likely to exist if the
same counsel were to represent such Indemnified Party and the Indemnifying Party
(in which case, if such Indemnified Party notifies the Indemnifying Party in
writing that it elects to employ separate counsel at the expense of the
Indemnifying Party, the Indemnifying Party shall not have the right to assume
the defense thereof and such counsel shall be at the expense of the Indemnifying
Party). The Indemnifying Party shall not be liable for any settlement of any
such Proceeding effected without its written consent, which consent shall not be
unreasonably withheld or delayed. No Indemnifying Party shall, without the prior
written consent of the Indemnified Party, effect any settlement of any pending
or threatened Proceeding in respect of which any Indemnified Party is a party
and indemnity has been sought hereunder, unless such settlement includes an
unconditional release of such Indemnified Party from all liability on claims
that are the subject matter of such Proceeding.

All fees and expenses of the Indemnified Party (including reasonable fees and
expenses to the extent incurred in connection with investigating or preparing to
defend such Proceeding in a manner not inconsistent with this Section) shall be
paid to the Indemnified Party, as incurred, within thirty (30) Business Days of
written notice thereof to the Indemnifying Party (regardless of whether it is
ultimately determined that an Indemnified Party is not entitled to
indemnification hereunder; provided, that the Indemnified Party shall reimburse
all such fees and expenses to the extent it is finally judicially determined
that such Indemnified Party is not entitled to indemnification hereunder).

 

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6.4 Contribution. If a claim for indemnification under Sections 6.1 or 6.2 is
due but unavailable to an Indemnified Party, then each Indemnifying Party, in
lieu of indemnifying such Indemnified Party, shall contribute to the amount paid
or payable by such Indemnified Party as a result of such Losses, in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party on the one hand and the Indemnified Party on the other in connection with
the actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among other
things, whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission of a material fact,
has been taken or made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission.

The amount paid or payable by a party as a result of any Losses shall be deemed
to include, subject to the limitations set forth in Section 6.3, any reasonable
attorneys’ or other reasonable fees or expenses incurred by such party in
connection with any Proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party in accordance with its terms. In no
event shall the Company be required to contribute an amount under this
Section 6.4 in excess of the net proceeds received by it upon the sale of its
Registrable Securities pursuant to a Registration Statement giving rise to such
contribution obligation. The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 6.4 were determined by pro
rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not also guilty of such fraudulent misrepresentation. The
indemnity and contribution agreements contained in this Section are in addition
to any liability that the Indemnifying Parties may have to the Indemnified
Parties pursuant to the law.

6.5 Survival. The agreements contained in this Article VI shall survive the
transfer of the Registrable Securities by any Purchaser and sale of all of the
Registrable Securities pursuant to any registration statement and shall remain
in full force and effect, regardless of any investigation made by or on behalf
of any Purchaser Indemnified Party.

ARTICLE 7. RULE 144

If the Company is subject to the requirements of Section 13, 14 or 15(d) of the
Exchange Act, the Company covenants that it will file any reports required to be
filed by it under the Securities Act and the Exchange Act, so as to enable the
Purchasers to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by (a) Rule 144
under the Securities Act, as such rule may be amended from time to time, or
(b) any successor rule or regulation hereafter adopted by the Commission. Upon
the request of any Purchaser, the Company will deliver to such Purchaser a
written statement as to whether it has complied with such requirements.
Notwithstanding anything in this Agreement, the Company shall not be required to
register any of its equity securities under Section 12 of the Exchange Act in
order to enable the Purchasers to dispose of Registrable Securities under Rule
144.

 

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ARTICLE 8. MISCELLANEOUS

8.1 Remedies. In the event of a breach by the Company or the Purchasers of any
of their respective obligations under this Agreement, the Company or the
Purchasers, as the case may be, in addition to being entitled to exercise all
rights granted by law and under this Agreement, including recovery of damages,
will be entitled to specific performance of its rights under this Agreement. The
Company and the Purchasers acknowledge and agree that monetary damages would not
provide adequate compensation for any losses incurred by reason of a breach by
either of them of any of the provisions of this Agreement and each hereby
further agrees that, in the event of any action for specific performance in
respect of such breach, it shall waive the defense that a remedy at law would be
adequate.

8.2 No Inconsistent Agreements. The Company shall not enter into any such
agreement with respect to its securities that is inconsistent with or violates
the rights granted to the Purchasers in this Agreement.

8.3 Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given,
unless the same shall be in writing and signed by the Company and the Purchasers
shall have consented thereto.

8.4 Termination of Registration Rights. This Agreement to register Registrable
Securities for sale under the Securities Act shall terminate on the earliest to
occur of (i) the first date on which all outstanding Registrable Securities are
eligible for sale under Rule 144 and restrictive legends have been removed from
all certificates representing the applicable Registrable Securities and (ii) the
fifth anniversary of the effective date of the Registration Statement filed
pursuant to Section 2.1. Notwithstanding any termination of this Agreement
pursuant to this Section 8.4, the parties’ rights and obligations under Article
VI hereof shall continue in full force and effect in accordance with their
respective terms.

8.5 Notices. Any notice, demand, request, waiver or other communication required
or permitted to be given hereunder shall be in writing and shall be delivered by
a recognized courier service, fully prepaid and properly addressed upon the
earlier of (i) actual receipt thereof, as shown by the records of such courier
or (ii) five days after the receipt thereof by the courier from the party giving
it. The addresses for such notice, demand, request, waiver or other
communication shall be:

If to the Company:

Eastman Kodak Company

343 State Street

Rochester, NY 14650

 

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Attention:    General Counsel Fax:    (585) 724-1089 If to Purchasers:

Southeastern Asset Management, Inc.

6410 Poplar Avenue, Suite 900

Memphis, TN 38119 Attention:    Andrew R. McCarroll Telephone:    901-818-5185
Email:    amccarroll@SEasset.com

Either party may from time to time change its address for notice by giving at
least five (5) days written notice of such changed address to the other party.

8.6 Successors and Assigns. (a) This Agreement shall be binding upon and inure
to the benefit of the parties and their successors and permitted assigns and
shall inure to the benefit of each Purchaser and its successors and permitted
assigns. Neither party may assign this Agreement nor any of its rights or
obligations hereunder without the prior written consent of the other party.

(b) In the event the Company engages in a merger or consolidation in which the
Registrable Securities are converted into securities of another company, or if
there are any changes in the Common Stock by way of share split, stock dividend,
combination or reclassification, appropriate arrangements will be made so that
the registration rights provided under this Agreement continue to be provided to
the Purchasers by the issuer of such securities. To the extent any new issuer,
or any other company acquired by the Company in a merger or consolidation, was
bound by registration rights obligations that would conflict with the provisions
of this Agreement, the Company will, unless the Purchasers otherwise agree, use
commercially reasonable efforts to modify any such “inherited” registration
rights obligations so as not to interfere in any material respects with the
rights provided under this Agreement.

8.7 Counterparts. This Agreement may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original and, all of
which taken together shall constitute one and the same Agreement and shall
become effective when counterparts have been signed by each party and delivered
to the other parties hereto, it being understood that all parties need not sign
the same counterpart. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the
party executing (or on whose behalf such signature is executed) with the same
force and effect as if such facsimile signature were the original thereof.

8.8 Governing Law; Jurisdiction. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York. This
Agreement shall not be interpreted or construed with any presumption against the
party causing this Agreement to be drafted. The exclusive jurisdiction for the
resolution of any conflicts regarding this Agreement shall be in the courts of
the Southern District of New York. This exclusive jurisdiction is a material
provision to this Agreement.

 

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8.9 Waiver of Jury Trial. Each of the parties to this Agreement hereby
unconditionally agrees to waive, to the fullest extent permitted by applicable
law, its respective rights to a jury trial of any claim or cause of action
(whether based on contract, tort or otherwise) based upon, arising out of or
relating to this Agreement or the transactions contemplated hereby. The scope of
this waiver is intended to be all-encompassing of any and all disputes that may
be filed in any court and that relate to the subject matter of this Agreement,
including contract claims, tort claims and all other common law and statutory
claims. Each party hereto: (i) acknowledges that this waiver is a material
inducement to enter into this Agreement, that each has already relied on this
waiver in entering into this Agreement, and that each will continue to rely on
this waiver in their related future dealings, (ii) acknowledges that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not in the event of any action or
proceeding, seek to enforce the foregoing waiver and (iii) warrants and
represents that it has reviewed this waiver with its legal counsel and that it
knowingly and voluntarily waives its jury trial rights following consultation
with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER
SPECIFICALLY REFERRING TO THIS SECTION 8.9 AND EXECUTED BY EACH OF THE PARTIES
HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. In the event of litigation, this
Agreement may be filed as a written consent to a trial by the court.

8.10 Cumulative Remedies. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law.

8.11 Severability. If any term, provision, covenant or restriction of this
Agreement is held to be invalid, illegal, void or unenforceable in any respect,
the remainder of the terms, provisions, covenants and restrictions set forth
herein shall remain in full force and effect and shall in no way be affected,
impaired or invalidated, and the parties hereto shall use their reasonable
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.

8.12 Section Headings. The Section headings herein are for convenience only, do
not constitute a part of this Agreement and shall not be deemed to limit or
affect any of the provisions hereof.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Registration Rights
Agreement to be duly executed by a person thereunto authorized as of the date
first indicated above.

 

COMPANY:

 

EASTMAN KODAK COMPANY

By:  

             

Name:   Title:  

[Signature Page to Registration Rights Agreement]

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PURCHASERS: C2W PARTNERS MASTER FUND LIMITED By:  

Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

 

  Name:   Title:

LONGLEAF PARTNERS SMALL-CAP

FUND

By:  

Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

 

  Name:   Title: DESERET MUTUAL PENSION TRUST By:  

Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

 

  Name:   Title:

[Signature Page to Registration Rights Agreement]

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EXHIBIT C

FORM OF SECURITY AGREEMENT

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GUARANTEE AND COLLATERAL AGREEMENT

Dated [•], 2019

From

The Grantors referred to herein

as Grantors

to

Wilmington Trust, National Association

as Collateral Agent

and

the Noteholders referred to herein

as Noteholders

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TABLE OF CONTENTS

 

          Page  

Section 1.

   Guarantee      2  

Section 2.

   Grant of Security      6  

Section 3.

   Security for Obligations      9  

Section 4.

   Grantors Remain Liable      9  

Section 5.

   Delivery and Control of Certain Account and Security Collateral      9  

Section 6.

   [Reserved]      11  

Section 7.

   Representations and Warranties      11  

Section 8.

   Further Assurances      13  

Section 9.

   As to Equipment and Inventory      14  

Section 10.

   Insurance      15  

Section 11.

   Post-Closing Changes; Collections on Receivables      15  

Section 12.

   [Reserved]      17  

Section 13.

   Voting Rights; Dividends; Etc.      17  

Section 14.

   [Reserved      18  

Section 15.

   As to Letter-of-Credit Rights and Commercial Tort Claims      18  

Section 16.

   Transfers and Other Liens; Additional Shares      18  

Section 17.

   Collateral Agent Appointed Attorney-in-Fact      19  

Section 18.

   Collateral Agent May Perform      20  

Section 19.

   The Collateral Agent’s Duties      20  

Section 20.

   Remedies      21  

Section 21.

   [Reserved]      22  

Section 22.

   Indemnity and Expenses      22  

Section 23.

   Amendments; Waivers; Additional Grantors; Etc.      23  

Section 24.

   Confidentiality; Notices; References      23  

Section 25.

   Continuing Security Interest; Assignments Under the Notes      25  

 

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Section 26.

   [Reserved]      25  

Section 27.

   Release; Termination      25  

Section 28.

   Right of Setoff      27  

Section 29.

   Appointment and Administration by Collateral Agent      28  

Section 30.

   Agency for Perfection      32  

Section 31.

   Execution in Counterparts      32  

Section 32.

   Governing Law      32  

Section 33.

   Jurisdiction; Waiver of Jury Trial      32  

Section 34.

   Intercreditor Agreement      33  

Schedules

 

Schedule I    –      Investment Property Schedule II    –      Deposit Accounts,
Securities Accounts and Lock Boxes Schedule III    –      Receivables
Schedule IV    –      [Reserved] Schedule V    –      Legal Name, Trade Names,
Location, Chief Executive Office, Type of Organization, Jurisdiction of
Organization, Organizational Identification Number and Federal Employer
Identification Number Schedule VI    –      Changes in Name, Location, Etc.
Schedule VII    –      Letters of Credit Schedule VIII    –      Equipment
Locations Schedule IX    –      Inventory Locations Schedule X    –     
Commercial Tort Claims Schedule XI    –      Mergers and Acquisitions
Schedule XII    –      Locations of Books and Records Schedule XIII    –     
Filing Offices Schedule XIV    –      Other Actions Exhibits       Exhibit A   
–      [Reserved] Exhibit B    –      [Reserved] Exhibit C    –      Form of
Security Agreement Supplement

 

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GUARANTEE AND COLLATERAL AGREEMENT

GUARANTEE AND COLLATERAL AGREEMENT dated [•], 2019 (as it may be amended,
restated, amended and restated, supplemented or otherwise modified from time to
time, this “Agreement”), made by Eastman Kodak Company, a New Jersey corporation
(“Company”), and the other persons listed on the signature pages hereof, or
which at any time execute and deliver a Security Agreement Supplement in
substantially the form attached hereto as Exhibit C (the Company and such
persons so listed or joined being, collectively, the “Grantors”), to Wilmington
Trust, National Association, as collateral agent (in such capacity, together
with any successors duly appointed by the Noteholders and assigns, the
“Collateral Agent”) for the Noteholders and the Noteholders (and their
successors, permitted transferees and permitted assigns).

PRELIMINARY STATEMENTS

(1) Company has agreed to issue to the Noteholders a certain series of secured
convertible promissory notes dated of even date herewith, in an aggregate
original principal amount of $100,000,000 (as amended from time to time, the
“Notes”), pursuant to that certain Note Purchase Agreement dated of even date
herewith, by and among the Company and the purchasers party thereto (together
with any successors and permitted assigns, the “Noteholders”) (as it may be
amended, restated, amended and restated, supplemented or otherwise modified from
time to time, the “Note Purchase Agreement”);

(2) Company is a member of an affiliated group of companies that includes each
other Grantor;

(3) Each Grantor is the holder of the indebtedness owed to such Grantor as of
the date hereof (the “Initial Pledged Debt”) set forth opposite such Grantor’s
name on and as otherwise described in Part I of Schedule I hereto and issued by
the obligors named therein.

(4) Each Grantor is the owner of the deposit accounts set forth opposite such
Grantor’s name on Schedule II hereto (together with all deposit accounts now
owned or hereafter acquired by the Grantors, the “Pledged Deposit Accounts”).

(5) Company is the owner of an L/C Cash Deposit Account (the “L/C Cash Deposit
Account”) created in accordance with the ABL Agreement and subject to the
security interest granted under this Agreement.

(6) Company is the owner of the Pledged Cash Account (Eligible Cash) (the
“Pledged Cash Account (Eligible Cash)”) created in accordance with the ABL
Agreement and subject to the security interest granted under this Agreement.

(7) It is a condition precedent to the obligation of the Noteholders to purchase
their respective Notes from the Company under the Note Purchase Agreement that
the Grantors shall have provided the guarantee and granted the security
interests contemplated by this Agreement.

