EXECUTION COPY


 


EXHIBIT 10.1


 


TERM LOAN CREDIT AGREEMENT


 


dated as of October 21, 2016


 


among


 


QUMU CORPORATION 


as Borrower,


 


THE VARIOUS FINANCIAL INSTITUTIONS PARTY HERETO,

as Lenders,


 


and


 


HALE CAPITAL PARTNERS, LP,

as Administrative Agent


 





 



 






    	 	 	 



     

    

 





	SECTION 1	DEFINITIONS	 	1
	 	 	 	 	 
	 	1.1	 	Definitions	 	1
	 	1.2	 	Other Interpretive Provisions	 	18
	 	 	 	 	 	 
	SECTION 2	TERM LOAN COMMITMENTS OF THE LENDERS	 	19
	 	 	 	 	 
	 	2.1	 	Term Loan Commitments	 	19
	 	 	 	 	 	 
	SECTION 3	EVIDENCING OF TERM LOANS	 	19
	 	 	 	 	 
	 	3.1	 	Term Notes	 	19
	 	3.2	 	Recordkeeping	 	20
	 	3.3	 	Allocation of Purchase Price	 	20
	 	 	 	 	 	 
	SECTION 4	INTEREST	 	20
	 	 	 	 	 
	 	4.1	 	Interest Rates	 	20
	 	4.2	 	Interest Payment Dates	 	20
	 	4.3	 	Computation of Interest	 	21
	 	 	 	 	 	 
	SECTION 5	FEES	 	21
	 	 	 	 	 
	 	5.1	 	Prepayment Fee	 	21
	 	5.2	 	Commitment Fee	 	21
	 	5.3	 	Administration Fees	 	21
	 	 	 	 	 	 
	SECTION 6	PREPAYMENTS; REPAYMENT	 	21
	 	 	 	 	 
	 	6.1	 	Prepayments	 	21
	 	6.2	 	Manner of Prepayments	 	22
	 	6.3	 	Repayment	 	22
	 	 	 	 	 	 
	SECTION 7	MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES	 	23
	 	 	 	 	 
	 	7.1	 	Making of Payments	 	23
	 	7.2	 	Application of Certain Payments	 	23
	 	7.3	 	Due Date Extension	 	23
	 	7.4	 	Setoff	 	23
	 	7.5	 	Proration of Payments	 	23
	 	7.6	 	Taxes	 	23
	 	 	 	 	 	 
	SECTION 8	INCREASED COSTS	 	25
	 	 	 	 	 
	 	8.1	 	Increased Costs	 	25
	 	8.2	 	Mitigation of Circumstances; Replacement of Lenders	 	26
	 	8.3	 	Conclusiveness of Statements; Survival of Provisions	 	27
	 	 	 	 	 	 
	SECTION 9	REPRESENTATIONS AND WARRANTIES	 	27
	 	 	 	 	 
	 	9.1	 	Organization	 	27
	 	9.2	 	Authorization; No Conflict	 	27
	 	9.3	 	Validity and Binding Nature	 	28
	 	9.4	 	Financial Condition	 	28
	 	9.5	 	No Material Adverse Change	 	28



 






    	 	 	 



     

    

  


	 	9.6	 	Litigation and Contingent Liabilities	 	28
	 	9.7	 	Ownership of Properties; Liens	 	28
	 	9.8	 	Equity Ownership; Subsidiaries	 	29
	 	9.9	 	Pension Plans	 	29
	 	9.10	 	Investment Company Act	 	30
	 	9.11	 	Compliance with Laws	 	30
	 	9.12	 	Regulation U	 	30
	 	9.13	 	Taxes	 	30
	 	9.14	 	Solvency, etc	 	30
	 	9.15	 	Environmental Matters	 	30
	 	9.16	 	Insurance	 	32
	 	9.17	 	Real Property	 	32
	 	9.18	 	Information	 	32
	 	9.19	 	Intellectual Property	 	32
	 	9.20	 	[Reserved]	 	32
	 	9.21	 	Labor Matters	 	33
	 	9.22	 	Anti-Terrorism Laws	 	33
	 	9.23	 	No Default	 	33
	 	9.24	 	Hedging Agreements	 	33
	 	9.25	 	OFAC	 	33
	 	9.26	 	Patriot Act	 	34
	 	9.27	 	Customers and Suppliers	 	34
	 	9.28	 	Significant Contracts	 	34
	 	9.29	 	Certain Foreign Subs	 	34
	 	 	 	 	 	 
	SECTION 10	 	AFFIRMATIVE COVENANTS	 	35
	 	 	 	 	 
	 	10.1	 	Reports, Certificates and Other Information	 	35
	 	10.2	 	Books, Records and Inspections	 	38





	 	10.3	 	Maintenance of Property; Insurance	 	38
	 	10.4	 	Compliance with Laws; Payment of Taxes and Liabilities	 	39
	 	10.5	 	Maintenance of Existence, etc	 	40
	 	10.6	 	Use of Proceeds	 	40
	 	10.7	 	Employee Benefit Plans	 	40
	 	10.8	 	Environmental Matters	 	40
	 	10.9	 	Further Assurances	 	42
	 	10.10	 	Accounts	 	42
	 	10.11	 	Post-Closing Covenants	 	42
	 	 	 	 	 	 
	SECTION 11	 	NEGATIVE COVENANTS	 	42
	 	 	 	 	 
	 	11.1	 	Debt	 	42
	 	11.2	 	Liens	 	43
	 	11.3	 	Operating Leases	 	44
	 	11.4	 	Restricted Payments	 	44
	 	11.5	 	Mergers, Consolidations, Sales	 	45
	 	11.6	 	Modification of Organizational Documents	 	45
	 	11.7	 	Transactions with Affiliates	 	45
	 	11.8	 	Unconditional Purchase Obligations	 	45



  






    	 	 	 



     

    

 


	 	11.9	 	Inconsistent Agreements	 	45
	 	11.10	 	Business Activities; Issuance of Equity	 	46
	 	11.11	 	Investments	 	46
	 	11.12	 	Fiscal Year	 	46
	 	11.13	 	Financial Covenants	 	47
	 	11.14	 	Cancellation of Debt	 	47
	 	11.15	 	Transfer to Foreign Subsidiaries	 	48
	 	11.16	 	Compliance with Laws	 	48
	 	11.17	 	Maintenance and Hosted Service Agreements	 	48
	 	11.18	 	Certain Foreign Subsidiaries	 	48
	 	 	 	 	 	 
	SECTION 12	 	EFFECTIVENESS; CONDITIONS OF LENDING, ETC	 	48
	 	 	 	 	 
	 	12.1	 	Term Loans	 	48
	 	12.2	 	Compliance with Warranties, No Default, etc	 	52
	 	 	 	 	 	 
	SECTION 13	 	EVENTS OF DEFAULT AND THEIR EFFECT	 	52
	 	 	 	 	 
	 	13.1	 	Events of Default	 	52
	 	13.2	 	Effect of Event of Default	 	54
	 	13.3	 	Credit Bidding	 	55
	 	 	 	 	 	 
	SECTION 14	 	THE AGENT	 	55
	 	 	 	 	 
	 	14.1	 	Appointment and Authorization	 	55
	 	14.2	 	Delegation of Duties	 	56
	 	14.3	 	Exculpation of Administrative Agent	 	56
	 	14.4	 	Reliance by Administrative Agent	 	56
	 	14.5	 	Notice of Default	 	57
	 	14.6	 	Credit Decision	 	57
	 	14.7	 	Indemnification	 	57
	 	14.8	 	Administrative Agent in Individual Capacity	 	58
	 	14.9	 	Successor Administrative Agent	 	58
	 	14.10	 	Collateral Matters	 	58
	 	14.11	 	Restriction on Actions by Lenders	 	59
	 	14.12	 	Administrative Agent May File Proofs of Claim	 	59
	 	14.13	 	Other Agents; Arrangers and Managers	 	60
	 	 	 	 	 	 
	SECTION 15	 	GENERAL	 	60
	 	 	 	 	 
	 	15.1	 	Waiver; Amendments	 	60
	 	15.2	 	Confirmations	 	61
	 	15.3	 	Notices	 	61
	 	15.4	 	Computations	 	62
	 	15.5	 	Costs, Expenses and Taxes	 	62
	 	15.6	 	Assignments; Participations	 	62
	 	15.7	 	Register	 	64
	 	15.8	 	GOVERNING LAW	 	64
	 	15.9	 	Confidentiality; Non-Public Information	 	64
	 	15.10	 	Severability	 	66
	 	15.11	 	Nature of Remedies	 	66



 






    	 	 	 



     

    

 


	 	15.12	 	Entire Agreement	 	67
	 	15.13	 	Counterparts	 	67
	 	15.14	 	Successors and Assigns	 	67
	 	15.15	 	Captions	 	67
	 	15.16	 	Customer Identification – USA Patriot Act Notice	 	67
	 	15.17	 	INDEMNIFICATION BY LOAN PARTIES	 	67
	 	15.18	 	Nonliability of Lenders	 	68
	 	15.19	 	FORUM SELECTION AND CONSENT TO JURISDICTION	 	69
	 	15.20	 	WAIVER OF JURY TRIAL	 	69
	 	 	 	 	 	 
	SECTION 16	 	JOINT AND SEVERAL LIABILITY	 	70
	 	 	 	 	 
	SECTION 17	 	OBSERVATION RIGHTS	 	73
	 	 	 	 	 
	 	17.1	 	Board Observer	 	73



  






    	 	 	 



     

    

 

	ANNEXES
	 	 
	ANNEX A	Lenders and Pro Rata Shares
	ANNEX B	Addresses for Notices
	 	 
	SCHEDULES
	 	 
	SCHEDULE 9.5	Material Adverse Change
	SCHEDULE 9.6	Litigation and Contingent Liabilities
	SCHEDULE 9.8	Subsidiaries
	SCHEDULE 9.16	Insurance
	SCHEDULE 9.17	Real Property
	SCHEDULE 9.21	Labor Matters
	SCHEDULE 9.27	Customers and Suppliers
	SCHEDULE 9.28	Significant Contracts
	SCHEDULE 10.11	Post-Closing Obligations
	SCHEDULE 10.12	Deferred Revenue
	SCHEDULE 11.1	Existing Debt
	SCHEDULE 11.2	Existing Liens
	SCHEDULE 11.5	Permitted Exclusive License
	SCHEDULE 11.11	Investments
	 	 
	EXHIBITS
	 	 
	EXHIBIT A	Form of Term Note
	EXHIBIT B	Form of Compliance Certificate
	EXHIBIT C	Form of Assignment Agreement
	EXHIBIT D	Form of Warrant







 






    	 	 	 



     

    

 



TERM LOAN CREDIT AGREEMENT


 


THIS TERM LOAN CREDIT AGREEMENT dated
as of October 21, 2016 (this “Agreement”) is entered into among (i) QUMU CORPORATION, a Minnesota corporation
(the “Borrower”), (ii) QUMU, Inc., a California corporation and the other Persons party hereto from time to
that are designated as a “Guarantor” hereunder, (iii) the financial institutions that are or may from time to
time become parties hereto (together with their respective successors and assigns, the “Lenders”), and (iv) HALE
CAPITAL PARTNERS, LP (in its individual capacity, “Hale Capital”), as administrative agent for the Lenders.


 


RECITALS


 


WHEREAS, Borrower has requested that
the Lenders make the Term Loans to Borrower to provide for the ongoing general corporate purposes and working capital needs of
Borrower as further provided herein, in an aggregate principal amount not to exceed $8,000,000, and the Lenders are willing to
do so on the terms and conditions set forth herein.


 


WHEREAS, to secure the Term Loans
and other Obligations, Borrower is granting to Administrative Agent, for the benefit of Administrative Agent and Lenders, a security
interest in and lien upon all of Borrower’s real and personal property.


 


In consideration of the mutual agreements
herein contained, the parties hereto agree as follows:


 


SECTION
1        DEFINITIONS.


 


1.1          Definitions. When
used herein the following terms shall have the following meanings:


 


“Account Debtor”
is defined in the Guaranty and Collateral Agreement.


 


“Account or Accounts”
is defined in the UCC.


 


“Acquisition”
means any transaction or series of related transactions for the purpose of or resulting, directly or indirectly, in (a) the
acquisition of all or a substantial portion of the assets of a Person, or of all or a substantial portion of any business or division
of a Person, (b) the acquisition of in excess of 50% of the Capital Securities of any Person, or otherwise causing any Person
to become a Subsidiary, or (c) a merger or consolidation or any other combination with another Person (other than a Person
that is already a Subsidiary).


 


“Administrative Agent”
means Hale Capital in its capacity as administrative agent for the Lenders hereunder and any successor thereto in such capacity.


 


“Affiliate” of
any Person means (a) any other Person which, directly or indirectly, controls or is controlled by or is under common control
with such Person, (b) any officer, manager or director of such Person and (c) with respect to any Lender, any entity
administered or managed by such Lender or an Affiliate or investment advisor thereof and which is engaged in making, purchasing,
holding or otherwise investing in commercial loans. A Person shall be


 






    	 	 	 



     

    

 


deemed to be “controlled by” any other Person
if such Person possesses, directly or indirectly, power to vote 10% or more of the securities (on a fully diluted basis) having
ordinary voting power for the election of directors or managers or power to direct or cause the direction of the management and
policies of such Person whether through the ability to exercise voting power, by contract or otherwise. Controlling,” and
“controlled by” and “under common control with” have meanings correlative thereto. Unless expressly stated
otherwise herein, neither Administrative Agent nor any Lender shall be deemed an Affiliate of any Loan Party.


 


“Agreement” is
defined in the preamble of this Agreement.


 


“Allocable Amount”
is defined in Section 16.6.


 


“Allowance for Doubtful Accounts”
means, an allowance for doubtful accounts determined in accordance with GAAP.


 


“Applicable Margin”
means six percent (6.0%).


 


“Approved Fund”
means (i) any Person (other than a natural person) engaged in making, purchasing, holding, or investing in commercial loans and
similar extensions of credit and that is advised, administered, or managed by a Lender, an Affiliate of a Lender (or an entity
or an Affiliate of an entity that administers, advises or manages a Lender); (ii) with respect to any Lender that is an investment
fund, any other investment fund that invests in loans and that is advised, administered or managed by the same investment advisor
as such Lender or by an Affiliate of such investment advisor; and (iii) any third party which provides “warehouse financing”
to a Person described in the preceding clause (i) or (ii) (and any Person described in said clause (i) or (ii) shall also be deemed
an Approved Fund with respect to such third party providing such warehouse financing).


 


“Asset Disposition”
means the sale, lease, assignment or other transfer for value (each, a “Disposition”) by any Loan Party to any
Person (other than Borrower) of any asset or right of such Loan Party (including, the loss, destruction or damage of any thereof
or any actual or threatened (in writing to any Loan Party) condemnation, confiscation, requisition, seizure or taking thereof)
other than (a) the sale or lease of inventory in the ordinary course of business, (b) (x) non-exclusive licenses of intellectual
property of any Loan Party in the ordinary course of business (for the avoidance of doubt licenses to a direct competitor of the
Loan Parties shall be deemed outside of the ordinary course of business) and (y) a Permitted Exclusive License, provided, that
each such license in clause (x) and (y) does not materially impair the value of such intellectual property as collateral for the
Obligations, and (c) other Dispositions in any Fiscal Year the Net Cash Proceeds of which do not in the aggregate exceed $25,000.


 


“Assignee” is
defined in Section 15.6.1.


 


“Assignment Agreement”
is defined in Section 15.6.1.


 


“Attorney Costs”
means, with respect to any Person, all reasonable fees and charges of any counsel to such Person, the reasonable allocable cost
of internal legal services of such


 






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Person, all reasonable disbursements of such internal counsel and all court costs and similar
legal expenses, each as actually incurred.


 


“Bank Product Agreements”
means those certain agreements entered into from time to time between any Loan Party and a Lender or its Affiliates in connection
with any of the Bank Products, including without limitation, Hedging Agreements.


 


“Bank Product Obligations”
means all obligations, liabilities, contingent reimbursement obligations, fees, and expenses owing by the Loan Parties to any Lender
or its Affiliates pursuant to or evidenced by the Bank Product Agreements and irrespective of whether for the payment of money,
whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all
such amounts that a Loan Party is obligated to reimburse to Administrative Agent or any Lender as a result of Administrative Agent
or such Lender purchasing participations or executing indemnities or reimbursement obligations with respect to the Bank Products
provided to the Loan Parties pursuant to the Bank Product Agreements.


 


“Bank Products”
means any service provided to, facility extended to, or transaction entered into with, any Loan Party by any Lender or its Affiliates
consisting of, (a) deposit accounts, (b) cash management services, including, controlled disbursement, lockbox, electronic
funds transfers (including, book transfers, fedwire transfers, ACH transfers), online reporting and other services relating to
accounts maintained with any Lender or its Affiliates, (c) debit cards and credit cards, (d) Hedging Agreements or (e) so
long as prior written notice thereof is provided by Lender (or its Affiliate) providing such service, facility or transaction and
Administrative Agent consents in writing to its inclusion as a Bank Product, any other service provided to, facility extended to,
or transaction entered into with, any Loan Party by a Lender or its Affiliates.


 


“Bankruptcy Code”
means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. §101, et seq.), as amended and in effect from time to time
and the regulations issued from time to time thereunder.


 


“Board” means
the Board of Directors of Borrower.


 


“Board Observer”
is defined in Section 17.1.


 


“Bookings”
means the dollar amount of products and/or services to be purchased by a customer from Borrower where documentary evidence
of a binding arrangement (e.g., signed contract, purchase order, payment of a renewal) between the customer and
the Borrower exists which is not contingent upon formal acceptance by customer (including,
without limitation, the Borrower’s distributors and re-sellers) and delivery of products and/or services is expected to be
initiated within 90 days of such binding arrangement and result in revenue or deferred revenue.


 


“Bookings
Report” means a Borrower prepared bookings report detailing Core Bookings and Total Bookings (with renewal bookings
stated separately), each such report in the same form and substance provided to the Administrative Agent prior to the Closing Date
(it being agreed that such report may be modified to account for new or eliminated product lines) together with any other information
reasonably requested from time to time by the Administrative Agent.


 






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“Borrower” is
defined in the preamble of this Agreement.


 


“Business Day”
means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the laws of, or
are in fact closed in, New York.


 


“Capital Expenditures”
means all expenditures which, in accordance with GAAP, would be required to be capitalized and shown on the consolidated balance
sheet of Borrower and its Subsidiaries, including expenditures in respect of Capital Leases, but excluding expenditures made in
connection with the replacement, substitution or restoration of assets to the extent financed (a) from insurance proceeds
(or other similar recoveries) paid on account of the loss of or damage to the assets being replaced or restored or (b) with
awards of compensation arising from the taking by eminent domain or condemnation of the assets being replaced.


 


“Capital Lease”
means, with respect to any Person, any lease of (or other agreement conveying the right to use) any real or personal property by
such Person that, in conformity with GAAP, is accounted for as a capital lease on the balance sheet of such Person.


 


“Capital Securities”
means, with respect to any Person, all shares, interests, participations or other equivalents (however designated, whether voting
or non-voting) of such Person’s capital, whether now outstanding or issued or acquired after the Closing Date, including
common shares, preferred shares, membership interests in a limited liability company, limited or general partnership interests
in a partnership, interests in a trust, interests in other unincorporated organizations or any other equivalent of such ownership
interest.


 


“Cash Equivalent Investment”
means, at any time, (a) any evidence of Debt, maturing not more than one year after such time, issued or guaranteed by the
United States Government or any agency thereof, (b) commercial paper, maturing not more than one year from the date of issue,
or corporate demand notes, in each case (unless issued by a Lender or its holding company) rated at least A-l by Standard &
Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. or P-l by Moody’s Investors Service, Inc., (c) any
certificate of deposit, time deposit or banker’s acceptance, maturing not more than one year after such time, or any overnight
Federal Funds transaction that is issued or sold by any Lender or its holding company (or by a commercial banking institution that
is a member of the Federal Reserve System and has a combined capital and surplus and undivided profits of not less than $500,000,000),
(d) any repurchase agreement entered into with any Lender (or commercial banking institution of the nature referred to in
clause (c)) which (i) is secured by a fully perfected security interest in any obligation of the type described in any
of clauses (a) through (c) above and (ii) has a market value at the time such repurchase agreement is entered into
of not less than 100% of the repurchase obligation of such Lender (or other commercial banking institution) thereunder and (e) money
market accounts or mutual funds which invest exclusively in assets satisfying the foregoing requirements, and (f) other short
term liquid investments approved in writing by Administrative Agent.


 


“CFC” means a
“controlled foreign corporation” as defined in Section 957(a) of the Code.


 






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“Change of Control”
means the occurrence of any of following events which results in: (a) any Person or “group” (within the meaning of
Rules 13d-3 and 13d-5 under the Securities and Exchange Act of 1934, as amended) (i) becoming the beneficial owner of at least
50% of the outstanding Capital Securities of Borrower or (ii) possessing the right to elect (through contract, ownership of
voting securities or otherwise) a majority of the Board; (b) the majority of the seats (other than vacant seats) on the Board
shall cease to be occupied by Persons who either (i) were members of the Board on the Closing Date or (ii) were nominated
for election by the Board, a majority of whom were directors on the Closing Date or whose election or nomination for election was
previously approved by a majority of such directors; (c) Borrower shall cease to own and control 100% of each class of the
outstanding Capital Securities of each of Qumu, Inc., Qumu UK Holdings, Qumu Japan, Qumu Singapore, and Qumu Middle East; (d) Qumu
UK Holdings shall cease to own and control 100% of each class of the outstanding Capital Securities of each of Qumu UK Limited
and Qumu Ltd.; or (e) Borrower shall cease to, directly or indirectly, own and control 100% of each class of the outstanding
Capital Securities of each other Subsidiary.


 


“Closing Date”
is defined in Section 12.1.


 


“Code” means the
Internal Revenue Code of 1986, as amended.


 


“Collateral” means
“Collateral” (as defined in the Guaranty and Collateral Agreement) and any and all other property now or hereafter
securing Obligations.


 


“Collateral Access Agreement”
means an agreement in form and substance reasonably satisfactory to Administrative Agent pursuant to which a mortgagee or lessor
of real property on which collateral is stored or otherwise located, or a warehouseman, processor or other bailee of Inventory
or other property owned by any Loan Party, acknowledges the Liens of Administrative Agent, waives or subordinates any Liens held
by such Person on such property and consents to any equity pledge and enforcement thereof, and, in the case of any such agreement
with a mortgagee or lessor, permits Administrative Agent reasonable access to and use of such real property following the occurrence
and during the continuance of an Event of Default to remove, assemble, complete or sell any Collateral stored or otherwise located
thereon.


 


“Collateral Documents”
means, collectively, the Guaranty and Collateral Agreement, each Mortgage, each Collateral Access Agreement, each Perfection Certificate,
each control agreement and any other agreement or instrument pursuant to which Borrower, any Subsidiary or any other Person grants
or purports to grant collateral to Administrative Agent for the benefit of the Lenders or otherwise relates to such collateral.


 


“Commodity Exchange Act”
means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.


 


“Compliance Certificate”
means a Compliance Certificate in substantially the form of Exhibit B.


 


“Computation Period”
means each period of four consecutive Fiscal Quarters ending on the last day of a Fiscal Quarter.


 






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“Contingent Liability”
means, with respect to any Person, each obligation and liability of such Person and all such obligations and liabilities of such
Person incurred pursuant to any agreement, undertaking or arrangement by which such Person: (a) guarantees, endorses or otherwise
becomes or is contingently liable upon (by direct or indirect agreement, contingent or otherwise, to provide funds for payment,
to supply funds to, or otherwise to invest in, a debtor, or otherwise to assure a creditor against loss) the indebtedness, dividend,
obligation or other liability of any other Person in any manner (other than by endorsement of instruments in the course of collection),
including any indebtedness, dividend or other obligation which may be issued or incurred at some future time; (b) guarantees
the payment of dividends or other distributions upon the Capital Securities of any other Person; (c) undertakes or agrees
(whether contingently or otherwise): (i) to purchase, repurchase, or otherwise acquire any indebtedness, obligation or liability
of any other Person or any property or assets constituting security therefor, (ii) to advance or provide funds for the payment
or discharge of any indebtedness, obligation or liability of any other Person (whether in the form of loans, advances, stock purchases,
capital contributions or otherwise), or to maintain solvency, assets, level of income, working capital or other financial condition
of any other Person, or (iii) to make payment to any other Person other than for value received; (d) agrees to lease
property or to purchase securities, property or services from such other Person with the purpose or intent of assuring the owner
of such indebtedness or obligation of the ability of such other Person to make payment of the indebtedness or obligation; (e) to
induce the issuance of, or in connection with the issuance of, any letter of credit for the benefit of such other Person; or (f) undertakes
or agrees otherwise to assure a creditor against loss. The amount of any Contingent Liability shall (subject to any limitation
set forth herein) be deemed to be the outstanding principal amount (or maximum permitted principal amount, if larger) of the indebtedness,
obligation or other liability guaranteed or supported thereby.


 


“Contractual Obligation”
means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking
to which such Person is a party or by which it or any of its assets or property is bound.


 


“Controlled Group”
means all members of a controlled group of corporations, all members of a controlled group of trades or businesses (whether or
not incorporated) under common control and all members of an affiliated service group which, together with Borrower or any of its
Subsidiaries, are treated as a single employer under Section 414 of the Code or Section 4001 of ERISA.


 


“Core Bookings”
means the sum of the portion Bookings within the following categories: perpetual license,
subscription and support for a period of one year or less, hardware, professional services and other, and maintenance and support
for a period of one year or less. For the avoidance of doubt Core Bookings shall not include Bookings within the following categories:
subscription and support and maintenance and support for a period greater than one year; or renewals of subscription and support
and maintenance and support. Core Bookings shall be calculated and delivered in the same
form and substance as the Bookings Report provided to the Administrative Agent prior to the Closing Date (it being agreed that
such Bookings Report may be modified to account for new or eliminated product lines) together with any other information reasonably
requested from time to time by the Administrative Agent. 


