Exhibit 10.1


 


Execution Version


 


CONSENT, WAIVER AND SIXTH AMENDMENT



TO FACILITY AGREEMENT


 


This CONSENT, WAIVER
AND SIXTH AMENDMENT TO FACILITY AGREEMENT (this “Amendment”) is entered into as of March 19, 2021, by and among
NEOS THERAPEUTICS, INC., a Delaware corporation (the “Borrower”), NEOS THERAPEUTICS COMMERCIAL, LLC, a Delaware
limited liability company (“Commercial”), NEOS THERAPEUTICS BRANDS, LLC, a Delaware limited liability company
(“Brands”), NEOS THERAPEUTICS, LP, a Texas limited partnership (“Neos LP”), PHARMAFAB TEXAS,
LLC, a Texas limited liability company (“PharmaFab”, together with Commercial, Brands and Neos LP, each individually
a “Guarantor”, and collectively, the “Guarantors”), DEERFIELD PRIVATE DESIGN FUND III, L.P.
(“DPDF”), DEERFIELD Partners, L.P. (“DP”,
and together with DPDF collectively referred to as the “Lenders”), and DEERFIELD MGMT, L.P., as collateral agent
for itself, the Lenders and the other Secured Parties (in such capacity, together with its successors and assigns in such capacity,
“Collateral Agent” and together with the Borrower, the Guarantors and Agent, collectively, the “Parties”).


 


RECITALS:


 


A. The
Borrower and the Lenders have entered into that certain Facility Agreement, dated as of May 11, 2016 (together with all exhibits
and schedules thereto and as the same has been amended, restated, supplemented and/or otherwise modified from time to time to prior
to (and not including) the date hereof, including by (i) that certain First Amendment to Facility Agreement, dated as of June 1,
2017, by and among the Borrower, the Guarantors party thereto and the Lenders, (ii) that certain Second Amendment to Facility Agreement,
dated as of November 5, 2018, by and among the Borrower, the Guarantors party thereto and the Lenders, (iii) that certain
Third Amendment to Facility Agreement, dated as of March 26, 2019, by and among the Borrower, the Guarantors party thereto
and the Lenders, (iv) that certain Fourth Amendment to Facility Agreement, dated as of October 2, 2019, by and among the Borrower,
the Guarantors party thereto and the Lenders, and (v) that certain Fifth Amendment to Facility Agreement, dated as of May 6, 2020,
by and among the Borrower, the Guarantors party thereto and the Lenders, the “Existing Facility Agreement”).
The Existing Facility Agreement, as amended hereby and as may be amended, restated, supplemented and/or otherwise modified from
time to time, is referred to as the “Facility Agreement”).


 


B. The
Borrower, Aytu Bioscience, Inc., a Delaware corporation (“Aytu”), and the Lenders have entered into that certain
Letter Agreement re: Consent and Modifications to Loan Documents, dated December 10, 2020 (the “Letter Agreement”).


 


C. Pursuant
to that certain Agreement and Plan of Merger, among the Borrower, Aytu, and Neutron Acquisition Sub., Inc., a Delaware corporation,
dated as of December 10, 2020 (together with all exhibits, schedules and disclose letters thereto, the “Merger Agreement”),
on the date hereof, Aytu will acquire the Borrower, and the parties to the Merger Agreement will consummate the other transactions
contemplated thereby (collectively, the “Aytu Merger”).


 


D. Pursuant
to that certain Letter Agreement, dated as of December 10, 2020, among the Borrower, Aytu and the Lenders, the Lenders have agreed,
on the terms and subject to the conditions set forth therein, to (a) consent to the Borrower’s agreement to make certain
amendments to the ABL Agreement and the other ABL Documents, (b) permanently waive certain Events of Default that have occurred
and are continuing and (c) amend the Existing Facility Agreement, in each case as more fully set forth therein.


 


E.  In
furtherance of the agreements set forth in the Letter Agreement, the Lenders have agreed to enter into this Agreement, grant such
permanent waivers and make such amendments, in each case on the term and subject to the conditions hereof.


 






     


     


    

 


NOW, THEREFORE, in
consideration of the mutual agreements contained herein, the Parties agree as follows:


 


1. Defined
Terms. Capitalized terms used herein which are defined in the Facility Agreement, unless otherwise defined herein, shall have
the meanings ascribed to them in the Facility Agreement. The Recitals to this Amendment are incorporated herein in their entirety
by this reference thereto.


 


2. Consent.
Subject to the satisfaction of the conditions precedent set forth in Section 5 of this Amendment, effective as of the Sixth
Amendment Effective Date, the Lenders hereby consent to the consummation of the amendments to the ABL Documents pursuant to an
amendment thereto in the form attached hereto as Exhibit B (the “ABL Amendment”).


 


3. Waivers.
Subject to the satisfaction of the conditions precedent set forth in Section 5 of this Amendment, effective as of the Sixth
Amendment Effective Date, the Lenders hereby irrevocably waive (i)(A) the Going Concern Condition (as defined in that certain letter
agreement by and among the Borrower and the Lenders dated as of November 6, 2020) for each of the fiscal quarters ended June 30,
2020 and September 30, 2020 and each other fiscal quarter ending thereafter and prior to the Sixth Amendment Effective Date (as
defined below) and (B) any Event of Default that would arise without such waiver due to the failure to satisfy the Going Concern
Condition (as defined in that certain letter agreement by and among the Borrower and the Lenders dated as of November 6, 2020)
for each of the fiscal quarters ended June 30, 2020 and September 30, 2020 and each other fiscal quarter ending thereafter and
prior to the Sixth Amendment Effective Date, as required pursuant to Section 5.1(v) of the Facility Agreement and (ii) the right
to impose the default rate of interest under Section 2.8 of the Facility Agreement, or to collect interest accruing at such default
rate of interest, that Lenders had a lawful right to collect or apply with respect to any such Event of Default for failure to
satisfy such Going Concern Condition.


 


4. Amendments
to Existing Facility Agreement. Subject to the satisfaction of the Conditions Precedent set forth in Section 4 of this
Amendment, (a) the Existing Facility Agreement is hereby amended to delete the stricken text (indicated textually in the same
manner as the following example: stricken text) and to add the double-underlined
text (indicated textually in the same manner as the following example: double-underlined
text) as set forth in the pages of the Facility Agreement attached as Exhibit A hereto, (b) the schedules to
the Facility Agreement are hereby replaced in their entirety with the Disclosure Schedules attached hereto.


 


5. Conditions
Precedent. The consents, waivers and amendments to the Facility Agreement contemplated hereby shall be effective upon the date
on which each of the following conditions is satisfied (or waived by the applicable Lenders) (such date, the “Sixth Amendment
Effective Date”):


 


a. Delivery
of Amendment Documents. (i) The parties thereto shall have executed and delivered to the Collateral Agent this Amendment, the
Joinders (as defined in the Letter Agreement), the ABL Amendment, in the form attached hereto as Exhibit B, promissory notes
in the form attached hereto as Exhibit C, a perfection certification in the form attached hereto as Exhibit D and
the other documents and certificates executed described in the closing checklist attached hereto as Exhibit E, (ii) the
Collateral Agent and the Lenders shall have received (A) executed legal opinions and resolutions in form and substance reasonably
satisfactory to the Collateral Agent and the Lenders, (B) lien searches in the jurisdiction of organization (and at the location
of the chief executive office, where applicable and appropriate) of each New Guarantor (as defined in the Letter Agreement), (C)
a certificate of the chief financial officer (or other officer with reasonably equivalent responsibilities) of Aytu certifying
that Aytu and its Subsidiaries, taken as a whole, after giving effect to the consummation of the Aytu Merger, are Solvent, (D)
customary officer’s and secretary’s certificates attaching the organizational documents of the Borrower and each Guarantor
(including the New Guarantors), and (iii) documents (including, without limitation insurance certificates and UCC-1 financing statements)
effecting the requirements of clause b. of this Section 5 (collectively, the “Amendment Documentation”).


 






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b. Perfection.
All actions necessary to establish that the Collateral Agent (for the benefit of itself, the Lenders and the other secured parties
under the Loan Documents) will have perfected first priority security interests (subject to Permitted Liens (which shall include
all Liens contemplated by the Term Sheet)) in the Collateral owned by each New Guarantor shall have been taken.


 


c. Representations
and Warranties. (i) The representations and warranties set forth in Sections 3.1(c), 3.1(g), 3.1(i), 3.1(q) (solely as it relates
to the execution, delivery and performance of the Amendment Documentation), 3.1(aa), 3.1(hh), 3.1(pp), and 3.1(qq) of the Facility
Agreement, in each case, after giving effect to the Merger Agreement and in each case with respect to both the Borrower and its
Subsidiaries and Aytu and its other Subsidiaries, shall be true and correct in all material respects (or, if any such representation
and warranty is qualified by materiality, in all respects), in each case as of the Sixth Amendment Effective Date or, to the extent
any such representation and warranty specifically relates to an earlier date, as of such earlier date, in each case with respect
to both the Borrower and its Subsidiaries and Aytu and its other Subsidiaries, and (ii) the representations and warranties made
by Aytu and its Affiliates with respect to Aytu and its Affiliates or the related business, financials or entities in the Merger
Agreement as are material to the interests of the Lenders, shall be true and correct in all material respects, but only to the
extent that the Borrower or its Affiliates have the right (taking into account any applicable cure provisions) to terminate its
or their obligations under the Merger Agreement or otherwise decline or refuse to close or consummate the Aytu Merger as a result
of a breach (or failure to be accurate, true or correct) of any such representations in the Merger Agreement.


 


d. Consummation
of Aytu Merger. Substantially concurrently with the execution and delivery of the Amendment Documentation, the Aytu Merger
shall be consummated in accordance with the terms of Merger Agreement without giving effect to (i) any amendments, modifications
or supplements thereof or (ii) waivers or consents thereunder by the Borrower or its Affiliates, in the case of each of clauses
(i) and (ii) in this Section 5.d., that are materially adverse to the interests of the Collateral Agent and the
Lenders and that have not been consented to in writing (such consent not to be unreasonably withheld, conditioned or delayed) by
the Lenders; it being understood that (x) any increase in the merger consideration under the Merger Agreement or (y) any change
to the definition of “Company Material Adverse Effect” in the Merger Agreement shall, in each case, be deemed materially
adverse to the interests of the Agent and the Lenders.


 


e. Indebtedness.
After giving effect to the consummation of the Aytu Merger, neither Aytu nor any of its Subsidiaries shall have any outstanding
Indebtedness other than Permitted Indebtedness (which shall include all Indebtedness contemplated by the Term Sheet (as defined
in the Letter Agreement)).


 


f. Fees
and Expenses. All expenses, fees and other amounts required to be paid on the Sixth Amendment Effective Date pursuant to the
Letter Agreement (including, without limitation, the Term Sheet (as defined therein)), and, to the extent invoiced one (1) Business
Day prior to the Sixth Amendment Effective Date, all reasonable out-of-pocket, costs, fees and expenses, including fees and disbursements
of legal counsel, incurred in connection with the negotiation, drafting and execution of this Amendment and the consummation of
the transactions contemplated hereby, shall in each case have been paid by wire transfer of immediately available funds to the
account of the Lenders specified in the Facility Agreement.


 



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g. PATRIOT
Act. With respect to the New Guarantors, the Lenders shall have received at least five (5) Business Days prior to the Sixth
Amendment Effective Date all documentation and other information required by regulatory authorities under applicable “know
your customer” and anti-money laundering rules and regulations, including, without limitation, the PATRIOT Act, that has
been reasonably requested by the Agent or any Lender in advance of the Sixth Amendment Effective Date.


 


h. Prepayment.
The Lenders shall have received, by wire transfer of immediately available funds to the account of the Lenders specified in the
Facility Agreement, a prepayment of $15,000,000 of the principal of the Loan (the “Prepayment”) in lieu of the
payment contemplated by Section 2.3(a)(v) of the Existing Facility Agreement, together with accrued interest thereon through the
Sixth Amendment Effective Date.


 


i. Make
Whole Interest. The Lenders shall have received, by wire transfer of immediately available funds to the account of the Lenders
specified in the Facility Agreement a “make whole” interest payment in the amount of $285,979.17.


 


6. Representations
and Warranties of the Borrower and the Guarantors. Each of the Borrower and the Guarantors, jointly and severally, hereby represents
and warrants to the Lenders as of the date of this Amendment as follows, which representations and warranties shall survive the
execution and delivery of this Amendment and continue in full force and effect until all of the Notes have been repaid in full:


 


a. Organization
and Good Standing. Each of the Borrower and the Guarantors is an entity duly incorporated or otherwise organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority
to own its properties and conduct its business.


 


b. Authority.
Each of the Borrower and Guarantors has the requisite corporate power and authority to enter into and to consummate the transactions
contemplated by this Amendment and the other Loan Documents (as amended hereby) and otherwise to carry out its obligations hereunder
and thereunder. The execution and delivery of this Amendment by each of the Borrower and Guarantors and the consummation by it
of the transactions contemplated hereby and by the other Loan Documents (as amended hereby) have been duly authorized by all necessary
action on its part, and no further action of its board of directors, managers, partners, stockholders or members is required in
connection herewith or therewith.


 


c. Consents.
Each of the Borrower and Guarantors is not required to obtain any consent from, authorization or order of, or make any filing or
registration with (other than the filing with the SEC of the 8-K Filing or as contemplated by the Security Agreement), any Governmental
Authority or any regulatory or self-regulatory agency or any other Person in order for it to execute, deliver or perform any of
its respective obligations under or contemplated by this Amendment, the Facility Agreement or the other Loan Documents (as amended
hereby), to which it is a party, in each case, in accordance with the terms hereof or thereof.


 


d. Valid
and Binding Agreement. This Amendment has been duly executed and delivered by each of the Borrower and the Guarantors, as applicable,
and each of this Amendment and the other Loan Documents (as amended hereby) constitutes its valid and binding obligations, enforceable
against it in accordance with their respective terms, except as limited applicable bankruptcy, insolvency, reorganization, moratorium
and other laws affecting enforcement of creditors’ rights, regardless of whether considered in a proceeding in equity or
at law.