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(8) Each Grantor will derive substantial direct or indirect benefit from the
transactions contemplated by this Agreement, the Note Purchase Agreement and the
other Transaction Documents.

(9) Terms defined in the Notes or Note Purchase Agreement and not otherwise
defined in this Agreement (including in Attachment 1 attached hereto) are used
in this Agreement as defined in the Notes and Note Purchase Agreement, as
applicable. The words “include,” “includes” and “including” shall be deemed to
be followed by the phrase “without limitation.” Further, unless otherwise
defined in this Agreement or in the Note or Note Purchase Agreement, terms
defined in Article 8 or 9 of the UCC (as defined below) are used in this
Agreement (whether or not capitalized) as such terms are defined in such
Article 8 or 9. “UCC” means the Uniform Commercial Code as in effect from time
to time in the State of New York; provided, that, if perfection or the effect of
perfection or non-perfection or the priority of the security interest in any
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, “UCC” means the Uniform
Commercial Code as in effect from time to time in such other jurisdiction for
purposes of the provisions hereof relating to such perfection, effect of
perfection or non-perfection or priority.

NOW, THEREFORE, in consideration of the premises and in order to induce the
Noteholders to purchase the Notes from the Company under the Note Purchase
Agreement, each Grantor hereby agrees with the Collateral Agent for the benefit
of the Secured Parties as follows:

Section 1. Guarantee.

(a) Guarantee. Each of the Guarantors hereby, jointly and severally,
unconditionally and irrevocably, guarantees to the Collateral Agent, for the
ratable benefit of the Secured Parties and their respective successors,
indorsees, transferees and assigns, the prompt and complete payment and
performance by the Company when due (whether at the stated maturity, by
acceleration or otherwise) of the Company Obligations. “Guarantors” shall mean
each Grantor other than the Company. “Company Obligations” shall mean the unpaid
principal of and interest on (including interest accruing after the maturity of
the Notes and interest accruing after the filing of any petition in bankruptcy,
or the commencement of any insolvency, reorganization or like proceeding,
relating to the Company, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding) the Notes and all other obligations and
liabilities of the Company to the Collateral Agent or to any Noteholder, whether
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, this Agreement, any other Transaction Document, or any other document
made, delivered or given in connection herewith or therewith, whether on account
of principal, interest, reimbursement obligations, fees, indemnities, costs,
expenses (including all fees, charges and disbursements of counsel to the
Collateral Agent or to any Noteholder that are required to be paid by the
Company pursuant to the terms of any Transaction Document).

 

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(i) Anything herein or in any other Transaction Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Transaction Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws relating to
the insolvency of debtors (after giving effect to the right of contribution
established in Section 1(b)).

(ii) Each Guarantor agrees that the Company Obligations may at any time and from
time to time exceed the amount of the liability of such Guarantor hereunder
without impairing the guarantee contained in this Section 1 or affecting the
rights and remedies of the Collateral Agent or any Noteholder hereunder.

(iii) The guarantee contained in this Section 1 shall remain in full force and
effect until all the Obligations (other than any contingent indemnification
obligations not then due and payable) shall have been satisfied by payment in
full. “Obligations” shall mean (i) in the case of the Company, the Company
Obligations, and (ii) in the case of each Guarantor, its Guarantor Obligations.
“Guarantor Obligations” shall mean with respect to any Guarantor, all
obligations and liabilities of such Guarantor which may arise under or in
connection with this Agreement (including, without limitation, this Section 1)
or any other Transaction Document, in each case whether on account of guarantee
obligations, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of counsel
to the Collateral Agent or to the Noteholders that are required to be paid by
such Guarantor pursuant to Section 22 hereof).

(iv) No payment made by the Company, any of the Guarantors, any other guarantor
or any other person or received or collected by the Collateral Agent or any
Noteholder from the Company, any of the Guarantors, any other guarantor or any
other person by virtue of any action or proceeding or any setoff or
appropriation or application at any time or from time to time in reduction of or
in payment of the Company Obligations shall be deemed to modify, reduce, release
or otherwise affect the liability of any Guarantor hereunder which shall,
notwithstanding any such payment (other than any payment made by such Guarantor
in respect of the Company Obligations or any payment received or collected from
such Guarantor in respect of the Company Obligations), remain liable for the
Company Obligations up to the maximum liability of such Guarantor hereunder
until the Obligations are paid in full (other than any contingent
indemnification obligations not then due and payable).

(b) Right of Contribution. Each Guarantor hereby agrees that to the extent that
a Guarantor shall have paid more than its proportionate share of any payment
made hereunder, such Guarantor shall be entitled to seek and receive
contribution from and against any other Guarantor hereunder which has not paid
its proportionate share of such payment. Each Guarantor’s right of contribution
shall be subject to the terms and conditions of Section 1(c). The provisions of
this Section 1(b) shall in no respect limit the obligations and liabilities of
any Guarantor to the Collateral Agent and the Noteholders, and each Guarantor
shall remain liable to the Collateral Agent and the Noteholders for the full
amount guaranteed by such Guarantor hereunder.

 

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(c) No Subrogation. Notwithstanding any payment made by any Guarantor hereunder
or any setoff or application of funds of any Guarantor by the Collateral Agent
or any Noteholder, no Guarantor shall be entitled to be subrogated to any of the
rights of the Collateral Agent or any Noteholder against the Company or any
other Guarantor or any collateral security or guarantee or right of offset held
by the Collateral Agent or any Noteholder for the payment of the Company
Obligations, nor shall any Guarantor seek or be entitled to seek any
contribution or reimbursement from the Company or any other Guarantor in respect
of payments made by such Guarantor hereunder, until all amounts owing to the
Collateral Agent and the Noteholders by the Company on account of the Company
Obligations (other than contingent indemnification obligations not then due and
payable) are paid in full. If any amount shall be paid to any Guarantor on
account of such subrogation rights at any time when all of the Company
Obligations shall not have been paid in full, such amount shall be held by such
Guarantor in trust for the Collateral Agent and the Noteholders, segregated from
other funds of such Guarantor, and shall, forthwith upon receipt by such
Guarantor, be turned over to the Collateral Agent in the exact form received by
such Guarantor (duly indorsed by such Guarantor to the Collateral Agent, if
required), to be applied against the Company Obligations, whether matured or
unmatured, in such order as the Collateral Agent may determine.

(d) Amendments, etc. with respect to the Company Obligations. Each Guarantor
shall remain obligated hereunder notwithstanding that, without any reservation
of rights against any Guarantor and without notice to or further assent by any
Guarantor, any demand for payment of any of the Company Obligations made by the
Collateral Agent or any Noteholder may be rescinded by the Collateral Agent or
such Noteholder and any of the Company Obligations continued, and the Company
Obligations, or the liability of any other person upon or for any part thereof,
or any collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waived, surrendered or released by
the Collateral Agent or any Noteholder, and the Note Purchase Agreement and the
other Transaction Documents and any other documents executed and delivered in
connection therewith may be amended, modified, waived, supplemented or
terminated, in whole or in part pursuant to the terms of thereof, as the
Collateral Agent (or the Required Noteholders) may reasonably deem advisable
from time to time, and any collateral security, guarantee or right of offset at
any time held by the Collateral Agent or any Noteholder for the payment of the
Company Obligations may be sold, exchanged, waived, surrendered or released.
Neither the Collateral Agent nor any Noteholder shall have any obligation to
protect, secure, perfect or insure any Lien at any time held by it as security
for the Company Obligations or for the guarantee contained in this Section 1 or
any property subject thereto.

 

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(e) Guarantee Absolute and Unconditional. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Company
Obligations and notice of or proof of reliance by the Collateral Agent or any
Noteholder upon the guarantee contained in this Section 1 or acceptance of the
guarantee contained in this Section 1; the Company Obligations, and any of them,
shall conclusively be deemed to have been created, contracted or incurred, or
renewed, extended, amended or waived, in reliance upon the guarantee contained
in this Section; and all dealings between the Company and any of the Guarantors,
on the one hand, and the Collateral Agent and the Noteholders, on the other
hand, likewise shall be conclusively presumed to have been had or consummated in
reliance upon the guarantee contained in this Section 1. Each Guarantor waives
diligence, presentment, protest, demand for payment and notice of default or
nonpayment to or upon the Company or any of the Guarantors with respect to the
Company Obligations. Each Guarantor understands and agrees that the guarantee
contained in this Section 1 shall be construed as a continuing, absolute and
unconditional guarantee of payment without regard to (a) the validity or
enforceability of the Note Purchase Agreement or any other Transaction Document,
any of the Company Obligations or any other collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to
time held by the Collateral Agent or any Noteholder, (b) any defense, setoff or
counterclaim (other than a defense of payment or performance) which may at any
time be available to or be asserted by the Company or any other person against
the Collateral Agent or any Noteholder, or (c) any other circumstance whatsoever
(with or without notice to or knowledge of the Company or such Guarantor) which
constitutes, or might be construed to constitute, an equitable or legal
discharge of the Company for the Company Obligations, or of such Guarantor under
the guarantee contained in this Section 1, in bankruptcy or in any other
instance. When making any demand hereunder or otherwise pursuing its rights and
remedies hereunder against any Guarantor, the Collateral Agent or any Noteholder
may, but shall be under no obligation to, make a similar demand on or otherwise
pursue such rights and remedies as it may have against the Company, any other
Guarantor or any other person or against any collateral security or guarantee
for the Company Obligations or any right of offset with respect thereto, and any
failure by the Collateral Agent or any Noteholder to make any such demand, to
pursue such other rights or remedies or to collect any payments from the
Company, any other Guarantor or any other person or to realize upon any such
collateral security or guarantee or to exercise any such right of offset, or any
release of the Company, any other Guarantor or any other person or any such
collateral security, guarantee or right of offset, shall not relieve any
Guarantor of any obligation or liability hereunder, and shall not impair or
affect the rights and remedies, whether express, implied or available as a
matter of law, of the Collateral Agent or any Noteholder against any Guarantor.
For the purposes hereof “demand” shall include the commencement and continuance
of any legal proceedings.

(f) Reinstatement. The guarantee contained in this Section 1 shall continue to
be effective, or be reinstated, as the case may be, if at any time payment, or
any part thereof, of any of the Company Obligations is rescinded or must
otherwise be restored or returned by the Collateral Agent or any Noteholder upon
the insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Company or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Company or any Guarantor or any substantial part of its property, or otherwise,
all as though such payments had not been made.

 

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Section 2. Grant of Security. Each Grantor hereby grants to the Collateral
Agent, for the benefit of the Secured Parties, a security interest in such
Grantor’s right, title and interest in and to each type of property described
below, whether now owned or hereafter acquired by such Grantor, wherever
located, and whether now or hereafter existing or arising (collectively, the
“Collateral”):

(a) all equipment in all of its forms, including all machinery, tools and
furniture (excepting all fixtures), and all parts thereof and all accessions
thereto, including computer programs and supporting information that constitute
equipment within the meaning of the UCC (any and all such property being the
“Equipment”);

(b) all inventory in all of its forms, including (i) all raw materials, work in
process, finished goods and materials used or consumed in the manufacture,
production, preparation or shipping thereof, (ii) goods in which such Grantor
has an interest in mass or a joint or other interest or right of any kind
(including goods in which such Grantor has an interest or right as consignee)
and (iii) goods that are returned to or repossessed or stopped in transit by
such Grantor, and all accessions thereto and products thereof and documents
therefor, including computer programs and supporting information that constitute
inventory within the meaning of the UCC (any and all such property being the
“Inventory”);

(c) (i) all accounts, instruments (including promissory notes), deposit
accounts, chattel paper, general intangibles (including payment intangibles, but
excluding any Intellectual Property) and other obligations of any kind owing to
the Grantors, whether or not arising out of or in connection with the sale or
lease of goods or the rendering of services and whether or not earned by
performance (any and all such instruments, deposit accounts, chattel paper,
general intangibles and other obligations to the extent not referred to in
clause (d) or (f) below, being the “Receivables”), and all supporting
obligations, security agreements, Liens, leases, letters of credit and other
contracts owing to the Grantors or supporting the obligations owing to the
Grantors under the Receivables (collectively, the “Related Contracts”), and
(ii) all commercial tort claims now or hereafter described on Schedule X hereto;

(d) the following (the “Security Collateral”):

(i) the Initial Pledged Debt and the instruments, if any, evidencing the Initial
Pledged Debt, and all interest, cash, instruments and other property from time
to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the Initial Pledged Debt;

(ii) all additional indebtedness from time to time owed to such Grantor (such
indebtedness, together with the Initial Pledged Debt, being the “Pledged Debt”)
and the instruments, if any, evidencing such indebtedness, and all interest,
cash, instruments and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such
indebtedness;

 

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(iii) all security entitlements carried in, or from time to time credited to, as
applicable, a securities account, all financial assets, and all dividends,
distributions, return of capital, interest, cash, instruments and other property
from time to time received, receivable or otherwise distributed in respect of or
in exchange for any or all of such security entitlements or financial assets and
all warrants, rights or options issued thereon with respect thereto; and

(iv) all other investment property (including all (A) security entitlements and
(B) securities accounts in which such Grantor has now, or acquires from time to
time hereafter, any right, title or interest in any manner, and the certificates
or instruments, if any, representing or evidencing such investment property, and
all dividends, distributions, return of capital, interest, cash, instruments and
other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of such investment property and all
warrants, rights or options issued thereon or with respect thereto (“Investment
Property”);

(e) [reserved];

(f) the following (collectively, the “Account Collateral”):

(i) the Pledged Deposit Accounts, the L/C Cash Deposit Account, the Pledged Cash
Account (Eligible Cash) and all funds and financial assets from time to time
credited thereto (including all cash equivalents), and all certificates and
instruments, if any, from time to time representing or evidencing the Pledged
Deposit Accounts, the L/C Cash Deposit Account and the Pledged Cash Account
(Eligible Cash);

(ii) all promissory notes, certificates of deposit, checks and other instruments
from time to time delivered to or otherwise possessed by the Collateral Agent
for or on behalf of such Grantor in substitution for or in addition to any or
all of the then existing Account Collateral; and

(iii) all interest, dividends, distributions, cash, instruments and other
property from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the then existing Account
Collateral; and

(g) [reserved]

(h) all documents, all money and all letter-of-credit rights;

(i) all books and records and documents (including databases, customer lists,
credit files, computer files, printouts, other computer output materials and
records and other records) of the Grantors pertaining to any of the Grantors’
Collateral;

(j) all other property not otherwise described above (except for any property
specifically excluded from any clause in this section, and any property
specifically excluded from any defined term used in any clause of this section);

 

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(k) all proceeds of and payments under business interruption insurance;

(l) all proceeds of, collateral for, income, royalties and other payments now or
hereafter due and payable with respect to, and supporting obligations relating
to, any and all of the Collateral (including proceeds, collateral and supporting
obligations that constitute property of the types described in clauses
(a) through (h) of this Section 2); and

(m) to the extent not otherwise included, all (A) payments under insurance
(whether or not the Collateral Agent is the loss payee thereof), or any
indemnity, warranty or guaranty, payable by reason of loss or damage to or
otherwise with respect to any of the foregoing Collateral, and (B) cash and cash
equivalents, including all Eligible Cash and US Cash;

provided, that, the security interest granted to the Collateral Agent for the
benefit of the Secured Parties by this Section 2, shall be effective only to the
extent such Collateral constitutes ABL Priority Collateral. References in this
Agreement to “Collateral” and to each type of Collateral set forth in clauses
(a) – (m) above, shall refer solely to such items to the extent constituting ABL
Priority Collateral.