 






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“Cumulative Net Cash Operating
Amount” means, as of any date of determination, consolidated net cash from (used in) operating activities of the Borrower
and its Subsidiaries, determined in accordance with GAAP.


 


“Debt” of any
Person means, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all indebtedness evidenced
by bonds, debentures, notes or similar instruments, (c) all obligations of such Person as lessee under Capital Leases which
have been or should be recorded as liabilities on a balance sheet of such Person in accordance with GAAP, (d) all obligations
of such Person to pay the deferred purchase price of property or services (excluding trade accounts payable in the ordinary course
of business), (e) all indebtedness secured by a Lien on the property of such Person, whether or not such indebtedness shall
have been assumed by such Person; provided that if such Person has not assumed or otherwise become liable for such indebtedness,
such indebtedness shall be measured at the fair market value of such property securing such indebtedness at the time of determination,
(f) all obligations, contingent or otherwise, with respect to the face amount of all letters of credit (whether or not drawn),
bankers’ acceptances and similar obligations issued for the account of such Person, (g) all Hedging Obligations of such
Person, (h) all Contingent Liabilities of such Person, (i) all Debt of any partnership of which such Person is a general
partner, (j) all non-compete payment obligations, earn-outs and similar obligations and (k) any Capital Securities or
other equity instrument, whether or not mandatorily redeemable, that under GAAP is characterized as debt, whether pursuant to financial
accounting standards board issuance No. 150 or otherwise.


 


“Default” means
any event that, if it continues uncured, will, with lapse of time or notice or both, constitute an Event of Default.


 


“Deferred Revenue”
means, deferred revenue determined in accordance with GAAP.


 


“Deferred Revenue Non-Current”
means, as of any date of determination, Deferred Revenue which is recognized in greater than one (1) year from such date of determination,
determined in accordance with GAAP.


 


“Deferred
Revenue Report” means a Borrower prepared Deferred Revenue Report in the same form and substance as the report provided
to the Administrative Agent prior to the Closing Date together with any other information reasonably requested from time to time
by the Administrative Agent.


 


“Dilution Amount”
means, as of any date of determination, a percentage, based upon the experience of the immediately prior 360 consecutive days,
that is the result of dividing the Dollar amount of (a) bad debt write-downs, discounts, advertising allowances, credits, or other
dilutive items with respect to Borrower’s Accounts, by (b) Borrower’s billings with respect to Accounts during such
period.


 


“Dollar” and the
sign “$” mean lawful money of the United States of America.


 


“Earnings Report”
means the statements of earnings for the Borrower and its Subsidiaries in the same form and
substance as the report provided to the Administrative Agent prior to


 






    	 	 7	 



     

    

 


Closing Date together with any other information reasonably
requested from time to time by the Administrative Agent.


 


“Eligible Account”
means those Accounts consisting of trade receivables created by each Loan Party in the ordinary
course of its business, that arise out of such Loan Party’s goods shipped or rendition of services, and that are not excluded
as ineligible by virtue of one or more of the excluding criteria set forth below; provided, however, that such criteria
may be revised from time to time by Administrative Agent in its reasonable discretion. In determining the amount to be included,
Eligible Accounts shall be calculated net of customer deposits, credits and unapplied cash. Eligible Accounts shall not include
the following:


 


(a)       Accounts
that the Account Debtor has failed to pay within 90 days of stated due date and Accounts specifically reserved for by the Loan
Parties;


 


(b)       Accounts
with payment terms greater than 90 days from original invoice date;


 


(c)       Accounts
owed by an Account Debtor (or its Affiliates) where any Accounts owed by that Account Debtor (or its Affiliates) are deemed ineligible
under clause (a) above (if past due amounts are greater than 10% of the Account Debtor’s Account balance) or clauses (h)
or (q) below;


 


(d)       Accounts
with respect to which the Account Debtor is an Affiliate of the Borrower or an employee of the Borrower;


        


(e)       Accounts
that are not payable in Dollars;


 


(f)       Accounts with respect
to which the Account Debtor (i) does not maintain its principal place of business in the United States, or (ii) is the government
of any foreign country or sovereign state, or of any state, province, municipality, or other political subdivision thereof, or
of any department, agency, public corporation, or other instrumentality thereof;


 


(g)       Accounts
with respect to which the Account Debtor is either (i) the United States or any department, agency, or instrumentality of the United
States (exclusive, however, of Accounts with respect to which such Borrower has complied, to the reasonable satisfaction of Lender,
with the Assignment of Claims Act, 31 USC §3727), or (ii) any state of the United States;


 


(h)       That
portion of Accounts with respect to which the Account Debtor is a creditor of such Borrower, has or has asserted a right of setoff,
forensic investigation, or has disputed its obligation to pay all or any portion of the Account;


 


(i)       That portion of
Accounts which reflect a reasonable reserve for warranty claims or returns or amounts which are owed to Account Debtors, including
those for rebates, allowances, prepayment discounts or other deductions;


 






    	 	 8	 



     

    

 


(j)         Accounts (i) owing
by a single Account Debtor or group of Affiliated Account Debtors whose total obligations owing to Borrowers exceed twenty five
(25%) percent of the aggregate amount of all otherwise Eligible Accounts (but the portion of the Accounts not in excess of the
foregoing percentage may be deemed an Eligible Account);


 


(k)       Accounts
with respect to which the Account Debtor, to the knowledge of any Loan Party or the Administrative Agent, is subject to an insolvency
or bankruptcy proceeding or any dissolution or liquidation proceeding, is not solvent, has gone out of business, or as to which
such Borrower has received notice of an imminent insolvency or bankruptcy proceeding or any dissolution or liquidation or a material
impairment of the financial condition of such Account Debtor;


 


(l)        [Reserved];


 


(m)       Accounts
representing credit card sales or “C.O.D.” sales;


 


(n)       Accounts
that are not subject to a valid and perfected first priority Lien by the Administrative Agent or that are subject to any other
Lien, unless such other Lien is a Permitted Lien and the holder of such Permitted Lien has entered into an intercreditor agreement
with Lender reasonably acceptable to Lender;


 


(o)       Accounts
that consist of progress billings (such that the obligation of the Account Debtors with respect to such Accounts is conditioned
upon such Loan Party’s satisfactory completion of any further performance under the agreement giving rise thereto) or retainage
invoices;


 


(p)       that
portion of Accounts which represent finance charges, service charges, sales taxes or excise taxes;


 


(q)       that
portion of Accounts which has been restructured, extended, amended or otherwise modified;


 


(r)       Accounts which
have not been invoiced or not invoiced in accordance with the material terms of the relevant agreement;


 


(s)       [Reserved];


 


(t)        Accounts
which do not have binding documentary evidence of an underlying transaction with an end user in the event that the transaction
giving rise to the Account involves a distributor, partner or other reseller; and


 


(u)       Accounts
or that portion of Accounts otherwise deemed ineligible and not covered by clauses (a) through (t) above by Administrative Agent
in its reasonable discretion exercising reasonable credit judgment.


 






    	 	 9	 



     

    

 


Any Accounts which are not Eligible
Accounts shall nonetheless constitute Collateral.


 


“Environmental Claims”
means all claims, however asserted, by any governmental, regulatory, or judicial authority or other Person alleging any potential
liability or responsibility, contingent or otherwise (including for damages, losses, punitive damages, consequential damages, costs
of environmental investigation and remediation, fines, penalties, indemnities or expenses) or other obligation, directly or indirectly
resulting from or based upon (a) violation of or pursuant to any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Substances, (c) exposure to any Hazardous Substances, (d) the
release or threatened release of any Hazardous Substances into the environment or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.


 


“Environmental Laws”
means the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. § 9601, et seq.), the
Hazardous Materials Transportation Act (49 U.S.C. § 5101, et seq.), the Resource Conservation and Recovery Act
(42 U.S.C. § 6901, et seq.), the Federal Clean Water Act (33 U.S.C. § 1251 et seq.), the Clean
Air Act (42 U.S.C. § 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.),
the Safe Drinking Water Act (42 U.S.C. § 300f to 300j-26 et seq.), the Oil Pollution Act of 1990 (33 U.S.C. § 2701
et seq.) and the Occupational Safety and Health Act (29 U.S.C. § 651 et seq.), and any other present or
future federal, state, local, foreign and other applicable statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental restrictions and common law relating to pollution,
the protection of the environment, natural resources, human health or the release of any Hazardous Substances into the environment,
including indoor and outdoor air, soil, groundwater, surface water, storm water, wetlands, sediment and discharges of wastewater
to public treatment systems, all as may be amended or otherwise modified from time to time.


 


“ERISA” means
the Employee Retirement Income Security Act of 1974.


 


“Event of Default”
means any of the events described in Section 13.1.


 


“Excluded Swap Obligation”
means, with respect to any guarantor of a Swap Obligation, including the grant of a security interest to secure the guaranty of
such Swap Obligation, any Swap Obligation if, and to the extent that, such Swap Obligation is or becomes illegal under the Commodity
Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation
of any thereof) by virtue of such guarantor’s failure for any reason to constitute an “eligible contract participant”
as defined in the Commodity Exchange Act and the regulations thereunder at the time the guaranty or grant of such security interest
becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than
one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Swap
Obligation or security interest is or becomes illegal.


 


“Excluded Taxes”
means taxes based upon, or measured by, a Lender’s or Administrative Agent’s (or a branch of a Lender’s or Administrative
Agent’s) overall net income, overall net receipts, or overall net profits (including franchise taxes imposed in lieu of such
taxes), but only


 






    	 	 10	 



     

    

 


to the extent such taxes are imposed by a taxing authority (a) in a jurisdiction in which such Lender or
Administrative Agent is organized, (b) in a jurisdiction which a Lender’s or Administrative Agent’s principal
office is located, or (c) in a jurisdiction in which such Lender’s or Administrative Agent’s lending office (or
branch) in respect of which payments under this Agreement are made is located.


 


“Extraordinary Receipts”
means any cash received by or paid to or for the account of any Loan Party not in the ordinary course of business (other than as
a result of the disposition of Borrower’s investment in BriefCam Ltd.), including without limitation, amounts received in
respect of indemnity obligations of a seller under any purchase or acquisition document, foreign, United States, state or local
tax refunds.


 


“Facilities” means,
at any time, the facilities or real properties owned, leased, managed or operated by any Loan Party and any of their respective
Subsidiaries.


 


“Fiscal Quarter”
means a fiscal quarter of a Fiscal Year.


 


“Fiscal Year”
means the fiscal year of Borrower and its Subsidiaries, which period shall be the 12-month period ending on December 31 of each
year.


 


“FRB” means the
Board of Governors of the Federal Reserve System or any successor thereto.


 


“GAAP” means generally
accepted accounting principles set forth from time to time in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards
Board (or agencies with similar functions of comparable stature and authority within the U.S. accounting profession) and the Securities
and Exchange Commission, which are applicable to the circumstances as of the date of determination.


 


“Governmental Authority” means the
government of the United States or any other nation, or of any political subdivision thereof, whether state or local, 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 (including any supra-national bodies such as the
European Union or the European Central Bank).


 


“Guaranty and Collateral
Agreement” means the Guaranty and Collateral Agreement dated as of the date hereof executed and delivered by the Loan
Parties, together with any joinders thereto and any other guaranty and collateral agreement executed by a Loan Party, in each case
in form and substance satisfactory to Administrative Agent.


 


“Hale Capital”
is defined in the preamble of this Agreement.


 


“Hazardous Substances”
means all explosive or radioactive substances, materials or waste and all hazardous waste, hazardous substance, pollutant, contaminant,
toxic substance, oil, hazardous material, chemical or other substance regulated by any Environmental Law.


 






    	 	 11	 



     

    

 


“Hedging Agreement”
means any bank underwritten cash and/or derivative financial instrument including, but not limited to, any interest rate, currency
or commodity swap agreement, cap agreement, collar agreement, spot foreign exchange, forward foreign exchange, foreign exchange
option (or series of options) and any other agreement or arrangement designed to protect a Person against fluctuations in interest
rates, currency exchange rates or commodity prices.


 


“Hedging Obligation”
means, with respect to any Person, any liability of such Person under any Hedging Agreement.


 


“Indemnified Liabilities”
– see Section 15.17.


 


“Interest Expense”
means for any period the consolidated interest expense of Borrower and its Subsidiaries for such period (including all imputed
interest on Capital Leases).


 


“Intercompany Subordination
Agreement” means that certain Intercompany Subordination Agreement, dated as of even date herewith, among the Borrower
and its foreign Subsidiaries and Administrative Agent.


 


“Inventory” is
defined in the Guaranty and Collateral Agreement.


 


“Investment” means,
with respect to any Person, any investment in another Person, whether by acquisition of any debt or Capital Security, by making
any loan or advance, by becoming obligated with respect to a Contingent Liability in respect of obligations of such other Person
(other than travel and similar advances to employees in the ordinary course of business) or by making an Acquisition.


 


“Joint Liability Payment”
is defined in Section 16.6.


 


“Late
Renewals” means a contract with a customer that is renewed
after the renewal opportunity’s contract termination date but within a ninety (90) day window after expiration and, as to
a renewal more than thirty (30) days after expiration, the contract price in respect thereof has not been discounted without the
prior written consent of the Administrative Agent (such consent not to be unreasonably withheld, conditioned or delayed).
Late renewals shall be included in a detailed list of such customers
as attached to the most recent Compliance Certificate delivered to Administrative Agent..


 


“Lender” is defined
in the preamble of this Agreement. For the purpose of identifying the Persons entitled to share in the Collateral and the proceeds
thereof under, and in accordance with the provisions of, this Agreement and the Collateral Documents, the term “Lender”
shall include Affiliates of a Lender providing a Bank Product.


 


“Lender Party”
is defined in Section 15.17.


 


“Lien” means any
mortgage, deed of trust, pledge, hypothecation, assignment, security interest, lien (whether statutory or otherwise), charge, claim
or encumbrance, or preference, priority or other security agreement or preferential arrangement held or asserted in respect of
any asset of any kind or nature whatsoever including any conditional sale or other title retention


 






    	 	 12	 



     

    

 


agreement, any lease having
substantially the same economic effect as any of the foregoing, and the filing of, or agreement to give, any financing statement
under the Uniform Commercial Code or comparable law of any jurisdiction.


 


“Loan Documents”
means this Agreement, the Term Notes, each Perfection Certificate, the Collateral Documents, the Intercompany Subordination Agreement,
and all documents, instruments and agreements delivered in connection with the foregoing.


 


“Loan Party” means
each Borrower and each domestic Subsidiary.


 


“Margin Stock”
means any “margin stock” as defined in Regulation U.


 


“Material Adverse Effect”
means a material adverse effect on (a) the condition (financial or otherwise), results of operations, assets, business, or properties
of Borrower or the Borrower and its Subsidiaries taken as a whole, (b) Borrower’s ability to duly and punctually pay or perform
the Obligations in accordance with the terms thereof, (c) the value of the Collateral, or Administrative Agent’s Liens on
the Collateral or the priority of any such Lien or (d) the practical realization of the benefits of Administrative Agent’s
and each Lender’s rights and remedies as provided by this Agreement and the other Loan Documents.


 


“Milestone Report”
means that certain milestone report as agreed in form and substance prior to the Closing Date between the Administrative Agent
and Borrower (which includes a calculation of the Dilution Amount beginning with the Fiscal Quarter ending September 30, 2017)
or any other milestone report in form and substance as mutually agreed by the Administrative Agent and the Borrower.


 


“Mortgage” means
a mortgage, deed of trust, leasehold mortgage or similar instrument granting Administrative Agent a Lien on real property of any
Loan Party.


 


“Multiemployer Pension Plan”
means a multiemployer plan, as defined in Section 4001(a)(3) of ERISA, to which Borrower or any other member of the Controlled
Group may have any liability.


 


“Net Cash Proceeds”
means:


 


(a)       with
respect to any Asset Disposition, the aggregate cash proceeds (including cash proceeds received pursuant to policies of insurance
or by way of deferred payment of principal pursuant to a note, installment receivable or otherwise, but only as and when received)
received by any Loan Party pursuant to such Asset Disposition net of (i) the direct costs relating to such sale, transfer
or other disposition (including sales commissions and legal, accounting and investment banking fees), (ii) taxes paid or reasonably
estimated by Borrower to be payable as a result thereof (after taking into account any available tax credits or deductions and
any tax sharing arrangements) and (iii) amounts required to be applied to the repayment of any Debt secured by a Lien on the
asset subject to such Asset Disposition (other than the Term Loans);


 






    	 	 13	 



     

    

 


(b)       with
respect to any issuance of Capital Securities or receipt of a capital contribution, the aggregate cash proceeds received by any
Loan Party pursuant to such issuance or contribution, net of the direct costs relating to such issuance or contribution (including
sales and underwriters’ commissions); and


 


(c)       with
respect to any issuance of Debt, the aggregate cash proceeds received by any Loan Party pursuant to such issuance, net of the direct
costs of such issuance (including up-front, underwriters’ and placement fees).


 


“Non-Consenting Lender”
is defined in Section 15.1.


 


“Non-U.S. Participant”
is defined in Section 7.6(d).


 


“Obligations”
means and include any and all loans, advances, debts, liabilities, obligations (including Attorney Costs and any reimbursement
obligations of each Loan Party in respect of surety bonds, all Hedging Obligations permitted hereunder which are owed to any Lender
(or its Affiliates) or Administrative Agent, and all other Bank Product Obligations), covenants and duties owing by any Loan Party,
or any Subsidiary of any Loan Party Lenders or Administrative Agent (or to any other director or indirect subsidiary or affiliate
of any Lender or Administrative Agent) of any kind or nature, present or future (including any interest or other amounts accruing
thereon, any fees accruing under or in connection therewith, any costs and expenses of any Person payable by any Loan Party and
any indemnification obligations payable by any Loan Party, whether or not a claim for post-filing or post-petition interest, fees
or other commencement of any insolvency, reorganization or like proceeding relating to any Loan Party arising or payable after
maturity, or after the filing of any petition interest, fees or other amounts is allowable or allowed in such proceeding), whether
or not for the payment of money, whether arising by reason of an extension of credit, loan, or in any other manner, whether direct
or indirect (including those acquired by assignment or participation), absolute or contingent, joint or several, due or to become
due, now existing or hereafter arising, contractual or tortious, liquidated or unliquidated, regardless of how such indebtedness
or liabilities arise or by what agreement or instrument they may be evidenced or whether evidenced by any agreement or instrument,
including but not limited to, (i) this Agreement, the Loan Documents and any amendments, extensions, renewals or increases thereto,
including all costs and expenses of Administrative Agent, and any Lender incurred in the documentation, negotiations, modification,
enforcement, collection or otherwise in connection with any of the foregoing, including but not limited to reasonable attorneys’
fees and expenses and all obligations of any Borrower to Administrative Agent, or Lenders to perform acts or refrain from taking
any action, (ii) all Hedging Obligations and (iii) all Bank Product Obligations. Notwithstanding the foregoing, “Obligations”
shall not include any Excluded Swap Obligations.


 


“OFAC” is defined
in Section 9.25.


 


“Operating Lease”
means any lease of (or other agreement conveying the right to use) any real or personal property by any Loan Party, as lessee,
other than any Capital Lease.


 


“Participant”
is defined in Section 15.6.2.


 


“Patriot Act”
is defined in Section 15.16.


 






    	 	 14	 



     

    

 


“PBGC” means the
Pension Benefit Guaranty Corporation and any entity succeeding to any or all of its functions under ERISA.


 


“Pension Plan”
means a “pension plan”, as such term is defined in Section 3(2) of ERISA, which is subject to Title IV of ERISA
or the minimum funding standards of ERISA (other than a Multiemployer Pension Plan), and as to which Borrower or any member of
the Controlled Group may have any liability, including any liability by reason of having been a substantial employer within the
meaning of Section 4063 of ERISA at any time during the preceding five years, or by reason of being deemed to be a contributing
sponsor under Section 4069 of ERISA.


 


“Perfection Certificate”
means a perfection certificate executed and delivered to Administrative Agent by a Loan Party.


 


“Permitted Exclusive License(s)”
means (a) any exclusive license or lease of intellectual property of the Loan Parties so long as (i) such license or lease does
not contain any provisions limiting the grant of a Lien in such license or lease in favor of the Administrative Agent, (ii) as
of the date of such license or lease and after giving effect thereto, no Default or Event of Default has occurred and is continuing,
and (iii) the entering into of such license or lease has been approved in writing by the Administrative Agent (such consent not
to be unreasonably withheld, conditioned or delayed), and (b) the License Agreement set forth on Schedule 11.5.


 


“Permitted Lien”
means a Lien expressly permitted hereunder pursuant to Section 11.2.


 


“Person” means
any natural person, corporation, partnership, trust, limited liability company, association, governmental authority or unit, or
any other entity, whether acting in an individual, fiduciary or other capacity.


 


“Prime Rate” means,
for any day, the rate of interest in effect for such day equal to the prime rate in the United States as reported from time to
time in The Wall Street Journal (or other authoritative source selected by Administrative Agent in its sole discretion),
or as Prime Rate is otherwise determined by Administrative Agent in its sole and absolute discretion. Administrative Agent’s
determination of the Prime Rate shall be conclusive, absent manifest error. Any change in such rate of interest shall take effect
at the opening of business on the day of such change. In the event The Wall Street Journal (or such other authoritative
source) publishes a range of “prime rates”, the Prime Rate shall be the highest of the “prime rates”.


 


“Pro Rata Share”
means, the percentage obtained by dividing (i) the principal amount of such Lender’s Term Loan by (ii) the principal
amount of all Term Loans of all Lenders.


 


“Qumu Inc.” means,
Qumu, Inc., a corporation organized under the laws of California.


 


“Qumu Japan” means,
Qumu Japan Co., Ltd, a limited company organized under the laws of Japan.


 


“Qumu Ltd.” means,
Qumu Limited, a private company limited by shares registered under the laws of England and Wales.


 






    	 	 15	 



     

    

 


“Qumu Middle East”
means, Qumu Middle East FZ-LLC (Dubai), a limited liability company organized under the laws of Dubai Internet City.


 


“Qumu Singapore”
means, Qumu (Singapore) Pte. Ltd, a limited company organized under the laws of Singapore.


 


“Qumu UK Holdings”
means, Qumu U.K. Holdings Ltd, a private company limited by shares registered under the laws of England and Wales.


 


“Qumu UK Limited”
means, Qumu U.K. Limited, a private company limited by shares registered under the laws of England and Wales.


 


“Real Estate Documents”
means, with respect to any real property owned Borrower or any Loan Party, all of the following (except to the extent waived by
Administrative Agent in its sole discretion): (a) a duly executed Mortgage providing for a first priority perfected Lien, in favor
of Administrative Agent, in all right, title and interest of Borrower or such Subsidiary in such real property; (b) an ALTA Loan
Title Insurance Policy, issued by an insurer acceptable to Administrative Agent, insuring Administrative Agent’s first priority
Lien on such real property and containing such endorsements as Administrative Agent may reasonably require (it being understood
that the amount of coverage, exceptions to coverage and status of title set forth in such policy shall be acceptable to Administrative
Agent); (c) copies of all documents of record concerning such real property as shown on the commitment for the ALTA Loan Title
Insurance Policy referred to above; (d) original or certified copies of all insurance policies required to be maintained with respect
to such real property by this Agreement, the applicable Mortgage or any other Loan Document; (e) a survey certified to Administrative
Agent meeting such standards as Administrative Agent may reasonably establish and otherwise reasonably satisfactory to Administrative
Agent; (f) a flood insurance policy concerning such real property, if required by the Flood Disaster Protection Act of 1973; and
(g) an appraisal, prepared by an independent appraiser acceptable to Administrative Agent, of such parcel of real property or interest
in real property, which appraisal shall satisfy the requirements of the Financial Institutions Reform, Recovery and Enforcement
Act, if applicable, and shall evidence compliance with the supervisory loan-to-value limits set forth in the Federal Deposit Insurance
Corporation Improvement Act of 1991, if applicable.


 


“Regulation D”
means Regulation D of the FRB.


 


“Regulation U”
means Regulation U of the FRB.


 


“Reportable Event”
means a reportable event as defined in Section 4043 of ERISA and the regulations issued thereunder as to which the PBGC has
not waived the notification requirement of Section 4043(a), or the failure of a Pension Plan to meet the minimum funding standards
of Section 412 of the Code (without regard to whether the Pension Plan is a plan described in Section 4021(a)(2) of ERISA)
or under Section 302 of ERISA.


 


“Required Lenders”
means, at any time, Lenders whose Pro Rata Shares exceed 66 2/3%.


 


“SEC” means the
Securities and Exchange Commission or any other governmental authority succeeding to any of the principal functions thereof.


 






    	 	 16	 



     

    

 


“Senior Officer”
means, with respect to any Loan Party, any of the president, the chief executive officer, the chief financial officer or the treasurer
of such Loan Party.


 


“Significant Contract”
means any written contract, agreement, instrument, permit, lease or license of any Loan Party or any Subsidiary of any Loan Party,
which is material to any such party’s business or which the failure to comply with could reasonably be expected to result
in a Material Adverse Effect.


 


“SMSSR Measurement Period”
means each period of one (1) fiscal month ending on the last day of the month ending three (3) months prior to the current month
(e.g., the measurement period for the month ended September 30, 2016 is the month ended June 30, 2016).


 


“Stockholder Affiliate”
means a stockholder of the Borrower that is an Affiliate of the Borrower solely by virtue of such stockholder’s percentage
ownership interest in the Borrower and not by virtue of any other relationship with the Borrower (such as being an officer or director
of the Borrower or being affiliated with an officer or director of the Borrower).