 






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e. Non-Contravention.
The execution, delivery and performance of this Amendment by each of the Borrower and the Guarantors of its obligations hereunder
and under the other Loan Documents (as amended hereby) does not and will not (i) conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute an event of default under, or result in the creation or imposition of any Lien
(other than pursuant to the Loan Documents) upon any assets of the Borrower or the Guarantors pursuant to, any agreement to which
any of the Borrower or the Guarantors is a party or by which the Loan Parties are bound or to which any of the assets of the Loan
Parties is subject, except to the extent that no Material Adverse Effect would reasonably be expected to result therefrom, (B)
result in any violation of or conflict with the provisions of the Organizational Documents, (C) result in the violation of any
material Applicable Law or (D) result in the violation of any judgment, order, rule, regulation or decree of any Governmental Authority.


 


f. Exemption
from Registration. Assuming the accuracy of the Lenders’ representations and warranties set forth in Section 7,
no registration under the Securities Act or state securities laws is required for the offer and issuance of the Notes by the Borrower
to the Lenders as contemplated hereby. The amendments and transactions contemplated hereby do not contravene, or require stockholder
approval pursuant to, the rules and regulations of NASDAQ. The Borrower acknowledges and agrees that, for purposes of Rule 144(d)
under the Exchange Act, each Lender shall be deemed to have acquired its Note (as amended hereby) on the Second Amendment Date.


 


7. Covenants.


 


a. Delivery
of Notes. Immediately upon the effectiveness of this Amendment and the delivery of the Notes by the Borrower to the Lenders,
the Notes delivered prior to the Sixth Amendment Effective Date (the “Existing Notes”) shall be cancelled and
of no further force and effect. As promptly as reasonably practicable following the date hereof, each Lender shall deliver the
Existing Notes to the Borrower for destruction. For the avoidance of doubt, the amendment and restatement of the terms of the Notes
as provided therein, and the cancellation of the Existing Notes in connection therewith, shall not be conditioned upon, or be subject
to, the delivery of the Notes by the Borrower to the Lenders, or the delivery of the Existing Notes by the Lenders to the Borrower.


 


b. Disclosure.
At or prior to 9:30 a.m. (New York City time) on the first (1st) business day following the date of this Amendment,
each of the Borrower and Aytu shall file a current report on Form 8-K (the “Announcing Form 8-Ks”) with the
Securities and Exchange Commission (the “SEC”) describing the terms of the transactions contemplated by this
Amendment and disclosing any other material non-public information (in the context of United States of America federal securities
laws) provided or made available to the Lenders, the Agent, the Lender, any of their affiliates or any of their officers, directors,
employees, attorneys, advisors, representatives or agents (all such persons and entities, collectively, the “Applicable
Persons”) by either the Borrower or Aytu or any of the Borrower’s or Aytu’s Subsidiaries or Affiliates or
any of their or their respective Subsidiaries’ or Affiliates’ officers, directors, employees, attorneys, representatives
or agents prior to the filing of the Announcing Form 8-Ks. Each of the Announcing Form 8-Ks shall include as exhibits thereto this
Amendment (including the annexes hereto) and, to the extent not already filed, the Merger Agreement (in each case, with redaction
only for bank account information). Each of the Borrower and Aytu represents and warrants to the Lenders, the Agent, the Lenders
and each other Applicable Person that, from and after the filing of its applicable Announcing Form 8-K, no Applicable Person shall
be (or shall be deemed to be) in possession of any material non-public information regarding either the Borrower or Aytu, any of
the Borrower’s or Aytu’s Subsidiaries or Affiliates received from, or made available by, the Borrower or Aytu or any
of the Borrower’s or Aytu’s respective Subsidiaries or Affiliates or any of their or their respective Subsidiaries’
or Affiliates’ officers, directors, employees, attorneys, advisors, representatives or agents. Notwithstanding any affirmative
disclosure obligations of the Borrower pursuant to the terms of this Amendment, each of the Borrower and Aytu shall not, and shall
cause each of their respective Subsidiaries and Affiliates and each of their and their respective Subsidiaries’ and Affiliates’
officers, directors, employees, attorneys, advisors, representatives and agents to not, provide any of the Applicable Person with
any material non-public information regarding either the Borrower or Aytu, any of the Borrower’s or Aytu’s respective
Subsidiaries or Affiliates or the Transactions from and after the filing of the Announcing Form 8-Ks with the SEC without the express
prior written consent of the Lenders, it being acknowledged and agreed that any such consent given prior to the date hereof shall
be ineffective from and after the date of the Announcing Form 8-Ks. Each of the Borrower and Aytu hereby acknowledges and agrees
that no Applicable Person shall have any duty of trust or confidence with respect to any material non-public information provided
to any Applicable Person in breach of, or otherwise possessed by any Applicable Person as a result of a breach of, any of the foregoing
covenants. Notwithstanding anything to the contrary contained herein, in the event of a breach of any of the foregoing covenants,
in addition to any other remedies available at law or in equity, the Lenders and their Affiliates shall have the right to make
a public disclosure, in the form of a press release, public advertisement or otherwise, of the applicable material non-public information
without the prior approval by the Borrower, Aytu or any other Person. For the avoidance of doubt, the parties hereto acknowledge
and agree that nothing contained in this Section 7.d. shall limit the obligations of the Borrower under, or the rights of
the Lenders under, Section 5.1(xiii) of the Facility Agreement.


 






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8. Termination
of Registration Rights Agreement. Effective upon the Sixth Amendment Effective Date, that certain Registration Rights Agreement,
dated as of June 1, 2017, by among the Borrower, Deerfield Private Design Fund III, L.P. and Deerfield Special Situations Fund,
L.P., shall be terminated in its entirety and shall have no further force or effect.


 


9. Acknowledgements.
Borrower and the Guarantors, jointly and severally, irrevocably and unconditionally acknowledge, affirm and covenant to each Lender
that there are no offsets, counterclaims or defenses to the Obligations, including the liabilities and obligations of the Borrower
or any Guarantor under the Notes and other Loan Documents (as amended hereby), or to the rights, remedies or powers of such Lender
in respect of any of the Obligations or any of the Loan Documents, and the Borrower and each Guarantor agrees not to interpose
(and each does hereby waive and release) any such defense, set-off or counterclaim in any action brought by such Lender with respect
thereto.


 


10. Miscellaneous.
This Amendment is an amendment contemplated under Section 6.6 of the Facility Agreement. For the avoidance of doubt, this
Amendment is governed by and subject to the provisions of Article 6 of the Facility Agreement, which provisions are incorporated
herein in their entirety by this reference thereto.


 


11. Effect
of Amendment; Reservation of Rights. Except as expressly set forth herein, none of the Lenders has agreed to any modification
of the Facility Agreement or any other Loan Document, nor waived (nor hereby waives), any obligation of Borrower or any Guarantor,
or any breach, default or Event of Default that may exist, under any of the Loan Documents, nor any of its rights or remedies thereunder,
including any rights or remedies arising from any breach, default or Event of Default, and each of the Lenders expressly reserves
all such rights and remedies.


 


12. Reaffirmation.
The execution and delivery of this Amendment shall not operate as a waiver of any right, power or remedy of the Lenders, or constitute
a waiver of any provision of the Facility Agreement or any other Loan Document. Each of the Borrower and the Guarantors signatory
hereto, as issuer, debtor, grantor, pledgor, mortgagor, guarantor or assignor, or in other any other similar capacity in which
such Person grants Liens or security interests in its property or otherwise acts as accommodation party or guarantor, as the case
may be, hereby (i) acknowledges and agrees that it has reviewed this Amendment, (ii) ratifies and reaffirms all of its obligations,
contingent or otherwise, under each of the Loan Documents (as amended hereby) to which it is a party (after giving effect hereto),
and (iii) to the extent such Person granted Liens on or security interests in any of its property pursuant to any such Loan Document
as security for or otherwise guaranteed the Obligations under or with respect to the Loan Documents, ratifies and reaffirms such
guarantee and grant of security interests and Liens and confirms and agrees that such security interests and Liens hereafter secure
all of the Obligations. Each of the Borrower and the Guarantors hereby consents to this Amendment and acknowledges that this Amendment
is a Loan Document and that each of the Loan Documents (as amended hereby) remains in full force and effect and is hereby ratified
and reaffirmed. Neither this Amendment nor any prior amendment of any of the Loan Documents shall be construed or deemed to be
a satisfaction, novation, cure, modification, amendment or release of any obligations (including the Obligations), the Facility
Agreement or any of the other Loan Documents or establish a course of conduct with respect to future requests for amendments, modifications
or consents.


 


[Remainder of Page Intentionally Left
Blank, Signature Page Follows]





 



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IN WITNESS WHEREOF,
the Parties have executed this Amendment as of the date first set forth above.


 


	 	BORROWER:
	 	 
	 	NEOS THERAPEUTICS, INC.


 


	 	By:	/s/ Richard Eisenstadt
	 	Name: 	Richard Eisenstadt
	 	Title:	Chief Financial Officer


 


	 	GUARANTORS:
	 	 
	 	NEOS THERAPEUTICS COMMERCIAL, LLC


 


	 	By:	/s/ Richard Eisenstadt
	 	Name: 	Richard Eisenstadt
	 	Title:	Chief Financial Officer


 


	 	NEOS THERAPEUTICS BRANDS, LLC


 


	 	By:	/s/ Richard Eisenstadt
	 	Name: 	Richard Eisenstadt
	 	Title:	Chief Financial Officer


 


	 	NEOS THERAPEUTICS, LP


 


	 	By:	PharmaFab Texas, LLC, its general partner


 


	 	By:	/s/ Richard Eisenstadt
	 	Name: 	Richard Eisenstadt
	 	Title:	Chief Financial Officer


 


	 	PHARMAFAB TEXAS, LLC


 


	 	By:	/s/ Richard Eisenstadt
	 	Name: 	Richard Eisenstadt
	 	Title:	Chief Financial Officer


 



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	 	LENDERS:
	 	 
	 	DEERFIELD PRIVATE DESIGN FUND III, L.P.


 


	 	By:	Deerfield Mgmt III, L.P., its General Partner
	 	By:	J.E. Flynn Capital III, LLC, its General Partner


 


	 	By:	/s/ David J. Clark
	 	Name: 	David J. Clark
	 	Title:	Authorized Signatory


 


	 	DEERFIELD Partners, L.P.


 


	 	By:	Deerfield Mgmt., L.P., its General Partner
	 	By:	J.E. Flynn Capital, LLC, its General Partner


 


	 	By:	/s/ David J. Clark
	 	Name: 	David J. Clark
	 	Title:	Authorized Signatory


 


	 	COLLATERAL AGENT:
	 	 
	 	DEERFIELD MGMT, L.P.


 


	 	By:	J.E. Flynn Capital, LLC, General Partner


 


	 	By:	/s/ David J. Clark
	 	Name: 	David J. Clark
	 	Title:	Authorized Signatory


 



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EXHIBIT A


 


Amended Facility Agreement


 






     


     


    

 


Execution Version


  


FACILITY AGREEMENT


 


between Neos Therapeutics, Inc.,

a Delaware corporation,


 


and the lenders set forth on the signature
page of this Agreement,


 


dated as of May 11, 2016,


 


as amended by 


 


the First Amendment to Facility Agreement,

dated as of June 1, 2017,


 


the Second Amendment to Facility Agreement,



dated as of November 5, 2018, 


 


the Third Amendment to Facility Agreement,



dated as of March 26, 2019, 


 


the Fourth Amendment to Facility Agreement,



dated as of October 2, 2019,


 


the Fifth Amendment to Facility Agreement,



dated as of May 6, 2020, 


 


and


 


the Waiver, Consent and Sixth Amendment
to Facility Agreement,


dated as of March 19, 2021


 




     


     


    

  


TABLE OF CONTENTS


 


	 	 	Page
	Article 1 DEFINITIONS	1
	Section 1.1	General Definitions	1
	Section 1.2	Interpretation	19
	Section 1.3	Business Day Adjustment	19
	Section 1.4	Loan Records	20
	Section 1.5	Accounting Terms and Principles	21
	Section 1.6	Officers	21
	 	 	 
	Article 2 AGREEMENT FOR
    THE LOAN	21
	Section 2.1	Use of Proceeds	21
	Section 2.2	Disbursement	21
	Section 2.3	Payment	21
	Section 2.4	Payments	23
	Section 2.5	Taxes	24
	Section 2.6	[Reserved]	25
	Section 2.7	Interest	25
	Section 2.8	Default Interest; Late Payment Fee	25
	Section 2.9	Fee	25
	 	 	 
	Article 3 REPRESENTATIONS,
    WARRANTIES AND CERTAIN AFFIRMATIVE COVENANTS	26
	Section 3.1	Representations, Warranties and Certain Affirmative Covenants
    of the Loan Parties	26
	Section 3.2	Borrower and other Loan Party Obligors Acknowledgment	40
	 	 	 
	Article 4 [RESERVED]	40
	 	 
	Article 5 PARTICULAR
    COVENANTS AND EVENTS OF DEFAULT	40
	Section 5.1	Affirmative Covenants	40
	Section 5.2	Negative Covenants	48
	Section 5.3	Financial Covenants	52
	Section 5.4	General Acceleration Provision upon Events of Default	53
	Section 5.5	Automatic Acceleration on Dissolution or Bankruptcy	56
	Section 5.6	Recovery of Amounts Due	56
	Section 5.7	Power of Attorney	56
	Section 5.8	Credit Bidding	57
	 	 	 
	Article 6 MISCELLANEOUS	58
	Section 6.1	Notices	58
	Section 6.2	Waiver of Notice	59
	Section 6.3	Reimbursement of Legal and Other Expenses	59
	Section 6.4	Governing Law	60
	Section 6.5	Successors and Assigns	60
	Section 6.6	Entire Agreement	61
	Section 6.7	Severability	61
	Section 6.8	Counterparts	61
	Section 6.9	Survival	61
	Section 6.10	No Waiver	62
	Section 6.11	Indemnity	62
	Section 6.12	No Usury	63
	Section 6.13	Further Assurances	63
	Section 6.14	Confidentiality	63
	Section 6.15	Intercreditor Agreement	64



 







    A-i


     


    

  


SCHEDULES


 


	Schedule 1.1-A	-	Indebtedness
	Schedule 1.1-B	-	Investments
	Schedule 1.1-C	-	Investments
	Schedule 3.1(h)	-	Proceedings
	Schedule 3.1(m)	-	Intellectual Property
	Schedule 3.1(p)	-	Retention of Rights
	Schedule 3.1(q)	-	Compliance with Laws
	Schedule 3.1(t)	-	Subsidiaries
	Schedule 3.1(u)	-	Compliance with Health Care Laws
	Schedule 3.1(x)	-	Health Care Proceedings
	Schedule 3.1(aa)	-	Capitalization
	Schedule 3.1(ll)	-	Insurance



 


EXHIBIT


 


	Exhibit C	-	Form of Compliance Certificate



 






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FACILITY AGREEMENT


 


FACILITY AGREEMENT
(this “Agreement”), dated as of May 11, 2016 (as amended by the First Amendment to Facility Agreement, dated
as of June 1, 2017, the Second Amendment to Facility Agreement, dated as of November 5, 2018, the Third Amendment to Facility Agreement,
dated as of March 26, 2019, the Fourth Amendment to Facility Agreement, dated as of October 2, 2019, the Fifth Amendment to Facility
Agreement, dated as of May 6, 2020, and the Waiver, Consent and Sixth Amendment to Facility Agreement, dated as of March 19, 2021),
between Neos Therapeutics, Inc., a Delaware corporation (the “Borrower”), and the lenders set forth on the signature
page of this Agreement (together with their successors and permitted assigns, the “Lenders” and, together with
the Borrower, the “Parties”).