Notwithstanding any of the other provisions set forth in this Section 2 or in
any Transaction Document, no Excluded Property shall constitute Collateral under
this Agreement. For purposes of this Agreement and the other Transaction
Documents, “Excluded Property” shall mean (1) any property to the extent that
such grant of a security interest (x) is prohibited by any applicable
Requirement of Law, (y) requires a consent not obtained of any Governmental
Authority pursuant to such applicable Requirement of Law or (z) is prohibited
by, or constitutes a breach or default under or results in the termination of or
requires any consent not obtained under, any contract, license, agreement,
instrument or other document evidencing or giving rise to such property or, in
the case of any Security Collateral (other than any of the foregoing issued by a
Grantor), any applicable shareholder or similar agreement, except to the extent
that such Requirement of Law or the term in such contract, license, agreement,
instrument or other document or shareholder or similar agreement providing for
such prohibition, breach, default or termination or requiring such consent is
ineffective under applicable law, (2) any lease, license or other agreement or
any property that is subject to a purchase money Lien or capital lease or
similar arrangement (in each case permitted by the Notes and for so long as
subject to such purchase money Lien, capital lease or similar arrangement), in
each case to the extent that a grant of a Lien therein would violate or
invalidate such lease, license or agreement or such purchase money, capital
lease or similar arrangement or create a right of termination in favor of any
party thereto (other than the Company or a Guarantor), except to the extent that
such lease, license or other agreement or other document providing for such
violation or invalidation or termination right is ineffective under applicable
law (it being understood that Excluded Property shall not include proceeds and
Receivables in respect of the foregoing), (3) any Intellectual Property, (4) any
property to the extent a security interest in such property would result in
material adverse tax consequences as reasonably determined by the Company and
the Collateral Agent, (5) any equity interests, including any equity interests
of the Company or any direct or indirect Subsidiary of

 

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the Company, (6) all leasehold interests in real property, and (7) any Excluded
Account. Notwithstanding anything herein or in any other Transaction Document,
the Grantors shall not be required to perfect the Collateral Agent’s security
interest in (i) motor vehicles and other assets subject to certificates of title
to the extent a Lien thereon cannot be perfected by the filing of a UCC
financing statement, (ii) Letter-of-Credit Rights, (iii) Disbursement Accounts
and (iv) any property as to which the Collateral Agent shall agree in writing
that the cost of obtaining a security interest or perfection thereof would be
excessive in relation to the value of the security to be afforded thereby.

Section 3. Security for Obligations. This Agreement secures, in the case of each
Grantor, the payment of all Obligations of such Grantor or Subsidiary of the
Company owing to the Secured Parties. Without limiting the generality of the
foregoing, this Agreement secures, as to each Grantor, the payment of all
amounts that constitute part of the Obligations and would be owed by such
Grantor or Subsidiary of the Company, as applicable, to any Secured Party but
for the fact that they are unenforceable or not allowable due to the existence
of a bankruptcy, reorganization or similar proceeding involving any of the
Company, the Guarantors and other Subsidiaries of the Company.

Section 4. Grantors Remain Liable. Anything herein to the contrary
notwithstanding, (a) each Grantor shall remain liable under the contracts and
agreements included in such Grantor’s Collateral to perform all of its duties
and obligations thereunder to the extent set forth therein to the same extent as
if this Agreement had not been executed, (b) the exercise by the Collateral
Agent of any of the rights hereunder shall not release any Grantor from any of
its duties or obligations under the contracts and agreements included in the
Collateral and (c) no Secured Party shall have any obligation or liability under
the contracts and agreements included in the Collateral by reason of this
Agreement or any other Transaction Document, nor shall any Secured Party be
obligated to perform any of the obligations or duties of any Grantor thereunder
or to take any action to collect or enforce any claim for payment assigned
hereunder.

Section 5. Delivery and Control of Certain Account and Security Collateral.
(a) Subject to the Intercreditor Agreement, all certificates or instruments
representing or evidencing Pledged Debt shall be promptly delivered to and held
by or on behalf of the Collateral Agent pursuant hereto and shall be in suitable
form for transfer by delivery, or shall be accompanied by duly executed
instruments of transfer or assignment in blank, all in form and substance
reasonably satisfactory to the Collateral Agent except to the extent that such
transfer or assignment is prohibited by applicable law.

(b) With respect to any Security Collateral representing interests in which any
Grantor has any right, title or interest, such Grantor will use commercially
reasonable efforts (or in the case of a wholly owned Subsidiary, take all
actions necessary) to cause (i) the issuers of such Security Collateral and
(ii) any securities intermediary which is the holder of any such Security
Collateral, to cause the Collateral Agent to have and retain, subject to the
Intercreditor Agreement, Control over such Security Collateral. Without limiting
the foregoing, such Grantor will, with respect to any such Security Collateral
held with a securities intermediary, use commercially reasonable efforts to
cause such securities intermediary to enter into a control agreement with the
Collateral Agent, in form and substance reasonably satisfactory to the
Collateral Agent, giving the Collateral Agent Control, subject to the
Intercreditor Agreement.

 

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(c) With respect to any securities account and any Security Collateral that
constitutes a security entitlement, within 60 days following the Closing Date
(or such later date as the Collateral Agent shall reasonably agree), the
relevant Grantor will cause the securities intermediary with respect to such
security account or security entitlement to identify in its records the
Collateral Agent as the entitlement holder thereof or enter into a control
agreement with the Collateral Agent, in form and substance reasonably
satisfactory to the Collateral Agent, giving the Collateral Agent Control,
subject to the Intercreditor Agreement.

(d) Subject to the Intercreditor Agreement and upon the occurrence and during
the continuance of an Event of Default, each Grantor shall cause the Security
Collateral, to be registered in the name of the Collateral Agent or such of its
nominees as the Collateral Agent shall direct, subject only to the revocable
rights specified in Section 13(a). In addition, the Collateral Agent shall have
the right upon the occurrence and during the continuance of an Event of Default
to convert Security Collateral consisting of financial assets credited to any
securities account or the L/C Cash Deposit Account to Security Collateral
consisting of financial assets held directly by the Collateral Agent, and to
convert Security Collateral consisting of financial assets held directly by the
Collateral Agent to Security Collateral consisting of financial assets credited
to any securities account or the L/C Cash Deposit Account.

(e) Upon the occurrence and during the continuance of an Event of Default, each
Grantor will notify each issuer of Security Collateral granted by it hereunder
that such Security Collateral is subject to the security interest granted
hereunder.

(f) With respect to any DDAs or Lock Boxes maintained by any Grantor, within 60
days following the Closing Date (or such later date as the Collateral Agent
shall reasonably agree) (the “Cash Control Implementation Date”), the relevant
Grantor shall (i) enter into (A) an Account Control Agreement with the banks
with which any Grantor maintains DDAs and securities accounts, with respect to
each DDA and securities account (other than any Excluded Accounts or
Disbursement Accounts) (collectively, the “Controlled DDA Accounts”) and (B) a
Lock Box Agreement with the banks with which any Grantor maintains a Lock Box,
with respect to each Lock Box (collectively, the “Controlled Lock Box
Accounts”), and (ii) with respect to any Account Control Agreements in effect on
the Closing Date relating to Controlled DDA Accounts and Controlled Lock Box
Accounts, cause the relevant banks to amend and restate such Account Control
Agreement to add the Collateral Agent as a secured party (or other similar term
used therein) thereunder. If, at any time from and after Cash Control
Implementation Date, any cash or cash equivalents owned by any Grantor that
constitute Collateral are deposited to any DDA, securities account or Lock Box
Account, or held or invested in any manner, other than in a Controlled Account
(or a Disbursement Account or an Excluded Account), the Collateral Agent (with
the consent of the ABL Agent) may require the applicable Grantor to close such
account and have all funds therein transferred to a Controlled

 

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Account, and all future deposits made to a Controlled Account (other than with
respect to cash on deposit in an Excluded Account or Disbursement Account). The
Grantors may close DDAs or Controlled Accounts and/or open new DDAs or
Controlled Accounts, subject to the execution and delivery to the ABL Agent and
the Collateral Agent of appropriate Account Control Agreements or Lock Box
Agreements, as applicable, consistent with the provisions of this Section 5(f)
and otherwise reasonably satisfactory to the ABL Agent and the Collateral Agent.

Section 6. [Reserved].

Section 7. Representations and Warranties. Each Grantor represents and warrants
as follows:

(a) Such Grantor’s exact legal name, chief executive office, type of
organization, jurisdiction of organization, organizational identification number
and Federal Employer Identification Number as of the date hereof is set forth in
Schedule V hereto. Within the five years preceding the date hereof, such Grantor
has not changed its legal name, chief executive office, type of organization,
jurisdiction of organization, organizational identification number or Federal
Employer Identification Number from those set forth in Schedule V hereto except
as set forth in Schedule VI hereto. Each of the trade names owned and used by
any Grantor in the operation of its business (e.g. billing, advertising, etc.)
are set forth in Schedule V hereto.

(b) Since the date four (4) months prior to the date hereof, each Grantor has
made or entered into only the mergers and acquisitions set forth on Schedule XI
hereto.

(c) The books and records of each Grantor pertaining to accounts, contract
rights, inventory, and other assets are located at the addresses indicated for
each Grantor on Schedule XII hereto.

(d) Such Grantor is the legal and beneficial owner of the Collateral and has
rights in, the power to transfer, or a valid right to use, the Collateral with
respect to which it has purported to grant a security interest hereunder, free
and clear of any Lien, claim, option or right of others, except for the security
interest created under this Agreement or Liens permitted under the Notes, and
has full power and authority to grant to the Collateral Agent the security
interest in such Collateral granted hereunder pursuant to the terms hereof. No
effective financing statement or other instrument similar in effect covering all
or any part of such Collateral or listing such Grantor or any trade name of such
Grantor as debtor is on file in any recording office, except such as may exist
on the date of this Agreement, have been filed in favor of the Collateral Agent
relating to the Transaction Documents or are otherwise permitted under the
Notes.

 

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(e) When financing statements naming such Grantor as debtor and the Collateral
Agent as secured party and providing a description of the Collateral with
respect to which such Grantor has purported to grant a security interest
hereunder have been filed in the appropriate offices against such Grantor in the
locations listed on Schedule XIII, the Collateral Agent will have a fully
perfected and, subject to the Intercreditor Agreement, first priority security
interest (except as enforceability may be affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors’ rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing), subject only to Liens
permitted under the Notes, in that Collateral of the Grantor in which a security
interest may be perfected by filing of an initial financing statement in the
appropriate office against such Grantor; provided, that, upon completion of the
filings referred to in this Section 7(e) and the other actions specified on
Schedule XIV, the security interests granted pursuant to this Agreement will
constitute valid perfected security interests in all of the U.S.-based
Collateral (other than Excluded Property) in favor of the Collateral Agent as
collateral security for the Obligations.

(f) All of such Grantor’s locations where Equipment and Inventory having a value
in excess of $1,000,000 is located as of the date hereof are specified in
Schedule VIII and Schedule IX hereto, respectively (other than Collateral in
transit in the ordinary course of business, in use or on display at any trade
show, conference or similar event in the ordinary course of business, maintained
with customers (or otherwise on the premises of customers) and consignees in the
ordinary course of business or in the possession of employees in the ordinary
course of business). Such Grantor has exclusive possession and control of its
Inventory, other than Inventory stored at any leased premises or third party
warehouse.

(g) None of the Receivables is evidenced by a promissory note or other
instrument in excess of $3,750,000 that has not been delivered to the Collateral
Agent. All such Receivables valued in excess of $3,750,000 is listed on
Schedule III attached hereto.

(h) Subject to the Intercreditor Agreement, all Security Collateral consisting
of instruments with an aggregate fair market value in excess of $10,000,000 for
all such Security Collateral of the Grantors has been delivered to the
Collateral Agent.

(i) If such Grantor is an issuer of Security Collateral, such Grantor confirms
that it has received notice of the security interest granted hereunder.

(j) The Pledged Debt pledged by such Grantor hereunder has been duly authorized,
authenticated or issued and delivered, is the legal, valid and binding
obligation of the issuers thereof and, if evidenced by any promissory notes,
subject to the Intercreditor Agreement, such promissory notes have been
delivered to the Collateral Agent, and is not in default.

(k) The Initial Pledged Debt constitutes all of the outstanding Indebtedness for
borrowed money owed to such Grantor by the issuers thereof.

(l) Such Grantor has no Investment Property with a market value in excess of
$1,000,000 as of the date hereof, other than the Investment Property listed on
Part IV of Schedule I hereto.

 

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(m) Such Grantor has no deposit accounts or securities accounts as of the date
hereof, other than the deposit accounts and securities accounts listed on
Schedule II hereto (other than deposit accounts or securities accounts that have
less than $750,000 in the aggregate on deposit).

(n) Such Grantor is not a beneficiary or assignee under any letter of credit
with a stated amount in excess of $2,500,000 and issued by a United States
financial institution as of the date hereof, other than the letters of credit
described in Schedule VII hereto.

(o) This Agreement creates in favor of the Collateral Agent for the benefit of
the Secured Parties a valid security interest in the Collateral granted by such
Grantor under this Agreement, securing the payment of the Obligations except to
the extent that Control or possession by the Collateral Agent is required for
the creation of the security interest; all filings and other actions necessary
to perfect the security interest in the U.S.-based Collateral granted by such
Grantor have been duly made or taken and are in full force and effect other than
(i) actions necessary to perfect the Collateral Agent’s security interest with
respect to Collateral evidenced by a certificate of title or Collateral
consisting of vessels or aircraft.

(p) No authorization or approval or other action by, and no notice to or filing
with, any Governmental Authority or any other third party is required for
(i) the grant by such Grantor of the security interest granted hereunder or for
the execution, delivery or performance of this Agreement by such Grantor,
(ii) the perfection or maintenance of the security interest created hereunder
(including, subject to the Intercreditor Agreement, the first priority nature of
such security interest in Collateral), except for (A) the filing of financing
and continuation statements under the UCC, (B) the actions described in
Section 5 with respect to the Security Collateral, and (C) the Control of
certain assets as provided in Sections 9-104, 9-105, 9-106 and 9-107 of the UCC,
or (iii) the exercise by the Collateral Agent of its voting or other rights
provided for in this Agreement or the remedies in respect of the Collateral
pursuant to this Agreement, except as set forth above and as may be required in
connection with the disposition of any portion of the Security Collateral by
laws affecting the offering and sale of securities generally.

(q) The Inventory that has been produced or distributed by such Grantor has been
produced in compliance with all requirements of applicable law except where the
failure to so comply would not have a Material Adverse Effect.