 


“Subscription, and Maintenance
and Support Revenue” means, those Subscription, and Maintenance and Support Revenue amounts as disclosed in the Borrower’s
quarterly and annual reports filed with the SEC.


 


“Subscription,
and Maintenance and Support Renewal Rates”: means the sum of the total dollar value of contracts with customers renewed
during the immediately preceding twelve (12) SMSRR Measurement Periods divided by sum of the total of contracts with customers
up for renewal during the applicable immediately preceding twelve (12) SMSRR Measurement Periods. Qualifying Late Renewals pertaining
to the applicable SMSRR Measurement Period will be included in the numerator of the month actually renewed, provided, however,
with respect to Late Renewals only, Late Renewals shall be included in the numerator of the last month of the applicable SMSRR
Measurement Period.


 


“Subsidiary” means,
with respect to any Person, a corporation, partnership, limited liability company or other entity of which such Person owns, directly
or indirectly, such number of outstanding Capital Securities as have more than 50% of the ordinary voting power for the election
of directors or other managers of such corporation, partnership, limited liability company or other entity. Unless the context
otherwise requires, each reference to Subsidiaries herein shall be a reference to Subsidiaries of Borrower.


 


“Swap Obligation”
means any Hedging Obligation that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange
Act, as amended from time to time.


 


“Taxes” means
any and all present and future taxes, duties, levies, imposts, deductions, assessments, charges or withholdings, and any and all
liabilities (including interest and penalties and other additions to taxes) with respect to the foregoing, but excluding Excluded
Taxes.


 


“Term Loan” is
defined in Section 2.1.


 


“Term Loan Commitment”
means, as to any Lender, such Lender’s commitment to make Term Loans under this Agreement. The amount of each Lender’s
Term Loan Commitment is set


 






    	 	 17	 



     

    

 


forth on Annex A. The aggregate amount of the Term Loan Commitments of all Lenders is $8,000,000.


 


“Term Loan Maturity Date”
means the earlier of (a) October 21, 2019, or (b) the Termination Date.


 


“Term Note” means
a promissory note issued to each Lender substantially in the form of Exhibit A.


 


“Termination Date”
means the earlier to occur of (a) October 21, 2019, or (b) the date on which the maturity of the Obligations is accelerated
(or deemed accelerated).


 


“Termination Event”
means, with respect to a Pension Plan that is subject to Title IV of ERISA, (a) a Reportable Event, (b) the withdrawal
of Borrower or any other member of the Controlled Group from such Pension Plan during a plan year in which Borrower or any other
member of the Controlled Group was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or was deemed
such under Section 4068(f) of ERISA, (c) the termination of such Pension Plan, the filing of a notice of intent to terminate
the Pension Plan or the treatment of an amendment of such Pension Plan as a termination under Section 4041 of ERISA, (d) the
institution by the PBGC of proceedings to terminate such Pension Plan or (e) any event or condition that might constitute
grounds under Section 4042 of ERISA for the termination of, or appointment of a trustee to administer, such Pension Plan.


 


“Total Plan Liability”
means, at any time, the present value of all vested and unvested accrued benefits under all Pension Plans, determined as of the
then most recent valuation date for each Pension Plan, using PBGC actuarial assumptions for single employer plan terminations.


 


“UCC” is defined
in the Guaranty and Collateral Agreement.


 


“Unfunded Liability”
means the amount (if any) by which the present value of all vested and unvested accrued benefits under all Pension Plans exceeds
the fair market value of all assets allocable to those benefits, all determined as of the then most recent valuation date for each
Pension Plan, using PBGC actuarial assumptions for single employer plan terminations.


 


“Warrant” is defined
in Section 12.1.20.


 


“Wholly-Owned Subsidiary”
means, as to any Person, a Subsidiary all of the Capital Securities of which (except directors’ qualifying Capital Securities)
are at the time directly or indirectly owned by such Person and/or another Wholly-Owned Subsidiary of such Person. Unless the context
otherwise requires, each reference to Wholly-Owned Subsidiaries shall be a reference to Wholly-Owned Subsidiaries of Borrower.


 


“Withholding Certificate”
is defined in Section 7.6(d).


 


1.2        Other Interpretive Provisions.


 






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(a)        The meanings
of defined terms are equally applicable to the singular and plural forms of the defined terms.


 


(b)        Section, Annex, Schedule and Exhibit references are to this Agreement unless otherwise specified.


 


(c)        The term “including” is not limiting and means “including without limitation.”


 


(d)        In the computation of periods of time from a specified date to a later specified date, the word “from” means
“from and including”; the words “to” and “until” each mean “to but excluding”,
and the word “through” means “to and including.”


 


(e)        Unless otherwise expressly provided herein, (i) references to agreements (including this Agreement and the other Loan
Documents) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, supplements and
other modifications thereto, but only to the extent such amendments, restatements, supplements and other modifications are not
prohibited by the terms of any Loan Document, and (ii) references to any statute or regulation shall be construed as including
all statutory and regulatory provisions amending, replacing, supplementing or interpreting such statute or regulation.


 


(f)        This Agreement and the other Loan Documents may use several different limitations, tests or measurements to regulate the
same or similar matters. All such limitations, tests and measurements are cumulative and each shall be performed in accordance
with its terms.


 


(g)      
This Agreement and the other Loan Documents are the result of negotiations among and have been reviewed by counsel to Administrative
Agent, Borrower, the Lenders and the other parties thereto and are the products of all parties. Accordingly, they shall not be
construed against Administrative Agent or the Lenders merely because of Administrative Agent’s or Lenders’ involvement
in their preparation.


 


Section 2        
TERM LOAN COMMITMENTS OF THE LENDERS.


 


2.1         Term
Loan Commitments. On and subject to the terms and conditions of this Agreement, each of the Lenders, severally and for itself
alone, agrees to make a term loan to Borrower (each such loan, a “Term Loan”) on the Closing Date in such Lender’s
Pro Rata Share of the aggregate amount of the Term Loan Commitments of all Lenders. The Term Loan Commitments of the Lenders shall
expire concurrently with the making of the Term Loans on the Closing Date. Amounts repaid or prepaid with respect to Term Loans
may not be re-borrowed.


 


Section 3        
EVIDENCING OF Term LOANS.


 


3.1        
Term Notes. At a Lender’s request, the Term Loans of such Lender shall be evidenced by a Term Note, with appropriate
insertions, payable to the order of such Lender in a face principal amount equal to the principal amount of such Lender’s
Term Loans.


 






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3.2        
Recordkeeping. Administrative Agent, on behalf of each Lender, shall record in its records, the date and amount
of each Term Loan made by each Lender, each repayment or conversion thereof. The aggregate unpaid principal amount so recorded
shall be rebuttably presumptive evidence of the principal amount of the Term Loans owing and unpaid. The failure to so record
any such amount or any error in so recording any such amount shall not, however, limit or otherwise affect the Obligations of
Borrower hereunder or under any Term Note to repay the principal amount of the Term Loans hereunder, together with all interest
accruing thereon.


 


3.3        
Allocation of Purchase Price. The Borrower, Administrative Agent and Lenders acknowledge that under the regulations
of the United States Department of Treasury, the issuance of the Term Notes and the Warrant for an aggregate, combined purchase
price will require the purchase price to be allocated between the Term Notes and the Warrant based on their relative fair market
values.  The allocation of the purchase price between the Term Notes (such amount to be allocated ratably between the Term
Notes, if applicable) and the Warrant shall be determined in accordance with GAAP following the Closing Date. None of the Administrative
Agent, the Borrower or Lenders will take any position for United States federal income tax purposes that is inconsistent with
the provisions of this Section 3.3.   The allocation of the purchase price between the Term Notes and the Warrant
does not modify, reduce or abrogate, in any manner, the Borrower’s obligations under the Term Notes and the Warrant, including
the Borrower’s obligation to purchase the Warrant in accordance with, and for the purchase price set forth in, Section 9(c)
and Exhibit A of the Warrant.


 


Section 4        
INTEREST.


 


4.1        
Interest Rates. Borrower agrees to pay interest on the unpaid principal amount of the Term Loans for the period
commencing on the Closing Date of until such Term Loans are paid in full, at a rate per annum equal to the sum of the Prime Rate
from time to time in effect plus the Applicable Margin;


 


provided that at any time an Event of Default
exists, if the Administrative Agent or the Required Lenders request, the interest rate applicable to the Term Loan shall be increased
by 4%; provided further that such increase may thereafter be rescinded by the Administrative Agent and Required Lenders,
notwithstanding Section 15.1. Notwithstanding the foregoing, upon the occurrence of an Event of Default under Sections 13.1.1
or 13.1.4, such increase and such bearing of interest shall occur automatically. In no event shall interest payable by Borrower
to any Lender hereunder exceed the maximum rate permitted under applicable law, and if any such provision of this Agreement is
in contravention of any such law, such provision shall be deemed modified to limit such interest to the maximum rate permitted
under such law.


 


4.2        
Interest Payment Dates. Accrued interest on each Term Loan shall be payable in arrears on the last day of each calendar
month, upon a prepayment of such Term Loan and at maturity. All such interest shall be paid in cash. Notwithstanding anything
contained herein to the contrary, after maturity, and at any time an Event of Default exists, all accrued interest on all Term
Loans shall be payable in cash on demand.


 






    	 	 20	 



     

    

 


4.3        
Computation of Interest. Interest shall be computed for the actual number of days elapsed on the basis of a year
of 360 days per calendar year. The applicable interest rate for the Term Loan shall change simultaneously with each change in
the Prime Rate.


 


Section 5        
FEES.


 


5.1        
Prepayment Fee. Borrower agrees that if the Term Loan is prepaid at any time, in whole or in part, for any reason
(whether by voluntary prepayment by Borrower, by reason of the occurrence of an Event of Default or the acceleration of the Term
Loans, including upon the occurrence of an insolvency proceeding of any Loan Party, or otherwise), or if the Term Loans shall
become accelerated and due and payable in full, Borrower shall pay to Administrative Agent, for the account the account of the
Lenders in accordance with their Pro Rata Share, as compensation for the costs of Administrative Agent and Lenders making funds
available to Borrower under this Agreement, a prepayment fee (each, a “Prepayment Fee”) calculated in accordance
with this Section 5.1. Each Prepayment Fee shall be equal to an amount determined by multiplying the principal amount prepaid
by the following applicable percentage amount: (i) four percent (4%) if such prepayment occurs within twelve (12) months after
the Closing Date, (ii) three percent (3%) if such prepayment occurs at any time twelve (12) months after the Closing Date but
less than twenty-four (24) months after the Closing Date, and (iii) two percent (2%) if such prepayment occurs at any time twenty-four
(24) months after the Closing Date but less than thirty-six (36) months after the Closing Date. Notwithstanding the foregoing,
no Prepayment Fee shall be applicable to a voluntary prepayment of the Term Loan made with the Net Cash Proceeds arising from
the sale of the Borrower’s investment in BriefCam Ltd., provided such voluntary prepayment is made within ten (10) days
of the consummation of such sale.


 


5.2        
Commitment Fee. The Borrower shall pay to the Administrative Agent for the account of the Lenders in accordance
with their Pro Rata Share a commitment fee (the “Commitment Fee”) in the amount of $160,000, which Commitment
Fee shall be paid to the Administrative Agent in cash and is deemed fully earned and non-refundable on the Closing Date.


 


5.3        
Administration Fees. The Borrowers shall pay to Administrative Agent a fee for the Administrative Agent’s
use of third party administration services (the “Administration Fee”) in the amount of $20,000 per annum, which
such Administration Fee is deemed fully earned and non-refundable on the Closing Date. The Administration Fee shall be payable
annually in advance, on the Closing Date and each anniversary of the Closing Date thereafter until the earlier of (i) the payment
in full of the Obligations, and (ii) Administrative Agent’s determination, in its sole discretion, that such third party
administrative services are no longer required in connection with the Term Loans.


 


Section 6        
PREPAYMENTS; REPAYMENT.


 


6.1        
Prepayments.


 


6.1.1     
Voluntary Prepayments. Borrower may from time to time prepay the Term Loans in whole or in part; provided
that Borrower shall give Administrative Agent


 






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(which shall promptly advise each Lender) notice thereof not later than 10:00 A.M.,
New York time, on the day of such prepayment of any Term Loan (which shall be a Business Day), specifying the date and amount
of prepayment. Any such partial prepayment of a Term Loan shall be in an amount equal to $500,000 or a higher integral multiple
of $100,000.


 


6.1.2      Mandatory Prepayments.


 


(a)          Borrower
shall make a prepayment of the Term Loans upon the occurrence of any of the following at the following times and in the following
amounts:


 


(i)        
Concurrently with the receipt by any Loan Party of any Net Cash Proceeds from any Asset Disposition (other than Net Cash
Proceeds received as a result of the disposition of Borrower’s investment in BriefCam Ltd.), in an amount equal to 100% of
such Net Cash Proceeds.


 


(ii)       
Concurrently with the receipt by any Loan Party of any Net Cash Proceeds from any issuance of Capital Securities of any
Loan Party or from any capital contribution (excluding (x) any issuance by Borrower of common Capital Securities to an employee,
consultant or director pursuant to any equity compensation plan, benefit plan or compensation program, (y) any issuance by Borrower
of Capital Securities upon exercise of the Warrants, and (z) any issuance by a Subsidiary to Borrower or another Subsidiary), in
an amount equal to 100% of such Net Cash Proceeds.


 


(iii)      
Concurrently with the receipt by any Loan Party of any Net Cash Proceeds from any issuance of any Debt of any Loan Party
(excluding Debt permitted by Section 11.1), in an amount equal to 100% of such Net Cash Proceeds.


 


(iv)      
Concurrently with the receipt by any Loan Party of any Extraordinary Receipts, in an amount equal to 100% of such Extraordinary
Receipts; and


 


(v)       
Concurrently with the occurrence of any Change of Control, in an amount equal to 100% of the outstanding principal balance
of the Term Loans, together with all accrued but unpaid interest and all other Obligations outstanding.


 


6.2         Manner of Prepayments. All prepayments of Term Loans shall be applied pro rata among the Term Loans according to
the principal amounts thereof.


 


6.3         Repayment.
Unless sooner paid in full, the outstanding principal balance of the Term Loans together with all accrued but unpaid interest
and all other Obligations outstanding shall be paid in full on the Term Loan Maturity Date.


 






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Section 7        
MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES.


 


7.1        
Making of Payments. All payments of principal or interest on the Term Note(s), and of all fees, shall be made by
Borrower to Administrative Agent in immediately available funds at the office specified by Administrative Agent not later than
noon, New York time, on the date due; and funds received after that hour shall be deemed to have been received by Administrative
Agent on the following Business Day. Administrative Agent shall promptly remit to each Lender its share of all such payments received
in collected funds by Administrative Agent for the account of such Lender. All payments under Section 8.1 shall be
made by Borrower directly to the Lender entitled thereto without setoff, counterclaim or other defense.


 


7.2        
Application of Certain Payments. So long as no Default or Event of Default has occurred and is continuing, voluntary
and mandatory prepayments shall be applied as set forth in Section 6.2. After the occurrence and during the continuance
of a Default or an Event of Default, all amounts collected or received by Administrative Agent or any Lender as proceeds from
the sale of, or other realization upon, all or any part of the Collateral shall be applied as set forth in the Guaranty and Collateral
Agreement.


 


7.3        
Due Date Extension. If any payment of principal or interest with respect to the Term Loans, or of any fees, falls
due on a day which is not a Business Day, then such due date shall be extended to the immediately following Business Day and,
in the case of principal, additional interest shall accrue and be payable for the period of any such extension.


 


7.4        
Setoff. Borrower, for itself and each other Loan Party, agrees that Administrative Agent and each Lender have all
rights of set-off and bankers’ lien provided by applicable law, and in addition thereto, Borrower, for itself and each other
Loan Party, agrees that at any time any Event of Default exists, Administrative Agent and each Lender may apply to the payment
of any Obligations of Borrower and each other Loan Party hereunder, whether or not then due, any and all balances, credits, deposits,
accounts or moneys of Borrower and each other Loan Party then or thereafter with Administrative Agent or such Lender.


 


7.5        
Proration of Payments. If any Lender shall obtain any payment or other recovery (whether voluntary, involuntary,
by application of offset or otherwise), on account of principal of or interest on any Term Loan (but excluding any payment pursuant
to Sections 8 or 15.6) or (b) other recoveries obtained by all Lenders on account of principal of and interest
on the Term Loans (or such participation) then held by them, then such Lender shall purchase from the other Lenders such participations
in the Term Loans held by them as shall be necessary to cause such purchasing Lender to share the excess payment or other recovery
ratably with each of them; provided that if all or any portion of the excess payment or other recovery is thereafter recovered
from such purchasing Lender, the purchase shall be rescinded and the purchase price restored to the extent of such recovery.


 


7.6         
Taxes.


 


(a)       
All payments made by Borrower hereunder or under any Loan Documents shall be made without setoff, counterclaim, or other
defense. To the extent permitted by applicable law, all payments hereunder or under the Loan Documents (including any


 






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payment of
principal, interest, or fees) to, or for the benefit, of any person shall be made by Borrower free and clear of and without deduction
or withholding for, or account of, any Taxes now or hereinafter imposed by any taxing authority.


 


(b)         If Borrower makes any payment hereunder or under any Loan Document in respect of which it is required by applicable law
to deduct or withhold any Taxes, Borrower shall increase the payment hereunder or under any such Loan Document such that after
the reduction for the amount of Taxes withheld (and any taxes withheld or imposed with respect to the additional payments required
under this Section 7.6(b)), the amount paid to the Lenders or Administrative Agent equals the amount that was payable
hereunder or under any such Loan Document without regard to this Section 7.6(b). To the extent Borrower withholds any
Taxes or any Excluded Taxes on payments hereunder or under any Loan Document, Borrower shall pay the full amount deducted to the
relevant taxing authority within the time allowed for payment under applicable law and shall deliver to Administrative Agent within
30 days after it has made payment to such authority a receipt issued by such authority (or other evidence satisfactory to Administrative
Agent) evidencing the payment of all amounts so required to be deducted or withheld from such payment.


 


(c)        
If any Lender or Administrative Agent is required by law to make any payments of any Taxes on or in relation to any amounts
received or receivable hereunder or under any other Loan Document, or any Tax is assessed against a Lender or Administrative Agent
with respect to amounts received or receivable hereunder or under any other Loan Document, Borrower will indemnify such person
against (i) such Tax (and any reasonable counsel fees and expenses associated with such Tax) and (ii) any taxes imposed
as a result of the receipt of the payment under this Section 7.6(c). A certificate prepared in good faith as to the
amount of such payment by such Lender or Administrative Agent shall, absent manifest error, be final, conclusive, and binding on
all parties.


 


(d)        
(i) To the extent permitted by applicable law, each Lender that is not a United States person within the meaning of
Code Section 7701(a)(30) (a “Non-U.S. Participant”) shall deliver to Borrower and Administrative Agent
on or prior to the Closing Date (or in the case of a Lender that is an Assignee, on the date of such assignment to such Lender)
two accurate and complete original signed copies of IRS Form W-8BEN, W-8ECI, or W-8IMY (or any successor or other applicable form
prescribed by the IRS) certifying to such Lender’s entitlement to a complete exemption from, or a reduced rate in, United
States withholding tax on interest payments to be made hereunder or any Term Loan. If a Lender that is a Non-U.S. Participant is
claiming a complete exemption from withholding on interest pursuant to Code Sections 871(h) or 881(c), the Lender shall deliver
(along with two accurate and complete original signed copies of IRS Form W-8BEN) a certificate in form and substance reasonably
acceptable to Administrative Agent (any such certificate, a “Withholding Certificate”). In addition, each Lender
that is a Non-U.S. Participant agrees that from time to time after the Closing Date, (or in the case of a Lender that is an Assignee,
after the date of the assignment to such Lender), when a lapse in time (or change in circumstances occurs) renders the prior certificates
hereunder obsolete or inaccurate in any material respect, such Lender shall, to


 






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the extent permitted under applicable law, deliver
to Borrower and Administrative Agent two new and accurate and complete original signed copies of an IRS Form W-8BEN, W-8ECI, or
W-8IMY (or any successor or other applicable forms prescribed by the IRS), and if applicable, a new Withholding Certificate, to
confirm or establish the entitlement of such Lender or Administrative Agent to an exemption from, or reduction in, United States
withholding tax on interest payments to be made hereunder or any Term Loan.


 


(ii)       
Each Lender that is not a Non-U.S. Participant (other than any such Lender which is taxed as a corporation for U.S. federal
income tax purposes) shall provide two properly completed and duly executed copies of IRS Form W-9 (or any successor or other applicable
form) to Borrower and Administrative Agent certifying that such Lender is exempt from United States backup withholding tax. To
the extent that a form provided pursuant to this Section 7.6(d)(ii) is rendered obsolete or inaccurate in any material
respect as result of change in circumstances with respect to the status of a Lender, such Lender shall, to the extent permitted
by applicable law, deliver to Borrower and Administrative Agent revised forms necessary to confirm or establish the entitlement
to such Lender’s or Administrative Agent’s exemption from United States backup withholding tax.


 


(iii)      
Notwithstanding anything herein to the contrary, Borrower shall not be required to pay additional amounts to a Lender or
to Administrative Agent, or indemnify any Lender or Administrative Agent, under this Section 7.6 to the extent that
such obligations would not have arisen but for the failure of a Lender to comply with Section 7.6(d).


 


(iv)       
Subject to the foregoing clause (d)(iii), Each Lender agrees to indemnify Administrative Agent and hold Administrative
Agent harmless for the full amount of any and all present or future Taxes and related liabilities (including penalties, interest,
additions to tax and expenses, and any Taxes imposed by any jurisdiction on amounts payable to Administrative Agent under this
Section 7.6) which are imposed on or with respect to principal, interest or fees payable to such Lender hereunder and
which are not paid by Borrower pursuant to this Section 7.6, whether or not such Taxes or related liabilities were
correctly or legally asserted. This indemnification shall be made within 30 days from the date Administrative Agent makes written
demand therefor.


 


Section 8        
INCREASED COSTS.


 


8.1        
Increased Costs.


 


(a)        
If, after the date hereof, the adoption of, or any change in, any applicable law, rule or regulation, or any change in the
interpretation or administration of any applicable law, rule or regulation by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance by any Lender with any request or directive (whether
or not having the force of law) of any such authority, central bank or comparable agency: (i) shall impose, modify or deem
applicable any reserve (including any reserve imposed by the FRB),


 






    	 	 25	 



     

    

 


special deposit or similar requirement against assets of, deposits
with or for the account of, or credit extended by any Lender; or (ii) shall impose on any Lender any other condition affecting
its Term Loans or its Term Note; and the result of anything described in clauses (i) and (ii) above is to increase the
cost to (or to impose a cost on) such Lender of maintaining any Term Loan, or to reduce the amount of any sum received or receivable
by such Lender under this Agreement or under its Term Note with respect thereto, then upon demand by such Lender (which demand
shall be accompanied by a statement setting forth the basis for such demand and a calculation of the amount thereof in reasonable
detail, a copy of which shall be furnished to Administrative Agent), Borrower shall pay directly to such Lender such additional
amount as will compensate such Lender for such increased cost or such reduction, so long as such amounts have accrued on or after
the day which is 180 days prior to the date on which such Lender first made demand therefor.


 


(b)       
If any Lender shall reasonably determine that any change in, or the adoption or phase-in of, any applicable law, rule or
regulation regarding capital adequacy, or any change in the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or administration thereof, or the compliance by any Lender or
any Person controlling such Lender with any request or directive regarding capital adequacy (whether or not having the force of
law) of any such authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on such
Lender’s or such controlling Person’s capital as a consequence of such Lender’s obligations hereunder to a level
below that which such Lender or such controlling Person could have achieved but for such change, adoption, phase-in or compliance
(taking into consideration such Lender’s or such controlling Person’s policies with respect to capital adequacy) by
an amount deemed by such Lender or such controlling Person to be material, then from time to time, upon demand by such Lender (which
demand shall be accompanied by a statement setting forth the basis for such demand and a calculation of the amount thereof in reasonable
detail, a copy of which shall be furnished to Administrative Agent), Borrower shall pay to such Lender such additional amount as
will compensate such Lender or such controlling Person for such reduction so long as such amounts have accrued on or after the
day which is 180 days prior to the date on which such Lender first made demand therefor.


 


8.2        
Mitigation of Circumstances; Replacement of Lenders.


 


(a)       
Each Lender shall promptly notify Borrower and Administrative Agent of any event of which it has knowledge which will result
in, and will use reasonable commercial efforts available to it (and not, in such Lender’s sole judgment, otherwise disadvantageous
to such Lender) to mitigate or avoid, any obligation by Borrower to pay any amount pursuant to Sections 7.6 or 8.1
(and, if any Lender has given notice of any such event described above and thereafter such event ceases to exist, such Lender shall
promptly so notify Borrower and Administrative Agent). Without limiting the foregoing, each Lender will designate a different funding
office if such designation will avoid (or reduce the cost to Borrower of) any event described above and such designation will not,
in such Lender’s sole judgment, be otherwise disadvantageous to such Lender.


 






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(b)         If
Borrower becomes obligated to pay additional amounts to any Lender pursuant to Sections 7.6 or 8.1, Borrower
may designate another bank which is acceptable to Administrative Agent in its reasonable discretion (such other bank being called
a “Replacement Lender”) to purchase the Term Loans of such Lender and such Lender’s rights hereunder,
without recourse to or warranty by, or expense to, such Lender, for a purchase price equal to the outstanding principal amount
of the Term Loans payable to such Lender plus any accrued but unpaid interest on such Term Loans and all accrued but unpaid fees
owed to such Lender and any other amounts payable to such Lender under this Agreement and any other Loan Document, and to assume
all the obligations of such Lender hereunder, and, upon such purchase and assumption (pursuant to an Assignment Agreement), such
Lender shall no longer be a party hereto or have any rights hereunder (other than rights with respect to indemnities and similar
rights applicable to such Lender prior to the date of such purchase and assumption) and shall be relieved from all obligations
to Borrower hereunder, and the Replacement Lender shall succeed to the rights and obligations of such Lender hereunder.