 


WITNESSETH:


 


WHEREAS, the Borrower
wishes to borrow from the Lenders a maximum of Sixty Million Dollars ($60,000,000) for the purpose described in Section 2.1;
and


 


WHEREAS, the Lenders
desire to make loans to the Borrower for such purpose;


 


NOW, THEREFORE, in
consideration of the mutual agreements set forth herein, the Parties agree as follows:


 


Article
1

DEFINITIONS


 


Section 1.1 General
Definitions. Unless otherwise defined herein, the following terms are used herein as defined in the UCC: Accounts, Account Debtor,
As-Extracted Collateral, Certificated Security, Chattel Paper, Commercial Tort Claims, Commodity Account, Commodity Contract, Continuation
Statement, Debtor, Deposit Account, Documents, Electronic Chattel Paper, Equipment, Farm Products, Financing Statement, Fixtures,
General Intangibles, Goods, Health-Care-Insurance Receivables, Instruments, Inventory, Letter-of-Credit Rights, Money, Payment
Intangible, Proceeds, Secured Party, Securities Account, Security Entitlement, Supporting Obligations and Tangible Chattel Paper.
Wherever used in this Agreement, the Exhibits or the Schedules attached hereto, unless the context otherwise requires, the following
terms have the following meanings:


 


“2022 Principal
Payment” has the meaning set forth in Section 2.3(a)(v).


 


“ABL Agent”
has the meaning ascribed to it in the definition “ABL Agreement.”


 


“ABL Agreement”
means that certain Loan and Security Agreement, dated as of the Fourth Amendment Date, by and among the Borrower, as a borrower,
Neos Therapeutics Brands, LLC, a Delaware limited liability company, as a borrower, Neos Therapeutics, LP, a Texas limited partnership,
as a borrower, Neos Therapeutics Commercial, LLC, a Delaware limited liability company, as an obligor, Pharmafab Texas, LLC, a
Texas limited liability company, as an obligor the “Lenders” party thereto from time to time and Encina Business Credit,
LLC, as agent for such “Lenders” (the “ABL Agent”), as amended, restated, supplemented or otherwise
modified from time to time in accordance and compliance with this Agreement and the Intercreditor Agreement.


 


“ABL Debt”
means Indebtedness outstanding under the ABL Documents that is expressly permitted to be incurred pursuant to clause (vi)
of the definition of “Permitted Indebtedness.”


 




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“ABL Documents”
means the “ABL Loan Documents” (as defined in the Intercreditor Agreement).


 


“ABL Facility”
has the meaning given to it in clause (vi) of the definition of “Permitted Indebtedness.”


 


“ABL Priority
Collateral” means “ABL Priority Collateral” as defined in the Intercreditor Agreement.


 


“Additional
Amounts” has the meaning given to it in Section 2.5(a) hereof.


 


“Additional
Exit Payment” has the meaning given to it in Section 2.3(c).


 


“Affiliate”
means, with respect to any Person, any other Person that directly or indirectly:


 


(a) owns
more than 10% of the legal or beneficial ownership interest of such Person or any of its Affiliates;


 


(b) controls,
or is controlled by, or is under common control with, such Person or any of its Affiliates;


 


(c) is a
general partner, or managing member of such Person or any of its Affiliates; or


 


(d) any officer
or director of the such Person or any of its Affiliates (and if that Person is an individual, any member of the immediate family
(including parents, siblings, spouse, children, stepchildren, nephews, nieces and grandchildren) of such individual and any trust
whose principal beneficiary is such individual or one or more members of such immediate family and any Person who is controlled
by any such member or trust).


 


A Person shall be deemed
to be “controlled by” any other Person if such Person possesses, directly or indirectly, power to vote ten percent
(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 or policies of such Person whether by contract or otherwise. Unless
expressly stated otherwise herein, no Secured Party shall be deemed an Affiliate of the Borrower or any of its Subsidiaries.


 


“Agreed Disclosure
Process” has the meaning set forth in Section 5.1(xiii).


 


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


 


“Agreement
Date” means the date of this Agreement.


 


“Announcing
Form 8-K” has the meaning set forth in Section 5.1(xiii).


 


“Applicable
Laws” means, with respect to any Person, the common law and any federal, state, local, foreign, multinational or international
laws, statutes, codes, treaties, standards, rules and regulations, guidelines, ordinances, orders, judgments, writs, injunctions,
decrees (including administrative or judicial precedents or authorities) and the interpretation or administration thereof by, and
other determinations, directives, requirements or requests of, any Governmental Authority, in each case whether or not having the
force of law and that are applicable to or binding upon such Person or any of its property or Products or to which such Person
or any of its property or Products is subject.


 




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“Authorizations”
has the meaning set forth in Section 3.1(q).


 


“Aytu”
means Aytu Biosciences, Inc., a Delaware corporation.


 


“Aytu Merger”
has the meaning given to such term in the Sixth Amendment.


 


“Aytu Merger
Agreement” means the “Merger Agreement,” as defined in the Letter Agreement.


 


“Bankruptcy
Code” means title 11 of the United States Code, as in effect from time to time.


 


“Borrower”
has the meaning set forth in the preamble.


 


“Borrower
Loan Parties” means the Borrower and each of its Subsidiaries.


 


“Business
Day” means a day on which banks are open for business in The City of 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 the Borrower and its Subsidiaries, but excluding (a) expenditures made in connection with the acquisition, replacement,
substitution or restoration of assets to the extent financed (i) from insurance proceeds (or other similar recoveries) paid on
account of the loss of or damage to the assets being replaced or restored or (ii) with cash awards of compensation arising from
the taking by eminent domain or condemnation of the assets being replaced, (b) leasehold improvement expenditures for which any
Loan Party is actually reimbursed by the lessor, sublessor or sublessee, (c) transaction fees and expenses incurred with any issuance
of debt or equity (including any initial public offering) to the extent capitalized, and (d) expenditures incurred under operating
leases that are required to be capitalized in accordance with GAAP (which are often referred to as “right to use assets”).


 


“Change of
Control” means (a) any “Person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Exchange Act) other than the holders of Aytu’s voting stock on the Sixth Amendment Effective Date (after giving effect
to the Aytu Merger) or their Controlled Investment Affiliates, is or shall at any time become the “beneficial owner”
(as defined in Rule 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of greater than 50% of the voting interest
in Aytu’s stock, (b) Aytu ceases, directly or indirectly, to own and control 100% of the voting interest in the stock of
the Borrower, (c) a sale of substantially all of the assets of Aytu and its Subsidiaries, or (d) the occurrence of a “Change
of Control”, “Change in Control”, “Fundamental Change” or concepts of similar import under the ABL
Documents; provided, however, that the consummation of the Aytu Merger shall not constitute a Change of Control.


 


“Code”
means the Internal Revenue Code of 1986, as amended, and any Treasury Regulations promulgated thereunder.


 


“Collateral”
has the meaning given to it in the Security Agreement.


 


“Collateral
Agent” means Deerfield Mgmt, L.P., in its capacity as collateral agent for the Secured Parties, together with its successors
and assigns in such capacity, under the Security Agreement and certain other Loan Documents.


 


“Commercial
Products” has the meaning given to it in Section 5.4(i).


 




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“Compliance
Certificate” means a compliance certificate substantially in the form of Exhibit C hereto to be signed by the
Chief Financial Officer or President of the Borrower (and with respect to the Borrower and its Subsidiaries only).


 


“Control Agreement”
means, with respect to any Deposit Account, Securities Account, Commodity Account, Security entitlement or Commodity Contract,
an agreement, in form and substance reasonably satisfactory to Collateral Agent, among Collateral Agent, the financial institution
or other Person at which such account is maintained or with which such entitlement or contract is carried and the Loan Party Obligor
maintaining such account or owning such entitlement or contract, effective to grant “control” (within the meaning of
Articles 8 and 9 under the applicable UCC) over such account to Collateral Agent (for the benefit of the Secured Parties), including,
without limitation, any definition provided for such defined term in the Security Agreement.


 


“controlled
by” has the meaning set forth in the definition of “Affiliate.”


 


“Controlled
Investment Affiliate” means as to any Person, any other Person that (a) directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person and (b) is organized by such Person primarily for the purpose of making
equity or debt investments in one or more companies.


 


“Default”
means any event which, at the giving of notice, lapse of time or fulfillment of any other applicable condition (or any combination
of the foregoing), would constitute an Event of Default.


 


“Disbursement”
has the meaning given to it in Section 2.2.


 


“Division”
in reference to any Person which is an entity, means the division of such Person into two (2) or more separate Persons, with the
dividing Person either continuing or terminating its existence as part of such division, including as contemplated under Section
18-217 of the Delaware Limited Liability Company Act for limited liability companies formed under Delaware law, or any analogous
action taken pursuant to any other Applicable Law with respect to any corporation, limited liability company, partnership or other
entity. The word “Divide,” when capitalized, shall have a correlative meaning.


 


“Dollars”
and the “$” sign mean the lawful currency of the United States of America.


 


“EBITDA”
means, for the applicable period, for the Borrower Loan Parties on a consolidated basis, the sum of (a) Net Income, plus
(b) Interest Expense deducted in the calculation of such Net Income, plus (c) taxes on income, whether paid, payable or
accrued, deducted in the calculation of such Net Income, plus (d) depreciation expense deducted in the calculation of such
Net Income, plus (e) amortization expense deducted in the calculation of such Net Income, plus (f) any other non-cash
charges that have been deducted in the calculation of such Net Income, plus (g) transaction fees and expenses incurred in
connection with the transactions contemplated by this Agreement in an aggregate amount not to exceed $500,000, minus (h)
any other non-cash gains that have been added in the calculation of such Net Income.


 


“Employee
Benefit Plan” has the meaning set forth in Section 3.1(s) hereof.


 


“ERISA”
means the Employee Retirement Income Security Act of 1974 and all rules, regulations and orders promulgated thereunder.


 




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“ERISA Affiliate”
means any trade or business (whether or not incorporated) under common control with a Loan Party within the meaning of Section
414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code
and Section 302 of ERISA).


 


“ERISA Event”
means: (a) a Reportable Event with respect to a Pension Plan; (b) the withdrawal of any Loan Party or any ERISA Affiliate from
a Pension Plan subject to Section 4063 of ERISA during a plan year in which such entity was a “substantial employer”
as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as such a withdrawal under Section 4062(e)
of ERISA; (c) a complete or partial withdrawal by a Loan Party or any ERISA Affiliate from a Multiemployer Plan or notification
that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Pension Plan
amendment as a termination under Section 4041 or 4041A of ERISA; (e) the institution by the PBGC of proceedings to terminate a
Pension Plan; (f) any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (g) the determination that any Pension Plan is considered an at-risk plan or a plan
in endangered or critical status within the meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304 and 305 of ERISA;
or (h) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon a Loan Party or any ERISA Affiliate.


 


“Event of
Default” has the meaning given to it in Section 5.4.


 


“Excess Availability”
has the meaning given to it in the ABL Agreement as in effect on the Fourth Amendment Date.


 


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


 


“Excluded
Taxes” means with respect to any Lender, (a) Taxes imposed on (or measured by) such Lender’s net income, franchise
Taxes and branch profit Taxes, in each case (i) imposed by the jurisdiction (or any political subdivision thereof) under the laws
of which such Lender is organized or incorporated or in which the applicable lending office of such Lender is located, or (ii)
that are Other Connection Taxes, (b) any United States federal withholding Tax imposed on amounts payable to such Lender under
the laws in effect at the time such Lender becomes a party to this Agreement or such Lender changes its lending office, except
to the extent such Lender acquired its interest in the Loan from a transferor that was entitled, immediately before such transfer,
to receive such Additional Amounts with respect to such withholding Tax pursuant to Section 2.5(a), (c) any United States
withholding Tax imposed on amounts payable to such Lender as a result of such Lender’s failure to comply with Section
2.5(d) other than as a result of such Lender’s legal inability to comply with Section 2.5(d) as a result of a
change in law occurring subsequent to the date such Lender became a party to this Agreement, or (d) any United States withholding
Tax imposed on amounts payable to such Lender due to such Lender’s non-compliance with FATCA.