(r) [Reserved]

Section 8. Further Assurances. (a) Each Grantor agrees that from time to time,
in accordance with the terms of this Agreement at the expense of such Grantor
and at the reasonable request of the Collateral Agent, such Grantor will
promptly execute and deliver, or otherwise authenticate, all further instruments
and documents, and take all further action that may be reasonably necessary or
desirable, or that the Collateral Agent may reasonably request, in order to
perfect and protect any pledge or security interest granted or purported to be
granted by

 

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such Grantor hereunder or to enable the Collateral Agent to exercise and enforce
its rights and remedies hereunder with respect to any Collateral of such
Grantor. Without limiting the generality of the foregoing, each Grantor will, at
the reasonable request of the Collateral Agent, promptly with respect to the
Collateral of such Grantor: (i) mark conspicuously each document included in
Inventory, each chattel paper included in Receivables each Assigned Agreement
and, at the request of the Collateral Agent, each of its records pertaining to
such Collateral with a legend, in form and substance reasonably satisfactory to
the Collateral Agent, indicating that such document, Assigned Agreement or
Collateral is subject to the security interest granted hereby; (ii) if any such
Collateral shall be evidenced by a promissory note or other instrument or
chattel paper, deliver and pledge to the Collateral Agent hereunder such note or
instrument or chattel paper duly indorsed and accompanied by duly executed
instruments of transfer or assignment, all in form and substance reasonably
satisfactory to the Collateral Agent; (iii) file such financing or continuation
statements, or amendments thereto, and such other instruments or notices, as may
be reasonably necessary or desirable, or as the Collateral Agent may reasonably
request, in order to perfect and preserve the security interest granted or
purported to be granted by such Grantor hereunder; and (iv) deliver to the
Collateral Agent evidence that all other actions that the Collateral Agent may
deem reasonably necessary or desirable in order to perfect and protect the
security interest granted or purported to be granted by such Grantor under this
Agreement has been taken.

(b) Each Grantor hereby authorizes the Collateral Agent to file one or more
financing or continuation statements, and amendments thereto in the applicable
UCC filing office, including one or more financing statements indicating that
such financing statements cover all assets or all personal property (or words of
similar effect) of such Grantor in the United States, or any real property or
fixtures, regardless of whether any particular asset described in such financing
statements falls within the scope of the UCC. A photocopy or other reproduction
of this Agreement shall be sufficient as a financing statement where permitted
by law. Each Grantor ratifies its authorization for the Collateral Agent to have
filed such financing statements, continuation statements or amendments filed
prior to the date hereof. Notwithstanding anything to the contrary contained
herein or in any other Transaction Document, the Collateral Agent shall not have
any responsibility for the preparing, recording, filing, rerecording, or
refiling of any financing statements (amendments or continuations) or other
instruments in any public office.

(c) Each Grantor will furnish to the Collateral Agent from time to time
statements and schedules further identifying and describing the Collateral of
such Grantor and such other reports in connection with such Collateral as the
Collateral Agent may reasonably request, all in reasonable detail.

Section 9. As to Equipment and Inventory. (a) Each Grantor will keep its
Equipment having a value in excess of $1,000,000 and Inventory having a value in
excess of $1,000,000 (other than Inventory sold in the ordinary course of
business) at the locations therefor specified in Schedule VIII and Schedule IX,
respectively, or, upon 30 days’ prior written notice to the Collateral Agent (or
such lesser time as may be agreed by the Collateral Agent), at such other places
designated by such Grantor in such notice. Schedule VIII and Schedule IX
respectively set forth whether each such location is owned, leased or operated
by third parties, and, if leased or operated by third parties, their names and
addresses.

 

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(b) Each Grantor will pay promptly when due all property and other taxes,
assessments and governmental charges or levies imposed upon, and all claims
(including claims for labor, materials and supplies) against, its Equipment and
Inventory, except to the extent payment thereof (i) would not reasonably be
expected to have a Material Adverse Effect or (ii) is being contested in good
faith by appropriate proceedings and as to which appropriate reserve or other
appropriate provision, as shall be required in conformity with GAAP shall have
been made. In producing its Inventory, each Grantor will comply with all
requirements of applicable law, except where the failure to so comply will not
have a Material Adverse Effect.

Section 10. Insurance. Each Grantor will, at its own expense, maintain insurance
with responsible and reputable insurance companies or associations in such
amounts and covering such risks as is usually carried by companies engaged in
similar businesses and owning similar properties in the same general areas in
which the Company or each Grantor operates; provided, that, the Company and each
Grantor may self-insure to the extent consistent with prudent business practice.
Each policy of each Grantor for liability insurance shall provide for all losses
to be paid on behalf of the Collateral Agent and such Grantor as their interests
may appear, and each policy for property damage insurance shall provide for all
losses to be paid, subject to the Intercreditor Agreement and the loss payee
provisions which were requested pursuant to clause (iii) below, directly to the
Collateral Agent. Each such policy shall in addition (i) name such Grantor and
the Collateral Agent as insured parties thereunder (without any representation
or warranty by or obligation upon the Collateral Agent) as their interests may
appear, (ii) provide that (A) there shall be no recourse against the Collateral
Agent for payment of premiums or other amounts with respect thereto and (B) if
agreed by the insurer (which agreement such Grantor shall use commercially
reasonable efforts to obtain), at least 10 days’ prior written notice of
cancellation or of lapse shall be given to the Collateral Agent by the insurer,
and (iii) contain such other customary loss payee provisions as the Collateral
Agent shall reasonably request. Each Grantor will, if so requested by the
Collateral Agent, deliver to the Collateral Agent certificates of insurance
evidencing such insurance and, as often as the Collateral Agent may reasonably
request, a report of a reputable insurance broker or the insurer with respect to
such insurance. Further, each Grantor will, at the request of the Collateral
Agent, duly execute and deliver instruments of assignment of such insurance
policies to comply with the requirements of Section 2(k), 2(l) and 2(m) and use
its commercially reasonable efforts to cause the insurers to acknowledge notice
of such assignment.

Section 11. Post-Closing Changes; Collections on Receivables. (a) If any Grantor
changes its name, type of organization, jurisdiction of organization or
organizational identification number from those set forth in Schedule V of this
Agreement it will give written notice to the Collateral Agent within 15 days of
such change and will take all action necessary for the purpose of perfecting or
protecting the security interest granted by this Agreement. Each Grantor will
hold and preserve its records relating to the Collateral, including the Related
Contracts, and will permit representatives of the Collateral Agent at any time
during normal

 

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business hours to inspect and make abstracts from such records and other
documents no more than once in any period of twelve (12) consecutive months (or
on an unlimited basis during an Event of Default); provided, that, in no event
shall the Company or any of its Subsidiaries be required to provide any such
information which (i) constitutes non-financial trade secrets or non-financial
proprietary information, (ii) in respect of which disclosure to the Collateral
Agent or any Holder (or their respective representatives or contractors) is
prohibited by Applicable Law or contractual confidentiality obligation owed to a
third party or (iii) in the reasonable determination of the Company, is subject
to attorney client or similar privilege or constitutes attorney work-product.
Notwithstanding anything to the contrary contained herein or in any other
Transaction Document, neither the Company nor any Grantor shall be required to
provide the Collateral Agent, any Noteholder or any of their advisors or
consultants with access to, or details concerning, any facility, document or
information to the extent that such provision would, in the Company’s or the
applicable Grantor’s reasonable judgment, result in a violation of Applicable
Law or regulation, including International Traffic in Arms Regulations. If any
Grantor does not have an organizational identification number and later obtains
one, it will promptly notify the Collateral Agent of such organizational
identification number.

(b) Collateral Agent shall have the right at any time or times, in Collateral
Agent’s name or in the name of a nominee of Collateral Agent, to verify the
validity, amount or any other matter relating to any Receivables or other
Collateral, by mail, telephone, facsimile transmission or otherwise (provided
any visits shall be done during normal business hours and at times to be
mutually agreed). Except as otherwise provided in this subsection (b), each
Grantor, at its own expense and in the ordinary course of business undertaken in
a commercially reasonable manner and consistent with applicable law, will
continue to collect, adjust, settle, compromise the amount or payment of, all
amounts due or to become due such Grantor under the Receivables. In connection
with such collections, adjustments, settlements, compromises and other exercises
of rights, such Grantor may take (and, at the Collateral Agent’s direction upon
the occurrence and during the continuance of an Event of Default, will take)
such action as such Grantor (or, upon the occurrence and during the continuance
of an Event of Default, the Collateral Agent) may deem necessary or advisable;
provided, that, the Collateral Agent shall have the right at any time, upon the
occurrence and during the continuance of an Event of Default and upon written
notice to such Grantor of its intention to do so, to notify the obligors under
any Receivables of the assignment of such Receivables to the Collateral Agent
and to direct such obligors to make payment of all amounts due or to become due
to such Grantor thereunder directly to the Collateral Agent and, upon such
notification and at the expense of such Grantor, to enforce collection of any
such Receivables, to adjust, settle or compromise the amount or payment thereof,
in the same manner and to the same extent as such Grantor might have done, and
to otherwise exercise all rights with respect to such Receivables, including
those set forth in Section 9-607 of the UCC. After receipt by any Grantor of the
notice from the Collateral Agent referred to in the proviso to the preceding
sentence, (i) all amounts and proceeds (including instruments) received by such
Grantor in respect of the Receivables of such Grantor shall be received in trust
for the benefit of the Secured Parties, shall be segregated from other funds of
such Grantor and shall be forthwith paid over to the Collateral Agent in the
same form as so received (with any necessary indorsement) to be applied as
provided in Section 20(b) or to prepay the Notes, and (ii) such Grantor will not
adjust, settle or compromise the amount or payment of any Receivable, release
wholly or partly any Obligor thereof or allow any credit or discount thereon
other than credits or discounts given in the ordinary course of business.

 

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(c) No Grantor will authorize the filing of any financing statement naming it as
debtor covering all or any portion of the Collateral owned by it, except for
financing statements (i) naming the Collateral Agent on behalf of the Secured
Parties as the secured party, and (ii) in respect to other Liens permitted by
the Notes. Each Grantor acknowledges that it is not authorized to file any
amendment or termination statement with respect to any financing statement
naming the Collateral Agent as secured party without the prior written consent
of the Collateral Agent, subject to such Grantor’s rights under the UCC.

Section 12. [Reserved].

Section 13. Voting Rights; Dividends; Etc. (a) So long as no Event of Default
shall have occurred and be continuing:

(i) Each Grantor shall be entitled to exercise any and all voting and other
consensual rights pertaining to the Security Collateral of such Grantor or any
part thereof for any purpose.

(ii) Each Grantor shall be entitled to receive and retain any and all dividends,
interest and other distributions paid in respect of the Security Collateral of
such Grantor if and to the extent that the payment thereof is not otherwise
prohibited by the terms of the Transaction Documents; provided, that, any and
all dividends, interest and other distributions paid or payable in the form of
instruments in respect of, or in exchange for, any Security Collateral, shall be
promptly delivered to the Collateral Agent to hold as Security Collateral (to
the extent it is not Excluded Property) and shall, if received by such Grantor,
be received in trust for the benefit of the Secured Parties, be segregated from
the other property or funds of such Grantor and be promptly delivered to the
Collateral Agent as Security Collateral in the same form as so received (with
any necessary indorsement).

(iii) The Collateral Agent will execute and deliver (or cause to be executed and
delivered) to each Grantor all such proxies and other instruments as such
Grantor may reasonably request in writing for the purpose of enabling such
Grantor to exercise the voting and other rights that it is entitled to exercise
pursuant to paragraph (i) above and to receive the dividends or interest
payments that it is authorized to receive and retain pursuant to paragraph
(ii) above.

(b) Upon the occurrence and during the continuance of an Event of Default:

(i) All rights of each Grantor (A) to exercise or refrain from exercising the
voting and other consensual rights that it would otherwise be entitled to
exercise pursuant to Section 13(a)(i) shall, upon notice to such Grantor by the
Collateral Agent, cease and (B) to receive the dividends, interest and other
distributions that it would otherwise be authorized

 

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to receive and retain pursuant to Section 13(a)(ii) shall automatically cease,
and all such rights shall, subject to the Intercreditor Agreement, thereupon
become vested in the Collateral Agent for the benefit of the Secured Parties,
which shall thereupon have the sole right to exercise or refrain from exercising
such voting and other consensual rights and to receive and hold as Security
Collateral such dividends, interest and other distributions.

(ii) All dividends, interest and other distributions that are received by any
Grantor contrary to the provisions of paragraph (i) of this Section 13(b) shall
be received in trust for the benefit of the Secured Parties, shall be segregated
from other funds of such Grantor and shall be promptly paid over to the
Collateral Agent as Security Collateral in the same form as so received (with
any necessary indorsement).

Section 14. [Reserved.]

Section 15. As to Letter-of-Credit Rights and Commercial Tort Claims. (a) Except
as otherwise permitted by the Transaction Documents, each Grantor, by granting a
security interest in its Receivables consisting of letter of credit rights to
the Collateral Agent, hereby assigns to the Collateral Agent such rights
(including its contingent rights) to the proceeds of all Related Contracts
consisting of letters of credit of which it is or hereafter becomes a
beneficiary or assignee. Upon request of the Collateral Agent, each Grantor will
promptly use commercially reasonable efforts to cause the issuer of each
letter-of-credit with a stated amount in excess of $2,500,000 and each nominated
person (as defined in Section 5-102 of the UCC) (if any) with respect thereto to
consent to such assignment of the proceeds thereof pursuant to a consent in form
and substance reasonably satisfactory to the Collateral Agent and deliver
written evidence of such consent to the Collateral Agent.

(b) Upon the occurrence and during the continuance of an Event of Default, each
Grantor will, promptly upon request by the Collateral Agent, (i) notify (and
such Grantor hereby authorizes the Collateral Agent to notify) the issuer and
each nominated person with respect to each of the Related Contracts consisting
of letters of credit that the proceeds thereof have been assigned to the
Collateral Agent hereunder and any payments due or to become due in respect
thereof are to be made directly to the Collateral Agent or its designee and
(ii) arrange for the Collateral Agent to become the transferee beneficiary of
letters of credit.

(c) In the event that any Grantor hereafter acquires or has any commercial tort
claim that has been filed with any court in excess of $5,000,000 in the
aggregate, it shall, promptly after such claim has been filed with such court,
deliver a supplement to Schedule X hereto, identifying such new commercial tort
claim.

Section 16. Transfers and Other Liens; Additional Shares. (a) Each Grantor
agrees that it will not (i) sell, assign or otherwise dispose of, or grant any
option with respect to, any of the Collateral, other than sales, assignments and
other dispositions of Collateral, and options relating to Collateral, permitted
under the terms of the Notes or (ii) create or suffer to exist any Lien upon or
with respect to any of the Collateral of such Grantor except for the pledge,
assignment and security interest created under this Agreement and Liens not
prohibited under the terms of the Notes.