 


8.3       
Conclusiveness of Statements; Survival of Provisions. Determinations and statements of any Lender pursuant to Section 8.1
shall be conclusive absent demonstrable error. Lenders may use reasonable averaging and attribution methods in determining
compensation under Section 8.1 and the provisions of such Section shall survive repayment of the Obligations,
cancellation of any Term Note(s), expiration and termination of this Agreement. For purposes of this Agreement, the Dodd-Frank
Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection
therewith, and all requests, rules, guidelines or directives promulgated by the Bank for International settlements, the Basel
Committee on Banking Supervision (or any successor or similar authority) or the United States regulatory authorities, in each
case pursuant to Basel III, shall in each case be deemed to be adopted and gone into effect after the date of this Agreement.


 


Section 9        
REPRESENTATIONS AND WARRANTIES.


 


To induce Administrative Agent and
the Lenders to enter into this Agreement and to induce the Lenders to make Term Loans hereunder, Borrower and each Loan Party represents
and warrants to Administrative Agent and the Lenders that:


 


9.1        
Organization. Each Loan Party and each of their respective Subsidiaries is validly existing and in good standing
under the laws of its jurisdiction of organization; and each Loan Party and each of its Subsidiaries is duly qualified to do business
in each jurisdiction where, because of the nature of its activities or properties, such qualification is required, except for
such jurisdictions where the failure to so qualify would not have a Material Adverse Effect.


 


9.2        
Authorization; No Conflict. Each Loan Party is duly authorized to execute and deliver each Loan Document to which
it is a party, Borrower is duly authorized to borrow monies hereunder, and each Loan Party and each of its Subsidiaries is duly
authorized to perform its obligations under each Loan Document to which it is a party. The execution, delivery and performance
by each Loan Party and each of its Subsidiaries of each Loan Document to which it is a party, and the borrowings by Borrower hereunder,
do not and will not (a) require any consent or approval of any governmental agency or authority (other than any consent or
approval which


 






    	 	 27	 



     

    

 


has been obtained and is in full force and effect), (b) conflict with (i) any provision of law, (ii) the
charter, by-laws or other organizational documents of any Loan Party and any of their respective Subsidiaries or (iii) any
agreement, indenture, instrument or other document, or any judgment, order or decree, which is binding upon any Loan Party and
any of its Subsidiaries or any of their respective properties or (c) require, or result in, the creation or imposition of
any Lien on any asset of any Loan Party (other than Liens in favor of Administrative Agent created pursuant to the Collateral
Documents).


 


9.3        
Validity and Binding Nature. Each of this Agreement and each other Loan Document to which any Loan Party or any
Subsidiary of a Loan Party is a party is the legal, valid and binding obligation of such Person, enforceable against such Person
in accordance with its terms, subject to bankruptcy, insolvency and similar laws affecting the enforceability of creditors’
rights generally and to general principles of equity.


 


9.4        
Financial Condition. The audited consolidated financial statements of Borrower and its Subsidiaries as at December
31, 2015, and the unaudited consolidated financial statements of Borrower and its Subsidiaries through June 30, 2016, copies of
each of which have been delivered to each Lender, were prepared in accordance with GAAP (subject, in the case of such unaudited
statements, to the absence of footnotes and to normal year-end adjustments) and present fairly the consolidated financial condition
of Borrower and its Subsidiaries as at such dates and the results of their operations for the periods then ended.


 


9.5        
No Material Adverse Change. Except as set forth on Schedule 9.5, since December 31, 2015, there has been
no material adverse change in the financial condition, operations, assets, business, or properties of (i) the Loan Parties taken
as a whole, or (ii) the Loan Parties and their Subsidiaries taken as a whole.


 


9.6        
Litigation and Contingent Liabilities. No litigation (including derivative actions), arbitration proceeding or governmental
investigation or proceeding is pending or, to Borrower’s knowledge, threatened against any Loan Party or any Subsidiary
of a Loan Party which could reasonably be expected to have a Material Adverse Effect, except as set forth in Schedule 9.6.
Other than any liability incident to such litigation or proceedings, no Loan Party and no Subsidiary of a Loan Party has any material
contingent liabilities not listed on Schedule 9.6 or permitted by Section 11.1.


 


9.7        
Ownership of Properties; Liens. None of the Loan Parties owns any real property. Each Loan Party and each of its
Subsidiaries owns good title to, or in the case of leased assets, has a valid leasehold interest in, or in the case of intellectual
property rights, has a valid and enforceable rights to use, all of its properties and assets, real and personal, tangible and
intangible, of any nature whatsoever (including patents, trademarks, trade names, service marks and copyrights), free and clear
of all Liens, charges and claims (including infringement claims with respect to patents, trademarks, service marks, copyrights
and the like) except for Liens permitted by Section 11.2. No financing statement or other public notice with respect
to all or any part of the Collateral is on file or of record in any public office, except filings evidencing Liens permitted by
Section 11.2, and filings for which termination statements have been delivered to Administrative Agent.


 






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9.8       
Equity Ownership; Subsidiaries. All issued and outstanding Capital Securities of each Loan Party and each of its
Subsidiaries are duly authorized and validly issued, fully paid, non-assessable, and free and clear of all Liens other than those
in favor of Administrative Agent, and such securities were issued in substantial compliance with all applicable state and federal
laws concerning the issuance of securities. Schedule 9.8 sets forth the authorized Capital Securities of each Loan
Party as of the Closing Date. All of the issued and outstanding Capital Securities of each direct or indirect Subsidiary of the
Borrower is, directly or indirectly, owned by Borrower. As of the Closing Date, except for the Warrants and as set forth on Schedule 9.8,
there are no pre-emptive or other outstanding rights, options, warrants, conversion rights or other similar agreements or understandings
for the purchase or acquisition of any Capital Securities of any Loan Party or any Subsidiary of any Loan Party.


 


9.9        
Pension Plans.


 


(a)        
The Unfunded Liability of all Pension Plans does not in the aggregate exceed twenty percent of the Total Plan Liability
for all such Pension Plans. Each Pension Plan complies in all material respects with all applicable requirements of law and regulations.
No contribution failure under Section 430 of the Code, Section 303 of ERISA or the terms of any Pension Plan has occurred
with respect to any Pension Plan, sufficient to give rise to a Lien under Section 303(k) of ERISA, or otherwise to have a
Material Adverse Effect. There are no pending or, to the knowledge of Borrower, threatened, claims, actions, investigations or
lawsuits against any Pension Plan, any fiduciary of any Pension Plan, or any Loan Party or any other member of the Controlled Group
with respect to a Pension Plan or a Multiemployer Pension Plan which could reasonably be expected to have a Material Adverse Effect.
No Loan Party and no other member of the Controlled Group has engaged in any prohibited transaction (as defined in Section 4975
of the Code or Section 406 of ERISA) in connection with any Pension Plan or Multiemployer Pension Plan which would subject
that Person to any material liability. Within the past five years, no Loan Party and no other member of the Controlled Group has
engaged in a transaction which resulted in a Pension Plan with an Unfunded Liability being transferred out of the Controlled Group,
which could reasonably be expected to have a Material Adverse Effect. No Termination Event has occurred or is reasonably expected
to occur with respect to any Pension Plan, which could reasonably be expected to have a Material Adverse Effect.


 


(b)       
All contributions (if any) have been made to any Multiemployer Pension Plan that are required to be made by Loan Parties
or any other member of the Controlled Group under the terms of the plan or of any collective bargaining agreement or by applicable
law; no Loan Party and no other member of the Controlled Group has withdrawn or partially withdrawn from any Multiemployer Pension
Plan, incurred any withdrawal liability with respect to any such plan or received notice of any claim or demand for withdrawal
liability or partial withdrawal liability from any such plan, and no condition has occurred which, if continued, could result in
a withdrawal or partial withdrawal from any such plan; and no Loan Party and no other member of the Controlled Group has received
any notice that any Multiemployer Pension Plan is in reorganization, that increased contributions may be required to avoid a reduction
in plan benefits or the imposition of any excise tax, that any such plan is or has been funded at a


 






    	 	 29	 



     

    

 


rate less than that required
under Section 412 of the Code, that any such plan is or may be terminated, or that any such plan is or may become insolvent.


 


9.10      
Investment Company Act. No Loan Party and no Subsidiary of any Loan Party is an “investment company”
or a company “controlled” by an “investment company” or a “subsidiary” of an “investment
company,” within the meaning of the Investment Company Act of 1940.


 


9.11      
Compliance with Laws. Each Loan Party and each Subsidiary thereof is in compliance with the requirements of all
laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (a) such
requirement of law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently
conducted or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected
to have a Material Adverse Effect.


 


9.12     
Regulation U. No Loan Party and no Subsidiary of any Loan Party is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or carrying Margin Stock.


 


9.13      
Taxes. Each Loan Party and each of its Subsidiaries has timely filed all federal tax returns and material state
tax returns and reports required by law to have been filed by it and has paid all taxes and governmental charges due and payable
with respect to such return, except any such taxes or charges which are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books. The Loan Parties and
their Subsidiaries have made adequate reserves on their books and records in accordance with GAAP for all taxes that have accrued
but which are not yet due and payable. No Loan Party and no Subsidiary of any Loan Party has participated in any transaction that
relates to a year of the taxpayer (which is still open under the applicable statute of limitations) which is a “reportable
transaction” within the meaning of Treasury Regulation Section 1.6011-4(b)(2) (irrespective of the date when the transaction
was entered into).


 


9.14      
Solvency, etc. On the Closing Date, and immediately prior to and after giving effect to the borrowing of the Term
Loans hereunder and the use of the proceeds thereof, with respect to each Loan Party and each of its Subsidiaries, individually,
(a) the fair value of its assets is greater than the amount of its liabilities (including disputed, contingent and unliquidated
liabilities), (b) the present fair saleable value of its assets is not less than the amount that will be required to pay
the probable liability on its debts as they become absolute and matured, (c) it is able to realize upon its assets and pay
its debts and other liabilities (including disputed, contingent and unliquidated liabilities) as they mature in the normal course
of business, (d) it does not intend to, and does not believe that it will, incur debts or liabilities beyond its ability
to pay as such debts and liabilities mature and (e) it is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which its property would constitute unreasonably small capital.


 


9.15      
Environmental Matters. Except as would not reasonably be expected to have a Material Adverse Effect:


 






    	 	 30	 



     

    

 


(a)       
Each of the Facilities and all past and current operations at or from the Facilities are in compliance with all applicable
Environmental Laws, and there is no violation of any Environmental Law with respect to the Facilities or the Loan Party’s
or any Subsidiary’s operations, and there are no conditions relating to the Facilities or the Loan Party’s or any Subsidiary’s
operations that could give rise to liability or obligation under any applicable Environmental Laws.


 


(b)         None
of the Facilities contains or has previously contained any Hazardous Substances at, on or under the Facilities in amounts or concentrations
that constitute or constituted a violation of, or could give rise to liability under, Environmental Laws.


 


(c)        
Each Loan Party and each of its Subsidiaries has obtained, and maintained in good standing, all licenses, permits, authorizations,
registrations and other approvals required under any Environmental Law and required for their respective ordinary course operations,
and for their reasonably anticipated future operations, and each Loan Party and each of its Subsidiaries is in compliance with
all terms and conditions thereof.


 


(d)         No Loan Party and no Subsidiary of any Loan Party has received or reasonably anticipates the issuance of any written or
verbal notice of, or inquiry from, or agreement with, any federal, state or local governmental authority regarding any violation,
alleged violation, non-compliance, liability or potential liability arising under Environmental Laws with regard to any of the
Facilities or the Loan Party’s or any Subsidiary’s operations, nor does any Loan Party or any Subsidiary of any Loan
Party have knowledge or reason to believe that any such notice will be received or is being threatened.


 


(e)        
Hazardous Substances have not been transported or disposed of from the Facilities, or generated, treated, stored or disposed
of at, on or under any of the Facilities or any other location, in each case by or on behalf of any Loan Party or any Subsidiary
of any Loan Party, or arising from any Loan Party’s or any Subsidiary’s operations, in violation of, or in a manner
that would be reasonably likely to give rise to liability under, any applicable Environmental Law.


 


(f)        
No judicial proceeding or governmental or administrative action is pending or, to the knowledge of the Loan Parties and
their respective Subsidiaries, threatened, under any Environmental Law to which any Loan Party or any of its Subsidiaries is or
will be named as a party, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders,
or other administrative or judicial requirements outstanding under any Environmental Law with respect to any Loan Party or any
Subsidiary, the Facilities or the Loan Parties’ or any Subsidiary’s operations.


 


(g)       
There has been no release of Hazardous Substances at or from the Facilities, or arising from or related to the operations
(including disposal) of any Loan Party or any Subsidiary in connection with the Facilities or otherwise in connection with the
Loan Parties’ or any Subsidiary’s operations, in violation of or in amounts or in a manner that could give rise to
liability under Environmental Laws.


 






    	 	 31	 



     

    

 


(h)       
No Loan Party and no Subsidiary of any Loan Party has any underground storage tanks that are not properly registered or
permitted under applicable Environmental Laws or that at any time have released, leaked, disposed of or otherwise discharged Hazardous
Substances.


 


9.16       Insurance.
Set forth on Schedule 9.16 is a complete and accurate summary of the property and casualty insurance program of the
Loan Parties and each of their respective Subsidiaries as of the Closing Date (including the names of all insurers, policy numbers,
expiration dates, amounts and types of coverage, annual premiums, exclusions, deductibles, self-insured retention, and a description
in reasonable detail of any self-insurance program, retrospective rating plan, fronting arrangement or other risk assumption arrangement
involving any Loan Party). Each Loan Party and each of its Subsidiaries and its properties are insured with financially sound
and reputable insurance companies which are not Affiliates of the Loan Parties, in such amounts, with such deductibles and covering
such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where
such Loan Parties or such Subsidiaries operate.


 


9.17       Real
Property. Set forth on Schedule 9.17 is a complete and accurate list, as of the Closing Date, of the address of
all real property owned or leased by any Loan Party and any Subsidiary, together with, in the case of leased property, the name
and mailing address of the lessor of such property.


 


9.18       Information.
All information heretofore or contemporaneously herewith furnished in writing by the Loan Parties and their Subsidiaries to Administrative
Agent or any Lender for purposes of or in connection with this Agreement and the transactions contemplated hereby (as modified
or supplemented by other written information so furnished) is, and all written information hereafter furnished by or on behalf
of any Loan Party or any Subsidiary to Administrative Agent or any Lender pursuant hereto or in connection herewith will be, true
and accurate in every material respect on the date as of which such information is dated or certified, and none of such information
is or will be incomplete by omitting to state any material fact necessary to make such information not misleading in light of
the circumstances under which made (it being recognized by Administrative Agent and the Lenders that any projections and forecasts
provided by Borrower are based on good faith estimates and assumptions believed by Borrower to be reasonable as of the date of
the applicable projections or assumptions and that actual results during the period or periods covered by any such projections
and forecasts may differ from projected or forecasted results).


 


9.19       Intellectual
Property. Each Loan Party and each of its Subsidiaries owns and possesses or has a license or other right to use all patents,
patent rights, trademarks, trademark rights, trade names, trade name rights, service marks, service mark rights and copyrights
as are necessary for the conduct of the businesses of the Loan Parties and their Subsidiaries, without any infringement upon rights
of others which could reasonably be expected to have a Material Adverse Effect.


 


9.20       [Reserved].


 






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9.21       Labor
Matters. Except as set forth on Schedule 9.21, no Loan Party and no Subsidiary of any Loan Party is subject to
any labor or collective bargaining agreement. There are no existing or threatened strikes, lockouts or other labor disputes involving
any Loan Party or any Subsidiary of any Loan Party that singly or in the aggregate could reasonably be expected to have a Material
Adverse Effect. Hours worked by and payment made to employees of the Loan Parties and each of their respective Subsidiaries are
not in violation of the Fair Labor Standards Act or any other applicable law, rule or regulation dealing with such matters.


 


9.22       Anti-Terrorism
Laws.


 


(a)       No
Loan Party and no Subsidiary of any Loan Party (and, to the knowledge of each Loan Party, no joint venture or Affiliate thereof)
is in violation in any material respects of any United States Requirements of Law relating to terrorism, sanctions or money laundering
(the “Anti-Terrorism Laws”), including the United States Executive Order No. 13224 on Terrorist Financing
(the “Anti-Terrorism Order”) and the Patriot Act.


 


(b)       No
Loan Party and no Subsidiary of any Loan Party (and, to the knowledge of each Loan Party, no joint venture or Affiliate thereof)
(i) is listed in the annex to, or is otherwise subject to the provisions of, the Anti-Terrorism Order, (ii) is owned
or controlled by, or acting for or on behalf of, any person listed in the annex to, or is otherwise subject to the provisions of,
the Anti-Terrorism Order, (iii) commits, threatens or conspires to commit or supports “terrorism” as defined in
the Anti-Terrorism Order or (iv) is named as a “specially designated national and blocked person” in the most
current list published by OFAC.


 


(c)       No
Loan Party and no Subsidiary of any Loan Party (and, to the knowledge of each Loan Party, no joint venture or Affiliate thereof)
(i) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit
of any person described in clauses (b)(i) through (b)(iv) above, (ii) deals in, or otherwise engages in any
transactions relating to, any property or interests in property blocked pursuant to the Anti-Terrorism Order or (iii) engages
in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate,
any of the prohibitions set forth in any Anti-Terrorism Law.


 


9.23       No
Default. No Default or Event of Default exists or would result from the incurrence by any Loan Party or any Subsidiary of
any Loan Party of any Debt hereunder or under any other Loan Document.


 


9.24       Hedging
Agreements. No Loan Party is a party to any Hedging Agreement.


 


9.25       OFAC.
Each Loan Party and each of its Subsidiaries is and will remain in compliance in all material respects with all U.S. economic
sanctions laws, Executive Orders and implementing regulations as promulgated by the U.S. Treasury Department’s Office of
Foreign Assets Control (“OFAC”), and all applicable anti-money laundering and counter-terrorism financing provisions
of the Bank Secrecy Act and all regulations issued pursuant to it. No Loan


 






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Party and no Affiliate of a Loan Party (excluding a
Stockholder Affiliate), and to the knowledge of the Loan Parties, no Stockholder Affiliate, (i) is a Person designated
by the U.S. government on the list of the Specially Designated Nationals and Blocked Persons (the “SDN List”)
with which a U.S. Person cannot deal with or otherwise engage in business transactions, (ii) is a Person who is otherwise
the target of U.S. economic sanctions laws such that a U.S. Person cannot deal or otherwise engage in business transactions with
such Person or (iii) is controlled by (including without limitation by virtue of such person being a director or owning voting
shares or interests), or acts, directly or indirectly, for or on behalf of, any person or entity on the SDN List or a foreign
government that is the target of U.S. economic sanctions prohibitions such that the entry into, or performance under, this Agreement
or any other Loan Document would be prohibited under U.S. law.


 


9.26       Patriot
Act. Loan Parties and each of their Affiliates (excluding Stockholder Affiliates), and to the knowledge of the Loan Parties,
Stockholder Affiliates, are in compliance with (a) the Trading with the Enemy Act, and each of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B Chapter V, as amended) and any other enabling legislation
or executive order relating thereto, (b) the Patriot Act and (c) other federal or state laws relating to “know
your customer” and anti-money laundering rules and regulations. No part of the proceeds of any Term Loan will be used
directly or indirectly for any payments to any government official or employee, political party, official of a political party,
candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or
obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977.


 


9.27       Customers
and Suppliers. Schedule 9.27 sets forth the complete and accurate list of (a) the 10 largest customers of the Loan
Parties (measured by aggregate billing) during the (i) Fiscal Year most recently ended and (ii) June 30, 2016 and after the Closing
Date the most recently closed Fiscal Quarter, indicating the amount of the existing contractual obligations for each such customer
(and noting the relevant Loan Party), and (b) the 10 largest suppliers of materials, products or services to the Loan Parties
(measured by the aggregate amount purchased by the Loan Parties during the (i) Fiscal Year most recently ended and (ii) June 30,
2016 and after the Closing Date the most recently closed Fiscal Quarter, indicating the amount of the existing contractual obligations
for each such supplier (and noting the relevant Loan Party).


 


9.28       Significant
Contracts. Schedule 9.28 as updated from time to time, including pursuant to any notice required under this Agreement)
sets forth all Significant Contracts of the Loan Parties. After the Closing Date, no Loan Party has entered into, accelerated,
terminated, modified, canceled or permitted to expire any Significant Contract or received notice that any other Person intends
to accelerate, terminate, modify, cancel or permit to expire any such Significant Contract.


 


9.29       Certain
Foreign Subsidiaries. Qumu Japan, Qumu Middle East and Qumu Singapore, do not own any assets or Capital Securities other than
de minimis amounts of assets incidental to the conduct of their business.


 






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Section 10AFFIRMATIVE
COVENANTS.


 


Until all Obligations
hereunder and under the other Loan Documents are paid in full, Borrower agrees that, unless at any time the Required Lenders shall
otherwise expressly consent in writing, it will:


 


10.1       Reports,
Certificates and Other Information. Furnish to Administrative Agent:


 


10.1.1       Annual
Report. Promptly when available and in any event within 90 days after the close of each Fiscal Year, (a) a copy of the
annual audit report of Borrower and its Subsidiaries for such Fiscal Year, including therein consolidated balance sheets and statements
of earnings and cash flows of Borrower and its Subsidiaries as at the end of such Fiscal Year, certified without an expression
of uncertainty regarding the Borrower’s ability to continue as a going concern and without qualification by independent
auditors of recognized standing selected by Borrower and reasonably acceptable to Administrative Agent (it being agreed that Borrower’s
independent auditor as of the Closing Date is acceptable to Administrative Agent), together with (i) a written statement
from such accountants to the effect that in making the examination necessary for the signing of such annual audit report by such
accountants, nothing came to their attention that caused them to believe that Loan Parties were not in compliance with any provision
of Sections 11.1, 11.3, 11.4, 11.13.3 or 11.13.5 of this Agreement insofar as such provision
relates to accounting matters or, if something has come to their attention that caused them to believe that Loan Parties were
not in compliance with any such provision, describing such non-compliance in reasonable detail and (ii) a comparison with
the budget for such Fiscal Year and a comparison with the previous Fiscal Year; and (b) a consolidating balance sheet of
Borrower and its Subsidiaries as of the end of such Fiscal Year and consolidating statement of earnings for Borrower and its Subsidiaries
for such Fiscal Year, certified by a Senior Officer of Borrower.


 


10.1.2       Interim
Reports. (a)  Promptly when available and in any event within 45 days after the end of each Fiscal Quarter, consolidated
and consolidating balance sheets of Borrower and its Subsidiaries as of the end of such Fiscal Quarter, together with consolidated
and consolidating statements of earnings and consolidated cash flows for such Fiscal Quarter and for the period beginning with
the first day of such Fiscal Year and ending on the last day of such Fiscal Quarter, together with a comparison with the corresponding
period of the previous Fiscal Year and a comparison with the budget for such period of the current Fiscal Year, certified by a
Senior Officer of Borrower; and (b) promptly when available and in any event within 30 days after the end of each month,
consolidated and consolidating balance sheets of Borrower and its Subsidiaries as of the end of such month, together with consolidated
and consolidating statements of earnings for the period beginning with the first day of such Fiscal Year and ending on the last
day of such month, certified by a Senior Officer of Borrower.


 


10.1.3       Compliance
Certificates. Contemporaneously with the furnishing of a copy of each annual audit report pursuant to Section 10.1.1
and each set of interim statements pursuant to Section 10.1.2, a duly completed compliance certificate in the
form of Exhibit B, with appropriate insertions, dated the date of such annual report or


 






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such statements and signed
by a Senior Officer of Borrower, containing (i) a computation of each of the applicable financial ratios and restrictions
set forth in Section 11.13 and to the effect that such officer has not become aware of any Default or Event of Default
that has occurred and is continuing or, if there is any such event, describing it and the steps, if any, being taken to cure it,
(ii) certification by Borrower that all of the representations and warranties set forth in this Agreement and the other Loan Documents
remain true and correct in all material respects as of the date of such compliance certificate (except for representations and
warranties that speak as to a specific date, in which case such representations and warranties shall remain true and correct as
of such date and except for changes permitted by this Agreement), and (iii) a statement of Borrower’s management in
the form as delivered to the Board and setting forth a discussion of Borrower’s and its Subsidiaries’ financial condition,
changes in financial condition and results of operations.


 


10.1.4       Reports
to the SEC and to Shareholders. Promptly upon the filing or sending thereof, copies of all regular, periodic or special reports
of any Loan Party filed with the SEC; copies of all registration statements of any Loan Party filed with the SEC (other than on
Form S-8); and copies of all proxy statements or other communications made to security holders generally provided that filing
or furnishing of such report, registration statement, proxy statement or other communication with the SEC via the EDGAR system
shall be deemed to be furnishing of the same to Administrative Agent.