 




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“Excluded
Transaction” means any of the following transactions: the entering into any collaborative arrangement, licensing, joint
venture, partnership, royalty agreement or similar agreements or other research, development manufacturing or other commercial
exploitation arrangements relating to the Intellectual Property or other assets of the Borrower or any of its Subsidiaries or other
assets (provided that the Borrower has a reasonable basis for believing that the downstream economics potentially to be
received by the Borrower and its Subsidiaries in connection with such collaborative arrangement, licensing, joint venture, partnership,
royalty agreement or similar agreements or other research, development, manufacturing or other commercial exploitation arrangements
relating to the IP, when combined with the potential downstream economics of rights in the IP retained by the Borrower and its
Subsidiaries are adequate to enable Borrower to timely satisfy all obligations of the Borrower and the other Loan Parties under
this Agreement), including, without limitation, but subject to the conditions set forth above, (1) any grant to any entity engaged
in, or owned by an entity engaged in, the pharmaceutical or biotechnology industry of a license or option to obtain a license to
any of the Borrower or any Subsidiary of the Borrower Intellectual Property or other assets; provided that the Borrower
or one of its Subsidiaries directly receives from such entity all consideration paid or payable by such entity in consideration
of such grant, which consideration may, but need not, include (without limitation) upfront, milestone, royalty and profit-sharing
payments, (2) any grant of a license or option to obtain a license to any entity that intends to research, develop, commercialize
or manufacture Products or services covered by such Intellectual Property or other assets whether directly or through the Borrower,
any Subsidiary of the Borrower or another entity, and (3) any arrangement or transfers of assets for the manufacture, research,
promotion and development of the Borrower’s or any Subsidiary of the Borrower’s Products and clinical trial management,
and data analysis and similar activities in support of the Borrower’s or any Subsidiary of the Borrower’s development
programs.


 


“Exit Payment”
has the meaning given to it in Section 2.3(c).


 


“FATCA”
means Sections 1471 through 1474 of the Code as of the date of this Agreement (or any amended or successor version that is substantially
comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof
and any agreement entered into pursuant to Section 1471(b)(1) of the Code and any intergovernmental agreements entered into in
connection with the foregoing.


 


“FDA”
means the US Food and Drug Administration.


 


“Fifth Amendment”
shall mean the Fifth Amendment to Facility Agreement, dated as of May 6, 2020, among the Borrower, the Guarantors and the Lenders.


 


“Fifth Amendment
Date” shall mean May 6, 2020.


 


“Financing
Lease” means any financing lease which is or should be capitalized on the balance sheet of the lessee thereunder in accordance
with GAAP.


 


“FIRREA”
means the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended.


 


“First Amendment”
means the First Amendment to Facility Agreement dated as of June 1, 2017, by and among Borrower, the Guarantors party thereto and
the Lenders party thereto.


 


“Fiscal Year”
means the fiscal year of the Borrower, which ends on June 30 of each year.


 


“Fixed Charge
Coverage Ratio” means the ratio, determined in a manner reasonably acceptable to the Lenders, of (a) EBITDA for the most
recently ended twelve-month period for which financial statements have been delivered or publicly filed (or are required to have
been delivered or publicly filed) under Section 5.1(v), minus unfinanced Capital Expenditures of the Borrower Loan Parties
on a consolidated basis for such period, to (b) Fixed Charges for such period.


 


“Fixed
Charges” means, for the period in question, on a consolidated basis, the sum of (a) all principal payments scheduled
or required to be made during or with respect to such period in respect of Indebtedness of the Borrower Loan Parties, plus
(b) all Interest Expense of the Borrower Loan Parties for such period paid or required to be paid in cash attributable to such
period, plus (c) all taxes of the Loan Parties paid or required to be paid for such period, and plus (d) all cash
distributions, dividends, redemptions and other cash payments made or required to be made during such period with respect to equity
securities or subordinated debt issued by any Borrower Loan Party.


 




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“Form 8-K”
means a current report on Form 8-K under the Exchange Act.


 


“Fourth Amendment”
means the Fourth Amendment to Facility Agreement dated as of October 2, 2019 among the Borrower, the Guarantors (as defined in
the Security Agreement) party thereto and Lenders.


 


“Fourth Amendment
Date” means October 2, 2019.


 


“GAAP”
means generally accepted accounting principles consistently applied as set forth 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 accounting profession).


 


“Governmental
Authority” means any government, quasi-governmental agency, governmental department, ministry, cabinet, commission, board,
bureau, agency, court, tribunal, regulatory authority, instrumentality, judicial, legislative, fiscal, or administrative or public
body or entity, whether domestic or foreign, federal, state or local, having jurisdiction over the matter or matters and Person
or Persons in question, including, but not limited to the FDA.


 


“Guarantor”
means Aytu and each Subsidiary of Aytu or the Borrower or other Person who provides a guaranty of the Obligations under the Security
Agreement or other Loan Document.


 


“Guaranty”,
as applied to any Indebtedness, liability or other obligation, means (a) a guaranty, directly or indirectly, in any manner, including
by way of endorsement (other than endorsements of negotiable instruments for collection in the Ordinary Course of Business), of
any part or all of such Indebtedness, liability or obligation and (b) an agreement, contingent or otherwise, and whether or not
constituting a guaranty, assuring, or intended to assure, the payment or performance (or payment of damages in the event of non-performance)
of any part or all of such Indebtedness, liability or obligation by any means (including the purchase of securities or obligations,
the purchase or sale of property or services or the supplying of funds).


 


“Health Care
Laws” means all laws relating to the provision and/or administration of, and/or payment for, healthcare products or services,
including, without limitation, Applicable Laws with respect to (in each case, to the extent applicable): (a) health care fraud
and abuse (including without limitation the following statutes, as amended, modified or supplemented from time to time and any
successor statutes thereto and regulations promulgated from time to time thereunder: the federal Anti-Kickback Statute (42 U.S.C.
§ 1320a-7b(b)); the Stark Law (42 U.S.C. § 1395nn); the civil False Claims Act (31 U.S.C. § 3729 et seq.); 42 U.S.C.
§§ 1320a-7, 1320a-7b; the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Pub. L. No. 108-173));
and any state, commonwealth or local laws similar to any of the foregoing; (b) Medicare, Medicaid or other programs which are sponsored
or maintained by a governmental payor; (c) quality, safety certification and accreditation standards and requirements; (d) HIPAA;
(e) prescription drug, medical device or controlled substances registration, approval, importation, sale, use, distribution, compounding,
dispensing, transporting, purchasing, storage, tracking, marketing and security, including state pharmacy and controlled substance
laws, the Federal Food, Drug, and Cosmetic Act, the Controlled Substances Act, the Prescription Drug Marketing Act of 1987, and
Food and Drug Administration rules and regulation; (f) the provision of free or discounted care or services; and (g) the conditions
of participation or enrollment as a provider/supplier in and Applicable Laws governing health programs administered by or paid
for, in whole or in part by, governmental payors.


 




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“Health Care
Permits” means any and all Permits issued or required under applicable Health Care Laws.


 


“HIPAA”
means the (a) Health Insurance Portability and Accountability Act of 1996; (b) the Health Information Technology for Economic and
Clinical Health Act (Title XIII of the American Recovery and Reinvestment Act of 2009); and (c) any state, commonwealth and local
laws regulating the privacy and/or security of individually identifiable health information, including state laws providing for
notification of breach of privacy or security of individually identifiable health information, in each case with respect to the
laws described in clauses (a), (b) and (c) of this definition, as the same may be amended, modified or supplemented
from time to time, any successor statutes thereto, any and all rules or regulations promulgated from time to time thereunder.


 


“Immaterial
Aytu Subsidiaries” means, collectively, Aytu Women’s Health, LLC, a Delaware limited liability company, and Fastrack
Pharmaceuticals, Inc., a Delaware corporation; provided, however, with respect to each of the foregoing Persons,
such Person shall cease to constitute an Immaterial Aytu Subsidiary upon the earlier to occur of (a) the date that is sixty (60)
days after the Sixth Amendment Effective Date if, as of such date, an appropriate Certificate of Dissolution or Certificate of
Cancellation (or the equivalent) has not been filed with the appropriate Governmental Authority with respect to such Person and
(b) the first date on which such Person acquires material assets or generates material revenue.


 


“Indebtedness”
means, with respect to any Person, the following:


 


(i) all obligations,
liabilities or indebtedness, contingent or otherwise, for borrowed money;


 


(ii) the deferred
purchase price of assets or services (other than (x) trade payables which are not one-hundred twenty (120) days past the invoice
date incurred in the Ordinary Course of Business, (y) unsecured earn-out obligations incurred on reasonable and customary terms
(but including the maximum potential amount payable under any other earn-out or similar obligations) and (z) unsecured indemnifications
of Aytu and its Subsidiaries (other than the Borrower and its Subsidiaries) incurred on reasonable and customary terms in connection
with an investment or acquisition consummated by any such Person) which in accordance with GAAP would be shown to be a liability
(or on the liability side of a balance sheet);


 


(iii) all guarantees
of Indebtedness, Guaranties, endorsements (other than for collection in the Ordinary Course of Business) and other contingent obligations
in respect of the obligations of others;


 


(iv) all letters
of credit issued or acceptance facilities established for the account of (or issued on behalf of) such Person, including without
duplication, all drafts drawn thereunder, and bankers’ acceptances, and financial and other hedging obligations;


 


(v) all capitalized
lease obligations;


 


(vi) all indebtedness
of another Person secured by any Lien on any property of Aytu or its Subsidiaries, whether or not such indebtedness has been assumed
or is recourse (with the amount thereof, in the case of any such indebtedness that has not been assumed by Aytu or its Subsidiaries,
being measured as the lower of (x) fair market value of such property and (y) the amount of the indebtedness secured);


 




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(vii) all obligations
and indebtedness created or arising under any conditional sale or title retention agreement;


 


(viii) all
obligations represented by promissory notes, bonds, debentures or the like, or on which interest charges are customarily paid;


 


(ix) all Financing
Leases of such Person;


 


(x) all Stock
issued subject to repurchase or redemption at any time on or prior to the Maturity Date, other than voluntary repurchases or redemptions
that are at the sole option of the Person issuing such Stock; and


 


(xi) all principal
outstanding under any synthetic lease, off-balance sheet loan or similar financing product.


 


Notwithstanding the
foregoing, in no event shall royalty obligations owed by Aytu to any Lender or any Affiliate of a Lender constitute Indebtedness
for purposes of this Agreement or any other Loan Document.


 


“Indemnified
Person” has the meaning given to it in Section 6.11.


 


“Indemnified
Taxes” means all Taxes including Other Taxes, other than Excluded Taxes, imposed on or with respect to any payment made
by or on account of any obligation of a Loan Party Obligor under any Loan Document.


 


“Indemnity”
has the meaning given to it in Section 6.11.


 


“Initial Exit
Payment” has the meaning given to it in Section 2.3(c).


 


“Intercreditor
Agreement” means that certain Intercreditor Agreement, dated as of the Fourth Amendment Date, by and among Encina Business
Credit, LLC, a Delaware limited liability company, in its capacity as agent for the “Lenders” under the ABL Agreement,
Deerfield Private Design Fund III, L.P., Deerfield Special Situations Fund, L.P., and Deerfield Mgmt, L.P., and acknowledged by
the Loan Party Obligors.


 


“Interest
Expense” means, for the applicable period, for the Borrower Loan Parties on a consolidated basis, total interest expense
(including interest attributable to Financing Leases in accordance with GAAP) and fees with respect to outstanding Indebtedness.


 


“Interest
Rate” means 12.95% per annum.


 


“Investment
Property” means the collective reference to (a) all “investment property” as such term is defined in Section
9-102 of the UCC, (b) all “financial assets” as such term is defined in Section 8-102(a)(9) of the UCC and (c) whether
or not constituting “investment property” as so defined, all Pledged Equity.


 


“IP,”
“Company IP” and “Intellectual Property” have the respective meanings given in Section
3.1(m).


 


“IRS”
means the United States Internal Revenue Service.


 


“Issuers”
means the collective reference to each of the issuers of Investment Property.


 




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“Lenders”
has the meaning set forth in the preamble.


 


“Letter Agreement”
means that certain Letter Agreement re: Consent and Modification to Loan Documents, dated December 10, 2010, among the Lenders,
the Loan Parties party thereto and Aytu.


 


“License”
means any license of Intellectual Property.


 


“Lien”
means any lien (statutory or otherwise), pledge, mortgage, security interest, deed of trust, charge, assignment, hypothecation,
title retention, deposit arrangement, easement, encumbrance or other security arrangement and any other preference, priority, or
preferential arrangement in the nature of a security interest of any kind or whatsoever, including any conditional sale contract
or other title-retention agreement, the interest of a lessor under a Financing Lease and any synthetic or other financing lease
having substantially the same economic effect as any of the foregoing.


 


“Loan”
means the loans made by the Lenders to the Borrower pursuant to Section 2.2 in the aggregate principal amount of Sixty Million
Dollars ($60,000,000) or, as the context may require, the principal amount thereof from time to time outstanding.


 


“Loan Documents”
means this Agreement, each Perfection Certificate and all other attachments, schedules, annexes and exhibits hereto, the Notes,
the Security Agreement, Intellectual Property security agreements, the Control Agreements, the First Amendment, the Second Amendment,
the Third Amendment, the Fourth Amendment, the Fifth Amendment, the Sixth Amendment, the Intercreditor Agreement (and any other
subordination or intercreditor agreement entered into by any of the Lenders with respect to any Indebtedness permitted under the
Loan Documents), any collateral assignment, and any other amendment, restatement, supplement, modification, waiver, consent, agreement,
document or instrument executed by Aytu or any of its Subsidiaries and delivered in connection with any of the foregoing and dated
the Agreement Date or subsequent thereto, whether or not specifically mentioned herein or therein.


 


“Loan Party”
means, individually, Aytu and each of its Subsidiaries (other than the Immaterial Aytu Subsidiaries); and “Loan Parties”
means, collectively, Aytu and all of its Subsidiaries (other than the Immaterial Aytu Subsidiaries).


 


“Loan Party
Obligor” means, individually, the Borrower, Aytu, each other Guarantor and each Obligor; and “Loan Party Obligors”
means, collectively, the Borrower, Aytu and each other Loan Party Obligor.