 

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Section 17. Collateral Agent Appointed Attorney-in-Fact. Each Grantor hereby
irrevocably appoints the Collateral Agent such Grantor’s attorney-in-fact, with
full authority in the place and stead of such Grantor and in the name of such
Grantor or otherwise, from time to time, in the Collateral Agent’s discretion,
to take any action and to execute any instrument that the Collateral Agent may
deem necessary or advisable to accomplish the purposes of this Agreement,
including:

(a) to obtain, an upon the occurrence and during the continuance of an Event of
Default, adjust insurance required to be paid to the Collateral Agent pursuant
to Section 10;

(b) upon the occurrence and during the continuation of any Event of Default, to
ask for, demand, collect, sue for, recover, compromise, receive and give
acquittance and receipts for moneys due and to become due under or in respect of
any of the Collateral;

(c) upon the occurrence and during the continuance of an Event of Default, to
receive, indorse and collect any drafts or other instruments, documents and
chattel paper, in connection with clause (a) or (b) above;

(d) upon the occurrence and during the continuation of any Event of Default to
file any claims or take any action or institute any proceedings that the
Collateral Agent may deem necessary or desirable for the collection of any of
the Collateral or otherwise to enforce compliance with the terms and conditions
of any Assigned Agreement or the rights of the Collateral Agent with respect to
any of the Collateral;

(e) [Reserved];

(f) to take or cause to be taken all actions necessary to perform or comply or
cause performance or compliance with the terms of this Agreement, including
actions to pay or discharge taxes or Liens (other than Permitted Liens) levied
or placed upon or threatened against the Collateral, the legality or validity
thereof and the amounts necessary to discharge the same to be determined by
Collateral Agent in its sole discretion, any such payments made by Collateral
Agent to become obligations of such Grantor to Collateral Agent, due and payable
immediately without demand;

(g) (i) upon the occurrence and during the continuation of any Event of Default,
generally to sell, transfer, lease, license, pledge, make any agreement with
respect to or otherwise deal with any of the Collateral as fully and completely
as though Collateral Agent were the absolute owner thereof for all purposes, and
(ii) to do, at Collateral Agent’s option and such Grantor’s expense, at any time
or from time to time, all acts and things that Collateral Agent deems reasonably
necessary to protect, preserve or realize upon the Collateral and Collateral
Agent’s security interest therein in order to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do;

 

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(h) upon the occurrence and during the continuation of any Event of Default, to
repair, alter, or supply goods, if any, necessary to fulfill in whole or in part
the purchase order of any person obligated to the Company or such other Grantor
in respect of any Account of the Company or such other Grantor; and

(i) upon the occurrence and during the continuance of any Event of Default, to
take exclusive possession of all locations where the Company or other Grantor
conducts its business or has rights of possession, with prompt notice to the
Company or any Grantor and to use such locations to store, process, manufacture,
sell, use, and liquidate or otherwise dispose of items that are Collateral,
without obligation to pay rent or other compensation for the possession or use
of any location.

Section 18. Collateral Agent May Perform. If any Grantor fails to perform any
agreement contained herein, the Collateral Agent may, but without any obligation
to do so, upon notice to the Company of at least five Business Days in advance
and if the Company fails to cure within such period, itself perform, or cause
performance of, such agreement, and the expenses of the Collateral Agent
incurred in connection therewith shall be payable by such Grantor under
Section 22.

Section 19. The Collateral Agent’s Duties. (a) The powers conferred on the
Collateral Agent hereunder are solely to protect the Secured Parties’ interest
in the Collateral and shall not impose any duty upon it to exercise any such
powers. Except for the safe custody of any Collateral in its possession and the
accounting for moneys actually received by it hereunder, the Collateral Agent
shall have no duty as to any Collateral, as to ascertaining or taking action
with respect to calls, conversions, exchanges, maturities, tenders or other
matters relative to any Collateral, whether or not any Secured Party has or is
deemed to have knowledge of such matters, or as to the taking of any necessary
steps to preserve rights against any parties or any other rights pertaining to
any Collateral. The Collateral Agent shall be deemed to have exercised
reasonable care in the custody and preservation of any Collateral in its
possession if such Collateral is accorded treatment substantially equal to that
which it accords its own property.

(b) Anything contained herein to the contrary notwithstanding, the Collateral
Agent may from time to time, when the Collateral Agent deems it to be necessary,
appoint one or more of its Affiliates (or, with the consent of the Company, any
other persons) subagents (each a “Subagent”) for the Collateral Agent hereunder
with respect to all or any part of the Collateral. In the event that the
Collateral Agent so appoints any Subagent with respect to any Collateral,
(i) the assignment and pledge of such Collateral and the security interest
granted in such Collateral by each Grantor hereunder shall be deemed for
purposes of this Agreement to have been made to such Subagent, in addition to
the Collateral Agent, for the benefit of the Secured Parties, as security for
the Obligations of such Grantor, (ii) such Subagent shall automatically be
vested, in addition to the Collateral Agent, with all rights, powers,
privileges, interests and remedies of the Collateral Agent hereunder with
respect to such Collateral, and (iii) the term “Collateral Agent,” when used
herein in relation to any rights, powers, privileges, interests and remedies of
the Collateral Agent with respect to such Collateral, shall include such
Subagent; provided, that, that no such Subagent shall be authorized to take any
action with respect to any such Collateral unless and except to the extent
expressly authorized in writing by the Collateral Agent.

 

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Section 20. Remedies. If any Event of Default shall have occurred and be
continuing and such Event of Default has resulted in the acceleration of the
Obligations, which acceleration has not been rescinded or otherwise terminated:

(a) The Collateral Agent may exercise in respect of the Collateral, in addition
to other rights and remedies provided for herein or otherwise available to it,
all the rights and remedies of a secured party upon default under the UCC
(whether or not the UCC applies to the affected Collateral) and also may:
(i) require each Grantor to, and each Grantor hereby agrees that it will at its
expense and upon request of the Collateral Agent forthwith, assemble all or part
of the Collateral as directed by the Collateral Agent and make it available to
the Collateral Agent at a place and time to be designated by the Collateral
Agent that is reasonably convenient to both parties; (ii) subject to applicable
law, without notice except as specified below, sell the Collateral or any part
thereof in one or more parcels at public or private sale, at any of the
Collateral Agent’s offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as the Collateral Agent may deem
commercially reasonable; (iii) occupy, on a non-exclusive basis, any premises
owned or leased by any of the Grantors where the Collateral or any part thereof
is assembled or located for a reasonable period in order to effectuate its
rights and remedies hereunder or under law, without obligation to such Grantor
in respect of such occupation; and (iv) exercise any and all rights and remedies
of any of the Grantors under or in connection with the Collateral, or otherwise
in respect of the Collateral, including any and all rights of such Grantor to
(A) demand or otherwise require payment of any amount under, or performance of
any provision of, the Receivables and the other Collateral, (B) withdraw, or
cause or direct the withdrawal, of all funds with respect to the Account
Collateral, and (C) exercise all other rights and remedies with respect to the
Receivables and the other Collateral, including those set forth in Section 9-607
of the UCC. Each Grantor agrees that, to the extent notice of sale shall be
required by law, at least ten days’ notice to such Grantor of the time and place
of any public sale, or of the time after which any private sale is to be made
shall constitute reasonable notification. The Collateral Agent shall not be
obligated to make any sale of Collateral regardless of notice of sale having
been given. The Collateral Agent may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the time and place to which it was so
adjourned. Each Grantor agrees that (A) the internet shall constitute a “place”
for purposes of Section 9-610(b) of the UCC and (B) to the extent notification
of sale shall be required by law, notification by mail of the URL where a sale
will occur and the time when a sale will commence at least ten (10) days prior
to the sale shall constitute a reasonable notification for purposes of
Section 9-611(b) of the UCC.

 

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(b) Any cash held by or on behalf of the Collateral Agent and all cash proceeds
received by or on behalf of the Collateral Agent in respect of any sale of,
collection from, or other realization upon all or any part of the Collateral and
any proceeds of the guarantee set forth in Section 1 may, in the discretion of
the Collateral Agent, be held by the Collateral Agent as collateral for, and/or
then or at any time thereafter shall be applied in whole or in part by the
Collateral Agent for the benefit of the Secured Parties against, all or any part
of the Obligations, in accordance with Section 1.2 of the Notes.

(c) All payments received by any Grantor under or in connection with any
Assigned Agreement or otherwise in respect of the Collateral shall be received
in trust for the benefit of the Collateral Agent, shall be segregated from other
funds of such Grantor and shall be forthwith paid over to the Collateral Agent
in the same form as so received (with any necessary indorsement).

(d) Subject to the provisions of Section 28, the Collateral Agent may, without
notice to any Grantor except as required by law and at any time or from time to
time, charge, set off and otherwise apply all or any part of the Obligations
against any funds held with respect to the Account Collateral or in any other
deposit account.

(e) [Reserved].

(f) In each case under this Agreement in which the Collateral Agent takes any
action with respect to the Collateral, including proceeds, the Collateral Agent
shall provide to the Company such records and information regarding the
possession, control, sale and any receipt of amounts with respect to such
Collateral as may be reasonably requested in writing by the Company as a basis
for the preparation of the company’s financial statements in accordance with
GAAP.

Section 21. [Reserved]

Section 22. Indemnity and Expenses. (a) Each Grantor agrees to indemnify, defend
and save and hold harmless each Secured Party and each of its Affiliates and
their respective officers, directors, employees, trustees, agents and advisors
(each, an “Indemnified Party”) from and against, and shall pay on demand, any
and all claims, damages, losses, liabilities and expenses (including reasonable
fees and expenses of counsel) that may be incurred by or asserted or awarded
against any Indemnified Party, in each case arising out of or in connection with
or resulting from this Agreement (including enforcement of this Agreement),
except to the extent such claim, damage, loss, liability or expense is found in
a final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party’s gross negligence or willful misconduct.

(b) Each Grantor will upon demand pay to the Collateral Agent the amount of any
and all reasonable expenses, including the reasonable fees and expenses of its
counsel and of any experts and agents, that the Collateral Agent may incur in
connection with (i) the custody, preservation, use or operation of, or the sale
of, collection from or other realization upon, any of the Collateral of such
Grantor, (ii) the exercise or enforcement of any of the rights of the Collateral
Agent or the other Secured Parties hereunder or (iii) the failure by such
Grantor to perform or observe any of the provisions hereof.

 

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(c) The undertakings in this Section 22 shall survive termination of this
Agreement, the payment of all Obligations and the resignation of the Collateral
Agent.

Section 23. Amendments; Waivers; Additional Grantors; Etc. (a) No amendment or
waiver of any provision of this Agreement, and no consent to any departure by
any Grantor herefrom, shall in any event be effective unless the same shall be
in writing and signed by the Collateral Agent and, with respect to any
amendment, the Company on behalf of the Grantors, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. No failure on the part of the Collateral Agent or any
other Secured Party to exercise, and no delay in exercising any right hereunder,
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or the exercise of
any other right.

(b) Each Subsidiary of the Company that is required to grant security to the ABL
Agent pursuant to the terms of the ABL Loan Documents shall become a Grantor for
all purposes of this Agreement upon the execution and delivery by such person of
a security agreement supplement in substantially the form of Exhibit C hereto
(each a “Security Agreement Supplement”). Such person shall be referred to as an
“Additional Grantor” and each reference in this Agreement and the other
Transaction Documents to “Grantor” or “Guarantor” shall also mean and be a
reference to such Additional Grantor, each reference in this Agreement and the
other Transaction Documents to the “Collateral” shall also mean and be a
reference to the Collateral granted by such Additional Grantor and each
reference in this Agreement to a Schedule shall also mean and be a reference to
the schedules attached to such Security Agreement Supplement.

Section 24. Confidentiality; Notices; References. (a) Each of the Collateral
Agent and the Secured Parties agree to maintain the confidentiality of the
Information (as defined below) except that Information may be disclosed (a) to
its and its Affiliates’ directors, officers, employees and agents, including
accountants, legal counsel and other advisors, and funding sources on a “need to
know” basis (it being understood that the persons to whom such disclosure is
made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential and shall agree to keep such
Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by Applicable Law or regulations or by any
subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or any other Transaction
Document or the enforcement of rights hereunder or thereunder, (f) subject to a
written agreement containing provisions substantially the same as those of this
Section 24, to any permitted assignee of, or any permitted prospective assignee
of, any of its rights or obligations under this Agreement, (g) with the prior
written consent of the Company or (h) to the extent such Information (i) becomes
publicly available

 

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other than as a result of a breach of this Section 24 or (ii) becomes available
to the Collateral Agent or any Noteholder on a non-confidential basis from a
source other than the Company. For the avoidance of doubt, the obligations of
any Secured Party under this Section 24(a) shall not be abrogated by such
Secured Party’s assignment of its Notes under the terms of the Notes. For the
purposes of this Section 24, “Information” means all information received from
the Company relating to the Company or its business, other than any such
information that is available to the Collateral Agent or any Noteholder on a
non-confidential basis prior to disclosure by the Company. Any person required
to maintain the confidentiality of Information as provided in this
Section 24 shall be considered to have complied with its obligation to do so if
such person has exercised the same degree of care to maintain the
confidentiality of such Information as such person would accord to its own
confidential information.

(b) Any notice, request or other communication required or permitted hereunder
shall be given in writing (unless otherwise specified herein) and shall be
deemed effectively given on the earlies of: (i) the date delivered, if delivered
by personal delivery as against written receipt therefor or by email to an
executive officer named below or such officer’s successor, or by facsimile (with
successful transmission confirmation which is kept by sending party), (ii) the
earlier of the date delivered or the third Business Day after deposit, postage
prepaid, in the U.S. Postal Service by certified mail, or (iii) the earlier of
the date delivered or the third Business Day after mailing by express courier
with delivery costs and fees prepaid, in each case, addressed to each of the
other parties thereto entitled at the following addresses (or at such other
address as such party may designate by five (5) calendar days’ advance written
notice similarly given to each of the other parties hereto):

If to Company:

Eastman Kodak Company

Attn: General Counsel

343 State Street

Rochester, New York 14650

Tel: 585-724-4000

Fax: 585-724-1089

Email: Roger.Byrd@kodak.com

with a copy to (which shall not constitute notice):

Sullivan & Cromwell LLP

Attn: S. Neal McKnight

125 Broad Street

New York, New York 10005

Email: mcknightn@sullcrom.com

 

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If to Collateral Agent:

Wilmington Trust, National Association

246 Goose Lane, Suite 105

Guilford, Connecticut 06437

Attention: Kodak Notes Administrator

Tel: 203-453-4130

Fax: 203-453-1183

Email: jodonnell@wilmingtontrust.com

with a copy to (which shall not constitute notice):

Covington & Burling LLP

The New York Times Building

620 Eighth Avenue

New York, New York 10018

Attn: Ronald A. Hewitt

Tel: 212-841-1000

Email: rhewitt@cov.com

Section 25. Continuing Security Interest; Assignments Under the Notes. This
Agreement shall create a continuing guaranty and continuing security interest in
the Collateral and shall (a) continue in effect (notwithstanding the fact that
from time to time there may be no Obligations outstanding) until (i) the Notes
have terminated pursuant to their express terms and (ii) all of the Obligations
(other than any contingent indemnification obligations not then due and payable)
have been paid in full and no commitments of the Collateral Agent or the
Noteholders which would give rise to any Obligations are outstanding, (b) be
binding upon each Grantor, its successors and assigns and (c) inure, together
with the rights and remedies of the Collateral Agent hereunder, to the benefit
of the Secured Parties and their respective successors, permitted transferees
and permitted assigns. Without limiting the generality of the foregoing
clause (c), to the extent permitted in Section 17 of the Notes, any Noteholder
may assign or otherwise transfer all or any portion of its rights and
obligations under the Notes to any permitted transferee, and such permitted
transferee shall thereupon become vested with all the benefits in respect
thereof granted to such Noteholder herein or otherwise.

Section 26. [Reserved].