 


10.1.5       Notice
of Default, Litigation and ERISA Matters. Promptly upon becoming aware of any of the following, written notice describing
the same and the steps being taken by Borrower or any Subsidiary affected thereby with respect thereto:


 


(a)       the
occurrence of a Default or an Event of Default;


 


(b)       any
litigation, arbitration or governmental investigation or proceeding not previously disclosed by Borrower to Administrative Agent
which has been instituted or, to the knowledge of Borrower, is threatened in writing against any Loan Party or any Subsidiary of
any Loan Party or to which any of the properties of any thereof is subject which might reasonably be expected to have a Material
Adverse Effect;


 


(c)       the
institution of any steps by any member of the Controlled Group or any other Person to terminate any Pension Plan, or the failure
of any member of the Controlled Group to make a required contribution to any Pension Plan (if such failure is sufficient to give
rise to a Lien under Section 303(k) of ERISA) or to any Multiemployer Pension Plan, or the taking of any action with respect
to a Pension Plan which could result in the requirement that any Loan Party furnish a bond or other security to the PBGC or such
Pension Plan, or the occurrence of any event with respect to any Pension Plan or Multiemployer Pension Plan which could result
in the incurrence by any member of the Controlled Group of any material liability, fine or penalty (including any claim or demand
for withdrawal liability or partial withdrawal from any Multiemployer Pension Plan), or any material increase in the contingent
liability of any Loan Party with respect to any post-retirement welfare benefit plan or other employee benefit plan of any Loan
Party or another member of the Controlled Group, or any notice that any Multiemployer Pension Plan is in reorganization, that increased
contributions may be required to avoid a


 






    	 36



     


    

 


reduction in plan benefits or the imposition of an excise tax, that any such plan is or
has been funded at a rate less than that required under Section 412 of the Code, that any such plan is or may be terminated,
or that any such plan is or may become insolvent;


 


(d)       any
cancellation or material change in any insurance maintained by any Loan Party or any Subsidiary of any Loan Party; or


 


(e)       any
other event (including (i) any violation of any Environmental Law or the assertion of any Environmental Claim or (ii) the
enactment or effectiveness of any law, rule or regulation) which might reasonably be expected to have a Material Adverse Effect.


 


10.1.6       Management
Reports. Promptly upon receipt thereof, copies of all management reports submitted to Borrower or its Subsidiaries by independent
auditors in connection with each annual or interim audit made by such auditors of the books of Borrower and its Subsidiaries.


 


10.1.7       Projections;
Annual Financial Plan. As soon as practicable, and in any event not later than the commencement of each Fiscal Year, preliminary
annual operating plan for the next Fiscal Year (including financial projections for Borrower and its Subsidiaries for such Fiscal
Year with projected quarterly operating results as well as projected balance sheet and cash flow) prepared in a manner consistent
with past practices including detail not less than provided to the Administrative Agent prior to the Closing Date and such other
detail as reasonably requested by the Administrative Agent, accompanied by a certificate of a Senior Officer of Borrower on behalf
of Borrower to the effect that (a) such projections were prepared by Borrower in good faith, (b) Borrower has a reasonable
basis for the assumptions contained in such projections, (c) such projections have been prepared in accordance with such
assumptions, and (d) in the case of a final annual operating plan, the Board has approved such annual operating plan. The preliminary
annual operating plan including projections delivered pursuant to this Section 10.1.7 shall be deemed to be final upon
the earlier to occur of (x) the Board has approved such annual operating plan or (y) the last day of February of such Fiscal Year;
provided that in any event such annual operating plan will be provided to Administrative Agent not later than 10 days of Board
approval.


 


10.1.9       Updated
Schedule. Contemporaneously with the furnishing of each (i) annual audit report pursuant to Section 10.1.1, an
updated version of Schedule 9.17 showing information as of the date of such audit report (it being agreed and understood
that this requirement shall be in addition to the other notice and delivery requirements set forth herein) and (ii) fiscal quarter
report pursuant to Section 10.1.2(a), an updated version of Schedules 9.27 and 9.28 showing information as of
the date of such report (it being agreed and understood that this requirement shall be in addition to the other notice and delivery
requirements set forth herein).


 


10.1.10       Additional
Reports. Contemporaneously with the furnishing of a copy of each annual audit report pursuant to Section 10.1.1
and each set of interim statements pursuant to (a) Section 10.1.2(a), (i) a Bookings Report, (ii) a Deferred Revenue
Report,


 






    	 37



     


    

 


(iii) beginning with the month ended September 30, 2017, a Milestone Report, and (iv) Earnings Report, and (b) Section 10.1.2(b) (i) copies of bank statements for the accounts listed in Section 10.10, and (ii) an Accounts Receivable aging report
and calculation of Eligible Accounts.


 


10.1.11       Other
Information. Promptly from time to time, such other information (including, without limitation, business or financial data,
reports, appraisals and projections) concerning the Loan Parties and each of their Subsidiaries, their properties or business,
as any Lender or Administrative Agent may reasonably request.


 


10.2       Books,
Records and Inspections. Keep, and cause each other Loan Party and each of their respective Subsidiaries to keep, its books
and records in accordance with sound business practices sufficient to allow the preparation of financial statements in accordance
with GAAP; permit, and cause each other Loan Party and each of their respective Subsidiaries to permit, any Lender or Administrative
Agent or any representative or agent thereof to inspect the properties and operations of the Loan Parties and their Subsidiaries;
and permit, and cause each other Loan Party and each Subsidiary to permit, at any reasonable time and with reasonable notice (or
at any time without notice if an Event of Default exists), any Lender or Administrative Agent or any representative or agent thereof
to visit any or all of its offices, to discuss its financial matters with its officers and its independent auditors (and Borrower
hereby authorizes such independent auditors to discuss such financial matters with any Lender or Administrative Agent or any representative
or agent thereof), and to examine (and, at the expense of the Loan Parties, photocopy extracts from) any of its books or other
records; and permit, and cause each other Loan Party and each of their respective Subsidiaries to permit, Administrative Agent
and its representatives and agents to inspect the Inventory and other tangible assets of the Loan Parties and each of their Subsidiaries,
to perform appraisals of the equipment of the Loan Parties and each of their Subsidiaries, and to inspect, audit, check and make
copies of and extracts from the books, records, computer data, computer programs, journals, orders, receipts, correspondence and
other data relating to Inventory, Accounts and any other collateral. All such inspections or audits by Administrative Agent shall
be at Borrower’s expense.


 


10.3       Maintenance
of Property; Insurance. (a) Keep, and cause each other Loan Party and each of their respective Subsidiaries to keep,
all property useful and necessary in the business of the Loan Parties and each of their respective Subsidiaries in good working
order and condition, ordinary wear and tear excepted.


 


(b)       Maintain,
and cause each other Loan Party and each of their respective Subsidiaries to maintain, with responsible insurance companies, such
insurance coverage as may be required by any law or governmental regulation or court decree or order applicable to it and such
other insurance, to such extent and against such hazards and liabilities, as is customarily maintained by companies similarly situated
(including, without limitation, business interruption insurance in an amount not less than as maintained on the Closing Date, but
which shall insure against all risks and liabilities of the type identified on Schedule 9.16 and shall have insured
amounts no less than, and deductibles no higher than, those set forth on such schedule; and, upon request of Administrative Agent
or any Lender, furnish to Administrative Agent or such Lender original or electronic copies of policies evidencing such insurance,
and a certificate


 






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setting forth in reasonable detail the nature and extent of all insurance maintained by the Loan Parties and
each of their respective Subsidiaries. Borrower shall cause each issuer of an insurance policy to provide Administrative Agent
with an endorsement (i) showing Administrative Agent as loss payee with respect to each policy of property or casualty insurance
and naming Administrative Agent as an additional insured with respect to each policy of liability insurance, (ii) providing
that 30 days’ notice will be given to Administrative Agent prior to any cancellation of, material reduction or change in
coverage provided by or other material modification to such policy and (iii) reasonably acceptable in all other respects to
Administrative Agent. Borrower shall, and shall cause each other Loan Party to, execute and deliver to Administrative Agent a collateral
assignment, in form and substance satisfactory to Administrative Agent, of each business interruption insurance policy maintained
by any Loan Party.


 


(c)       UNLESS
BORROWER PROVIDES ADMINISTRATIVE AGENT WITH EVIDENCE OF THE INSURANCE COVERAGE REQUIRED BY THIS AGREEMENT, ADMINISTRATIVE AGENT
MAY PURCHASE INSURANCE AT BORROWER’S EXPENSE TO PROTECT ADMINISTRATIVE AGENT’S AND THE LENDERS’ INTERESTS
IN THE COLLATERAL. THIS INSURANCE MAY, BUT NEED NOT, PROTECT ANY LOAN PARTY’S INTERESTS. THE COVERAGE THAT ADMINISTRATIVE
AGENT PURCHASES MAY NOT PAY ANY CLAIM THAT IS MADE AGAINST ANY LOAN PARTY IN CONNECTION WITH THE COLLATERAL. BORROWER MAY LATER
CANCEL ANY INSURANCE PURCHASED BY ADMINISTRATIVE AGENT, BUT ONLY AFTER PROVIDING ADMINISTRATIVE AGENT WITH EVIDENCE THAT LOAN PARTIES
HAVE OBTAINED INSURANCE AS REQUIRED BY THIS AGREEMENT. IF ADMINISTRATIVE AGENT PURCHASES INSURANCE FOR THE COLLATERAL, BORROWER
WILL BE RESPONSIBLE FOR THE COSTS OF THAT INSURANCE, INCLUDING INTEREST AND ANY OTHER CHARGES THAT MAY BE IMPOSED WITH THE
PLACEMENT OF THE INSURANCE, UNTIL THE EFFECTIVE DATE OF THE CANCELLATION OR EXPIRATION OF THE INSURANCE. THE COSTS OF THE INSURANCE
MAY BE ADDED TO THE PRINCIPAL AMOUNT OF THE LOANS OWING HEREUNDER. THE COSTS OF THE INSURANCE MAY BE MORE THAN THE COST
OF THE INSURANCE THE LOAN PARTIES MAY BE ABLE TO OBTAIN ON THEIR OWN.


 


10.4       Compliance
with Laws; Payment of Taxes and Liabilities. (a)  Comply, and cause each other Loan Party and each of their respective
Subsidiaries to comply, with all applicable laws, rules, regulations, decrees, orders, judgments, licenses and permits, except
where failure to comply could not reasonably be expected to have a Material Adverse Effect; (b) without limiting clause (a) above, ensure, and cause each other Loan Party to ensure, that no person who owns a controlling interest in or otherwise controls
a Loan Party is or shall be (i) listed on the Specially Designated Nationals and Blocked Person List maintained by the OFAC,
Department of the Treasury, and/or any other similar lists maintained by OFAC pursuant to any authorizing statute, Executive Order
or regulation or (ii) a person designated under Section 1(b), (c) or (d) of Executive Order No. 13224 (September 23,
2001), any related enabling legislation or any other


 






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similar Executive
Orders, (c) without limiting clause (a) above, comply, and cause each other Loan Party to comply, with all
applicable Bank Secrecy Act and anti-money laundering laws and regulations and (d) pay, and cause each other Loan Party to
pay, prior to delinquency, all taxes and other governmental charges against it or any of its property, as well as claims of
any kind which, if unpaid, could become a Lien on any of its property; provided that the foregoing shall not require
any Loan Party to pay any such tax or charge so long as it shall contest the validity thereof in good faith by appropriate
proceedings and shall set aside on its books adequate reserves with respect thereto in accordance with GAAP and, in the case
of a claim which could become a Lien on any collateral, such contest proceedings shall stay the foreclosure of such Lien or
the sale of any portion of the collateral to satisfy such claim.


 


10.5       Maintenance
of Existence, etc. Maintain and preserve, and (subject to Section 11.5) cause each other Loan Party to maintain
and preserve, (a) its existence and good standing in the jurisdiction of its organization and (b) its qualification
to do business and good standing in each jurisdiction where the nature of its business makes such qualification necessary (other
than such jurisdictions in which the failure to be qualified or in good standing could not reasonably be expected to have a Material
Adverse Effect).


 


10.6       Use
of Proceeds. Use the proceeds of the Term Loans solely for working capital purposes, for Capital Expenditures and for other
general business purposes; and not use or permit any proceeds of any Term Loan to be used, either directly or indirectly, for
the purpose, whether immediate, incidental or ultimate, of “purchasing or carrying” any Margin Stock.


 


10.7       Employee
Benefit Plans.


 


(a)       Maintain,
and cause each other member of the Controlled Group to maintain, each Pension Plan in substantial compliance with all applicable
requirements of law and regulations.


 


(b)       Make,
and cause each other member of the Controlled Group to make, on a timely basis, all required contributions to any Multiemployer
Pension Plan.


 


(c)       Not,
and not permit any other member of the Controlled Group to (i) seek a waiver of the minimum funding standards of ERISA, (ii) terminate
or withdraw from any Pension Plan or Multiemployer Pension Plan or (iii) take any other action with respect to any Pension
Plan that would reasonably be expected to entitle the PBGC to terminate, impose liability in respect of, or cause a trustee to
be appointed to administer, any Pension Plan, unless the actions or events described in clauses (i), (ii) and (iii) individually
or in the aggregate would not have a Material Adverse Effect.


 


10.8       Environmental
Matters. (a) If any release or threatened release or other disposal of Hazardous Substances shall occur or shall have occurred
on any of the Facilities or any other assets of any Loan Party or any Subsidiary of any Loan Party, Borrower shall, or shall cause
the applicable Loan Party or the applicable Subsidiary of such Loan Party to, cause the prompt containment and removal of such
Hazardous Substances and the remediation of such real property or other assets as necessary to comply with all Environmental Laws
and to preserve the value of such real property or other assets. Without limiting the generality of the foregoing,


 






    	 40



     


    

 


Borrower shall,
and shall cause each other Loan Party and each of their respective Subsidiaries to, comply with any Federal or state judicial
or administrative order requiring the performance at any of the Facilities of any Loan Party or any Subsidiary of any Loan Party
of activities in response to the release or threatened release of a Hazardous Substance. To the extent that the transportation,
handling, storage, generation, treatment or disposal of Hazardous Substances is permitted by this Agreement, Borrower shall, and
shall cause each other Loan Party and each of their respective Subsidiaries to comply with Environmental Laws in all such activities
and to dispose of such Hazardous Substances, or of any other wastes, only at licensed disposal facilities operating in compliance
with Environmental Laws.


 


(b)       Borrower
shall comply in all material respects with the requirements of all federal, state, and local Environmental Laws applicable to the
Loan Parties and each of their respective Subsidiaries or the Facilities; notify the Administrative Agent promptly in the event
of any spill, release or disposal of Hazardous Substances on, or hazardous waste pollution or contamination affecting, the Facilities
in material violation of applicable Environmental Laws of which a Loan Party has actual knowledge; forward to the Administrative
Agent promptly any written notices relating to such matters received from any Governmental Authority; and pay when due any fine
or assessment against the Facilities arising under Environmental Laws, provided, that the Loan Parties and each of their
respective Subsidiaries shall not be required to pay any such fine or assessment so long as the validity thereof shall be diligently
contested in good faith by appropriate proceedings and they shall have set aside on their books reasonable reserves (in accordance
with GAAP) with respect to any such fine or assessment so contested; and provided further that, in any event, payment of
any such fine or assessment shall be made before any of the Facilities shall be subjected to a Lien or be seized or sold in satisfaction
thereof.


 


(c)       Borrower
shall promptly notify the Administrative Agent upon becoming aware of any fact or change in circumstances that would be expected
to cause any of the representations and warranties contained in Section 9.15 to cease to be true in all material respects
for any time before the Closing Date.


 






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10.9       Further
Assurances. Take, and cause each other Loan Party and each Subsidiary of any Loan Party to take, such actions as are necessary
or as Administrative Agent or the Required Lenders may reasonably request from time to time to ensure that the Obligations of
each Loan Party under the Loan Documents are secured by a first priority perfected Lien in favor of Administrative Agent (subject
to Permitted Liens) on substantially all of the assets of Borrower and each Loan Party (as well as all Capital Securities of each
domestic Subsidiary, all Capital Securities of each first-tier foreign Subsidiary that is not a CFC, and with respect to any first-tier
foreign Subsidiary that is a CFC, 100% of all non-voting Capital Securities and 65% of all voting Capital Securities) and guaranteed
by each Loan Party (including, immediately upon the acquisition or creation thereof (or such longer period as the Administrative
Agent may provide in its sole discretion), any Subsidiary acquired or created after the Closing Date), in each case as Administrative
Agent may determine, including (a) the execution and delivery of guaranties, security agreements, pledge agreements, mortgages,
deeds of trust, financing statements, opinions of counsel and other documents, in each case in form and substance reasonably satisfactory
to Administrative Agent, and the filing or recording of any of the foregoing, (b) the delivery of certificated securities
and other Collateral with respect to which perfection is obtained by possession, and (c) with respect to any real property acquired
by any Loan Party after the Closing Date, the delivery within thirty (30) days after the date such real property was acquired
(or such longer period as the Administrative Agent may provide in its sole discretion) of each of the Real Estate Documents with
respect to such real property.


 


10.10       Accounts.
Unless Administrative Agent otherwise consents in writing, in order to facilitate Administrative Agent’s and the Lenders’
maintenance and monitoring of their security interests in the Collateral, maintain all of their deposit accounts and securities
accounts (a) with an institution that has entered into a control agreement with Administrative Agent and the applicable Loan Party
granting “control” (as defined in the UCC) of such accounts to Administrative Agent and otherwise in form and substance
satisfactory to Administrative Agent, and (b) in a structure acceptable to Administrative Agent. For the avoidance of doubt, all
receivables of each Loan Party shall be deposited into a deposit account that meets the requirements of this Section 10.10.


 


10.11       Post-Closing
Covenants. Borrower shall satisfy the requirements and/or provide to the Administrative Agent each of the documents, instruments,
agreements and information set forth on Schedule 10.11, in form and substance acceptable to the Administrative Agent, on
or before the date specified for such requirement in such Schedule or such later date to be determined by the Administrative Agent
in its sole discretion, each of which shall be completed or provided in form and substance satisfactory to the Administrative
Agent.


 


Section 11NEGATIVE
COVENANTS


 


Until all Obligations
hereunder and under the other Loan Documents are paid in full, Borrower agrees that, unless at any time the Required Lenders shall
otherwise expressly consent in writing, it will:


 


11.1       Debt.
Not, and not permit any other Loan Party or any Subsidiary of any Loan Party to, create, incur, assume or suffer to exist any
Debt, except:


 






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(a)       Obligations
under this Agreement and the other Loan Documents;


 


(b)       Debt
secured by Liens permitted by Section 11.2(d), and extensions, renewals and refinancings thereof; provided that
the aggregate amount of all such Debt at any time outstanding shall not exceed $100,000;


 


(c)       Debt
of Borrower to any domestic Wholly-Owned Subsidiary or Debt of any Subsidiary to Borrower or a domestic Wholly-Owned Subsidiary
of the Borrower; provided that such Debt shall be evidenced by a demand note in form and substance reasonably satisfactory
to Administrative Agent and pledged and delivered to Administrative Agent pursuant to the Collateral Documents as additional collateral
security for the Obligations, and the obligations under such demand note shall be subordinated to the Obligations of Borrower hereunder
in a manner reasonably satisfactory to Administrative Agent;


 


(d)       Debt
described on Schedule 11.1 and any extension, renewal or refinancing thereof so long as the principal amount thereof
is not increased or the maturity thereof shortened;


 


(e)       Debt
permitted by Section 11.15 between Borrower and a foreign Subsidiary subject to the Intercompany Subordination Agreement;
and


 


(f)       Contingent
Liabilities arising with respect to customary indemnification obligations in favor of purchasers in connection with dispositions
not otherwise prohibited under this Agreement or any of the Loan Documents.


 


11.2       Liens.
Not, and not permit any other Loan Party or any Subsidiary of any Loan Party to, create or permit to exist any Lien on any
of its real or personal properties, assets or rights of whatsoever nature (whether now owned or hereafter acquired),
except:


 


(a)       Liens
for taxes or other governmental charges not at the time delinquent or thereafter payable without penalty or being diligently contested
in good faith by appropriate proceedings and, in each case, for which it maintains adequate reserves in accordance with GAAP and
the execution or other enforcement of which is effectively stayed;


 


(b)       Liens
arising in the ordinary course of business (such as (i) Liens of carriers, warehousemen, mechanics and materialmen and other
similar Liens imposed by law and (ii) Liens in the form of deposits or pledges incurred in connection with worker’s
compensation, unemployment compensation and other types of social security (excluding Liens arising under ERISA) or in connection
with surety bonds, bids, performance bonds and similar obligations) for sums not overdue or being diligently contested in good
faith by appropriate proceedings and not involving any advances or borrowed money or the deferred purchase price of property or
services and, in each case, for which it maintains adequate reserves in accordance with GAAP and the execution or other enforcement
of which is effectively stayed;


 


(c)       Liens
described on Schedule 11.2 as of the Closing Date;


 






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(d)       subject
to the limitation set forth in Section 11.1(b), (i) Liens arising in connection with Capital Leases (and attaching
only to the property being leased for the Capital Leases described on Schedule 11.2), and (ii) Liens that constitute
purchase money security interests on any property securing debt incurred for the purpose of financing all or any part of the cost
of acquiring such property, provided that any such Lien attaches to such property within 20 days of the acquisition thereof
and attaches solely to the property so acquired;


 


(e)       attachments,
appeal bonds, judgments and other similar Liens, for sums not exceeding $100,000 arising in connection with court proceedings,
provided the execution or other enforcement of such Liens is effectively stayed and the claims secured thereby are being
actively contested in good faith and by appropriate proceedings;


 


(f)       easements,
rights of way, restrictions, minor defects or irregularities in title and other similar Liens not interfering in any material respect
with the ordinary conduct of the business of any Loan Party or any Subsidiary of any Loan Party; and


 


(g)       Liens
arising under the Loan Documents.


 


Notwithstanding anything
contained herein to the contrary, no Loan Party shall create or permit to exist any Lien on (x) any real or personal properties,
assets or rights of whatsoever nature (whether now owned or hereafter acquired) of any foreign Subsidiary, or (y) any Capital Securities
issued by any foreign Subsidiary (other than Liens arising under the Loan Documents).


 


11.3       Operating
Leases. Not permit the aggregate amount of all rental payments under Operating Leases made (or scheduled to be made) by the
Loan Parties and their Subsidiaries (on a consolidated basis) to exceed $1,500,000 in a Fiscal Year.


 


11.4       Restricted
Payments. Not, and not permit any other Loan Party or any Subsidiary of any Loan Party to, (a) make any distribution
to any holders of its Capital Securities, (b) purchase or redeem any of its Capital Securities (except in connection with
the exercise or vesting of equity awards in accordance with the terms of such awards), (c) pay any management fees, transaction-based
fees or similar fees to any of its equity holders or any Affiliate thereof, (d) make any redemption, prepayment (whether
mandatory or optional), defeasance, repurchase or any other payment in respect of any Debt or (e) set aside funds for any
of the foregoing; except that (i) any Subsidiary of Borrower may declare and pay dividends to the Borrower or any domestic Wholly-Owned
Subsidiary of Borrower, (ii) a Loan Party may purchase or redeem any of its Capital Securities from an officer, employee, consultant,
manager and director in connection with the termination of employment or engagement of any such Person so long as (x) no Default
or Event of Default has occurred and is continuing or would result therefrom, (y) the such redemptions and repurchases are for
the lesser of fair market value and cost, and (z) the aggregate amount in respect of all such redemptions and repurchases does
not exceed $100,000 in any Fiscal Year, and (iii) Each of Qumu Ltd., Qumu UK Limited and Qumu UK Holdings may make loans to, make
Investments in, declare and pay dividends to or otherwise transfer funds to one another, so long as such loans, dividends and
Investments are reported to


 






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Administrative Agent on a monthly basis and in detail reasonably satisfactory to Administrative Agent.


 


11.5       Mergers,
Consolidations, Sales. Not, and not permit any other Loan Party or any Subsidiary of any Loan Party to (a) be a party
to any merger or consolidation, (b) sell, transfer, dispose of, convey or lease any of its assets or Capital Securities (including
the sale of Capital Securities of any Subsidiary) except for (x) sales of inventory in the ordinary course of business and (y)
the issuance of Capital Securities of the Borrower, (c) license or dispose of any intellectual property other than (x) non-exclusive
licenses of intellectual property of any Loan Party in the ordinary course of business (for the avoidance of doubt licenses to
a competitor of the Loan Parties shall be deemed outside of the ordinary course of business) and (y) a Permitted Exclusive License,
provided, that each such license in clauses (x) and (y) does not materially impair the value of such intellectual property as
collateral for the Obligations, or (d) sell or assign with or without recourse any receivables, except for (i) any such
merger, consolidation, sale, transfer, conveyance, lease or assignment of or by any domestic Wholly-Owned Subsidiary into Borrower
or into any other domestic Wholly-Owned Subsidiary; and (ii) any such purchase or other acquisition (x) by a Loan Party of
the assets or Capital Securities of any domestic Wholly-Owned Subsidiary, or (y) by a foreign Subsidiary of the assets or Capital
Securities of another foreign Subsidiary.


 


11.6       Modification
of Organizational Documents. Not permit the charter, by-laws or other organizational documents of any Loan Party or any of
their respective Subsidiaries to be amended or modified in any way which could reasonably be expected to materially adversely
affect the interests of the Lenders; not change, or allow any Loan Party or any of their respective Subsidiaries to change, its
state of formation or its organizational form.


 


11.7       Transactions
with Affiliates. Not, and not permit any other Loan Party or any of their respective Subsidiaries to, enter into, or cause,
suffer or permit to exist any transaction, arrangement or contract with any of its other Affiliates (other than the Loan Parties)
which is on terms which are less favorable than are obtainable from any Person which is not one of its Affiliates.


 


11.8       Unconditional
Purchase Obligations. Not, and not permit any other Loan Party or any of their Subsidiaries to, enter into or be a party to
any contract for the purchase of materials, supplies or other property or services if such contract requires that payment be made
by it regardless of whether delivery is ever made of such materials, supplies or other property or services.