 


“Loss”
has the meaning given to it in Section 6.11.


 


“Material
Adverse Effect” means any event, act, omission, condition or circumstance which, which individually or in the aggregate,
has or could reasonably be expected to have a material adverse effect on (a) the business, operations, properties, assets or financial
condition or assets of Aytu and its Subsidiaries (taken as a whole), (b) the validity or enforceability of, or any Secured Party’s
rights or remedies under, any Loan Document, (c) the ability of Aytu and its Subsidiaries (taken as a whole) to timely perform
any of its obligations under the Loan Documents (including the Obligations) when due, (d) the rights and remedies of the Secured
Parties under any Loan Document, including any ability of any Secured Party to realize upon the Collateral, or (e) the existence,
perfection or priority of any security interest or Lien granted in any Loan Document and covering Collateral in which Collateral
Agent has previously perfected a security interest or Lien.


 


“Material
Contract” has the meaning given to it in Section 3.1(ee).


 




    A-10


     


    

 


“Maturity
Date” has the meaning given to it in Section 2.3(a)(ii).


 


“Medicaid”
means, collectively, the health care assistance program established by Title XIX of the Social Security Act (42 U.S.C. § 1396
et seq.) and any statutes succeeding thereto, and all Applicable Laws pertaining to such program, including (a) all federal statutes
affecting such program; (b) all state and commonwealth statutes and plans for medical assistance enacted in connection with such
program and federal rules and regulations promulgated in connection with such program; and (c) all applicable provisions of all
rules, regulations and legally binding manuals, orders and administrative and reimbursement requirements of all Governmental Authorities
promulgated in connection with such program, in each case as the same may be amended, supplemented or otherwise modified from time
to time.


 


“Medicare”
means, collectively, the health insurance program for the aged and disabled established by Title XVIII of the Social Security Act
(42 U.S.C. § 1395 et seq.) and any statutes succeeding thereto, and all Applicable Laws pertaining to such program including
(a) all federal statutes (whether set forth in Title XVIII of the Social Security Act (42 U.S.C. § 1395 et seq.) or elsewhere)
affecting such program; and (b) all applicable provisions of all rules, regulations and legally binding manuals, orders, administrative
and reimbursement requirements of all Governmental Authorities promulgated in connection with such program, in each case as the
same may be amended, supplemented or otherwise modified from time to time.


 


“Monthly Principal
Payment” has the meaning given to it in Section 2.3(a)(iv).


 


“Monthly Principal
Payment Date” has the meaning given to it in Section 2.3(a)(iv).


 


“Multiemployer
Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which a Loan Party or
any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated
to make contributions.


 


“NASDAQ”
means the Nasdaq Stock Market (or any successor thereto).


 


“Natesto License”
means the license by Aytu of the Natesto product line and related Intellectual Property.


 


“Necessary
Disclosure” has the meaning set forth in Section 5.1(xiii).


 


“Net Income”
means, for the applicable period, for the Borrower Loan Parties on a consolidated basis, the net income (or loss) of the Borrower
Loan Parties on a consolidated basis for such period, excluding any gains or non-cash losses from dispositions, any extraordinary
gains or extraordinary non-cash losses and any gains or non-cash losses from discontinued operations, in each case of the Loan
Parties on a consolidated basis for such period.


 


“Notes”
means promissory notes issued to the Lenders on the Sixth Amendment Effective Date evidencing the Loan in substantially the form
of Exhibit C attached to the Sixth Amendment, as may be further amended, restated, supplemented, replaced or otherwise modified
from time to time.


 


“Obligations”
means all Loans and Disbursements, interests, fees (including any Prepayment Amount and the Exit Payment), expenses, costs, liabilities,
indebtedness and other obligations (monetary (including post-petition interest, costs, fees, expenses and other amounts, whether
allowed or not) or otherwise) of (or owed by) the Borrower, the other Loan Party Obligors or any other Person under or in connection
with the Loan Documents, in each case howsoever created, arising or evidenced, whether direct or indirect (including those acquired
by assignment), absolute or contingent, now or hereafter existing, or due or to become due.


 




    A-11


     


    

 


“Obligor”
means any guarantor, endorser, acceptor, surety or other Person liable on, or with respect to, any of the Obligations or who is
the owner of any property which is security for any of the Obligations, other than the Borrower.


 


“Ordinary
Course of Business” means, in respect of any transaction involving any Person, the Ordinary Course of Business of such
Person, as conducted by such Person as of the Sixth Amendment Effective Date and any practices that are utilized to improve past
practices or to conform with customary operating procedures for a similar business, as reasonably determined by such Person.


 


“Organizational
Documents” means for any Person as of any date, such Person’s charter, constitutional or constituent documents,
formation documents and/or certificate of incorporation (or equivalent thereof), and each certificate of change of name, and, (a)
if such Person is a corporation, its bylaws or memorandum and articles of association (or equivalent thereof) in current form,
(b) if such Person is a limited liability company, its limited liability company agreement or its shareholders agreement (or similar
agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with
all current amendments or modifications thereto.


 


“Other Connection
Taxes” means with respect to any Lender, Taxes imposed as a result of a present or former connection between such Lender
and the jurisdiction imposing such Tax (except a connection arising from such Lender having executed, delivered, become a party
to, performed its obligations or received a payment under, received or perfected a security interest under, engaged in any transaction
pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan Document).


 


“Other Obligor”
means any Obligor other than any Loan Party Obligor.


 


“Other Taxes”
means any and all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes arising from any
payment made hereunder or from the execution, delivery, registration or enforcement of, or otherwise with respect to, any Loan
Document except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment
made in connection with the exercise of remedies following an Event of Default).


 


“Paragraph
IV Certification” means a certification by an applicant filing an ANDA or 505(b)(2) NDA referencing a drug listed in
Approved Drug Products with Therapeutic Equivalence Evaluations to the FDA that the patent relating to such listed drug
is invalid or will not be infringed upon by the manufacture, use or sale of the drug product for which the ANDA or 505(b)(2) NDA
is submitted.


 


“Parties”
has the meaning set forth in the preamble.


 


“PBGC”
means the Pension Benefit Guaranty Corporation.


 


“Pension Act”
means the Pension Protection Act of 2006.


 


“Pension Funding
Rules” means the rules of the Code and ERISA regarding minimum required contributions (including any installment payment
thereof) to Pension Plans and Multiemployer Plans and set forth in, with respect to plan years ending prior to the effective date
of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter,
Section 412, 430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA, and any sections of the Code or ERISA
related thereto that are enacted after the date of this Agreement.


 




    A-12


     


    

 


“Pension Plan”
means any employee pension benefit plan (including a Multiemployer Plan) that is maintained or is contributed to by a Loan Party
and any ERISA Affiliate and is either covered by Title IV of ERISA or is subject to the minimum funding standards under Section
412 of the Code.


 


“Perfection
Certificate” means a perfection certificate substantially in the form attached as Exhibit D to the Sixth Amendment.


 


“Permits”
means all permits, licenses, registrations, certificates, qualifications, accreditations, approvals or similar rights required
to be obtained, from any Governmental Authority.


 


“Permitted
Indebtedness” means:


 


(i) the Obligations;


 


(ii) Indebtedness
arising under operating leases in the Ordinary Course of Business;


 


(iii) Indebtedness
in respect of purchase money financing and capital lease obligations that are Financing Leases covering existing and newly-acquired
Equipment, including for the acquisition, installation, qualification and validation of such Equipment up to an aggregate amount
outstanding at any time of $8,000,000;


 


(iv) Indebtedness
incurred as a result of endorsing negotiable instruments received in the Ordinary Course of Business;


 


(v) other unsecured
Indebtedness not to exceed $250,000 in the aggregate at any time outstanding;


 


(vi) Indebtedness
in respect of a revolving credit facility in an aggregate principal amount not to exceed $25,000,000 evidenced by the ABL Agreement
(the “ABL Facility”), to the extent subject to, and permitted by, and in full compliance with, the Intercreditor
Agreement;


 


(vii) the Indebtedness
existing on the Sixth Amendment Effective Date described Schedule 1.1-A; in each case, along with extensions, refinancings,
modifications, amendments and restatements thereof; provided, that (i) the principal amount thereof is not increased, (ii)
if secured by a Permitted Lien, no additional collateral beyond that existing as of the Sixth Amendment Effective Date is granted
to secure such Indebtedness; (iii) if such Indebtedness is subordinated to any or all of the Obligations, the applicable subordination
terms are not amended, restated, supplemented or otherwise modified without the prior written consent of the Required Lenders,
and (iv) the terms thereof are not amended, restated, supplemented or otherwise modified to impose more burdensome terms upon any
Loan Party;


 


(viii) to the
extent constituting Indebtedness, Indebtedness incurred in connection with the financing of insurance premiums in the Ordinary
Course of Business of the Loan Parties;


 




    A-13


     


    

 


(ix) unsecured
Indebtedness of Aytu and its Subsidiaries (other than the Borrower Loan Parties) incurred from and after the 91st day
after the Sixth Amendment Effective Date, in an aggregate amount outstanding not to exceed $5,000,000 that is subordinated in right
of payment to the Obligations pursuant to a subordination agreement substantially similar in form and substance to the Subordination
Agreement, dated as of February 8, 2021, by and among Aytu and the Lenders or otherwise in form and substance reasonably acceptable
to the Lenders;


 


(x) (A) purchase
money and Financing Lease obligations of Persons acquired by Aytu or any of its Subsidiaries (other than the Borrower Loan Parties)
in an aggregate amount not to exceed $250,000 outstanding at any time and (B) other purchase money and Financing Lease obligations
of Aytu and its Subsidiaries (other than the Borrower Loan Parties) in an aggregate amount not to exceed $250,000 outstanding at
any time; and


 


(xi) other
unsecured Indebtedness of Aytu and its Subsidiaries (other than the Borrower Loan Parties) in an aggregate amount outstanding at
any time not to exceed $1,000,000.


 


“Permitted
Investments” means:


 


(i) investments
outstanding on the Sixth Amendment Effective Date described in Schedule 1.1-B;


 


(ii) investments
by any Loan Party in any other Loan Party or any Subsidiary of a Loan Party in equity interests; provided, that (a) any
such equity interests held by a Loan Party Obligor shall be pledged as required pursuant to this Agreement and/or the Security
Agreement, as applicable, and (b) the aggregate amount of investments by Loan Parties in Subsidiaries that are not Loan Parties
(together with outstanding intercompany loans permitted under clause (iii) below of this definition and outstanding Guaranties
permitted under clause (iv) below of this definition) shall not exceed $500,000 at any time outstanding);


 


(iii) loans
or advances made by any Loan Party to any Subsidiary and made by any Subsidiary to a Loan Party or any other Subsidiary; provided,
that (a) any such loans and advances made by a Loan Party and evidenced by a promissory note shall be pledged pursuant to this
Agreement and (b) the principal amount of such loans and advances made by Loan Parties to Subsidiaries that are not Loan Parties
(together with outstanding investments permitted by clause (ii) above of this definition and outstanding Guaranties permitted
under clause (iv) below of this definition) shall not exceed $250,000 at any time outstanding);


 


(iv) Guaranties
constituting Permitted Indebtedness; provided, that the aggregate principal amount of Indebtedness of Subsidiaries that
are not Loan Parties that is guaranteed by any Loan Party (together with outstanding investments permitted under clause (ii)
above of this definition and outstanding intercompany loans permitted under clause (iii) above of this definition) shall
not exceed $250,000 at any time outstanding);


 


(v) loans and
advances to directors, employees and officers of any Loan Party Obligor and its Subsidiaries for bona fide business purposes in
the Ordinary Course of Business, in an aggregate amount not to exceed $50,000 at any time outstanding;


 




    A-14


     


    

 


(vi) leases
of real or personal property in the Ordinary Course of Business and in accordance with the terms and conditions of this Agreement;
and


 


(vii) investments
constituting deposits described in Permitted Liens.


 


“Permitted
Liens” means:


 


(i) purchase-money
security interests in specific items of Equipment securing Permitted Indebtedness described under clause (iii) of the definition
of Permitted Indebtedness;


 


(ii) liens
for taxes, fees, assessments, or other governmental charges or levies, either not delinquent or being contested in good faith by
appropriate proceedings (which proceedings have the effect of preventing the enforcement of such lien) for which adequate reserves
in accordance with GAAP are being maintained provided the same have no priority over any of the Collateral Agent’s security
interests;


 


(iii) liens
of materialmen, mechanics, carriers, or other similar liens arising in the Ordinary Course of Business and securing obligations
which are not delinquent or are being contested in good faith by appropriate proceedings (which proceedings have the effect of
preventing the enforcement of such lien) for which adequate reserves in accordance with GAAP are being maintained;


 


(iv) liens
which constitute banker’s liens, rights of set-off, or similar rights as to deposit accounts or other funds maintained with
a bank or other financial institution (but only to the extent such banker’s liens, rights of set-off or other rights are
in respect of customary service charges relative to such deposit accounts and other funds, and not in respect of any loans or other
extensions of credit by such bank or other financial institution to any Loan Party);


 


(v) cash deposits
or pledges of an aggregate amount not to exceed $50,000 to secure the payment of worker’s compensation, unemployment insurance,
or other social security benefits or obligations, public or statutory obligations, surety or appeal bonds, bid or performance bonds,
or other obligations of a like nature incurred in the Ordinary Course of Business;


 


(vi) judgment
Liens in respect of judgments that do not constitute an Event of Default;


 


(vii) easements,
zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the Ordinary Course of
Business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere
with the ordinary conduct of business of the Borrower or any Subsidiary;


 


(viii) any
Lien in existence on the Sixth Amendment Effective Date and described in Schedule 1.1-C and any Lien granted as a replacement
or substitute therefor; provided, that any such replacement or substitute Lien (i) does not secure an aggregate amount of Indebtedness,
if any, greater than that secured on the Sixth Amendment Effective Date and (ii) does not encumber any property other than the
property subject thereto on the Sixth Amendment Effective Date;


 




    A-15


     


    

 


(ix) Liens
on the assets of the Loan Party Obligors securing the ABL Debt to the extent such Liens are subject to, and permitted by, and are
in compliance with, the Intercreditor Agreement;


 


(x) other Liens
securing obligations in an aggregate principal amount not to exceed $25,000 at any time outstanding;


 


(xi) Liens
in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the
importation of goods in the Ordinary Course of Business of the Loan Parties;


 


(xii) Liens
securing purchase-money obligations and under Financing Leases, in each case, with respect to Permitted Indebtedness described
under clause (x) of the definition of “Permitted Indebtedness;”


 


(xiii) Liens
securing any royalty obligations owed by Aytu to any Lender or any Affiliate of a Lender; and


 


(xiv) restrictions
and encumbrances under (a) non-exclusive out-bound licenses granted to customers in the Ordinary Course of Business, (b) over-the-counter
software that is commercially available to the public, and (c) in-bound licenses of Intellectual Property on reasonable and customary
terms in the Ordinary Course of Business.