Section 27. Release; Termination. (a) Upon any disposition of any item of
Collateral of any Grantor as permitted by the Transaction Documents and receipt
by the Collateral Agent of a written certification by the Company that such
disposition or other event, as applicable, is not permitted under the terms of
the Transaction Documents (which written certification the Collateral Agent
shall be entitled to rely conclusively without further inquiry), then, in the
case of the foregoing clause (i), the security interests granted under this
Agreement by such Grantor in such Collateral or in the assets of such
Subsidiary, as applicable, shall immediately terminate and

 

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automatically be released and, in the case of the foregoing clause (ii),
Collateral Agent will, in each case and subject to the Intercreditor Agreement,
promptly deliver at the Grantor’s request to such Grantor all notes and other
instruments representing any Pledged Debt, Receivables or other Collateral so
released, and Collateral Agent will, at such Grantor’s expense, promptly execute
and deliver to such Grantor such documents as such Grantor shall reasonably
request in writing to evidence the release of such item of Collateral from the
assignment and security interest granted hereby; provided, that, no such
documents shall be required unless such Grantor shall have delivered to the
Collateral Agent, at least five Business Days prior to the date such documents
are required by Grantor, or such lesser period of time agreed by the Collateral
Agent, a written request for release describing the item of Collateral and the
consideration to be received in the sale, transfer or other disposition and any
expenses in connection therewith, together with a form of release for execution
by the Collateral Agent (which form shall be reasonably acceptable to the
Collateral Agent) and a certificate of such Grantor to the effect that the
transaction will be in compliance with the Transaction Documents.

(b) At such time as the Obligations shall have been paid in full, the Collateral
shall be released from the Liens created hereby, and this Agreement and all
obligations (other than those expressly stated to survive such termination) of
the Collateral Agent and each Grantor hereunder shall automatically terminate,
all without delivery of any instrument or performance of any act by any party,
and all rights to Collateral shall revert to the Grantors. At the request and
sole expense of any Grantor following any such termination, the Collateral Agent
shall promptly deliver to such Grantor any Collateral held by the Collateral
Agent hereunder, and promptly execute and deliver to such Grantor such documents
as such Grantor shall reasonably request in writing to evidence such
termination. At the request and sole expense of the Company, a Guarantor shall
be released from its obligations hereunder in the event that all the Capital
Stock of such Guarantor shall be sold, transferred or otherwise disposed of.

(c) The Noteholders irrevocably authorize the Collateral Agent to and the
Collateral Agent shall upon receipt by the Collateral Agent of a written
certification by the Company that such release or other event, as applicable, is
not prohibited under the terms of the Transaction Documents (which written
certification the Collateral Agent shall be entitled to rely conclusively
without further inquiry):

(i) release any Lien on any property granted to or held by the Collateral Agent
under any Transaction Document if required or otherwise approved, authorized or
ratified in writing in accordance with the terms of the Transaction Documents,
including pursuant to the Intercreditor Agreement;

(ii) release the Company or any Guarantor from its obligations under the
Transaction Documents if such person (i) ceases to be a Subsidiary or
(ii) becomes an Unrestricted Subsidiary, in each case, as a result of a
transaction or designation permitted under the terms of the Transaction
Documents; provided that no such release shall occur with respect to an entity
that becomes an Unrestricted Subsidiary if the Company or any Guarantor
continues to be a guarantor in respect of the ABL Facility unless and until each
guarantor is (or is being simultaneously) released from its guarantee with
respect to the ABL Facility;

 

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(iii) release any Lien on any property granted to or held by the Collateral
Agent under any Transaction Document on any assets that are excluded from the
Collateral; and

(iv) enter into or amend an intercreditor agreement with the collateral agent or
other representatives of the holders of Indebtedness that is permitted to be
secured by a Lien on the Collateral.

(d) Notwithstanding anything to the contrary contained herein or in any other
Transaction Document, the Collateral Agent shall, upon receipt by the Collateral
Agent of a written certification by the Company that such disposition or other
event, as applicable, is not prohibited under the terms of the Transaction
Documents (which written certification the Collateral Agent shall be entitled to
rely conclusively without further inquiry), without notice to or vote or consent
of, any Noteholder, take such actions as shall be reasonably requested in
writing by the Company as necessary or desirable to release, or document the
release, by the Collateral Agent, of the security interest in any Collateral
being sold, disposed of or transferred in a transaction permitted by the
Transaction Documents, in each case to a person other than the Company and its
Subsidiaries, and to release any guarantee obligations under any Transaction
Documents of any person being sold, disposed of or transferred to a person other
than the Company or its Subsidiaries, or no longer required to provide a
guaranty hereunder to the extent necessary to permit consummation of such sales
or dispositions of assets in accordance with the Transaction Documents.

Section 28. Right of Setoff. If one or more Events of Default shall have
occurred and be continuing, each Noteholder shall have the right, in addition to
and not in limitation of any right which any such Noteholder may have under
Applicable Law or otherwise, to set off and apply any and all deposits (general
or special, time or demand, provisional or final), at any time held and other
obligations at any time owing by such Noteholder to or for the credit or the
account of the Company against any of and all the obligations of the Company now
or hereafter existing under this Agreement and the other Transaction Documents
held by such Noteholder, irrespective of whether or not such Noteholder shall
have made any demand under this Agreement or such other Transaction Document and
although such obligations may be unmatured. The rights of each Noteholder under
this Section 28 are in addition to other rights and remedies (including other
rights of setoff) which such Noteholder may have. No Noteholder will, or will
permit any of its successors or permitted assigns to, exercise its rights under
this Section 28 without the consent of the Required Noteholders. ANY AND ALL
RIGHTS TO REQUIRE THE COLLATERAL AGENT TO EXERCISE ITS RIGHTS OR REMEDIES WITH
RESPECT TO ANY OTHER COLLATERAL WHICH SECURES ANY OF THE OBLIGATIONS PRIOR TO
THE EXERCISE THE SETOFF UNDER THIS SECTION ARE HEREBY KNOWINGLY, VOLUNTARILY AND
IRREVOCABLY WAIVED.

 

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Section 29. Appointment and Administration by Collateral Agent.

(a) Each Noteholder hereby irrevocably designates and appoints Wilmington Trust,
National Association as Collateral Agent under this Agreement and the other
Transaction Documents and as Second Priority Representative under the
Intercreditor Agreement. The general administration of this Agreement and the
related security documents and instruments shall be by the Collateral Agent in
its capacity as such and, with respect to the Intercreditor Agreement, as Second
Priority Representative. By accepting the benefits of this Agreement and the
other Transaction Documents, the Noteholders each hereby (a) irrevocably
authorize the Collateral Agent (i) to enter into the Transaction Documents to
which it is a party, and (ii) at its discretion, to take or refrain from taking
such actions as agent on its behalf and to exercise or refrain from exercising
such powers under the Transaction Documents as are delegated by the terms hereof
or thereof, as appropriate, together with all powers reasonably incidental
thereto, and (b) agrees and consents to all of the provisions of this Agreement
and the Intercreditor Agreement. All Collateral shall be held or administered by
the Collateral Agent (or its duly-appointed agent) for its own benefit and for
the ratable benefit of the other Secured Parties in their capacity as such and
no Secured Party (other than the Collateral Agent) shall be required to execute
this Agreement as a party thereto. The Collateral Agent shall have no duties or
responsibilities except as set forth in this Agreement and the other Transaction
Documents, nor shall it have any fiduciary relationship with any other Secured
Party, and no implied covenants, responsibilities, duties, obligations, or
liabilities shall be read into the Transaction Documents or otherwise exist
against the Collateral Agent.

(b) Any occasion requiring or permitting an approval, consent, discretion,
waiver, election or other action on the part of the Noteholders, shall be taken
by the Collateral Agent (upon receipt by the Collateral Agent from the Company
of the Note Register, or certification of the Noteholders if the Company fails
to provide such Note Register, in accordance with clause (m)), for and on behalf
or for the benefit of all Secured Parties upon the direction of the Required
Noteholders, and any such action shall be binding on all Secured Parties. The
Collateral Agent, when acting on behalf of the Secured Parties, may execute any
of its respective duties under this Agreement by or through any of its officers,
agents and employees, and neither the Collateral Agent nor its respective
directors, officers, agents or employees shall be liable to any other Secured
Party for any action taken or omitted to be taken in good faith, or be
responsible to any Noteholder for the consequences of any oversight or error of
judgment, or for any loss, except to the extent of any liability imposed by law
by reason of the Collateral Agent’s own gross negligence or willful misconduct.
Neither the Collateral Agent nor its directors, officers, agents and employees
shall in any event be liable to any Noteholder for any action taken or omitted
to be taken by it pursuant to instructions received by it from the Required
Noteholders, or in reliance upon the advice of counsel selected by it. Without
limiting the foregoing, neither the Collateral Agent nor any of its respective
directors, officers, employees, or agents shall be: (i) responsible to any
Noteholder for the due execution, validity, genuineness, effectiveness,
sufficiency, or enforceability of, or for any recital, statement, warranty or
representation in, this Agreement, any other Transaction Document or any related
agreement, document or order; (ii) required to ascertain or to make any inquiry
concerning the

 

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performance or observance by the Company or any Guarantor of any of the terms,
conditions, covenants, or agreements of this Agreement or any of the Transaction
Documents; (iii) responsible to any other Secured Party for the state or
condition of any properties of the Company, any Guarantor or any other obligor
hereunder constituting Collateral for the Obligations or any information
contained in the books or records of the Company or any Guarantor;
(iv) responsible to any Noteholder for the validity, enforceability,
collectability, effectiveness or genuineness of this Agreement or any other
Transaction Document or any other certificate, document or instrument furnished
in connection therewith; or (v) responsible to any Noteholder for the validity,
priority or perfection of any Lien securing or purporting to secure the
Obligations or for the value or sufficiency of any of the Collateral.

(c) The Collateral Agent may execute any of its duties under this Agreement or
any other Transaction Document by or through its agents or attorneys-in-fact,
and shall be entitled to the advice of counsel concerning all matters pertaining
to its rights and duties hereunder or under the other Transaction Documents. The
Collateral Agent shall not be responsible for the negligence or misconduct of
any agents or attorneys-in-fact selected by it with reasonable care.

(d) Neither the Collateral Agent nor any of its directors, officers, employees,
or agents shall have any responsibility to the Company or any Guarantor on
account of the failure or delay in performance or breach by any other Secured
Party of any of its respective obligations under this Agreement or any of the
other Transaction Documents or in connection herewith or therewith.

(e) The Collateral Agent shall be entitled to rely, and shall be fully protected
in relying, upon any notice, consent, certificate, affidavit, or other document
or writing believed by them in good faith to be genuine and correct and to have
been signed, sent or made by the proper person or persons, and upon the advice
and statements of legal counsel (including, without, limitation, counsel to the
Company or any Guarantor), independent accountants and other experts selected by
the Company or any Guarantor or any Secured Party. The Collateral Agent shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Transaction Document unless they shall first receive such advice or
concurrence of the Required Noteholders as it deems appropriate or they shall
first be indemnified to its satisfaction by the other Secured Parties against
any and all liability and expense which may be incurred by them by reason of the
taking or failing to take any such action.

(f) The Collateral Agent shall not be deemed to have knowledge or notice of the
occurrence of any Event of Default unless the Collateral Agent has actual
knowledge of the same or has received notice from the Company or any Guarantor
referring to this Agreement, describing such Event of Default and stating that
such notice is a “notice of event of default”. In the event that the Collateral
Agent obtains such actual knowledge or receives such a notice, the Collateral
Agent shall give prompt notice thereof to each of the other Secured Parties.
Upon and during the occurrence of an Event of Default, the Collateral Agent
shall take such action with respect to such Event of Default as shall be
reasonably directed by the Required Noteholders.

 

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Unless and until the Collateral Agent shall have received such direction, the
Collateral Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to any such Event of Default as it
shall deem advisable in the best interest of the Secured Parties. In no event
shall the Collateral Agent be required to comply with any such directions to the
extent that the Collateral Agent believes that its compliance with such
directions would be unlawful.

(g) Each Secured Party (other than the Collateral Agent) acknowledges that it
has, independently and without reliance upon the Collateral Agent or any other
Secured Party, and based on the financial statements prepared by the Company and
the Guarantors and such other documents and information as it has deemed
appropriate, made its own credit analysis and investigation into the business,
assets, operations, property, and financial and other condition of the Company
and the Guarantors and has made its own decision to enter into this Agreement
and the other Transaction Documents.

(h) Each of the Noteholders agrees to (a) reimburse the Collateral Agent and its
Affiliates for such Secured Party’s Applicable Percentage of (i) any expenses
and fees incurred by the Collateral Agent for the benefit of Secured Parties
under this Agreement and any of the other Transaction Documents, including
counsel fees and compensation of agents and employees paid for services rendered
on behalf of the Secured Parties, and any other expense incurred in connection
with the operations or enforcement thereof not reimbursed by the Secured Parties
and (ii) any expenses of any Collateral Agent incurred for the benefit of the
Secured Parties that the Company or the Guarantors have agreed to reimburse
pursuant to this Agreement or any other Transaction Document and have failed to
so reimburse and (b) indemnify and hold harmless each Collateral Agent and any
of its Affiliates, directors, officers, employees, or agents, on demand, in the
amount of such Secured Party’s Applicable Percentage, from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses, or disbursements of any kind or nature whatsoever which
may be imposed on, incurred by, or asserted against it or any Secured Party in
any way relating to or arising out of this Agreement or any of the other
Transaction Documents or any action taken or omitted by it or any of them under
this Agreement or any of the other Transaction Documents to the extent not
reimbursed by the Company or any Guarantor, including costs of any suit
initiated by any Collateral Agent against any Secured Party (except such as
shall have been determined by a court of competent jurisdiction by final and
non-appealable judgment to have resulted from the gross negligence, bad faith or
willful misconduct of the Collateral Agent); provided, however, that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against such Secured
Party in its capacity as such. The provisions of this Section 29(h) shall
survive the repayment of the Obligations.

(i) It is understood and agreed that the Collateral Agent shall have the same
rights and powers hereunder (including the right to give such instructions) as
the other Noteholders and may exercise such rights and powers, as well as their
rights and powers under other agreements and instruments to which they are or
may be party, and engage in other transactions with the Company or any
Guarantor, as though they were not the Collateral Agent.

 

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The Collateral Agent and its Affiliates may engage in any kind of commercial or
investment banking, trust, advisory or other business with the Company and its
Affiliates as if it were not an Agent hereunder.

(j) The Collateral Agent may deem and treat a Noteholder party to this Agreement
as Noteholder unless and until the Collateral Agent shall have received a notice
of transfer of the Note held by such Noteholder.

(k) The Collateral Agent may resign at any time by giving thirty (30) Business
Days’ prior written notice thereof to the other Secured Parties and the Company.
Upon any such resignation of the Collateral Agent, the Required Noteholders
shall have the right to appoint a successor Collateral Agent, which, so long as
there is no Event of Default continuing, shall be reasonably satisfactory to the
Company (whose consent in any event shall not be unreasonably withheld or
delayed). If no successor Collateral Agent shall have been so appointed by the
Required Noteholders and/or none shall have accepted such appointment within
thirty (30) Business Days after the retiring Collateral Agent’s giving of notice
of resignation, the retiring Agent may, on behalf of the other Secured Parties,
appoint a successor Collateral Agent which shall be a person capable of
complying with all of the duties of the Collateral Agent hereunder (in the
opinion of the retiring Collateral Agent and as certified to the other Secured
Parties in writing by such successor Collateral Agent) which, so long as there
is no Event of Default continuing, shall be reasonably satisfactory to the
Company (whose consent shall not in any event be unreasonably withheld or
delayed). Upon the acceptance of any appointment as Collateral Agent by a
successor Collateral Agent, such successor Collateral Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Collateral Agent and the retiring Collateral Agent shall be
discharged from its duties and obligations under this Agreement.