 


11.9       Inconsistent
Agreements. Not, and not permit any other Loan Party or any of their Subsidiaries to, enter into any agreement containing
any provision which would (a) be violated or breached by any borrowing by Borrower hereunder or by the performance by any
Loan Party of any of its Obligations hereunder or under any other Loan Document, (b) prohibit any Loan Party or any of its
Subsidiaries from granting to Administrative Agent and the Lenders, a Lien on any of its assets or (c) create or permit to
exist or become effective any encumbrance or restriction on the ability of any Subsidiary to (i) pay dividends or make other
distributions to Borrower or any other Subsidiary, or pay any Debt owed to Borrower or any other Subsidiary, (ii) make loans
or advances to any Loan Party or (iii) transfer any of its assets or properties to


 






    	 45



     


    

 


any Loan Party, other than (a) customary
restrictions and conditions contained in agreements relating to the sale of all or a substantial part of the assets of any Subsidiary
pending such sale, provided that such restrictions and conditions apply only to the Subsidiary to be sold and such sale
is permitted hereunder (b) restrictions or conditions imposed by any agreement relating to purchase money Debt, Capital Leases
and other secured Debt permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing
such Debt and (c) customary provisions in leases and other contracts restricting the assignment thereof.


 


11.10       Business
Activities; Issuance of Equity. Not, and not permit any other Loan Party or any Subsidiary to, engage in any line of business
other than the businesses engaged in on the date hereof and businesses reasonably related thereto. Not, and not permit any Loan
Party (other than Borrower) or any Subsidiary to, issue any Capital Securities other than any issuance by a Subsidiary to Borrower
or another Subsidiary in accordance with Section 11.4.


 


11.11       Investments.
Not, and not permit any other Loan Party or any Subsidiary to, make or permit to exist any Investment in any other Person, except
the following:


 


(a)       contributions
by Borrower to the capital of any domestic Wholly-Owned Subsidiary in existence on the Closing Date, or by any Subsidiary to the
capital of any other domestic Wholly-Owned Subsidiary in existence on the Closing Date, so long as the recipient of any such capital
contribution has guaranteed the Obligations and such guaranty is secured by a pledge of all of its Capital Securities and substantially
all of its real and personal property, in each case in accordance with Section 10.9;


 


(b)       Investments
constituting Debt permitted by Section 11.1;


 


(c)       Contingent
Liabilities constituting Debt permitted by Section 11.1 or Liens permitted by Section 11.2;


 


(d)       Cash
Equivalent Investments;


 


(e)       Subject
to Section 10.10, bank deposits in the ordinary course of business;


 


(f)       Investments
in securities of Account Debtors received pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or
insolvency of such Account Debtors; and


 


(g)       Investments
listed on Schedule 11.11 existing as of the Closing Date.


 


provided that (x) any Investment
which when made complies with the requirements of the definition of the term Cash Equivalent Investment may continue to be held
notwithstanding that such Investment if made thereafter would not comply with such requirements; (y) no Investment otherwise
permitted by clause (b) or (c) shall be permitted to be made if, immediately before or after giving effect thereto, any Default
or Event of Default exists.


 


11.12       Fiscal
Year. Not change its or any Loan Party’s or any of their respective Subsidiaries’ Fiscal Year.


 






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11.13       Financial
Covenants.


 


11.13.1       Maximum
Cumulative Net Cash Operating Amount. Not permit the Cumulative Net Cash Operating Amount as of the last day of any Fiscal
Quarter to exceed $(5,000,000) (negative) (excluding any Interest Expense), provided that the Cumulative Net Cash Operating Amount
shall be prorated for the number of days in the Fiscal Quarter in which the Closing Date occurs.


 


11.13.2       Minimum
Eligible Accounts and Cash. Not permit the sum of (x) the cash denominated in Dollars (which is held by the Loan Parties in
compliance with the terms in Section 10.10 of this Agreement in a deposit account in the United States) and (y) the face
amount of Eligible Accounts (which are reduced by a prorated allocation of the current outstanding balance of Allowance for Doubtful
Accounts general reserve) as of the last day of any fiscal month to be less than 100% of the outstanding Obligations.


 


11.13.3       Minimum
Cash. Not permit the cash denominated in Dollars (which is held by the Loan Parties in compliance with the terms in Section
10.10 of this Agreement in a deposit account in the United States) at any time to be less than $4,000,000.


 


11.13.4       Minimum
Core Bookings. Not permit the sum of Core Bookings as of the last day of any Computation Period to be less than $10,000,000
for such Computation Period. For the purpose of calculating such Core Bookings, Core Bookings shall be reduced by the aggregate
amount of any reversals and negative adjustments affecting Core Bookings in such Computation Period.


 


11.13.5       Maximum
Deferred Revenue Non-Current. Not permit Deferred Revenue Non-Current as of the last day of any Fiscal Quarter to be greater
than 20% of Deferred Revenue (inclusive of Deferred Revenue Non-Current).


 


11.13.5.     
Minimum Subscription and Maintenance and Support Revenue. Not permit the aggregate Subscription and Maintenance and Support
Revenue as of the last day of any Computation Period to be less than $18,000,000 for such Computation Period, provided that, this
covenant shall be tested for each Fiscal Quarter following the Closing Date and through but not including the Fiscal Quarter ending
September 30, 2017.


 


11.13.6       Subscription
and Maintenance and Support Dollar Renewal Rates. Beginning with the Fiscal Quarter ending September 30, 2017, not permit the
Subscription and Maintenance and Support Dollar Renewal Rates as of the last day of any Fiscal Quarter to fall below 80%.


 


11.14       Cancellation
of Debt. Not, and not permit any other Loan Party or any of their respective Subsidiaries to, cancel any claim or debt owing
to it, except for reasonable consideration or in the ordinary course of business, and except for the cancellation of debts or
claims not to exceed $100,000 in any Fiscal Year.


 






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11.15       Transfer
to Foreign Subsidiaries. Borrower shall not, and shall not permit any of the Loan Parties to, sell, transfer, assign (by operation
of law or otherwise), distribute, loan, advance, invest or otherwise dispose of, any money, assets or property in or to any foreign
Subsidiary, except for loans of not greater than (i) $150,000 for the period from the Closing Date through December 31, 2016,
and (ii) $500,000 per Fiscal Year thereafter. Any such intercompany loan shall be (i) evidenced by a note and owed to a Loan Party,
(ii) delivered to Administrative Agent either endorsed in blank or together with an undated instrument of transfer executed in
blank by the applicable Loan Party(s) that are the payee(s) on such note and (iii) any such loan is subordinated pursuant to the
Intercompany Subordination Agreement.


 


11.16       Compliance
with Laws. Borrower shall not, and shall not permit any of the Loan Parties or any of their respective Subsidiaries, to fail
to comply with the laws, regulations and executive orders referred to in Sections 9.25 and 9.26.


 


11.17       Maintenance
and Hosted Service Agreements. The Loan Parties and their Subsidiaries shall not without the
prior written consent of the Administrative Agent in each case, solicit or otherwise incent customers or others to accelerate
any payments which were not currently due under any maintenance agreement, service agreement, statement of work, master service
agreement, hardware agreement, hosted service agreement, license agreement, or contract.


 


11.18       Certain
Foreign Subsidiaries. Not permit any of Qumu Japan, Qumu Middle East and Qumu Singapore to incur any liabilities in excess
of $500,000 in the aggregate at any time, own or acquire any assets or Capital Securities other than de minimis amounts of assets
incidental to the conduct of their business and not permit Qumu Japan, Qumu Middle East and Qumu Singapore, taken as a whole,
to have gross revenue in excess of $1,000,000 for the immediately preceding twelve (12) fiscal months, provided however, such
limitation shall not apply to the extent the Loan Parties take such actions as further described in Section 10.9 hereof
as reasonably requested by the Administrative Agent with respect to a pledge of the Capital Securities of Qumu Japan, Qumu Middle
East and Qumu Singapore.


 


Section 12EFFECTIVENESS;
CONDITIONS OF LENDING, ETC.


 


The obligation of each
Lender to make its Term Loan on the Closing Date is subject to the satisfaction of the following conditions precedent:


 


12.1       Term
Loans. The obligation of the Lenders to make the Term Loans is, subject to the conditions precedent that Administrative
Agent shall have received all of the following, each duly executed and dated the Closing Date (or such earlier date as shall be
satisfactory to Administrative Agent), in form and substance satisfactory to Administrative Agent (and the date on which all such
conditions precedent have been satisfied or waived in writing by Administrative Agent and the Lenders is called the “Closing
Date”)(for the avoidance of doubt funding of the Term Loans by the Lenders deemed satisfaction of the following unless
set forth on Schedule 10.11):


 






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12.1.1       Agreement,
Term Notes and other Loan Documents. This Agreement and, to the extent requested by any Lender, a Term Note made payable to
such Lender, and all other Loan Documents.


 


12.1.2       Authorization
Documents. For each Loan Party, such Person’s (a) charter (or similar formation document), certified by the appropriate
governmental authority; (b) good standing certificates in its state of incorporation (or formation) and in each other state
requested by Administrative Agent; (c) bylaws (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 Loan Documents
to which it is party and the transactions contemplated thereby; and (e) signature and incumbency certificates of its officers
executing any of the Loan Documents (it being understood that Administrative Agent and each Lender may conclusively rely on each
such certificate until formally advised by a like certificate of any changes therein), all certified by its secretary or an assistant
secretary (or similar officer) as being in full force and effect without modification.


 


12.1.3       Consents,
etc. Certified copies of all documents evidencing any necessary corporate or partnership action, consents and governmental
approvals (if any) required for the execution, delivery and performance by the Loan Parties of the documents referred to in this
Section 12.


 


12.1.4       Letter
of Direction. A letter of direction containing funds flow information with respect to the proceeds of the Term Loans on the
Closing Date.


 


12.1.5       Guaranty
and Collateral Agreement. A counterpart of the Guaranty and Collateral Agreement executed by each Loan Party, together with
all instruments, transfer powers and other items required to be delivered in connection therewith.


 


12.1.6       Perfection
Certificate. A Perfection Certificate completed and executed by each Loan Party.


 


12.1.7       Collateral
Access Agreements.


 


(a)       In
the case of any leased real property for which Administrative Agent requires a Collateral Access Agreement, a Collateral Access
Agreement from the landlord of such property waiving any landlord’s Lien in respect of personal property kept at the premises
subject to such lease.


 


(b)       A
Collateral Access Agreement with respect to each bailee with which Borrower or any Subsidiary keeps Inventory or other assets that
are required under the Guaranty and Collateral Agreement to be delivered on the Closing Date.


 


12.1.8       Control
Agreements. All deposit account control agreements and securities account control agreements that are required under the Guaranty
and Collateral Agreement to be delivered on the Closing Date.


 






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12.1.9         Opinions
of Counsel. Opinions of counsel for each Loan Party reasonably requested by Administrative Agent.


 


12.1.10       Insurance.
Evidence of the existence of insurance required to be maintained pursuant to Section 10.3(b), together with evidence
that Administrative Agent has been named as a lender’s loss payee and an additional insured on all related insurance policies.


 


12.1.11       Payment
of Fees. Evidence of payment by Borrower of all accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Closing Date, together with all Attorney Costs of Administrative Agent to the extent invoiced prior to the Closing Date,
plus such additional amounts of Attorney Costs as shall constitute Administrative Agent’s reasonable estimate of Attorney
Costs incurred or to be incurred by Administrative Agent through the closing proceedings (provided that such estimate shall not
thereafter preclude final settling of accounts between Borrower and Administrative Agent).


 


12.1.12       Solvency
Certificate. A solvency certificate executed by a Senior Officer of Borrower.


 


12.1.13       Pro
Forma Financial Statements. A consolidated pro forma balance sheet of Borrower as at the Closing Date, adjusted to
give effect to the consummation of the financings contemplated hereby as if such transactions had occurred on such date,
consistent in all material respects with the sources and uses of cash as previously described to the Lenders and the
forecasts previously provided to the Lenders.


 


12.1.14       Reports.
Administrative Agent shall have received and been reasonably satisfied with such Bookings Report and Deferred Revenue Report calculated
as of August 31, 2016.


 


12.1.15       Search
Results; Lien Terminations. Certified copies of Uniform Commercial Code search reports dated a date reasonably near to the
Closing Date, listing all effective financing statements which name any Loan Party (under their present names and any previous
names) as debtors, together with (a) copies of such financing statements, (b) termination of all agreements relating thereto
and the release of Liens granted in connection therewith, with Uniform Commercial Code or other appropriate termination statements
and documents effective to evidence the foregoing (other than Liens permitted by Section 11.2), and (c) such other
Uniform Commercial Code termination statements as Administrative Agent may reasonably request.


 


12.1.16       Filings,
Registrations and Recordings. Administrative Agent shall have received each document (including Uniform Commercial Code financing
statements) required by the Collateral Documents or under law or reasonably requested by Administrative Agent to be filed, registered
or recorded in order to create in favor of Administrative Agent, for the benefit of the Lenders, a perfected Lien on the collateral
described therein, prior to any other Liens (subject only to Liens permitted pursuant to Section 11.2), in proper
form for filing, registration or recording.


 






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12.1.17       Closing
Certificate, Consents and Permits. A certificate executed by an officer of Borrower on behalf of Borrower certifying the matters
set forth in Section 12.2 and certain other matters requested by the Administrative Agent as of the Closing Date.


 


12.1.18       Financial
Statements. Administrative Agent shall have received and been reasonably satisfied with such financial statements of Loan
Parties requested by Administrative Agent, including, without limitation, through the most recent year-to-date interim period.


 


12.1.19       No
Material Adverse Change. There shall not have occurred since December 31, 2015, any developments or events which individually
or in the aggregate with other such circumstances has had or could reasonably be expected to have a Material Adverse Effect.


 


12.1.20       Investment
Documents. The Administrative Agent shall have received confirmation of ownership and capital structure of the Loan Parties
and be satisfied with the constituent documents of the Loan Parties and related investment agreements. Hale Capital or its Affiliate
shall have received a warrant, in the form of Exhibit D, for the purchase of common Capital Securities of Borrower (the
“Warrant”).


 


12.1.21       Employment
Agreements. Receipt by the Administrative Agent of employment agreements for certain key management of Borrower duly executed
and delivered by each party thereto, in each case, in form and substance satisfactory to the Administrative Agent.


 


12.1.22       [Reserved].


 


12.1.23       Diligence.
The Administrative Agent shall have received all due diligence materials as Administrative Agent has requested and Administrative
Agent shall have found such due diligence satisfactory to it, including, without limitation, Significant Contracts, service contracts,
orders and existing backlog.


 


12.1.24       Condition.
Administrative Agent shall have completed a satisfactory examination of the condition of the Loan Parties, including, without
limitation, review of (a) the books, records and assets of the Loan Parties, (b) a special purpose review of the Loan Parties’
historical cash flow, conducted by a firm and in form and substance acceptable to Administrative Agent.


 


12.1.25       Background
Checks. Administrative Agent shall have reviewed and shall have been satisfied with background checks on certain key management
of Loan Parties.


 


12.1.26       Approvals.
Administrative Agent shall have received approval of its executive credit committee.


 


12.1.27       [Reserved].


 






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12.1.28       Source
Code Escrow. Administrative Agent and Borrower shall have entered into a third party source code escrow agreement satisfactory
to Administrative Agent in its reasonable discretion.


 


12.1.29       Other.
Such other documents as Administrative Agent or any Lender may reasonably request.


 


12.2       Compliance
with Warranties, No Default, etc. Both before and after giving effect to the borrowing of the Term Loans, the following statements
shall be true and correct and certified to the Administrative Agent in a certificate signed by a duly authorized representative
of Borrower:


 


(a)       the
representations and warranties of each Loan Party set forth in this Agreement and the other Loan Documents shall be true and correct
in all respects with the same effect as if then made (except to the extent stated to relate to a specific earlier date, in which
case such representations and warranties shall be true and correct as of such earlier date);


 


(b)       no
Default or Event of Default shall have then occurred and be continuing; and


 


(c)       the
Loan Parties shall be in compliance on a pro forma basis with the financial covenants set forth in Section 11.13 (other
than Section 11.13.1 and after giving effect to the funding of the Term Loans with respect to Sections 11.13.2 and
11.13.3) computed using the covenant levels and financial information for the most recently ended month or Fiscal Quarter,
whichever is applicable, for which information is available.


 


Section 13EVENTS
OF DEFAULT AND THEIR EFFECT.


 


13.1       Events
of Default. Each of the following shall constitute an Event of Default under this Agreement:


 


13.1.1       Non-Payment
of the Term Loans, etc. Default in the payment when due of the principal of any Term Loan; or default, and continuance thereof
for three Business Days, in the payment when due of any interest, fee, or other amount payable by any Loan Party hereunder or
under any other Loan Document.


 


13.1.2       Non-Payment
of Other Debt. Any default shall occur under the terms applicable to any Debt of any Loan Party or any Subsidiary of any Loan
Party in an aggregate amount (for all such Debt so affected and including undrawn committed or available amounts and amounts owing
to all creditors under any combined or syndicated credit arrangement) exceeding $100,000 and such default shall (a) consist
of the failure to pay such Debt when due, whether by acceleration or otherwise, or (b) accelerate the maturity of such Debt
or permit the holder or holders thereof, or any trustee or agent for such holder or holders, to cause such Debt to become due
and payable (or require any Loan Party or any Subsidiary of any Loan Party to purchase or redeem such Debt or post cash collateral
in respect thereof) prior to its expressed maturity.


 






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13.1.3       Other
Material Obligations. Default in the payment when due, or in the performance or observance of, any material obligation of,
or condition agreed to by, any Loan Party or any Subsidiary of any Loan Party with respect to any material purchase or lease of
goods or services where such default, singly or in the aggregate with all other such defaults, might reasonably be expected to
have a Material Adverse Effect.


 


13.1.4       Bankruptcy,
Insolvency, etc. Any Loan Party or any Subsidiary of any Loan Party becomes insolvent or generally fails to pay, or admits
in writing its inability or refusal to pay, debts as they become due; or any Loan Party or any Subsidiary of any Loan Party applies
for, consents to, or acquiesces in the appointment of a trustee, receiver or other custodian for such Loan Party or such Subsidiary
or any property thereof, or makes a general assignment for the benefit of creditors; or, in the absence of such application, consent
or acquiescence, a trustee, receiver or other custodian is appointed for any Loan Party or any Subsidiary of any Loan Party or
for a substantial part of the property of any thereof and is not discharged within 60 days; or any bankruptcy, reorganization,
debt arrangement, or other case or proceeding under any bankruptcy or insolvency law, or any dissolution or liquidation proceeding,
is commenced in respect of any Loan Party or any Subsidiary of any Loan Party, and if such case or proceeding is not commenced
by such Loan Party or such Subsidiary, it is consented to or acquiesced in by such Loan Party or such Subsidiary, or remains for
60 days undismissed; or any Loan Party or any Subsidiary of any Loan Party takes any action to authorize, or in furtherance of,
any of the foregoing.


 


13.1.5       Non-Compliance
with Loan Documents. (a) Failure by any Loan Party to comply with or to perform any covenant set forth in Sections 10.1,
10.2, 10.3(b), 10.5, 10.6, 10.11, or Section 11; or (b) failure by any Loan
Party to comply with or to perform any other provision of this Agreement or any other Loan Document (and not constituting an Event
of Default under any other provision of this Section 13) and continuance of such failure described in this clause (b) for 15 days.


 


13.1.6       Representations;
Warranties. Any representation or warranty made by any Loan Party or any Subsidiary of any Loan Party herein or any other
Loan Document is breached or is false or misleading in any material respect, or any schedule, certificate, financial statement,
report, notice or other writing furnished by any Loan Party or any Subsidiary of any Loan Party to Administrative Agent or any
Lender in connection herewith is false or misleading in any material respect on the date as of which the facts therein set forth
are stated or certified.


 


13.1.7       Pension
Plans. (a) Any Person institutes steps to terminate a Pension Plan if as a result of such termination Borrower or any
member of the Controlled Group could be required to make a contribution to such Pension Plan, or could incur a liability or obligation
to such Pension Plan, in excess of $100,000; (b) a contribution failure occurs with respect to any Pension Plan sufficient
to give rise to a Lien under Section 302(f) of ERISA; (c) the Unfunded Liability exceeds twenty percent of the Total
Plan Liability; or (d) there shall occur any withdrawal or partial withdrawal from a Multiemployer Pension Plan and the withdrawal
liability (without unaccrued interest) to Multiemployer Pension Plans as a result of such withdrawal (including any outstanding


 






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withdrawal liability that Borrower or any member of the Controlled Group have incurred on the date of such withdrawal) exceeds
$100,000.


 


13.1.8       Judgments.
Final judgments which exceed an aggregate of $100,000 (to the extent not covered by independent third-party insurance as to which
the insurer does not dispute coverage) shall be rendered against any Loan Party or any Subsidiary of any Loan Party and shall
not have been paid, discharged or vacated or had execution thereof stayed pending appeal within 30 days after entry or filing
of such judgments.


 


13.1.9       Invalidity
of Collateral Documents, etc. Any Collateral Document shall cease to be in full force and effect; or any Loan Party or any
Subsidiary of any Loan Party (or any Person by, through or on behalf of any Loan Party or any Subsidiary of any Loan Party) shall
contest in any manner the validity, binding nature or enforceability of any Collateral Document.


 


13.1.10       Public
Company Failure. Borrower’s SEC reporting obligations under the Securities Exchange Act of 1934, as amended, are terminated
or Borrower’s Capital Securities are delisted from The Nasdaq Stock Market and not listed on any other national stock exchange
(for the avoidance of doubt a “national stock exchange” shall not include OTC Bulletin Board or any other similar
over the counter exchange).


 


13.1.11       Material
Adverse Effect. The occurrence of any event having a Material Adverse Effect.


 


13.1.12       Cessation
of Business. If any Loan Party or any Subsidiary is enjoined, restrained, or in any way prevented by court order from continuing
to conduct all or any material part of its business.


 


13.2       Effect
of Event of Default. If any Event of Default described in Section 13.1.4 shall occur in respect of Borrower, the
Term Loans and all other Obligations hereunder shall become immediately due and payable, all without presentment, demand, protest
or notice of any kind; and, if any other Event of Default shall occur and be continuing, Administrative Agent may (and, upon the
written request of the Required Lenders shall) declare all or any part of the Term Loans and all other Obligations hereunder to
be due and payable, whereupon the Term Loans and other Obligations hereunder shall become immediately due and payable, all without
presentment, demand, protest or notice of any kind. Administrative Agent shall promptly advise Borrower of any such declaration,
but failure to do so shall not impair the effect of such declaration.


 






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13.3       Credit
Bidding. The Loan Parties and the Lenders hereby irrevocably authorize (and by entering into a Bank Product Agreement, each
Bank Product provider shall be deemed to authorize) Administrative Agent, based upon the instruction of the Required Lenders,
to Credit Bid and purchase (either directly or through one or more acquisition vehicles) all or any portion of the Collateral
(and the Loan Parties shall approve Administrative Agent as a qualified bidder and such Credit Bid as qualified bid) at any sale
thereof conducted by Administrative Agent, based upon the instruction of the Required Lenders, under any provisions of the Uniform
Commercial Code, as part of any sale or investor solicitation process conducted by any Loan Party, any interim receiver, receiver,
receiver and manager, administrative receiver, trustee, agent or other Person pursuant or under any insolvency laws; provided,
however, that (i) the Required Lenders may not direct Administrative Agent in any manner that does not treat each of the
Lenders equally, without preference or discrimination, in respect of consideration received as a result of the Credit Bid, (ii) the
acquisition documents shall be commercially reasonable and contain customary protections for minority holders, such as, among
other things, anti-dilution and tag-along rights, (iii) the exchanged debt or equity securities must be freely transferable,
without restriction (subject to applicable securities laws) and (iv) reasonable efforts shall be made to structure the acquisition
in a manner that causes the governance documents pertaining thereto to not impose any obligations or liabilities upon the Lenders
individually (such as indemnification obligations).


 


For purposes of the
preceding sentence, the term “Credit Bid” shall mean, an offer submitted by Administrative Agent (on behalf
of the Lender group), based upon the instruction of the Required Lenders, to acquire the property of any Loan Party or any portion
thereof in exchange for and in full and final satisfaction of all or a portion (as determined by Administrative Agent, based upon
the instruction of the Required Lenders) of the claims and Obligations under this Agreement and other Loan Documents.


 


Section 14THE
AGENT.


 


14.1       Appointment
and Authorization. Each Lender hereby irrevocably (subject to Section 14.9) appoints, designates and authorizes
Administrative Agent to take such action on its behalf under the provisions of this Agreement and each other Loan Document and
to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary contained
elsewhere in this Agreement or in any other Loan Document, Administrative Agent shall not have any duty or responsibility except
those expressly set forth herein, nor shall Administrative Agent have or be deemed to have any fiduciary relationship with any
Lender or participant, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against Administrative Agent. Without limiting the generality
of the foregoing sentence, the use of the term “agent” herein and in other Loan Documents with reference to Administrative
Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any
applicable law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.


 






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14.2       Delegation
of Duties. Administrative Agent may execute any of its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of counsel and other consultants or experts concerning
all matters pertaining to such duties. Administrative Agent shall not be responsible for the negligence or misconduct of any agent
or attorney-in-fact that it selects in the absence of gross negligence or willful misconduct.


 


14.3       Exculpation
of Administrative Agent. None of Administrative Agent nor any of its directors, officers, employees or agents shall (a) be
liable for any action taken or omitted to be taken by any of them under or in connection with this Agreement or any other Loan
Document or the transactions contemplated hereby (except to the extent resulting from its own gross negligence or willful misconduct
in connection with its duties expressly set forth herein as determined by a final, nonappealable judgment by a court of competent
jurisdiction), or (b) be responsible in any manner to any Lender or participant for any recital, statement, representation
or warranty made by any Loan Party or Affiliate of Borrower, or any officer thereof, contained in this Agreement or in any other
Loan Document, or in any certificate, report, statement or other document referred to or provided for in, or received by Administrative
Agent under or in connection with, this Agreement or any other Loan Document, or the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document (or the creation, perfection or priority of any Lien or security interest
therein), or for any failure of Borrower or any other party to any Loan Document to perform its Obligations hereunder or thereunder.
Administrative Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance
of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of Borrower or any of Borrower’s Subsidiaries or Affiliates.