 


“Person”
means and includes any natural person, individual, partnership, limited partnership, joint venture, corporation, trust, limited
liability company, limited company, joint stock company, unincorporated organization, government entity or any political subdivision
or agency thereof, or any other entity.


 


“Pledged Equity”
means the equity interests and other Stock listed pledged pursuant to the Security Agreement, together with any other equity interests,
Stock, certificates, options, or rights or instruments of any nature whatsoever in respect of the equity interests and Stock of
any Person that may be issued or granted to, or held by, any Loan Party Obligor while this Agreement is in effect, and including,
to the extent attributable to, or otherwise related to, such pledged equity interests and Stock, all of such Loan Party Obligor’s
(a) interests in the profits and losses of each Issuer, (b) rights and interests to receive distributions of each Issuer’s
assets and properties and (c) rights and interests, if any, to participate in the management of each Issuer related to such pledged
equity interests and Stock.


 


“Prepayment
Amount” has the meaning set forth in Section 2.3(b).


 


“Pro Rata
Share” means, with respect to any Lender, the applicable percentage set forth on Schedule I to the Second Amendment or
such other percentage as the Lenders shall unanimously determine; provided that the Lenders shall notify the Borrower of
such determination at least three (3) days prior to the effectiveness of such other percentage.


 


“Products”
means any item or any service that is designed, created, manufactured, managed, performed or otherwise offered by or on behalf
of any of the Loan Parties or any of their Subsidiaries.


 


“Register”
has the meaning set forth in Section 1.4(b).


 


“Reportable
Event” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the thirty-day notice
period has been waived.


 




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“Required
Lenders” means, at any time, Lenders holding Loans representing more than 50% of the sum of the Loans outstanding.


 


“Restricted
Accounts” means Deposit Accounts (a) established and used (and at all times will be used) solely for the purpose of paying
current payroll obligations of Loan Parties (and which do not (and will not at any time) contain any deposits other than those
necessary to fund current payroll), in each case, in the Ordinary Course of Business, or (b) maintained (and at all times will
be maintained) solely in connection with an employee benefit plan, but solely to the extent that all funds on deposit therein are
solely held for the benefit of, and owned by, employees (and will continue to be so held and owned) pursuant to such plan.


 


“Restricted
Payment” means any payment, dividend or other distribution (whether in cash, securities or other property) with respect
to any equity interests in the Borrower, any Loan Party or any Subsidiary of the Borrower, or any payment, dividend or other distribution
(whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any such equity interests in any of the Borrower, any Loan Party or any
Subsidiary or any option, warrant or other right to acquire any such equity interests in any of the Borrower, any Loan Party or
any Subsidiary of Borrower.


 


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


 


“Second Amendment”
means the Second Amendment to Facility Agreement dated as of November 5, 2018 among the Borrower, Guarantors and Lenders.


 


“SEC Reports”
has the meaning set forth in Section 3.1(pp).


 


“Secured Parties”
means Collateral Agent, the Lenders and all Indemnified Persons.


 


“Securities”
means, collectively the Notes (including the guaranties thereof by the Guarantors).


 


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


 


“Security
Agreement” means the Guaranty and Security Agreement of even date herewith among Borrower, its Subsidiaries, Collateral
Agent and Lenders.


 


“Sixth Amendment”
means the Waiver and Sixth Amendment to Facility Agreement, dated as of March 19, 2021, among the Lenders and the Loan Parties.


 


“Sixth Amendment
Effective Date” means the Sixth Amendment Effective Date, as defined in the Sixth Amendment.


 


“Sixth Amendment
Effective Date Prepayment” means the “Prepayment,” as defined in the Sixth Amendment.


 


“SPS”
means Specialty Pharmaceutical Services, a subsidiary of Cardinal Health.


 


“Stock”
means (a) all shares of capital stock (whether denominated as common stock or preferred stock), equity interests, beneficial, partnership
or membership interests, joint venture interests, participations or other ownership or profit interests in or equivalents (regardless
of how designated) of or in a Person (other than an individual), whether voting or non-voting; and (b) all securities convertible
into or exchangeable for any other Stock and all warrants, options or other rights to purchase, subscribe for or otherwise acquire
any other Stock, whether or not presently convertible, exchangeable or exercisable.


 




    A-17


     


    

 


“Subsidiary”
or “Subsidiaries” means, as to any Person, any Person of which securities or other ownership interests having
ordinary voting power to elect a majority of the board of directors or other Persons performing similar functions are at the time
directly or indirectly owned by such Person. Unless the context otherwise requires, each reference to Subsidiaries herein shall
be a reference to Subsidiaries of Aytu (other than the Immaterial Aytu Subsidiaries).


 


“Tax Affiliate”
means (a) Aytu and its Subsidiaries and (b) any Affiliate of Aytu with which Aytu files or is required to file consolidated, combined
or unitary tax returns.


 


“Tax Return”
has the meaning set forth in Section 3.1(o).


 


“Taxes”
means all present or future taxes, levies, imposts, stamp or other duties, deductions, assessments, fees or other charges or withholdings
imposed by any Governmental Authority, together with any interest, additions to tax or penalties applicable thereto.


 


“Term Loan
Priority Collateral” means “Term Loan Priority Collateral” as defined in the Intercreditor Agreement.


 


“Term Priority
Deposit Account” means “Term Priority Deposit Account” as defined in the Intercreditor Agreement.


 


“Third Amendment”
means the Third Amendment to Facility Agreement dated as of March 29, 2019 among the Borrower, the Guarantors (as defined in the
Security Agreement) party thereto and Lenders.


 


“UCC”
means, at any given time, the Uniform Commercial Code as adopted and in effect at such time in the State of New York or other applicable
jurisdiction.


 




    A-18


     


    

 


Section 1.2 Interpretation.
In this Agreement and the other Loan Documents, unless the context otherwise requires, all words and personal pronouns relating
thereto shall be read and construed as the number and gender of the party or parties requires and the verb shall be read and construed
as agreeing with the required word and pronoun. The division of this Agreement and the other Loan Documents into Articles and Sections
and the use of headings and captions is for convenience of reference only and shall not modify or affect the interpretation or
construction of this Agreement or any of its provisions. The words “herein,” “hereof,” “hereunder,”
“hereinafter” and “hereto” and words of similar import refer to this Agreement (or other applicable Loan
Document) as a whole and not to any particular Article or Section hereof (or thereof). The use in any of the Loan Documents of
the word “include” or “including,” when following any general statement, term or matter, shall not be construed
to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar
items or matters, whether or not non-limiting language (such as “without limitation” or “but not limited to”
or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that
fall within the broadest possible scope of such general statement, term or matter. References in this Agreement to a specified
Article, Exhibit, Section or Schedule shall be construed as a reference to that specified Article, Exhibit, Section or Schedule
of this Agreement. Any reference to any of the Loan Documents means such document as the same shall be amended, restated, supplemented
or otherwise modified and from time to time in effect. The term “or” has, except where otherwise indicated, the inclusive
meaning represented by the phrase “and/or.” The term “documents” and “agreements” include any
and all instruments, documents, agreements, certificates, indentures, notices and other writings, however evidenced. The references
to “asset” (or “assets”) and “property” (or “properties”) in the Loan Documents
are meant to be mean the same and are used throughout the Loan Documents interchangeably, and such words shall be deemed to refer
to any and all tangible and intangible assets and properties, including cash, securities, Stock, accounts and contract rights.
Unless otherwise specified herein or therein, all terms defined in any Loan Document shall have the defined meanings when used
in any certificate or other document made or delivered pursuant hereto or thereto. The meanings of defined terms shall be equally
applicable to the singular and plural forms of the defined terms. Terms (including uncapitalized terms) not otherwise defined herein
and that are defined in the UCC shall have the meanings therein described. 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.”
If any provision of this Agreement or any other Loan Document refers to any action taken or to be taken by any Person, or which
such Person is prohibited from taking, unless otherwise expressly stated, such provision shall be interpreted to encompass any
and all means, direct or indirect, of taking, or not taking, such action. References to any statute or regulation may be made by
using either the common or public name thereof or a specific cite reference and, except as otherwise provided with respect to FATCA,
are to be construed as including all statutory and regulatory provisions related thereto or consolidating, amending, replacing,
supplementing or interpreting the statute or regulation, and any reference to any law or regulation, shall, unless otherwise specified,
refer to such law or regulation as amended, modified or supplemented from time to time. Whenever any reference is made in any Loan
Document to any Person such reference shall be construed to include such Person’s permitted successors and permitted assigns.
Unless otherwise specified, all references in any Loan Document to times of day shall be references to New York City time. Notwithstanding
anything to the contrary in any Loan Document, any reference to “Organizational Document” or “Organizational
Documents” of any Loan Party or any of its Subsidiaries in any Loan Document shall mean such written documents, agreements
and arrangements that are in effect on the date hereof, without giving effect to any amendment, restatement, change, supplement,
waiver or other modification thereto or thereof that is not expressly permitted by Section 5.2(xiii). The terms “shall”
and “will” are used interchangeably in this Agreement and the other Loan Documents and mean for the Loan Parties and
their Subsidiaries to have an absolute obligation to perform or do (or not perform or not do) a certain action or event, as the
context may require. The payment, prepayment, redemption or repayment of any principal, interest, fees, amounts and/or other Obligations
under this Agreement or the other Loan Documents shall be made in cash in Dollars unless expressly stated otherwise herein or therein.
Any reference to “payment in full,” “payment in full in cash,” “paid in full,” “paid
in full in cash,” “repaid in full,” “repaid in full in cash,” “prepaid in full,” “prepaid
in full in cash,” “redeemed in full,” “redeemed in full in cash” or any other term or word of similar
effect used in this Agreement or any other Loan Document with respect to the Loans or the Obligations shall mean all Obligations
(including any Prepayment Amount and the Exit Payment) (excluding contingent claims for indemnification to the extent no claim
giving rise thereto has been asserted) have been repaid in full in cash and have been fully performed; provided that reference
otherwise to “payment”, “paid”, “repaid”, “prepaid”, “redeem”, “purchase”,
“defease”, “prepayment” or “redemption” or any term or word of similar effect used in this
Agreement or any other Loan Document with respect to the Loans or the Obligations shall mean in cash. Any action or event that
is prohibited by the terms of the Loan Documents shall mean that such action or event is not expressly and directly permitted to
be taken or consummated under the Loan Documents.


 


Section 1.3 Business
Day Adjustment. Except as otherwise expressly stated herein or in any other Loan Document (and except on the Maturity Date
or any date of acceleration of any of the Obligations, which in each such case, such payment or performance shall be due and payable
or performed on or prior to such day regardless of whether such day is a Business Day), if the day by which any payment or other
performance is due to be made is not a Business Day, that payment or performance shall be made by the next succeeding Business
Day unless that next succeeding Business Day falls in a different calendar month, in which case that payment or other performance
shall be made by the Business Day immediately preceding the day by which such payment or other performance is due to be made;
provided that interest will continue to accrue each additional day in connection therewith.




 




    A-19


     


    

  


Section 1.4 Loan
Records.


 


(a) The Borrower
shall record on its books and records the amount of the Loan, the interest rate applicable, all payments of principal and interest
thereon and the principal balance thereof from time to time outstanding.


 


(b) The Borrower
shall establish and maintain at its address referred to in Section 6.1, a record of ownership (the “Register”)
in which the Borrower agrees to register by book entry the interests (including any rights to receive payment hereunder) of each
Lender in the Loan, and any assignment of any such interest, and accounts in the Register in accordance with its usual practice
in which it shall record (1) the names and addresses of the Lenders (and any change thereto pursuant to this Agreement), (2) the
amount of the Loan and each funding of any participation therein, (3) the amount of any principal, interest, fee or other amount
due and payable or paid, and (4) any other payment received by the Lenders from the Borrower and its application to the Loan.


 


(c) Notwithstanding
anything to the contrary contained in this Agreement, the Loan (including any Notes evidencing the Loan) is a registered obligation,
the right, title and interest of the Lenders and their assignees in and to the Loan shall be transferable only upon notation of
such transfer in the Register and no assignment thereof shall be effective until recorded therein. This Section 1.4 shall
be construed so that the Loan is at all times maintained in “registered form” within the meaning of Sections 163(f),
871(h)(2) and 881(c)(2) of the Code and Treasury Regulations Section 5f.103-1(c).


 


(d) The Borrower
and the Lenders shall treat each Person whose name is recorded in the Register as a Lender for all purposes of this Agreement.
Information contained in the Register with respect to any Lender shall be available for access by the Borrower or such Lender at
any reasonable time and from time to time upon reasonable prior written notice, or when an Event of Default exists, with just notice
(whether reasonable or not) by any such Lender.