After any retiring Collateral Agent’s resignation hereunder as Collateral Agent,
the provisions of Section 22 of this Agreement and this Sections 29 shall inure
to its benefit as to any actions taken or omitted to be taken by it while it was
such Collateral Agent under this Agreement.

(l) The Noteholders are not partners or co-venturers, and no Noteholder shall be
liable for the acts or omissions of, or (except as otherwise set forth herein in
case of the Collateral Agent) authorized to act for, any other Noteholder.

(m) For purposes of the general administration of this Agreement, the
Intercreditor Agreement and any related security documents and instruments, the
Company agrees to promptly upon request therefor, deliver to the Collateral
Agent a copy of a register of Noteholders (the “Note Register”) setting forth
the identity and contact information of each of the Noteholders at the relevant
time, the aggregate principal amount of the Notes held by each such Noteholder
at such time and the aggregate principal amount of Notes then outstanding (which
Note Register the Collateral Agent shall be entitled to rely conclusively
without further inquiry). In the event that the Company fails to promptly
provide a copy of the Note Register, the Collateral Agent shall be entitled to
conclusively rely, and shall be fully protected in relying, on written
information provided by any Person purporting to be a Noteholder and setting
forth the aggregate principal amount of Notes held by such Person.

 

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Section 30. Agency for Perfection. Each Noteholder hereby appoints each other
Noteholder as agent for the purpose of perfecting Liens for the benefit of the
Collateral Agent and the Noteholders, in assets which, in accordance with
Article 9 of the UCC or any other Applicable Law of the United States of America
can be perfected only by possession or control. Should any Noteholder (other
than the Collateral Agent) obtain possession or control of any such Collateral,
such Noteholder shall notify the Collateral Agent thereof, and, promptly upon
the Collateral Agent’s request therefor, shall deliver such Collateral to the
Collateral Agent or otherwise deal with such Collateral in accordance with the
Collateral Agent’s instructions.

Section 31. Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier or pdf shall be effective as delivery of an original
executed counterpart of this Agreement.

Section 32. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.

Section 33. Jurisdiction; Waiver of Jury Trial. (a) Each of the parties hereto
hereby irrevocably and unconditionally submits, for itself and its property, to
the exclusive jurisdiction of any New York State court or federal court of the
United States of America sitting in New York City in the borough of Manhattan,
and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in any such New York State court or, to the extent permitted by
law, in such federal court. Each Grantor hereby further irrevocably consents to
the service of process in any action or proceeding in such courts by the mailing
thereof by any parties hereto by registered or certified mail, postage prepaid,
to the Company at its address specified pursuant to Section 24 of this
Agreement. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.

(b) Each of the parties hereto irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any such New York State or
federal court. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

 

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(c) Each of the parties hereto hereby irrevocably waives all right to trial by
jury in any action, proceeding or counterclaim (whether based on contract, tort
or otherwise) arising out of or relating to this Agreement or the actions of the
Collateral Agent or any Secured Party in the negotiation, administration,
performance or enforcement thereof.

Section 34. Intercreditor Agreement. Notwithstanding anything herein to the
contrary, the Lien granted to the Collateral Agent, for the benefit of the
Secured Parties, pursuant to this Agreement and the exercise of any right or
remedy by the Collateral Agent and the other Secured Parties hereunder are
subject to the provisions of the Intercreditor Agreement. In the event of any
conflict or inconsistency between the provisions of the Intercreditor Agreement
and this Agreement, the provisions of the Intercreditor Agreement shall control.
Notwithstanding anything herein to the contrary, any provision hereof that
requires any Grantor to (a) deliver any Collateral to the Collateral Agent or
(b) cause the Collateral Agent to have Control over such Collateral may be
satisfied prior to the Maturity Date by (i) the delivery of such Collateral by
such Grantor to the Collateral Agent for the benefit of itself and the
Noteholders and (ii) providing that the Collateral Agent be provided with
Control with respect to such Collateral of such Grantor for the benefit of the
itself and the other Secured Parties. Until the First Priority Obligations
Payment Date with respect to ABL Priority Collateral, the delivery of any ABL
Priority Collateral to the ABL Agent pursuant to the ABL Loan Documents shall
satisfy any delivery requirement hereunder or under any other Transaction
Document.

[Remainder of Page Intentionally Left Blank]

 

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IN WITNESS WHEREOF, each Grantor and Guarantor has caused this Agreement to be
duly executed and delivered by its officer thereunto duly authorized as of the
date first above written.

 

EASTMAN KODAK COMPANY By:  

                                      

Name: Title: Address for Notices:

Eastman Kodak Company

345 State Street

Rochester, NY 14650

EASTMAN KODAK INTERNATIONAL

CAPITAL COMPANY INC.

FAR EAST DEVELOPMENT LTD. FPC INC. KODAK (NEAR EAST), INC. KODAK AMERICAS, LTD.

LASER-PACIFIC MEDIA CORPORATION

QUALEX INC.

By:  

 

Name: Title: Address for Notices:

c/o Eastman Kodak Company

345 State Street

Rochester, NY 14650

[Signature Page to Guaranty and Collateral Agreement (Secured Convertible
Notes)]

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KODAK PHILIPPINES, LTD. NPEC INC. By:  

                              

Name: Title: Address for Notices:

c/o Eastman Kodak Company

345 State Street

Rochester, NY 14650

[Signature Page to Guaranty and Collateral Agreement (Secured Convertible
Notes)]

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WILMINGTON TRUST, NATIONAL ASSOCIATION By:  

                              

  Name:   Title:

Address for Notices:

 

Wilmington Trust, National Association

246 Goose Lane, Suite 105

Guilford, Connecticut 06437

Attention: Kodak Notes Administrator

Fax: (203) 453-1183

 

with a copy to:

 

Covington & Burling LLP

The New York Times Building

620 Eighth Avenue

New York, NY 10018

Attn: Ronald A. Hewitt

Fax: (212) 841-1010

[Signature Page to Guaranty and Collateral Agreement (Secured Convertible
Notes)]

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C2W PARTNERS MASTER FUND LIMITED

By: Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

                     

  Name:   Title: Address for Notices:

c/o Southeastern Asset Management, Inc.

6410 Poplar Avenue, Suite 900,

Memphis, TN 38119 Attention: Andrew R. McCarroll Email: amccarroll@SEasset.com
Facsimile: (901) 260-0885 LONGLEAF PARTNERS SMALL-CAP FUND

By: Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

 

  Name:   Title: Address for Notices:

c/o Southeastern Asset Management, Inc.

6410 Poplar Avenue, Suite 900,

Memphis, TN 38119 Attention: Andrew R. McCarroll Email: amccarroll@SEasset.com
Facsimile: (901) 260-0885

[Signature Page to Guaranty and Collateral Agreement (Secured Convertible
Notes)]

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DESERET MUTUAL PENSION TRUST

By: Southeastern Asset Management, Inc.,

Acting as Investment Advisor

By:  

                 

  Name:   Title: Address for Notices: c/o Southeastern Asset Management, Inc.
6410 Poplar Avenue, Suite 900, Memphis, TN 38119 Attention: Andrew R. McCarroll
Email: amccarroll@SEasset.com Facsimile: (901) 260-0885

[Signature Page to Guaranty and Collateral Agreement (Secured Convertible
Notes)]

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ATTACHMENT 1

CERTAIN DEFINITIONS

For purposes of this Agreement, the following terms shall have the following
meanings:

“ABL Agent” has the meaning set forth in the Intercreditor Agreement.

“ABL Agreement” means that certain Amended and Restated Credit Agreement, dated
as of May 26, 2016 (as amended, amended and restated, supplemented or otherwise
modified in accordance with the terms thereof), among Company, the lenders party
thereto and Bank of America, N.A., as ABL Agent.

“ABL Loan Documents” has the meaning set forth in the Intercreditor Agreement.

“ABL Priority Collateral” has the meaning set forth in the Intercreditor
Agreement.

“Account” has the meaning set forth in the UCC.

“Account Collateral” has the meaning set forth in Section 2(f) of this
Agreement.

“Account Control Agreement” means an agreement in form and substance reasonably
satisfactory to the Collateral Agent, establishing Control of a deposit account
or securities account, in each case as required pursuant to the terms of this
Agreement, by either the Collateral Agent or the ABL Agent, subject to the terms
of the Intercreditor Agreement.

“Additional Grantor” has the meaning set forth in Section 23(b) of this
Agreement.

“Affiliate” means, with respect to a specific person, another person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the person specified.

“Agreement” means this Guarantee and Collateral Agreement, as amended, restated,
supplemented or otherwise modified from time to time.

“Applicable Law” means, as to any person, all statutes, rules, regulations,
orders or other requirements having the force of law and applicable to such
person, and all court orders and injunctions, and/or similar rulings and
applicable to such person, in each case of or by any Governmental Authority, or
court, or tribunal which has jurisdiction over such person, or any property of
such person.

“Applicable Percentage” means with respect to any Noteholder at any time, the
percentage (carried out to the fourth decimal place) of the outstanding
principal amount of Notes held by such Noteholder at such time to the aggregate
outstanding principal amount of Notes outstanding held by all Noteholders at
such time.

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York, New York are authorized or required by law
to remain closed.

 

Attachment 1-1

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“Capital Expenditures” means, without duplication, any expenditure of money for
any purchase or other acquisition of any asset which, in conformity with GAAP,
would be required to be classified as a capital expenditure on the consolidated
statement of cash flows of the Company and its Restricted Subsidiaries;
provided, that, the term “Capital Expenditures” shall not include (i) any
additions to property, plant and equipment and other expenditures made in
connection with the replacement, substitution, restoration, repair or
improvement of assets to the extent made with (w) the proceeds of equity
issuances of, or capital contributions to, the Company, (x) Indebtedness
borrowed (excluding borrowings under the ABL Agreement) by the Company, any
Guarantor or any Restricted Subsidiary in connection with such capital
expenditures, (y) the proceeds from any casualty insurance or condemnation or
eminent domain paid on account of the loss of or damage to the assets being
replaced, substituted, restored, repaired or improved, to the extent that the
proceeds therefrom are utilized or committed to be utilized for capital
expenditures within twelve (12) months of the receipt of such proceeds and (if
so committed) are so utilized within eighteen (18) months of the receipt of such
proceeds, or (z) the proceeds from any sale or other disposition of the
Company’s or any Restricted Subsidiary’s assets (other than assets consisting of
Accounts and the proceeds thereof), to the extent that the proceeds therefrom
are utilized or committed to be utilized for capital expenditures within twelve
(12) months of the receipt of such proceeds and (if so committed) are so
utilized within eighteen (18) months of the receipt of such proceeds, (ii) the
purchase price of equipment that is purchased substantially contemporaneously
with the trade-in of existing equipment solely to the extent of the amount of
such purchase price reduced by the credit granted by the seller of such
equipment for the equipment being traded in at such time, (iii) expenditures
that constitute operating lease expenses in accordance with GAAP,
(iv) expenditures that constitute permitted acquisitions or other investments
that consist of the purchase of a business unit, line of business or a division
of a person or all or substantially all of the assets of a person, (v) any
expenditures which are paid by a third party or which are contractually required
to be, and are, reimbursed to the Company and the Guarantors in cash by a third
party (including landlords) during such period of calculation or (vi) any
non-cash capitalized interest expense reflected as additions to property, plant
or equipment in the consolidated balance sheet of the Company and the Restricted
Subsidiaries.

“Capital Lease Obligations” means, with respect to any person for any period,
the obligations of such person to pay rent or other amounts under any lease of
(or other arrangement conveying the right to use) real or personal property, or
a combination thereof, which obligations are required to be classified and
accounted for as a capital lease on a balance sheet of such person under GAAP
and the amount of which obligations shall be the capitalized amount thereof
determined in accordance with GAAP. For the avoidance of doubt, operating leases
shall also be accounted for in accordance with GAAP in effect as of the date
hereof, provided that any such obligations that are be required to be classified
and accounted for as an operating lease under GAAP as existing on the date
hereof that are recharacterized as capital leases due to a change in GAAP after
the date hereof shall not be treated as Capital Lease Obligations for any
purpose under this Agreement, but instead shall be accounted for as if they were
operating leases for all purposes under this Agreement (other than provisions
relating to the preparation or delivery of financial statements) as determined
under GAAP in effect on the date hereof.

“Cash Control Implementation Date” has the meaning set forth in Section 5(f) of
this Agreement.

 

Attachment 1-2

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“CFC” means a “controlled foreign corporation” within the meaning of Section 957
of the Internal Revenue Code of 1986, as amended from time to time.

“Closing Date” has the meaning set forth in the Notes.

“Collateral” has the meaning set forth in Section 2 of this Agreement.

“Collateral Agent” has the meaning set forth in the preamble of this Agreement.

“Company” means Eastman Kodak Company, a New Jersey Corporation.

“Company Obligations” has the meaning set forth in Section 1(a) of this
Agreement.

“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a person, whether
through the ability to exercise voting power or by contract. “Controlling” and
“Controlled” have meanings correlative thereto.

“Controlled Account” means any Controlled DDA Account or Controlled Lock Box
Account.

“Controlled DDA Account” has the meaning set forth in Section 5(f) of this
Agreement.

“Controlled Lock Box Account” has the meaning set forth in Section 5(f) of this
Agreement.

“Currency and Commodity Hedging Agreement” means any foreign currency exchange
agreement, commodity price protection agreement or other currency exchange rate
or commodity price hedging arrangement.

“DDAs” means any checking, savings or other demand deposit accounts maintained
by the Company or any Guarantor.

“Disbursement Accounts” means the deposit accounts (other than Excluded
Accounts) used by the Company or any Guarantor for disbursements and payments
(other than payroll) in the ordinary course of business; provided, that, in no
event shall the aggregate amount on deposit in the Disbursement Accounts exceed
the estimated amount expected for disbursement and payments by the Company or
such Guarantor and any fees in respect of such amount.

“Disqualified Stock” means any Equity Interest that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, (a) except as set forth in
the proviso hereto, matures (excluding any maturity as the result of an optional
redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or is redeemable at the option of the
holder thereof, in whole or in part, or requires the payment of any cash
dividend or any other scheduled payment constituting a return of capital, in
each case at any time on or prior to the 91st day after the Maturity Date, or
(b) is convertible into or exchangeable (unless at the sole option of the issuer
thereof) for (i) debt securities or (ii) any Equity Interest referred to in
clause (a) above, in each case at any time prior to the first anniversary of the
Maturity Date; provided, that (i) only the portion of the Equity Interests that
so mature or are mandatorily redeemable are so convertible or exchangeable or
are so redeemable at the option of the holder thereof prior to such date shall
be deemed to be

 

Attachment 1-3

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Disqualified Stock; (ii) if such Equity Interests are issued to any plan for the
benefit of employees of the Company or any Restricted Subsidiary or by any such
plan to such employees, such Equity Interests shall not constitute Disqualified
Stock solely because they may be required to be repurchased by the Company or
any Restricted Subsidiary in order to satisfy applicable statutory or regulatory
obligations or as a result of such employee’s termination, death or disability;
and (iii) such Equity Interest may by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable or exercisable)
become mandatorily redeemable or redeemable at the option of the holder thereof
upon the occurrence of a change in control or disposition subject to payment in
full in cash of all Obligations (other than contingent indemnification
obligations not then due and owing).