 


14.4       Reliance
by Administrative Agent. Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any
writing, communication, signature, resolution, representation, notice, consent, certificate, electronic mail message, affidavit,
letter, telegram, facsimile, telex or telephone message, statement or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or Persons, and upon advice and statements of legal counsel
(including counsel to Borrower), independent accountants and other experts selected by Administrative Agent. Administrative Agent
shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall
first receive such advice or concurrence of the Required Lenders as it deems appropriate and, if it so requests, confirmation
from the Lenders of their obligation to indemnify Administrative Agent against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action. Administrative Agent shall in all cases be fully protected
in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request or consent
of the Required Lenders and such request and any action taken or failure to act pursuant thereto shall be binding upon each Lender.
For purposes of determining compliance with the conditions specified in Section 12, each Lender that has signed this
Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless Administrative Agent shall have
received written notice from such Lender prior to the proposed Closing Date specifying its objection thereto.


 






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14.5       Notice
of Default. Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Event of Default
or Default except with respect to defaults in the payment of principal, interest and fees required to be paid to Administrative
Agent for the account of the Lenders, unless Administrative Agent shall have received written notice from a Lender or Borrower
referring to this Agreement, describing such Event of Default or Default and stating that such notice is a “notice of default”.
Administrative Agent will notify the Lenders of its receipt of any such notice. Administrative Agent shall take such action with
respect to such Event of Default or Default as may be requested by the Required Lenders in accordance with Section 13;
provided that unless and until Administrative Agent has received any such request, Administrative Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with respect to such Event of Default or Default as
it shall deem advisable or in the best interest of the Lenders.


 


14.6       Credit
Decision. Each Lender acknowledges that Administrative Agent has not made any representation or warranty to it, and that no
act by Administrative Agent hereafter taken, including any consent and acceptance of any assignment or review of the affairs of
the Loan Parties, shall be deemed to constitute any representation or warranty by Administrative Agent to any Lender as to any
matter, including whether Administrative Agent has disclosed material information in its possession. Each Lender represents to
Administrative Agent that it has, independently and without reliance upon Administrative Agent and based on such documents and
information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of the Loan Parties, and made its own decision to enter into this
Agreement and to extend credit to Borrower hereunder. Each Lender also represents that it will, independently and without reliance
upon Administrative Agent and based on such documents and information as it shall deem appropriate at the time, continue to make
its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of Borrower. Except for notices, reports and other documents expressly herein required
to be furnished to the Lenders by Administrative Agent, Administrative Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business, prospects, operations, property, financial or other condition
or creditworthiness of Borrower which may come into the possession of Administrative Agent.


 


14.7       Indemnification.
Whether or not the transactions contemplated hereby are consummated, each Lender shall indemnify upon demand Administrative Agent
and its directors, officers, employees and agents (to the extent not reimbursed by or on behalf of Borrower and without limiting
the obligation of Borrower to do so), according to its applicable Pro Rata Share, from and against any and all Indemnified Liabilities
(as hereinafter defined); provided that no Lender shall be liable for any payment to any such Person of any portion of
the Indemnified Liabilities to the extent determined by a final, nonappealable judgment by a court of competent jurisdiction to
have resulted from the applicable Person’s own gross negligence or willful misconduct. No action taken in accordance with
the directions of the Required Lenders shall be deemed to constitute gross negligence or willful misconduct for purposes of this
Section. Without limitation of the foregoing, each Lender shall reimburse Administrative Agent upon demand for its ratable share
of any costs or out-of-pocket expenses (including Attorney Costs


 






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and Taxes) incurred by Administrative Agent in connection with
the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Document,
or any document contemplated by or referred to herein, to the extent that Administrative Agent is not reimbursed for such expenses
by or on behalf of Borrower. The undertaking in this Section shall survive repayment of the Term Loans, cancellation of the
Term Notes, any foreclosure under, or modification, release or discharge of, any or all of the Collateral Documents, termination
of this Agreement and the resignation or replacement of Administrative Agent.


 


14.8       Administrative
Agent in Individual Capacity. Hale Capital and its Affiliates may make loans to, issue letters of credit for the account of,
accept deposits from, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with the Loan Parties and Affiliates as though Hale Capital were not Administrative Agent hereunder and without
notice to or consent of any Lender. Each Lender acknowledges that, pursuant to such activities, Hale Capital or its Affiliates
may receive information regarding Borrower or its Affiliates (including information that may be subject to confidentiality obligations
in favor of Borrower or such Affiliate) and acknowledges that Administrative Agent shall be under no obligation to provide such
information to them. With respect to their Term Loans (if any), Hale Capital and its Affiliates shall have the same rights and
powers under this Agreement as any other Lender and may exercise the same as though Hale Capital were not Administrative Agent,
and the terms “Lender” and “Lenders” include Hale Capital and its Affiliates, to the extent applicable,
in their individual capacities.


 


14.9       Successor
Administrative Agent. Administrative Agent may resign as Administrative Agent upon 30 days’ notice to the Lenders. If
Administrative Agent resigns under this Agreement, the Required Lenders shall, with (so long as no Default or Event of Default
exists) the consent of Borrower (which shall not be unreasonably withheld or delayed), appoint from among the Lenders a successor
agent for the Lenders. If no successor agent is appointed prior to the effective date of the resignation of Administrative Agent,
Administrative Agent may appoint, after consulting with the Lenders and Borrower, a successor agent from among the Lenders. Upon
the acceptance of its appointment as successor agent hereunder, such successor agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term “Administrative Agent” shall mean such successor agent, and
the retiring Administrative Agent’s appointment, powers and duties as Administrative Agent shall be terminated. After any
retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provisions of this Section 14 and Sections 15.5 and 15.17 shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was Administrative Agent under this Agreement. If no successor agent has accepted appointment as Administrative Agent
by the date which is 30 days following a retiring Administrative Agent’s notice of resignation, the retiring Administrative
Agent’s resignation shall nevertheless thereupon become effective and the Lenders shall perform all of the duties of Administrative
Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above.


 


14.10       Collateral
Matters. Each Lender authorizes and directs Administrative Agent to enter into the other Loan Documents for the benefit of
Lenders. Each Lender hereby agrees that, except as otherwise set forth herein, any action taken by Administrative Agent or Required


 






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Lenders in accordance with the provisions of this Agreement or the other Loan Documents, and the exercise by the Administrative
Agent or Required Lenders of the powers set forth herein or therein, together with such other powers as are reasonably incidental
thereto, shall be authorized and binding upon all Lenders. Administrative Agent is hereby authorized on behalf of all Lenders,
without the necessity of any notice to or further consent from any Lender to take any action with respect to any Collateral or
Loan Documents which may be necessary to perfect and maintain perfected the Liens upon the Collateral granted pursuant to this
Agreement and the other Loan Documents. The Lenders irrevocably authorize Administrative Agent, at its option and in its discretion,
(a) to release any Lien granted to or held by Administrative Agent under any Collateral Document (i) upon payment in
full of all Term Loans and all other outstanding obligations of Borrower hereunder; (ii) constituting property sold or to
be sold or disposed of as part of or in connection with any disposition permitted hereunder (including the release of any guarantor);
or (iii) subject to Section 15.1, if approved, authorized or ratified in writing by the Required Lenders; or
(b) to subordinate its interest in any Collateral to any holder of a Lien on such Collateral which is permitted by Section 11.2(d)(i) or (d)(iii) (it being understood that Administrative Agent may conclusively rely on a certificate from Borrower in
determining whether the Debt secured by any such Lien is permitted by Section 11.1(b)). Upon request by Administrative
Agent at any time, the Lenders will confirm in writing Administrative Agent’s authority to release, or subordinate its interest
in, particular types or items of Collateral pursuant to this Section 14.10.


 


14.11       Restriction
on Actions by Lenders. Each Lender agrees that it shall not, without the express written consent of Administrative Agent,
and shall, upon the written request of Administrative Agent (to the extent it is lawfully entitled to do so), set off against
the Obligations, any amounts owing by such Lender to a Loan Party or any deposit accounts of any Loan Party now or hereafter maintained
with such Lender. Each of the Lenders further agrees that it shall not, unless specifically requested to do so in writing by Administrative
Agent, take or cause to be taken, any action, including the a commencement of any legal or equitable proceedings to foreclose
any loan or otherwise enforce any security interest in any of the Collateral or to enforce all or any part of this Agreement or
the other Loan Documents. All enforcement actions under this Agreement and the other Loan Documents against the Loan Parties or
any third party with respect to the Obligations or the Collateral may only be taken by Administrative Agent (at the direction
of the Required Lenders or as otherwise permitted in this Agreement) or by its agents at the direction of Administrative Agent.


 


14.12       Administrative
Agent May File Proofs of Claim. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, Administrative Agent (irrespective
of whether the principal of any Term Loan shall then be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether Administrative Agent shall have made any demand on Borrower) shall be entitled and empowered, by intervention
in such proceeding or otherwise:


 


(a)       to
file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Term Loans, and all
other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have
the claims of the Lenders and Administrative Agent (including any claim for the


 






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reasonable compensation, expenses, disbursements
and advances of the Lenders and Administrative Agent and their respective agents and counsel and all other amounts due the Lenders
and Administrative Agent under Sections 5, 15.5 and 15.17) allowed in such judicial proceedings; and


 


(b)       to
collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;


 


and any custodian, receiver, assignee,
trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender
to make such payments to Administrative Agent and, in the event that Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to Administrative Agent any amount due for the reasonable compensation, expenses, disbursements
and advances of Administrative Agent and its agents and counsel, and any other amounts due Administrative Agent under Sections 5,
15.5 and 15.17.


 


Nothing contained herein
shall be deemed to authorize Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan
of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize
Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.


 


14.13       Other
Agents; Arrangers and Managers. None of the Lenders or other Persons identified on the facing page or signature pages
of this Agreement as a “syndication agent,” “documentation agent,” “co-agent,” “book
manager,” “lead manager,” “arranger,” “lead arranger” or “co-arranger”,
if any, shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than, in the case
of such Lenders, those applicable to all Lenders as such. Without limiting the foregoing, none of the Lenders or other Persons
so identified shall have or be deemed to have any fiduciary relationship with any Lender. Each Lender acknowledges that it has
not relied, and will not rely, on any of the Lenders or other Persons so identified in deciding to enter into this Agreement or
in taking or not taking action hereunder.


 


Section 15GENERAL.


 


15.1       Waiver;
Amendments. No delay on the part of Administrative Agent or any Lender in the exercise of any right, power or remedy shall
operate as a waiver thereof, nor shall any single or partial exercise by any of them of any right, power or remedy preclude other
or further exercise thereof, or the exercise of any other right, power or remedy. No amendment, modification or waiver of, or
consent with respect to, any provision of this Agreement or the other Loan Documents shall in any event be effective unless the
same shall be in writing and acknowledged by Lenders having an aggregate Pro Rata Shares of not less than the aggregate Pro Rata
Shares expressly designated herein with respect thereto or, in the absence of such designation as to any provision of this Agreement,
by the Required Lenders, and then any such amendment, modification, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. No amendment, modification, waiver or consent shall (a) extend or
increase the Term Loan Commitment of any Lender without the written consent of such Lender, (b) extend the date scheduled
for payment of any principal (excluding mandatory


 






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prepayments) of or interest on the Term Loans or any fees payable hereunder
without the written consent of each Lender directly affected thereby, (c) reduce the principal amount of any Term Loan, the
rate of interest thereon or any fees payable hereunder, without the consent of each Lender directly affected thereby; or (d) release
any guarantor from its obligations under the Guaranty and Collateral Agreement, other than as part of or in connection with any
disposition permitted hereunder, or all or any substantial part of the Collateral granted under the Collateral Documents (except
as permitted by Section 14.9), change the definition of Required Lenders, any provision of this Section 15.1,
any provision of Section 13.3 or reduce the aggregate Pro Rata Share required to effect an amendment, modification,
waiver or consent, without, in each case set forth in this clause (d), the written consent of all Lenders. No provision of Sections 6.1.2
or 6.2 with respect to the timing or application of mandatory prepayments of the Term Loans shall be amended, modified
or waived without the consent of Lenders having a majority of the aggregate Pro Rata Shares of the Term Loans affected thereby.
No provision of Section 14 or other provision of this Agreement affecting Administrative Agent in its capacity as
such shall be amended, modified or waived without the consent of Administrative Agent.


 


Notwithstanding the
foregoing, this agreement may be amended (or amended and restated) with the written consent of the Required Lenders, Administrative
Agent and Borrower (a) to add one or more additional credit facilities to this Agreement and to permit the extensions of credit
from time to time outstanding thereunder and the accrued interest and fees in respect thereof to share ratably in the benefits
of this Agreement and the other Loan Documents with the Term Loans and the accrued interest and fees in respect thereof and (b) to
include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders.


 


If, in connection with
any proposed amendment, modification, waiver or termination requiring the consent of all Lenders, the consent of the Required Lenders
is obtained, but the consent of other Lenders whose consent is required is not obtained (any such Lender whose consent is not obtained
being referred to as a “Non-Consenting Lender”), then, so long as Administrative Agent is not a Non-Consenting
Lender, Administrative Agent and/or a Person or Persons reasonably acceptable to Administrative Agent shall have the right to purchase
from such Non-Consenting Lenders, and such Non-Consenting Lenders agree that they shall, upon Administrative Agent’s request,
sell and assign to Administrative Agent and/or such Person or Persons, all of the Term Loans of such Non-Consenting Lenders for
an amount equal to the principal balance of all such Term Loans held by such Non-Consenting Lenders and all accrued interest, fees,
expenses and other amounts then due with respect thereto through the date of sale, such purchase and sale to be consummated pursuant
to an executed Assignment Agreement.


 


15.2       Confirmations.
Borrower and each holder of a Term Note agree from time to time, upon written request received by it from the other, to confirm
to the other in writing (with a copy of each such confirmation to Administrative Agent) the aggregate unpaid principal amount
of the Term Loans then outstanding under such Term Note.


 


15.3       Notices.
All notices hereunder shall be in writing (including facsimile transmission) and shall be sent to the applicable party at its
address shown on Annex B or at such other address as such party may, by written notice received by the other parties, have
designated as its address for such purpose. Notices sent by facsimile transmission shall be deemed to have been given when sent;
notices sent by mail shall be deemed to have been given three Business


 






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Days after the date when sent by registered or certified
mail, postage prepaid; and notices sent by hand delivery or overnight courier service shall be deemed to have been given when
received. Administrative Agent shall be entitled to rely on telephonic instructions from any person that Administrative Agent
in good faith believes is an authorized officer or employee of Borrower, and Borrower shall hold Administrative Agent and each
other Lender harmless from any loss, cost or expense resulting from any such reliance.


 


15.4       Computations.
Where the character or amount of any asset or liability or item of income or expense is required to be determined, or any consolidation
or other accounting computation is required to be made, for the purpose of this Agreement, such determination or calculation shall,
to the extent applicable and except as otherwise specified in this Agreement, be made in accordance with GAAP, consistently applied;
provided that if Borrower notifies Administrative Agent that Borrower wishes to amend any covenant in Sections 10
or 11.13 (or any related definition) to eliminate or to take into account the effect of any change in GAAP on the operation of
such covenant (or if Administrative Agent notifies Borrower that the Required Lenders wish to amend Sections 10 or 11.13
(or any related definition) for such purpose), then Borrower’s compliance with such covenant shall be determined on the
basis of GAAP in effect immediately before the relevant change in GAAP became effective, until either such notice is withdrawn
or such covenant (or related definition) is amended in a manner satisfactory to Borrower and the Required Lenders.


 


15.5       Costs,
Expenses and Taxes. Each Loan Party, jointly and severally agrees to pay on demand all reasonable out-of-pocket costs and
expenses of Administrative Agent (including Attorney Costs and any Taxes) in connection with the preparation, execution, syndication,
delivery and administration (including perfection and protection of any Collateral and the costs of Intralinks (or other similar
service), if applicable) of this Agreement, the other Loan Documents and all other documents provided for herein or delivered
or to be delivered hereunder or in connection herewith (including any amendment, supplement or waiver to any Loan Document), whether
or not the transactions contemplated hereby or thereby shall be consummated (in the case of out-of-pocket costs and expenses incurred
prior to the date hereof, up to a maximum of $165,000 with additional fees, if any, subject to the prior approval of Borrower
which approval shall not be unreasonably withheld), and all reasonable out-of-pocket costs and expenses (including Attorney Costs
and any Taxes) incurred by Administrative Agent and each Lender after an Event of Default in connection with the collection of
the Obligations or the enforcement of this Agreement the other Loan Documents or any such other documents or during any workout,
restructuring or negotiations in respect thereof. In addition, each Loan Party agrees to pay, and to save Administrative Agent
and the Lenders harmless from all liability for, any fees of Borrower’s auditors in connection with any reasonable exercise
by Administrative Agent and the Lenders of their rights pursuant to Section 10.2. All Obligations provided for in
this Section 15.5 shall survive repayment of the Term Loans, cancellation of the Term Notes, or termination of this
Agreement.


 


15.6       Assignments;
Participations.


 


15.6.1       Assignments.
(a) Any Lender may at any time assign to one or more Persons (any such Person, an “Assignee”) all or any
portion of such Lender’s Term Loans and Term Loan Commitments, with the prior written consent of Administrative


 






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Agent, and
Borrower (which consent of Borrower shall not be unreasonably withheld or delayed), provided, however, consent of Borrower shall
not be required (x) for an assignment by a Lender to a Lender or an Affiliate of a Lender or an Approved Fund, or, or (y) during
the existence of a Default or an Event of Default. Except as Administrative Agent may otherwise agree, any such assignment shall
be in a minimum aggregate amount equal to $1,000,000 or, if less, the remaining Term Loan Commitment and Term Loans held by the
assigning Lender. Borrower and Administrative Agent shall be entitled to continue to deal solely and directly with such Lender
in connection with the interests so assigned to an Assignee until Administrative Agent shall have received and accepted an effective
assignment agreement in substantially the form of Exhibit C hereto (an “Assignment Agreement”) executed,
delivered and fully completed by the applicable parties thereto and a processing fee of $3,500. No assignment may be made to any
Person if at the time of such assignment Borrower would be obligated to pay any greater amount under Sections 7.6
or 8 to the Assignee than Borrower is then obligated to pay to the assigning Lender under such Sections (and if any
assignment is made in violation of the foregoing, Borrower will not be required to pay such greater amounts). Any attempted assignment
not made in accordance with this Section 15.6.1 shall be treated as the sale of a participation under Section 15.6.2.
Borrower shall be deemed to have granted its consent to any assignment requiring its consent hereunder unless Borrower has expressly
objected to such assignment within three Business Days after notice thereof.


 


(b)       From
and after the date on which the conditions described above have been met, (i) such Assignee shall be deemed automatically
to have become a party hereto and, to the extent that rights and obligations hereunder have been assigned to such Assignee pursuant
to such Assignment Agreement, shall have the rights and obligations of a Lender hereunder and (ii) the assigning Lender, to
the extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment Agreement, shall be released
from its rights (other than its indemnification rights) and obligations hereunder. Upon the request of the Assignee (and, as applicable,
the assigning Lender) pursuant to an effective Assignment Agreement, Borrower shall execute and deliver to Administrative Agent
for delivery to the Assignee (and, as applicable, the assigning Lender) a Term Note in the principal amount of the Assignee’s
Pro Rata Share of the of the Assignee’s Term Loans (and, as applicable, a Term Note in the principal amount of the Term Loans
retained by the assigning Lender). Each such Term Note shall be dated the effective date of such assignment. Upon receipt by Administrative
Agent of such Term Note(s), the assigning Lender shall return to Borrower any prior Term Note held by it.


 


(c)       Any
Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall
not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security
interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.


 






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15.6.2       Participations.
Any Lender may at any time sell to one or more Persons participating interests in its Term Loans, Term Loan Commitments or other
interests hereunder (any such Person, a “Participant”). In the event of a sale by a Lender of a participating
interest to a Participant, (a) such Lender’s obligations hereunder shall remain unchanged for all purposes, (b) Borrower
and Administrative Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights
and obligations hereunder and (c) all amounts payable by Borrower shall be determined as if such Lender had not sold such
participation and shall be paid directly to such Lender. No Participant shall have any direct or indirect voting rights hereunder
except with respect to any event described in Section 15.1 expressly requiring the unanimous vote of all Lenders or,
as applicable, all affected Lenders. Each Lender agrees to incorporate the requirements of the preceding sentence into each participation
agreement which such Lender enters into with any Participant. Borrower agrees that if amounts outstanding under this Agreement
are due and payable (as a result of acceleration or otherwise), each Participant shall be deemed to have the right of set-off
in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating
interest were owing directly to it as a Lender under this Agreement; provided that such right of set-off shall be subject to the
obligation of each Participant to share with the Lenders, and the Lenders agree to share with each Participant, as provided in
Section 7.5. Borrower also agrees that each Participant shall be entitled to the benefits of Section 7.6
or 8 as if it were a Lender (provided that on the date of the participation no Participant shall be entitled to
any greater compensation pursuant to Section 7.6 or 8 than would have been paid to the participating Lender
on such date if no participation had been sold and that each Participant complies with Section 7.6(d) as if it were
an Assignee).


 


15.7       Register.
Administrative Agent shall maintain a copy of each Assignment Agreement delivered and accepted by it and register (the “Register”)
for the recordation of names and addresses of the Lenders and the Term Loan Commitment of each Lender from time to time and whether
such Lender is the original Lender or the Assignee. No assignment shall be effective unless and until the Assignment Agreement
is accepted and registered in the Register. All records of transfer of a Lender’s interest in the Register shall be conclusive,
absent manifest error, as to the ownership of the interests in the Term Loans. Administrative Agent shall not incur any liability
of any kind with respect to any Lender with respect to the maintenance of the Register.


 


15.8       GOVERNING
LAW. THIS AGREEMENT AND EACH NOTE SHALL BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.


 


15.9       Confidentiality;
Non-Public Information.


 


15.9.1As
required by federal law and Administrative Agent’s policies and practices, Administrative Agent may need to obtain, verify,
and record certain customer identification information and documentation in connection with opening or maintaining


 






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accounts, or
establishing or continuing to provide services. Administrative Agent and each Lender agree to use commercially reasonable efforts
(equivalent to the efforts Administrative Agent or such Lender applies to maintain the confidentiality of its own confidential
information) to maintain as confidential all information provided to them by any Loan Party and designated as confidential, except
that Administrative Agent and each Lender may disclose such information (a) to Persons employed or engaged by Administrative
Agent or such Lender or such Lender’s Affiliates or Approved Funds in evaluating, approving, structuring or administering
the Term Loans and the Term Loan Commitments, provided that, all such Persons shall be bound by obligations of confidentiality
in respect of such information no less restrictive than this Section 15.9; (b) to any assignee or participant or potential
assignee or participant that has agreed to comply with the covenant contained in this Section 15.9 (and any such assignee
or participant or potential assignee or participant may disclose such information to Persons employed or engaged by them as described
in clause (a) above); (c) as required or requested by any federal or state regulatory authority or examiner, or any insurance
industry association, or as reasonably believed by Administrative Agent or such Lender to be compelled by any court decree, subpoena
or legal or administrative order or process; (d) as, on the advice of Administrative Agent’s or such Lender’s
counsel, is required by law; (e) in connection with the exercise of any right or remedy under the Loan Documents or in connection
with any litigation to which Administrative Agent or such Lender is a party; (f) to any nationally recognized rating agency
that requires access to information about a Lender’s investment portfolio in connection with ratings issued with respect
to such Lender; (g) to any Affiliate of Administrative Agent, or any Lender who may provide Bank Products to the Loan Parties,
provided that, all such Persons shall be bound by obligations of confidentiality in respect of such information no less
restrictive than this Section 15.9; (h) to Lender’s independent auditors and other professional advisors as to
which such information has been identified as confidential; or (i) that ceases to be confidential through no fault of Administrative
Agent or any Lender. In the case of any disclosure under Sections 15.9.1(c), (d), (e) and (f), Administrative Agent and
such Lender will provide Borrower, to the extent not prohibited by law, with reasonably prompt notice thereof so that Borrower
may seek, at Borrower’s sole expense, an appropriate protective order or other remedy or waive compliance, in whole or in
part, with the terms of this Section 15.9. Notwithstanding the foregoing, Borrower consents to the publication by Administrative
Agent or any Lender of a tombstone or similar advertising material relating to the financing transactions contemplated by this
Agreement, and Administrative Agent reserves the right to provide to industry trade organizations information necessary and customary
for inclusion in league table measurements. If any provision of any confidentiality agreement, non-disclosure agreement or other
similar agreement between Borrower and Lender conflicts with or contradicts this Section 15.9 with respect to the treatment
of confidential information, this section shall supersede all such prior or contemporaneous agreements and understandings
between the parties.