 




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Section 1.5
Accounting Terms and Principles. All accounting determinations required to be made pursuant hereto shall, unless expressly
otherwise provided herein, be made in accordance with GAAP. No change in the accounting principles used in the preparation of
any financial statement hereafter adopted by the Borrower or its Subsidiaries shall be given effect for purposes of measuring
compliance with any provision of this Agreement or otherwise determining any relevant ratios and baskets which govern whether
any action is permitted hereunder unless the Borrower and the Required Lenders agree to modify such provisions to reflect
such changes in GAAP, and unless such provisions are modified, all financial statements and similar documents provided
hereunder shall be provided together with a reconciliation between the calculations and amounts set forth therein before and
after giving effect to such change in GAAP. Notwithstanding any other provision contained herein or in any other Loan
Document, all terms of an accounting or financial nature used herein and in the other Loan Documents shall be construed, and
all computations of amounts and ratios referred to herein and in the other Loan Documents shall be made, without giving
effect to (a) any election under Statement of Financial Accounting Standards No. 159 (Codification of Accounting Standards
825 10) (or any other Codification of Accounting Standards or Statement of Financial Accounting Standard having a similar
result or effect) to value any Indebtedness or other liabilities of any Loan Party or any Subsidiary at “fair
value,” as defined therein, or (b) any treatment of Indebtedness in respect of convertible debt instruments under
Codification of Accounting Standards 470-20 (or any other Codification of Accounting Standards or Statement of Financial
Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as
described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof. A breach
of a financial covenant contained in Section 5.3 shall be deemed to have occurred as of the last day of any specified
measurement period, regardless of when the financial statements reflecting such breach are delivered to any Secured
Party.


 


Section 1.6 Officers.
Any document, agreement or instrument delivered under the Loan Documents that is signed by an officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan
Party and such officer shall be conclusively presumed to have acted on behalf of such Loan Party in such Person’s capacity
as an officer of such Loan Party and not in any individual capacity.


 


Article
2

AGREEMENT FOR THE LOAN


 


Section 2.1 Use
of Proceeds. The proceeds of the Loan will be used for repayment of existing Indebtedness to the Existing Lenders, for working
capital and for general corporate purposes. All proceeds of all Loans will be used solely for lawful business purposes.


 


Section 2.2 Disbursement.
On the Agreement date, the Lenders disbursed Loans to the Borrower (the “Disbursement”) in the initial principal
amount of $60,000,000. As of the Sixth Amendment Effective Date, after giving effect to the Sixth Amendment Date Prepayment, the
aggregate outstanding principal amount of the Loan is $15,625,000. On the Sixth Amendment Effective Date, Borrower issued to each
Lender party to the Sixth Amendment, a Note evidencing the Loan made (or held) by such Lender on the Sixth Amendment Effective
Date in substantially the form attached as Exhibit B to the Sixth Amendment.


 


Section 2.3 Payment.


 


(a) After
the Sixth Amendment Effective Date, Borrower shall be required to repay the outstanding principal amount of the Loan as follows:


 


(i) a monthly
installment (the “Monthly Principal Payment”) of $625,000 on the 11th day of April 2021 (such monthly
payment date during such period, the “Monthly Principal Payment Date”); and


 


(ii) all outstanding
principal and interest and all other outstanding Obligations shall be due and payable on May 11, 2022 (the principal portion of
such payment, the “2022 Principal Payment” and such date, the “Maturity Date”).


 


Subject to
Sections 2.3(b) and 2.3(c) the Borrower (i) may prepay the Obligations in whole or in part at any time and from time
to time and (ii) shall prepay all of the outstanding Obligations upon the occurrence of a Change of Control. The amount of any
prepayment of the Obligations shall be allocated among the Lenders in accordance with their respective Pro Rata Shares.


 




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(b) If the
Obligations are paid, repaid, redeemed or prepaid in whole or in part for any reason, whether voluntary or involuntary and whether
(A) before, at the time of or after (1) the Maturity Date, (2) any acceleration of any of the Obligations, (3) the filing of any
voluntary or involuntary bankruptcy petition, (4) an insolvency, (5) the occurrence of an Event of Default, (6) a foreclosure or
(7) a sale or disposition, (B) in connection with a Change of Control or (C) by any other method, manner, action, event, circumstance,
situation, procedure or process, such payment, repayment, redemption or prepayment shall be accompanied at the same time (without
notice or further action by any Person) by a cash payment by the Loan Party Obligors to the Lenders based on the Lenders’
respective Pro Rata Shares of (i) the amount of all accrued and unpaid interest on the principal amount of the Loans and Notes
prepaid through the date of such payment, repayment, redemption or prepayment, plus (ii) other than with respect to the Sixth Amendment
Effective Date Prepayment, a fee in the amount of 6.25% of the amount of principal paid, repaid, redeemed or prepaid, if such payment,
repayment, redemption or prepayment occurs on or before December 31, 2021 (the amounts payable pursuant to clauses (i) and
(ii) of this Section 2.3(b), collectively, the “Prepayment Amount”). The Loan Party Obligors shall
provide Lenders two (2) Business Days prior written notice of any voluntary payment, repayment, redemption or prepayment of the
Obligations (a “Prepayment Notice”). The Loan Party Obligors and the other Parties acknowledge and agree that,
in light of the impracticality and extreme difficulty of ascertaining actual damages, the Prepayment Amount set forth in this Section
2.3(b) are intended to be a reasonable calculation of the actual damages that would be suffered by the Secured Parties as a
result of any such payment, repayment, redemption or prepayment. The parties hereto further acknowledge and agree that the Prepayment
Amount set forth in this Section 2.3(b) are not intended to act as a penalty or to punish the Borrower or any other Loan
Party Obligor for any such payment, repayment, redemption or prepayment.


 


(c) Notwithstanding
anything to the contrary in the Loan Documents (and in addition to the amounts payable pursuant to Section 2.3(b)), effective
as of the date hereof, there shall be a fully due and owing non-refundable exit payment in cash in a total amount equal to $750,238.93
(the “Initial Exit Payment”), which Initial Exit Payment shall be deemed an Obligation and shall be deemed to
have been fully earned as of the date hereof. Effective as of the Fifth Amendment Date, there shall be fully due and owing an additional
non-refundable exit payment in cash of $250,000 (the “Additional Exit Payment” and, together with the Initial
Exit Payment, each an “Exit Payment” and collectively, the “Exit Payments”), which Additional
Exit Payment shall be deemed an Obligation and shall be deemed to have been fully earned as of the Fifth Amendment Date. The Loan
Party Obligors’ obligation to pay the Exit Payments will not be subject to any counterclaim or setoff for, or be otherwise
affected by, any claim or dispute that any Loan Party Obligor may have. The Initial Exit Payment shall be paid, in cash, immediately
without notice or further action by the Loan Party Obligors to the Lenders based on their respective Pro Rata Shares upon the earliest
to occur of (i) the date when the remaining Loans are due, payable, paid, repaid, redeemed or prepaid (in each case, whether voluntary
or involuntary and whether (A) before, at the time of or after (1) the Maturity Date, (2) any acceleration of any of the Obligations,
(3) the filing of any voluntary or involuntary bankruptcy petition, (4) an insolvency, (5) the occurrence of an Event of Default,
(6) a foreclosure or (7) a sale or disposition, (B) in the connection with a Change of Control or (C) by any other method, manner,
action, event, circumstance, situation, procedure or process) in an amount that causes (or such lesser amount of outstanding Loans
that are so due, payable, paid, repaid, redeemed, or prepaid that the Required Lenders have agreed to cause) the principal amount
of remaining Loans outstanding to be (or a payment, repayment, redemption, or prepayment is required to be made that would cause
such Loans, if such payment, repayment, redemption, or prepayment would have been made to be) less than $10,000,000, including,
without limitation, when the principal amount of the remaining Loans have been paid, repaid, redeemed, or prepaid in full; (ii)
the Maturity Date, (iii) the date of any acceleration of any of the Obligations, (iv) the date of any filing of any voluntary or
involuntary bankruptcy petition, (v) the date of any insolvency, the date of any foreclosure or (vi) the date any Change of Control
occurs. The Additional Exit Payment shall be paid, in cash, immediately without notice or further action by the Loan Party Obligors
to the Lenders based on their respective Pro Rata Shares upon the earliest to occur of any of the events described in clauses
(i) through (vi) of the immediately preceding sentence; provided, that for purposes of this sentence, clause
(i) will only be applicable if the principal amount of the remaining Loans has been paid, repaid, redeemed, or prepaid in full.
The Loan Party Obligors and the other Parties acknowledge and agree that the Collateral Agent and the Lenders would not have entered
into this Agreement (including the Fourth Amendment and the Fifth Amendment) or the other Loan Documents without the Loan Party
Obligors agreeing to pay the Exit Payments in the aforementioned instances. The Loan Party Obligors and the other Parties further
acknowledge and agree that the Exit Payments set forth in this Section 2.3(c) are not intended to act as a penalty or to
punish the Borrower or any other Loan Party Obligors for any such payment, repayment, redemption, or prepayment (or the requirement
for such payment, repayment, or redemption to be due, payable or made).


 




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(d) Each
payment by the Borrower and the other Loan Party Obligors to the Secured Parties in respect of the Obligations shall be applied
(i) first, ratably to all fees, costs and expenses (including any attorneys’ fees) owed to any Secured Party under
the Loan Documents, but only to the extent such fees, costs and expenses have been invoiced and are due and payable, (ii) second,
ratably to accrued and unpaid interest owed to the Lenders and any other Secured Parties, (iii) third, ratably to the outstanding
principal amount of the Loans owed to the Lenders (including any Prepayment Amount with respect thereto and any applicable Exit
Payment with respect thereto), and, (iv) fourth, to all other Obligations owing to any Secured Party; provided that
voluntary prepayments of principal shall be applied against, and reduce, principal payments in the order specified in Section
2.3(e); and, provided, further, that during the continuance of a Default or an Event of Default, payments shall
be applied as determined by the Required Lenders in their sole discretion.


 


(e) Any prepayments
of principal by the Borrower or any other Loan Party Obligor shall be applied against, and reduce, principal repayments required
pursuant to Section 2.3(a) with respect to each applicable Lender’s Loans (and Notes evidencing such Loans) in the
order set forth in Section 2.3(a). For the avoidance of doubt, any such prepayment that, in accordance with this Section
2.3(e), is applied against a Monthly Principal Payment shall reduce the amount of such Monthly Principal Payment due on the
applicable Monthly Principal Payment Date, and the amount that would otherwise be deferred in respect of such Monthly Principal
Payment in accordance with Section 2.3(a)(iv) shall be reduced on a dollar-for-dollar basis in the amount of such principal
converted or prepaid.


 


Section 2.4 Payments.
All payments by the Borrower or any other Loan Party Obligor hereunder and under any of the Loan Documents shall be made without
setoff or counterclaim. Payments of any amounts due or payable to the Lenders, the other Secured Parties and other Persons under
this Agreement shall be made in Dollars in immediately available funds prior to 1:00 p.m. New York City time on such date that
any such payment is due or payable, at such bank or places as the Lenders shall from time to time designate in writing at least
5 Business Days prior to the date such payment is due. The Borrower and the other Loan Party Obligors shall pay all and any costs
(administrative or otherwise) imposed by banks, clearing houses, or any other financial institution, in connection with making
any payments under any of the Loan Documents.


 




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Section 2.5 Taxes.


 


(a) Any and
all payments hereunder or under any other Loan Document shall be made, in accordance with this Section 2.5, free and clear
of and without deduction for any and all present or future Taxes except as required by Applicable Law. If Borrower or any other
Loan Party Obligor shall be required by Applicable Law to deduct any Taxes from or in respect of any sum payable hereunder or under
any other Loan Document, (i) Borrower or such other Loan Party Obligor shall make such deductions, (ii) Borrower or such other
Loan Party Obligor shall pay the full amount deducted to the relevant Governmental Authority in accordance with Applicable Law,
and (iii) to the extent that the deduction is made on account of Indemnified Taxes, the sum payable shall be increased by as much
as shall be necessary so that after making all required deductions(including deductions for Taxes applicable to additional sums
payable under this Section 2.5), each Lender shall receive an amount equal to the sum it would have received had no such
deductions been made (any and all such additional amounts payable shall hereinafter be referred to as the “Additional
Amounts”). Within thirty (30) days after the date of any payment of such Taxes, each Loan Party Obligor shall furnish
to the applicable Lender the original or a certified copy of a receipt evidencing payment thereof or other evidence of such payment
reasonably satisfactory to such Lender.


 


(b) Each
Loan Party Obligor agrees to pay and authorizes each Lender to pay in its name (but without duplication), all Other Taxes. If any
Loan Party Obligor directly pays such Other Taxes within 30 days after the date of any payment of Other Taxes, such Loan Party
Obligor shall furnish to the applicable Lender the original or a certified copy of a receipt evidencing payment thereof or other
evidence of such payment reasonably satisfactory to such Lender.


 


(c) Without
duplication with respect to any Additional Amounts, the applicable Loan Party Obligor shall reimburse and indemnify, within 10
days after receipt of demand therefor, each Lender for all Indemnified Taxes (including all Indemnified Taxes imposed on amounts
payable under this Section 2.5(c)) paid by such Lender, whether or not such Indemnified Taxes were correctly or legally
asserted. A certificate of the applicable Lender(s) setting forth the amounts to be paid thereunder and delivered to Borrower or
the applicable Loan Party Obligor shall be conclusive, absent manifest error.


 


(d) Each
Lender that is a “United States person” (as such term is defined in Section 7701(a)(30) of the Code) for United States
federal income tax purposes shall, on or before the date on which the Lender becomes a party to this Agreement, provide to Borrower
a properly completed and executed IRS Form W-9 certifying that such Lender is not subject to backup withholding tax. Each Lender
that is not a United States person for United States federal income tax purposes (a “Foreign Lender”) and is
entitled to an exemption from or reduction of United States withholding tax with respect to payments under this Agreement shall,
on or before the date on which the Lender becomes a party to this Agreement, provide Borrower with a properly completed and executed
IRS Form W-8ECI, W-8BEN, W-BENE, W-8IMY or other applicable forms (together with any required supporting documentation), or any
other applicable certificate or document reasonably requested by the Borrower, and, if such Foreign Lender is relying on the portfolio
interest exception of Section 871(h) or Section 881(c) of the Code (or any successor provision thereto), shall also provide the
Borrower with a certificate (a “Portfolio Interest Certificate”) representing that such Foreign Lender is not
a “bank” for purposes of Section 881(c) of the Code (or any successor provision thereto), is not a 10% holder of the
Borrower described in Section 871(h)(3)(B) of the Code (or any successor provision thereto), and is not a controlled foreign corporation
receiving interest from a related person (within the meaning of Sections 881(c)(3)(C) and 864(d)(4) of the Code, or any successor
provisions thereto). Each Lender shall provide new forms (or successor forms) as reasonably requested by Borrower from time to
time and shall notify Borrower in writing within a reasonable time after becoming aware of any event requiring a change in the
most recent forms previously delivered by such Lender to Borrower. If the Foreign Lender is a partnership and one or more direct
or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a Portfolio
Interest Certificate on behalf of such direct or indirect partner.