“Domestic Subsidiary” means any Subsidiary of the Company that is not a Foreign
Subsidiary.

“Eligible Cash” has the meaning set forth in the ABL Agreement.

“Equipment” has the meaning set forth in Section 2(a) of this Agreement.

“Equity Interests” means, as to any person, all of the authorized shares of
capital stock of (or other ownership or profit interests in) such person,
including all classes of common and preferred capital stock, all of the
warrants, options or other rights for the purchase or acquisition from such
person of shares of capital stock of (or other ownership or profit interests in)
such person, all of the securities convertible into or exchangeable for shares
of capital stock of (or other ownership or profit interests in) such person or
warrants, rights or options for the purchase of acquisition from such person of
such shares (or such other interests), and all of the other ownership or profit
interests in such person (including partnership, membership or trust interests
therein), rights to receive distributions of cash and other property, and to
receive allocations of items of income, gain, loss, deductions and credit and
similar items from such person, whether voting or nonvoting, whether or not such
interests include rights entitling the holder thereof to exercise control over
such person, and whether or not such shares, warrants, options, rights or other
interests are outstanding on any date of determination; provided, that,
notwithstanding the foregoing, no Indebtedness shall constitute Equity
Interests.

“Event of Default” has the meaning set forth in the Notes.

“Excluded Accounts” means any and all of the (i) payroll, employee benefits,
healthcare, escrow, fiduciary, defeasance, redemption, trust, tax and other
similar accounts, (ii) “zero balance” accounts from which balances are swept
daily to a Controlled Account, (iii) other accounts prohibited by Applicable Law
from being pledged to, or having a security interest therein granted to, a third
party and (iv) other accounts of the Company or any Guarantor (other than DDAs
and other accounts into which customer or other third party payments in respect
of the Collateral are scheduled to be or regularly made) with aggregate balances
for all such accounts under this clause (iv) of less than $5,000.

“Excluded Property” has the meaning set forth in Section 2(m) of this Agreement.

“Financial Officer” of any person (other than a natural person) means the chief
financial officer, president, chief executive officer, treasurer or controller
or any other officer of such person designated or authorized by any of the
foregoing.

 

Attachment 1-4

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“First Priority Obligation Payment Date” has the meaning set forth in the
Intercreditor Agreement.

“Fiscal Quarter” means each three-month period of the Company ending on
March 31, June 30 or December 31 of any year.

“Foreign Subsidiary” means any Subsidiary organized under the laws of a
jurisdiction other than the United States of America or any State thereof or the
District of Columbia.

“GAAP” means generally accepted accounting principles in the United States of
America, as in effect from time to time.

“Governmental Authority” means the government of the United States of America,
any other nation or any political subdivision thereof, whether state, local or
other, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.

“Grantors” has the meaning set forth in the Preamble of this Agreement.

“Guarantee” of or by any person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness of any other person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any
obligation of the guarantor, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment thereof, (b) to purchase or lease property, securities or services
for the purpose of assuring the owner of such Indebtedness or other obligation
of the payment thereof, (c) 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
(d) as an account party in respect of any letter of credit or letter of guaranty
issued to support such Indebtedness or obligation; provided, that, the term
“Guarantee” shall not include endorsements for collection or deposit in the
ordinary course of business or customary and reasonable indemnity obligations in
effect on the Closing Date or entered into in connection with any contractual
arrangement, including, but not limited to, any acquisition, Capital
Expenditure, investment or disposition of assets permitted under this Agreement
(other than such obligations with respect to Indebtedness). The amount of any
Guarantee by a person shall be deemed to be an amount equal to the stated amount
or determinable amount of the primary obligation in respect of which such
Guarantee is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such person is required to
perform thereunder) as determined by such person in good faith.

“Guarantors” means each Grantor other than the Company.

“Guarantor Obligations” has the meaning set forth in Section 1(a)(i) of this
Agreement.

“Hedging Agreement” means any Currency and Commodity Hedging Agreement or
Interest Rate Hedging Agreement.

 

Attachment 1-5

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“Immaterial Foreign Subsidiary” means each Restricted Subsidiary that is a
Foreign Subsidiary designated in writing by the Company to the Collateral Agent
as an Immaterial Foreign Subsidiary; provided, that, (a) an Immaterial Foreign
Subsidiary shall not at the time of designation have net sales for any Fiscal
Quarter or total assets as of the last day of any Fiscal Quarter in an amount
that is equal to or greater than 5.0% of the net sales or total sales, as
applicable, of the Company and its Restricted Subsidiaries for, or as of the
last day of, such Fiscal Quarter determined as of the date of the most recent
annual audited or quarterly unaudited financial statements required to be
delivered pursuant to Section 4.4 of the Notes, as the case may be, and
(b) Immaterial Foreign Subsidiaries, when taken together with all other
Immaterial Foreign Subsidiaries, at the time of designation shall not have net
sales for any Fiscal Quarter or total assets as of the last day of any Fiscal
Quarter in an amount that is equal to or greater than 5.0% of the net sales or
total assets, as applicable, of the Company and its Restricted Subsidiaries for,
or as of the last day of, such Fiscal Quarter determined as of the date of the
most recent annual audited or quarterly unaudited financial statements required
to be delivered pursuant to Section 4.4 of the Notes; provided, that, if for any
subsequent Fiscal Quarter the conditions above would not be met if the Company
were designating such Subsidiary as an Immaterial Foreign Subsidiary at such
time, the Company will promptly designate in writing to the Collateral Agent the
Foreign Subsidiaries which will cease to be treated as “Immaterial Foreign
Subsidiaries” in order to comply with the foregoing conditions.

“Indebtedness” of any person means, without duplication, (a) all obligations of
such person for borrowed money, (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 (i) current
accounts payable incurred in the ordinary course of business and accrued
expenses and (ii) any earn-out obligations, except to the extent not paid after
becoming due and payable or such obligations appear as a liability on the
balance sheet of such person in accordance with GAAP), (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, but only to the extent of such Lien, and only to the extent of the
lesser of the fair market value of the property secured by the Lien and the
amount of Indebtedness, (f) all Guarantees by such person of Indebtedness set
forth in subclauses (a)-(e) and (g)-(k), (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 letters of guaranty, (i) all
obligations, contingent or otherwise, of such person in respect of bankers’
acceptances, (j) the obligations of such person in respect of any Hedging
Agreement and (k) all Disqualified Stock of such person. The Indebtedness of any
person shall include the Indebtedness of any other entity (including any
partnership in which such person is a general partner) to the extent such person
is liable therefor as a result of such person’s ownership interest in or other
relationship with such entity, except to the extent the terms of such
Indebtedness provide that such person is not liable therefor (but only for the
portion so liable). For purposes of determining Indebtedness, (x) the “principal
amount” of the obligations of any person in respect of any Hedging Agreement at
any time shall be the maximum aggregate amount (giving effect to any netting
agreements) that such person would be required to pay if such Hedging Agreement
were terminated at such time and (y) in no event shall obligations under any
Hedging Agreement be deemed “Indebtedness” for calculating any financial ratio
(or component thereof).

 

Attachment 1-6

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“Indemnified Party” has the meaning set forth in Section 22(a) of this
Agreement.

“Initial Collateral” has the meaning set forth in Section 2(m) of this
Agreement.

“Initial Pledged Debt” has the meaning set forth in Recital (3) of this
Agreement.

“Intellectual Property” means all intellectual property of the Company and its
Subsidiaries, including:

(a) all patents, patent applications, utility models and statutory invention
registrations, all inventions claimed or disclosed therein and all improvements
thereto;

(b) all trademarks, service marks, uniform resource locators, domain names,
trade dress, logos, designs, slogans, trade names, business names, corporate
names and other source identifiers, whether registered or unregistered,
together, in each case, with the goodwill symbolized thereby;

(c) all copyrights, including copyrights in computer software, internet web
sites and the content thereof, whether registered or unregistered; all
confidential and proprietary information, including know-how, trade secrets,
manufacturing and production processes and techniques, inventions, research and
development information, databases and data, including technical data,
financial, marketing and business data, pricing and cost information, business
and marketing plans and customer and supplier lists and information, and all
other intellectual, industrial and intangible property of any type, including
industrial designs and mask works;

(d) except as set forth above, all registrations and applications for
registration for any of the foregoing, including those registrations and
applications for registration, together with all reissues, divisions,
continuations, continuations-in-part, extensions, renewals and reexaminations
thereof;

(e) all agreements, permits, consents, orders and franchises relating to the
license, development, use or disclosure of any of the foregoing to which such
Grantor, now or hereafter, is a party or a beneficiary; and

(f) any and all claims for damages and injunctive relief for past, present and
future infringement, dilution, misappropriation, violation, misuse or breach
with respect to any of the foregoing, with the right, but not the obligation, to
sue for and collect, or otherwise recover, such damages.

 

Attachment 1-7

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“Intercreditor Agreement” means that certain Intercreditor Agreement, dated as
of even date herewith, among the Collateral Agent, Bank of America, N.A., as ABL
Agent, the Company and the Guarantors.

“Interest Rate Hedging Agreement” means any interest rate protection agreement
or other interest rate hedging arrangement.

“Inventory” has the meaning set forth in Section 2(b) of this Agreement.

“Investment Property” has the meaning set forth in Section 2(d)(vi) of this
Agreement.

“L/C Cash Deposit Account” has the meaning set forth in Recital (5) of this
Agreement.

“Lien” has the meaning set forth in the Notes.

“Lock Box” means those lock boxes that are maintained by the Grantors as of the
Closing Date, as set forth in Schedule II.

“Lock Box Agreement” means, with respect to any Lock Box established by a
Grantor, an agreement, in form and substance reasonably satisfactory to the
Collateral Agent, establishing Control of such Lock Box by the ABL Agent or the
Collateral Agent, in accordance with this Agreement and the Intercreditor
Agreement.

“Material Adverse Effect” means a material adverse effect on (a) the business,
condition (financial or otherwise), operations, performance or properties of the
Company and any person whose accounts are consolidated with the accounts of the
Company in accordance with GAAP, taken as a whole, (b) the rights and remedies
of the Collateral Agent or any Noteholder under any Transaction Document or
(c) the ability of the Company or any Guarantor to perform its obligations under
any Transaction Document to which it is a party.

“Material First-Tier Foreign Subsidiary” means any Foreign Subsidiary or
Qualified CFC Holding Company that is owned directly by or on behalf of the
Company or any Guarantor and is not an Immaterial Foreign Subsidiary.

“Maturity Date” has the meaning set forth in the Notes.

“Noteholders” has the meaning set forth in the Recitals to this Agreement.

“Note Purchase Agreement” means the Note Purchase Agreement, dated as of the
date hereof, by and among the Company, the Noteholders and Collateral Agent (as
it may be amended, restated, amended and restated, supplemented or otherwise
modified from time to time).

“Note Register” has the meaning set forth in Section 29(m) of this Agreement.

“Notes” means each of the Notes referred to in the Note Purchase Agreement.

“Obligations” has the meaning set forth in Section 1(a)(iii) of this Agreement.

“Permitted Lien” has the meaning set forth in the Notes.

 

Attachment 1-8

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“Pledged Debt” has the meaning set forth in Section 2(d)(iv) of this Agreement.

“Pledged Cash Account (Eligible Cash)” has the meaning set forth in Recital
(6) to this Agreement.

“Pledged Deposit Accounts” has the meaning set forth in Recital (4) of this
Agreement.

“Qualified CFC Holding Company” means any Domestic Subsidiary that has no
material assets other than Equity Interests in one or more Subsidiaries that are
CFCs.

“Receivables” has the meaning set forth in Section 2(c) of this Agreement.

“Related Contracts” has the meaning set forth in Section 2(c) of this Agreement.

“Requirement of Law” means, as to any person, the certificate of incorporation
and by-laws or other organizational or governing documents of such person, and
any law, treaty, rule or regulation or determination of an arbitrator or a court
or other Governmental Authority, in each case applicable to or binding upon such
person or any of its property or to which such person or any of its property is
subject.

“Required Noteholders” means (i) prior to the Closing Date, each purchaser
entitled to purchase Notes pursuant to the terms of the Note Purchase Agreement,
and (ii) on or after the Closing Date, holders of at least a majority of
aggregate principal amount of Notes then outstanding.

“Restricted Subsidiary” means any Subsidiary other than an Unrestricted
Subsidiary. Unless otherwise specified, any references herein to a “Restricted
Subsidiary” shall refer to a Restricted Subsidiary of the Company.

“Second Priority Representative” shall have the meaning set forth in the
Intercreditor Agreement.

“Secured Parties” means any of the Collateral Agent and the Noteholders, as well
as any other holder of Obligations.

“Security Agreement Supplement” has the meaning set forth in Section 23(b) of
this Agreement.

“Security Collateral” has the meaning set forth in Section 2(d) of this
Agreement.

“Subagent” has the meaning set forth in Section 19(b) of this Agreement.

“Subsidiary” means, with respect to any person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than
fifty percent (50%) of the ordinary voting power to elect a majority of the
board of directors or other managers thereof or, in the case of a partnership,
more than fifty percent (50%) of the general partnership interests are, as of

 

Attachment 1-9

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such date, owned, controlled or held, or (b) that is, as of such date, otherwise
Controlled, by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent. Unless otherwise specified,
“Subsidiary” shall mean a Subsidiary of the Company. For the avoidance of doubt,
a variable interest entity shall not constitute a subsidiary.

“Transaction Documents” has the meaning set forth in the Note Purchase
Agreement.

“UCC” has the meaning set forth in Recital (9) to this Agreement.

“Unrestricted Subsidiary” means (a) any Subsidiary of the Company designated by
the board of directors (or equivalent governing body) of the Company as an
Unrestricted Subsidiary pursuant to the terms of the ABL Loan Documents and
(b) any Subsidiary of an Unrestricted Subsidiary.

“US Cash” has the meaning set forth in the ABL Agreement.

 

Attachment 1-10

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EXHIBIT D

FORM OF TA LETTER

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EASTMAN KODAK COMPANY

343 State Street

Rochester, New York 14650

May [•], 2019

Computershare Inc.

Computershare Trust Company

N.A. Transfer Agent and Registrar

ATTN: Janet Moor

250 Royall Street

Canton, MA 02021

 

  Re:

Reservation of Common Stock for Issuance

Dear Ms. Moor:

Eastman Kodak Company, a New Jersey corporation (the “Company”), hereby
instructs you to reserve 31,497,850 shares (the “Conversion Shares”) of the
Company’s common stock, par value $0.01 per share (“Common Stock”), from
authorized but unissued shares of Common Stock in a reserve account entitled
“5.00% Secured Convertible Notes” for issuance upon conversion of the 5.00%
Secured Convertible Notes (the “Notes”).

The reservation of the Conversion Shares for issuance upon conversion of the
Preferred Stock was authorized and approved by the Board of Directors of the
Company on May 20, 2019.

If you need any further information, please do not hesitate to call me. Thank
you for your assistance to this matter.

[Signature Page Follows]

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Very truly yours,

 

EASTMAN KODAK COMPANY By:  

 

  Name:   Title:

[Signature Page to Letter to Transfer Agent Reserving Common Stock]