 


15.9.2The
Loan Parties hereby acknowledge that (a) the Administrative Agent will make available to the Lenders materials and/or information
provided by or on behalf of the Borrower hereunder and (b) certain of the Lenders may have personnel who do not wish to receive
material non-public information (“MNPI”) with respect to the Loan


 






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Parties or their Affiliates, or the respective
securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such
Persons’ securities. The Loan Parties hereby agree that they shall identify in writing and clearly and conspicuously mark
information that contains only information that is publicly available or that is not material for purposes of United States federal
and state securities laws as “PUBLIC”. The Loan Parties agree that by identifying such information as “PUBLIC”
or publicly filing such information with the SEC, then Administrative Agent, the Lenders shall be entitled to treat such information
as not containing any MNPI for purposes of United States federal and state securities laws. The Loan Parties further represent,
warrant, acknowledge and agree that the following documents and materials shall be deemed to be PUBLIC, whether or not so marked,
and do not contain any MNPI: (A) the Loan Documents, including the schedules and exhibits attached thereto, and (B) administrative
materials of a customary nature prepared by the Loan Parties or Administrative Agent (including, without limitation, notices of
borrowing).


 


15.9.3If
any Lender has elected to abstain from receiving MNPI concerning the Loan Parties or their Affiliates, such Lender acknowledges
that, notwithstanding such election, Administrative Agent and/or the Loan Parties will, from time to time, make available syndicate-information
(which may contain MNPI) as required by the terms of this Agreement, or in the course of administering the Term Loans, to the credit
contact(s) identified for receipt of such information on the Lender’s administrative questionnaire who are able to receive
and use all syndicate-level information (which may contain MNPI) in accordance with such Lender’s compliance policies and
contractual obligations and applicable law, including federal and state securities laws; provided, that if such contact is not
so identified in such questionnaire, the relevant Lender or hereby agrees to promptly (and in any event within one (1) Business
Day) provide such a contact to Administrative Agent and the Loan Parties upon request therefor by Administrative Agent or the Loan
Parties. Notwithstanding such Lender’s election to abstain from receiving MNPI, such Lender acknowledges that if such Lender
chooses to communicate with Administrative Agent, it assumes the risk of receiving MNPI concerning the Loan Parties or their Affiliates.


 


15.10       Severability.
Whenever possible each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions
of this Agreement. All obligations of the Loan Parties and rights of Administrative Agent and the Lenders expressed herein or
in any other Loan Document shall be in addition to and not in limitation of those provided by applicable law.


 


15.11       Nature
of Remedies. All Obligations of the Loan Parties and rights of Administrative Agent and the Lenders expressed herein or in
any other Loan Document shall be in addition to and not in limitation of those provided by applicable law. No failure to exercise
and no delay in exercising, on the part of Administrative Agent or any Lender, any right, remedy, power or privilege hereunder,
shall operate as a waiver thereof; nor shall any single or partial


 






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exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.


 


15.12       Entire
Agreement. This Agreement, together with the other Loan Documents, embodies the entire agreement and understanding among the
parties hereto and supersedes all prior or contemporaneous agreements and understandings of such Persons, verbal or written, relating
to the subject matter hereof and thereof and any prior arrangements made with respect to the payment by the Loan Parties of (or
any indemnification for) any fees, costs or expenses payable to or incurred (or to be incurred) by or on behalf of Administrative
Agent or the Lenders.


 


15.13       Counterparts.
This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts and
each such counterpart shall be deemed to be an original, but all such counterparts shall together constitute but one and the same
Agreement. Receipt of an executed signature page to this Agreement by facsimile or other electronic transmission shall constitute
effective delivery thereof. Electronic records of executed Loan Documents maintained by the Lenders shall deemed to be originals.


 


15.14       Successors
and Assigns. This Agreement shall be binding upon Borrower, the Lenders and Administrative Agent and their respective successors
and assigns, and shall inure to the benefit of Borrower, the Lenders and Administrative Agent and the successors and assigns of
the Lenders and Administrative Agent. No other Person shall be a direct or indirect legal beneficiary of, or have any direct or
indirect cause of action or claim in connection with, this Agreement or any of the other Loan Documents. No Loan Party may assign
or transfer any of its rights or Obligations under this Agreement without the prior written consent of Administrative Agent and
each Lender.


 


15.15       Captions.
Section captions used in this Agreement are for convenience only and shall not affect the construction of this Agreement.


 


15.16       Customer
Identification – USA Patriot Act Notice. Each Lender and Hale Capital (for itself and not on behalf of any other party)
hereby notifies the Loan Parties that, pursuant to the requirements of the USA Patriot Act, Title III of Pub. L. 107-56,
signed into law October 26, 2001 (the “Patriot Act”), it is required to obtain, verify and record information
that identifies the Loan Parties, which information includes the name and address of the Loan Parties and other information that
will allow such Lender or Hale Capital, as applicable, to identify the Loan Parties in accordance with the Act.


 


15.17       INDEMNIFICATION
BY LOAN PARTIES. IN CONSIDERATION OF THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY ADMINISTRATIVE AGENT AND THE LENDERS
AND THE AGREEMENT TO EXTEND THE TERM LOAN COMMITMENTS PROVIDED HEREUNDER, BORROWER HEREBY AGREES TO INDEMNIFY, EXONERATE AND HOLD
ADMINISTRATIVE AGENT, EACH LENDER AND EACH OF THE OFFICERS, DIRECTORS, EMPLOYEES, AFFILIATES, APPROVED FUNDS AND AGENTS OF ADMINISTRATIVE
AGENT AND EACH LENDER (EACH A “LENDER PARTY”) FREE AND HARMLESS FROM AND AGAINST ANY AND ALL ACTIONS, CAUSES
OF ACTION, SUITS, LOSSES, LIABILITIES, DAMAGES AND EXPENSES, INCLUDING ATTORNEY COSTS


 






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(COLLECTIVELY, THE “INDEMNIFIED
LIABILITIES”), INCURRED BY THE LENDER PARTIES OR ANY OF THEM AS A RESULT OF, OR ARISING OUT OF, OR RELATING TO (a) ANY
TENDER OFFER, MERGER, PURCHASE OF CAPITAL SECURITIES, PURCHASE OF ASSETS OR OTHER SIMILAR TRANSACTION FINANCED OR PROPOSED TO
BE FINANCED IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, WITH THE PROCEEDS OF ANY OF THE LOANS, (b) THE USE, HANDLING, RELEASE,
EMISSION, DISCHARGE, TRANSPORTATION, STORAGE, TREATMENT OR DISPOSAL OF ANY HAZARDOUS SUBSTANCE AT ANY PROPERTY OWNED OR LEASED
AT ANY TIME BY ANY LOAN PARTY, (c) ANY VIOLATION, OBLIGATION OR LIABILITY PURSUANT TO ANY ENVIRONMENTAL LAWS WITH RESPECT
TO CONDITIONS AT ANY PROPERTY OWNED OR LEASED BY ANY LOAN PARTY AT ANY TIME OR THE OPERATIONS CONDUCTED THEREON, (d) THE INVESTIGATION,
CLEANUP OR REMEDIATION OF OFFSITE LOCATIONS AT WHICH ANY LOAN PARTY OR THEIR RESPECTIVE PREDECESSORS ARE ALLEGED TO HAVE DIRECTLY
OR INDIRECTLY DISPOSED OF HAZARDOUS SUBSTANCES OR OTHERWISE BE LIABLE UNDER ENVIRONMENTAL LAWS, OR (e) THE EXECUTION, DELIVERY,
PERFORMANCE OR ENFORCEMENT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT BY ANY OF THE LENDER PARTIES, EXCEPT FOR ANY SUCH INDEMNIFIED
LIABILITIES ARISING ON ACCOUNT OF THE APPLICABLE LENDER PARTY’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT AS DETERMINED BY
A FINAL, NONAPPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION. IF AND TO THE EXTENT THAT THE FOREGOING UNDERTAKING MAY BE
UNENFORCEABLE FOR ANY REASON, EACH LOAN PARTY HEREBY AGREES TO MAKE THE MAXIMUM CONTRIBUTION TO THE PAYMENT AND SATISFACTION OF
EACH OF THE INDEMNIFIED LIABILITIES WHICH IS PERMISSIBLE UNDER APPLICABLE LAW. ALL OBLIGATIONS PROVIDED FOR IN THIS SECTION 15.17 SHALL SURVIVE REPAYMENT OF THE TERM LOANS, CANCELLATION OF THE TERM NOTES, ANY FORECLOSURE UNDER, OR ANY MODIFICATION, RELEASE
OR DISCHARGE OF, ANY OR ALL OF THE COLLATERAL DOCUMENTS AND TERMINATION OF THIS AGREEMENT.


 


15.18       Nonliability
of Lenders. The relationship between Borrower on the one hand and the Lenders and Administrative Agent on the other hand shall
be solely that of borrower and lender. Neither Administrative Agent nor any Lender has any fiduciary relationship with or duty
to any Loan Party arising out of or in connection with this Agreement or any of the other Loan Documents, and the relationship
between the Loan Parties, on the one hand, and Administrative Agent and the Lenders, on the other hand, in connection herewith
or therewith is solely that of debtor and creditor. Neither Administrative Agent nor any Lender undertakes any responsibility
to any Loan Party to review or inform any Loan Party of any matter in connection with any phase of any Loan Party’s business
or operations. Borrower agrees, on behalf of itself and each other Loan Party, that neither Administrative Agent nor any Lender
shall have liability to any Loan Party (whether sounding in tort, contract or otherwise) for losses suffered by any Loan Party
in connection with, arising out of, or in any way related to the transactions contemplated and the relationship established by
the Loan Documents, or any act, omission or event occurring in connection therewith, unless it is determined in a final non-appealable
judgment by a court of


 






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competent jurisdiction that such losses resulted from the gross negligence or willful misconduct of the
party from which recovery is sought. NO LENDER PARTY SHALL BE LIABLE FOR ANY DAMAGES ARISING FROM THE USE BY OTHERS OF ANY
INFORMATION OR OTHER MATERIALS OBTAINED THROUGH INTRALINKS OR OTHER SIMILAR INFORMATION TRANSMISSION SYSTEMS IN CONNECTION WITH
THIS AGREEMENT, NOR SHALL ANY LENDER PARTY HAVE ANY LIABILITY WITH RESPECT TO, AND BORROWER ON BEHALF OF ITSELF AND EACH OTHER
LOAN PARTY, HEREBY WAIVES, RELEASES AND AGREES NOT TO SUE FOR ANY SPECIAL, PUNITIVE, EXEMPLARY, INDIRECT OR CONSEQUENTIAL DAMAGES
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ARISING OUT OF ITS ACTIVITIES IN CONNECTION HEREWITH OR THEREWITH (WHETHER
BEFORE OR AFTER THE CLOSING DATE). Each Loan Party acknowledges that it has been advised by counsel in the negotiation, execution
and delivery of this Agreement and the other Loan Documents to which it is a party. No joint venture is created hereby or by the
other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby among the Lenders or among the Loan
Parties and the Lenders


 


15.19       FORUM
SELECTION AND CONSENT TO JURISDICTION. ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED THAT NOTHING IN THIS AGREEMENT SHALL BE
DEEMED OR OPERATE TO PRECLUDE ADMINISTRATIVE AGENT FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION.
EACH LOAN PARTY HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE.
EACH LOAN PARTY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE
WITHIN OR WITHOUT THE STATE OF NEW YORK. EACH LOAN PARTY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH
COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.


 


15.20       WAIVER
OF JURY TRIAL. EACH LOAN PARTY, ADMINISTRATIVE AGENT AND EACH LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, ANY NOTE, ANY OTHER LOAN DOCUMENT AND ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR
ARISING FROM ANY LENDING RELATIONSHIP EXISTING


 






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IN CONNECTION WITH ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.


 


Section 16JOINT
AND SEVERAL LIABILITY


 


16.1       Borrower is
defined collectively to include all Persons constituting Borrower; provided, however, that any references herein to “any
Borrower”, “each Borrower”, “a Borrower” or similar references, shall be construed as a reference
to each individual Person comprising Borrower. In addition, each Person comprising Borrower hereby acknowledges and agrees that
all of the representations, warranties, covenants, obligations, conditions, agreements and other terms contained in this Agreement
shall be applicable to and shall be binding upon each Person comprising Borrower unless expressly otherwise stated herein.


 


16.2       Each Borrower
shall be jointly and severally liable for all of the Obligations of each other Borrower, regardless of which Borrower actually
receives the proceeds or other benefits of the Term Loans or other extensions of credit hereunder or the manner in which Borrowers,
Administrative Agent or any Lender accounts therefor in their respective books and records.


 


16.3       Each Borrower
acknowledges that it will enjoy significant benefits from the business conducted by each other Borrower because of, inter alia,
their combined ability to bargain with other Persons including without limitation their ability to receive the Term Loans and other
credit extensions under this Agreement and the other Loan Documents which would not have been available to any Borrower acting
alone. Each Borrower has determined that it is in its best interest to procure the credit facilities contemplated hereunder, with
the credit support of each other Borrower as contemplated by this Agreement and the other Loan Documents.


 


16.4       Each of Administrative
Agent and the Lenders have advised each Borrower that it is unwilling to enter into this Agreement and the other Loan Documents
and make available the credit facilities extended hereby or thereby to any Borrower unless each Borrower agrees, among other things,
to be jointly and severally liable for the due and proper payment of the Obligations of each other Borrower. Each Borrower has
determined that it is in its best interest and in pursuit of its purposes that it so induce the Lenders to extend credit pursuant
to this Agreement and the other documents executed in connection herewith (A) because of the desirability to each Borrower
of the credit facilities hereunder and the interest rates and the modes of borrowing available hereunder and thereunder, (B) because
each Borrower may engage in transactions jointly with other Borrowers and (C) because each Borrower may require, from time
to time, access to funds under this Agreement for the purposes herein set forth. Each Borrower, individually, expressly understands,
agrees and acknowledges, that the credit facilities contemplated hereunder would not be made available on the terms herein in the
absence of the collective credit of all the Borrowers, and the joint and several liability of all the Borrowers. Accordingly, each
Borrower acknowledges that the benefit of the accommodations made under this Agreement to the Borrower, as a whole, constitutes
reasonably equivalent value, regardless of the amount of the indebtedness actually borrowed by, advanced to, or the amount of credit
provided to, or the amount of collateral provided by, any one Borrower.


 






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16.5       To the extent
that applicable law otherwise would render the full amount of the joint and several obligations of any Borrower hereunder and under
the other Loan Documents invalid or unenforceable, such Person’s obligations hereunder and under the other Loan Documents
shall be limited to the maximum amount which does not result in such invalidity or unenforceability; provided, however, that each
Borrower’s obligations hereunder and under the other Loan Documents shall be presumptively valid and enforceable to their
fullest extent in accordance with the terms hereof or thereof, as if this Section 16 were not a part of this Agreement.


 


16.6       To the extent
that any Borrower shall make a payment under this Section 16 of all or any of the Obligations (a “Joint Liability
Payment”) which, taking into account all other Joint Liability Payments then previously or concurrently made by any other
Borrower, exceeds the amount that such Borrower would otherwise have paid if each Borrower had paid the aggregate Obligations satisfied
by such Joint Liability Payments in the same proportion that such Person’s “Allocable Amount” (as defined below)
(as determined immediately prior to such Joint Liability Payments) bore to the aggregate Allocable Amounts of each Borrower as
determined immediately prior to the making of such Joint Liability Payments, then, following payment in full in cash of the Obligations
(other than contingent indemnification Obligations not then asserted), such Borrower shall be entitled to receive contribution
and indemnification payments from, and be reimbursed by, each other Borrower for the amount of such excess, pro rata based upon
their respective Allocable Amounts in effect immediately prior to such Joint Liability Payments. As of any date of determination,
the “Allocable Amount” of any Borrower shall be equal to the maximum amount of the claim which could then be
recovered from such Borrower under this Section 16 without rendering such claim voidable or avoidable under §548
of Chapter 11 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance
Act or similar statute or common law.


 


16.7       Each Borrower
assumes responsibility for keeping itself informed of the financial condition of each other Borrower, and any and all endorsers
and/or guarantors of any instrument or document evidencing all or any part of such other Borrower’s Obligations, and of all
other circumstances bearing upon the risk of nonpayment by such other Borrower of their Obligations, and each Borrower agrees that
neither Administrative Agent nor any Lender shall have any duty to advise such Borrower of information known to Administrative
Agent or any Lender regarding such condition or any such circumstances or to undertake any investigation not a part of its regular
business routine. If Administrative Agent or any Lender, in its sole discretion, undertakes at any time or from time to time to
provide any such information to a Borrower, neither Administrative Agent nor any Lender shall be under any obligation to update
any such information or to provide any such information to such Borrower or any other Person on any subsequent occasion.


 


16.8       Administrative
Agent is hereby authorized to, at any time and from time to time, (a) in accordance with the terms of this Agreement, renew,
extend, accelerate or otherwise change the time for payment of, or other terms relating to, Obligations incurred by any Borrower
or any other Loan Party, otherwise modify, amend or change the terms of any promissory note or other agreement, document or instrument
now or hereafter executed by any Borrower or any other Loan Party and delivered to Administrative Agent or any Lender; (b) accept
partial payments on an Obligation incurred by any Borrower; (c) take and hold security or collateral for


 






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the payment of an
Obligation incurred by any Borrower hereunder or for the payment of any guaranties of an Obligation incurred by any Borrower or
other liabilities of any Borrower and exchange, enforce, waive and release any such security or collateral; (d) apply such
security or collateral and direct the order or manner of sale thereof as Administrative Agent, in its sole discretion, may determine;
and (e) settle, release, compromise, collect or otherwise liquidate an Obligation incurred by any Borrower and any security
or collateral therefor in any manner, without affecting or impairing the obligations of any other Borrower. In accordance with
the terms of this Agreement, Administrative Agent shall have the exclusive right to determine the time and manner of application
of any payments or credits, whether received from a Borrower or any other source, and such determination shall be binding on each
Borrower. In accordance with the terms of this Agreement, all such payments and credits may be applied, reversed and reapplied,
in whole or in part, to any of an Obligation incurred by any Borrower as Administrative Agent shall determine in its sole discretion
without affecting the validity or enforceability of the Obligations of any other Borrower. Nothing in this Section 16
shall modify any right of any Borrower or any Lender to consent to any amendment or modification of this Agreement or the other
Loan Documents in accordance with the terms hereof or thereof.


 


16.9       Each Borrower
hereby agrees that, except as hereinafter provided, its obligations hereunder shall be unconditional, irrespective of (a) the
absence of any attempt to collect an Obligation incurred by Borrower from any Borrower or any guarantor or other action to enforce
the same; (b) failure by Administrative Agent to take any steps to perfect and maintain its security interest in, or to preserve
its rights to, any security or collateral for an Obligation incurred by any Borrower; (c) of any proceeding under the Bankruptcy
Code, or any similar proceeding, by or against any Borrower or any other Loan Party, or Administrative Agent’s or any Lender’s
election in any such proceeding of the application of §1111(b)(2) of the Bankruptcy Code; (d) any borrowing or grant
of a security interest by any Borrower as debtor-in-possession under §364 of the Bankruptcy Code; (e) the disallowance,
under §502 of the Bankruptcy Code, of all or any portion of Administrative Agent’s or any Lender’s claim(s) for
repayment of any of an Obligation incurred by any Borrower; or (f) any other circumstance which might otherwise constitute
a legal or equitable discharge or defense of a guarantor unless such legal or equitable discharge or defense is that of a Borrower
in its capacity as a Borrower.


 


16.10       Any notice
given by any Borrower hereunder shall constitute and be deemed to be notice given by all Borrowers, jointly and severally. Notice
given by Administrative Agent or any Lender to any Borrower hereunder or pursuant to any other Loan Documents in accordance with
the terms hereof or thereof shall constitute notice to each Borrower. The knowledge of any Borrower shall be imputed to all Borrowers
and any consent by any Borrower shall constitute the consent of and shall bind all Borrowers.


 


16.11       This Section 16
is intended only to define the relative rights of Borrower and nothing set forth in this Section 16 is intended to
or shall impair the obligations of Borrower, jointly and severally, to pay any amounts as and when the same shall become due and
payable in accordance with the terms of this Agreement or any other Loan Documents. Nothing contained in this Section 16
shall limit the liability of any Borrower to pay the credit facilities made directly or indirectly to such Borrower and accrued
interest, fees and expenses with respect thereto for which such Borrower shall be primarily liable.


 






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16.12     The parties
hereto acknowledge that the rights of contribution and indemnification hereunder shall constitute assets of each Borrower to which
such contribution and indemnification is owing. The rights of any indemnifying Borrower against the other Borrowers under this
Section 16 shall be exercisable upon the full and payment of the Obligations.


 


16.13     No payment
made by or for the account of a Borrower, including, without limitation, (a) a payment made by such Borrower on behalf of
an Obligation of another Borrower or (b) a payment made by any other Person under any guaranty, shall entitle such Borrower,
by subrogation or otherwise, to any payment from such other Borrower or from or out of property of such other Borrower and such
Borrower shall not exercise any right or remedy against such other Borrower or any property of such other Borrower by reason of
any performance of such Borrower of its joint and several obligations hereunder, until, in each case, the payment in full of all
Obligations (other than contingent indemnification Obligations not then asserted).


 


Section 17Observation
Rights


 


17.1       Board
Observer.


 


(a)       
Appointment
Right.For so long as the Obligations are outstanding, Hale Capital shall have the right to appoint and remove one (1) non-voting
observer (a “Board Observer”) to the Board who will be entitled to attend all meetings of the Board and all committees
thereof and receive all notices, written consents, resolutions, reports, and materials that a member of the Board or any such committee
may receive from time to time from Borrower (at the same time as the members of the Board or any such committee receive such materials).
The initial Board Observer shall be Martin Hale, Jr. and Hale Capital shall have the right to replace its Board Observer from time
to time with another observer reasonably acceptable to Borrower (which observer may, in Hale Capital’s discretion, be someone
independent from, and not an Affiliate of, Hale Capital).


 


(b)       
Exclusions and Conditions. Notwithstanding the foregoing, Borrower shall be entitled to withhold any information and exclude
the Board Observer from any meeting, or any portion thereof, (a) if in the good faith determination of the Board, access to such
information or attendance at such meeting would adversely affect the attorney-client privilege between Borrower and its counsel;
or (b) that relates to matters as to which Borrower reasonably determines that Hale Capital, the Board Observer or their respective
Affiliates, have or are likely to have a conflict of interest, including, without limitation, discussions relating to any agreement
(including the Loan Documents) between Borrower or any Affiliate, on the one hand, and Hale Capital, the Administrative Agent,
the Lenders, the Board Observer or their respective Affiliates, on the other hand.  As a condition of the Board Observer’s
right to attend any meeting or receive any information, the Board Observer shall (i) execute a confidentiality agreement in form
and substance reasonably acceptable to Borrower and Hale Capital with respect to all information and discussions to which the Board
Observer will have access and (ii) the Board Observer shall agree to abide by the terms of Borrower’s insider trading policy
as if the Board Observer were a director.


 






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(c)       
 Expenses.
Borrower shall reimburse the Board Observer for all reasonable and documented out-of-pocket expenses incurred by the Board
Observer in his or her capacity thereof, including, without limitation, all reasonable and documented out-of-pocket travel and
lodging expenses associated with attending meetings of the Board or any committee thereof.


 


[SIGNATURE PAGES FOLLOW]








 






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The parties hereto
have caused this Agreement to be duly executed and delivered by their duly authorized officers as of the date first set forth
above. 





	 	 	 	 	 
	BORROWER:	QUMU CORPORATION, a Minnesota
    corporation
	 	 	 
	 	By:	/s/ Peter J. Goepfrich
	 	Name:	Peter J. Goepfrich
	 	Title: 	Chief Financial Officer
	 	 	 
	GUARANTOR:	QUMU, INC., a California corporation
	 	 	 
	 	By:	/s/ Peter J. Goepfrich
	 	Name:	Peter J. Goepfrich
	 	Title:	Chief Financial Officer




Signature Page to
Credit Agreement






     


     


    

 





	 	 	 	 	 
		HALE CAPITAL PARTNERS, LP, as Administrative Agent
	 	 	 
	 	By:	/s/ Martin M. Hale, Jr.
	 	Name:	Martin M. Hale, Jr.
	 	Title: 	Chief Executive Officer



 


Signature Page to

Credit Agreement


 






     


     


    

 


	 	 	 	 	 
		HCP-FVD, LLC, as Lender
	 	 	 
	 	By:	/s/ Martin M. Hale, Jr.
	 	Name:	Martin M. Hale, Jr.
	 	Title:	CEO








 


Signature Page to 

Credit Agreement


 




     


     


    

 


ANNEX A


 


LENDERS
AND PRO RATA SHARES


 


	Lender	Term
    Loan 

    Commitment	Pro
    Rata 

     Share*/ 
	HCP-FVD, LLC	$8,000,000	100%
	TOTALS	$8,000,000	100%


 


		*/	Carry
                                         out to nine decimal places.



 





Annex A to Credit Agreement




     


     


    

 


ANNEX B


 


ADDRESSES
FOR NOTICES


 


 


BORROWER


 


QUMU CORPORATION, a Minnesota corporation

510 1st Avenue North, Suite 305

Minneapolis, MN 55403

Attention: Chief Executive Officer

E-Mail: vern.hanzlik@qumu.com

Telephone: (612) 638-9100

Facsimile: (612) [_______________]


 


With a copy to:


 


Lindquist & Vennum LLP


4200 IDS Center


80 South 8th Street


Minneapolis, MN 55406


Attention: April Hamlin, Esq.


E-Mail: ahamlin@lindquist.com


Telephone: 612-371-3211


Facsimile: 612-371-3207


 


HALE CAPITAL PARTNERS, LP, as Administrative
Agent


c/o Hale Capital Partners, LP


17 State Street, Suite 3230

New York, NY 10004


Attention: [_______________]


E-Mail:


Telephone:


Facsimile: 212-751-1201


 


With a mandatory copy to:


 


Greenberg Traurig, LLP


One International Place


Boston, MA 02110


Attention: Jeffrey M. Wolf, Esq.


E-Mail: wolfje@gtlaw.com


Telephone: 617-310-6097


Facsimile: 617-310-6001


 


Annex B to Credit Agreement