 




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(e) If a
payment to a Lender under this Agreement would be subject to United States withholding tax imposed by FATCA if such Lender were
to fail to comply with the applicable reporting requirements of FATCA, such Lender shall deliver to Borrower, at the times prescribed
by law or as reasonably requested by Borrower, such documentation as is required in order for Borrower to comply with its obligations
under FATCA, to determine that such Lender has or has not complied with its obligations under FATCA, or to determine the amount
to deduct and withhold from such payment.


 


(f) If a
Lender determines in its sole discretion, exercised in good faith, that it has received a refund from a Governmental Authority
relating to Taxes in respect of which the Borrower paid Additional Amounts or made a payment pursuant to Sections 2.5(b)
or 2.5(c) then, provided no Event of Default has occurred and is continuing, such Lender shall promptly pay such
refund (limited to the amount paid by the Borrower under Section 2.5 with respect to the Taxes refunded) to the Borrower,
net of all out-of-pocket expense (including Taxes) of such Lender incurred in obtaining such refund or making such payment; provided
that the Borrower, upon the request of such Lender, agrees to repay the amount paid over to the Borrower (plus any penalties, interest
or other charges imposed by the relevant Governmental Authority) to such Lender if such Lender is required to repay such refund
to such Governmental Authority. Notwithstanding anything to the contrary in this Section 2.5(f), in no event shall a Lender
be required to pay any amount to the Borrower pursuant to this Section 2.5(f), the payment of which would place the Lender
in a less favorable net after-Tax position than the Lender would have been in if the Tax subject to indemnification and giving
rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or Additional Amount
with respect to such Tax had never been paid. Nothing in this Section 2.5(f) shall require any Lender to disclose any information
it deems confidential (including, without limitation, its tax returns) to any Person, including Borrower.


 


Section 2.6 [Reserved].


 


Section 2.7 Interest.
The outstanding principal amount of the Loans and Notes shall bear interest at the Interest Rate (calculated on the basis of a
360 day year for the actual number of days elapsed). Interest shall be paid quarterly in arrears commencing on June 1, 2016 and
on the first Business Day of each September, December, March and June thereafter (each, an “Interest Payment Date”)
and on the Maturity Date.


 


Section 2.8 Default
Interest; Late Payment Fee. Without limiting the remedies available to the Secured Parties under the Loan Documents or otherwise,
to the maximum extent permitted by Applicable Law, if an Event of Default occurs and is continuing, at the Required Lender’s
election, the amount outstanding under and in respect of the Loans and Notes (which shall include all outstanding principal thereunder,
together with any interest and other amounts due and payable with respect to the Notes and not paid when due) and all other Obligations,
shall bear interest at the rate per annum equal to the Interest Rate plus 5.00%. In addition to the foregoing, the Borrower
shall pay a late fee on any amount or Obligation (other than principal) not paid when due (including after giving effect to any
grace period provided hereunder) equal to 10% of such overdue amount.


 


Section 2.9 Fee.
In consideration of Lenders’ agreement to extend the Loan to Borrower, Borrower shall pay to Lenders on the Agreement
Date, a yield enhancement payment in the amount of $1,350,000, which yield enhancement payment will be deducted by Lenders from
the Disbursement. Borrower agrees to reimburse the Secured Parties for reasonable, documented out-of-pocket expenses for attorneys,
accountants and other professional advisors, and other reasonable documented out-of-pocket expenses incurred by the Secured Parties
(i) in connection with their due diligence, negotiation and documentation of the transactions contemplated by the Loan Documents
(including their review, negotiation and documentation of any post-closing obligations of the Borrower and the other Loan Party
Obligor) and (ii) in connection with all amendments and modifications thereto, whether or not consummated. At the applicable Lender’s
election such reimbursable amounts may be deducted from the Disbursement. The provisions of this Section 2.9 supersede
and replace in its entirety that certain Expense Reimbursement Agreement, dated as of April 7, 2016, Neos Therapeutics, Inc. and
Deerfield Management Company, L.P. (Series C).




 




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Article
3

REPRESENTATIONS, WARRANTIES AND CERTAIN AFFIRMATIVE COVENANTS


 


Section 3.1 Representations,
Warranties and Certain Affirmative Covenants of the Loan Parties. Aytu, the Borrower and the other Loan Parties jointly and
severally represent, warrant and convent to the Secured Parties as of the Sixth Amendment Effective Date as follows:


 


(a) Existence
and Authority. Each Loan Party is duly organized, validly existing and in good standing under the laws of its jurisdiction
of organization and is qualified to do business in each jurisdiction in which the operation of its business requires that it be
qualified or, if such Loan Party is not so qualified, such Loan Party may cure any such failure without losing any of its rights,
incurring any liens or material penalties, or otherwise affecting the Collateral Agent or any other Secured Party’s rights.
Each Loan Party has all requisite power and authority to own and operate its properties, to carry on its business as now conducted
and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated
hereby and thereby. The execution, delivery and performance by each Loan Party Obligor of this Agreement and all of the other Loan
Documents to which such Loan Party Obligor is a party have been duly and validly authorized, do not violate such Loan Party Obligor’s
Organizational Documents or any law or any material agreement, document or instrument or any court order which is binding upon
any Loan Party or its property, do not constitute grounds for acceleration of any Indebtedness or obligation under any material
agreement, document or instrument which is binding upon any Loan Party or its property, and do not require the consent of any Person.
Each Loan Party Obligor shall reserve and maintain all of its leases, licenses, permits (including Permits), franchises qualifications,
and rights that are necessary and desirable in the Ordinary Course of Business. No Loan Party is required to obtain any government
approval, permit (including Permit), consent, or authorization from, or to file any declaration or statement with, any Governmental
Authority in connection with or as a condition to the execution, delivery or performance of any of the Loan Documents. This Agreement
and each of the other Loan Documents have been duly executed and delivered by, and are enforceable against, each of the Loan Party
Obligors who have signed them, in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at law.


 


(b) No
Defaults. No Default or Event of Default has occurred and is continuing (or would result after giving effect to any transactions
contemplated by the Loan Documents and the ABL Documents).


 


(c) Solvency.
Each of Aytu and its Subsidiaries (i) is individually solvent and each able to pay its debts as they come due, (ii) has not admitted
its inability in writing to pay their debts as they come due, (iii) has not taken action (and none of Aytu or any of its Subsidiaries
is contemplating taking action), and no such action has been taken by (or, to the knowledge of Aytu or any of its Subsidiaries,
has been or is contemplated to be taken by) a third party, for Aytu’s or any Subsidiary of Aytu’s winding up, dissolution,
or liquidation or similar executory or judicial proceeding or for the appointment of a liquidator, custodian, receiver, trustee,
administrator or other similar officer for Aytu, any Subsidiary of Aytu or any material portion of or all of their assets or revenues
or for the filing of a petition against Aytu or any of its Subsidiaries or any of its or their assets under any state, federal
or other bankruptcy or insolvency law, and (iv) each, individually, have sufficient capital to carry on each of their businesses
as now conducted and as proposed to be conducted. The fair saleable value of all of the assets and properties of each Loan Party,
individually, exceeds the aggregate liabilities and Indebtedness of each such Loan Party (including contingent liabilities).


 




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(d) No
Liens. No Lien exists on the assets of Aytu or any Subsidiary of Aytu, except for Permitted Liens.


 


(e) Obligations
are Absolute. The obligation of the Borrower and the other Loan Party Obligors to make any payment under this Agreement and
the other Loan Documents (together with all charges in connection therewith) is absolute and unconditional.


 


(f) No
Indebtedness. No Indebtedness of Aytu or any Subsidiary of Aytu exists other than Permitted Indebtedness.


 


(g) Good
Standing; Power and Authority. Each of Aytu and the Borrower is validly existing as a corporation in good standing under the
laws of the state of Delaware. Aytu and its Subsidiaries have full power and authority to own their properties, conduct their business
and enter into the Loan Documents and to consummate the transactions contemplated under the Loan Documents and the ABL Documents,
and are duly qualified to do business as a foreign entity and are in good standing in each jurisdiction where the failure to be
so qualified could reasonably be expected to result in a Material Adverse Effect.


 


(h) Actions,
Suits, Hearings and Proceedings. There is no pending or, to the knowledge of Aytu and its Subsidiaries, threatened in writing,
any action, suit, hearings or other proceeding before any Governmental Authority (a) to which Aytu or any of its Subsidiaries is
a party or (b) which has as the subject thereof any assets owned by Aytu or any of its Subsidiaries, except, in each case, as would
not reasonably be expected to result in a Material Adverse Effect. Except as set forth on Schedule 3.1(h), there are no
current or, to the knowledge of Aytu or any of its Subsidiaries, pending, legal, governmental or regulatory enforcement actions,
suits or other proceedings to which Aytu or any of its Subsidiaries or any of their assets is subject, except as would not reasonably
be expected to result in a Material Adverse Effect.


 


(i) Enforceability;
No Conflict; No Consents. The Loan Documents have been duly authorized, executed and delivered by Aytu and each Subsidiary
of Aytu that is a party thereto, and constitute the valid, legal and binding obligation of Aytu and its Subsidiaries party thereto,
enforceable in accordance with their terms, except as such enforceability may be limited by applicable insolvency, bankruptcy,
reorganization, moratorium or other similar laws affecting creditors’ rights generally (whether enforcement is sought by
proceedings in equity or at law). The execution, delivery and performance of the Loan Documents by Aytu and its Subsidiaries and
the consummation of the transactions herein and therein contemplated will not (A) conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute an event of default under, or result in the creation or imposition of any Lien
(other than pursuant to the Loan Documents) upon any assets of Aytu or any of its Subsidiaries pursuant to, any agreement to which
Aytu or any of its Subsidiaries is a party or by which Aytu or any of its Subsidiaries are bound or to which any of the assets
of Aytu or any of its Subsidiaries is subject, except to the extent that no Material Adverse Effect would reasonably be expected
to result therefrom, (B) result in any violation of or conflict with the provisions of the Organizational Documents, (C) result
in the violation of any material Applicable Law or (D) result in the violation of any judgment, order, rule, regulation or decree
of any Governmental Authority. No consent, approval, permit (including Permit), authorization or order of, or registration or filing
with any Governmental Authority or other party or Person is required for the execution, delivery and performance of any of the
Loan Documents or for the consummation by Aytu and its Subsidiaries of the transactions contemplated hereby or thereby, except
for (a) such registrations and filings contemplated by the Security Agreement, (b) as have been obtained or made prior to the Agreement
Date or (c) the failure of which to obtain or make would not reasonably be expected to result in a Material Adverse Effect. Aytu
and its Subsidiaries party thereto have the power and authority to enter into the Loan Documents and to consummate the transactions
contemplated under the Loan Documents.


 




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(j) Names;
Trade Names and Styles. The name of each Loan Party Obligor set forth the Perfection Certificate delivered on the Sixth Amendment
Effective Date is its true, correct and complete legal name, and no Loan Party Obligor has used any other name at any time in the
past five years, or at any time will use any other name, in any tax filing made in any jurisdiction. Listed in the Perfection Certificate
delivered on the Sixth Amendment Effective Date are all prior names used by such Loan Party Obligor at any time in the past five
years prior to the Sixth Amendment Effective Date and all of the present and prior trade names used by such Loan Party Obligor
at any time in the past five years.


 


(k) Necessary
Permits and Documents; Compliance with Laws and Orders. Aytu and each of its Subsidiaries holds or has applied for, and is
operating in good standing and in compliance in all material respects with, all franchises, grants, authorizations, licenses, permits
(including Permits), easements, consents, certificates and orders of any Governmental Authority required for the conduct of its
business (collectively, “Necessary Documents”). All Necessary Documents are valid and in full force and effect.
Neither the Borrower nor any of its Subsidiaries has (i) received written notice of any revocation or modification of any of the
Necessary Documents and (ii) any reason to believe that any of the Necessary Documents will not be renewed in the Ordinary Course
of Business (or will be voided, revoked or withdrawn). Each of Aytu and its Subsidiaries is in compliance in all material respects
with all applicable federal, state, local and foreign laws, regulations, orders and decrees applicable to the conduct of its business.


 


(l) Marketable
Title; Valid Leases. Aytu and its Subsidiaries have good and marketable title to all of their assets free and clear of all
Liens except Permitted Liens. To Aytu’s and its Subsidiaries’ knowledge, except as could not reasonably be expected
to have a Material Adverse Effect, the property held under lease by Aytu or any of its Subsidiaries is held under valid, subsisting
and enforceable leases with only such exceptions with respect to any particular lease as do not interfere in any material respect
with the conduct of the business of Aytu or any Subsidiaries.


 




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(m) Intellectual
Property. Other than as disclosed in any Paragraph IV Certification made in connection with a new drug application, Aytu and
its Subsidiaries own or, where a license is required, have the right to use pursuant to a valid and enforceable written license,
implied license or other legally enforceable right, all of the Intellectual Property (as defined below) that they have publicly
described as being owned or licensed by them (the “Company IP”) or, to the knowledge of Aytu and its Subsidiaries,
that is necessary for the conduct of their business as currently conducted (the “IP”). To the knowledge of Aytu
and its Subsidiaries, other than as disclosed in any Paragraph IV Certification made in connection with a new drug application,
the Company IP that is registered with or issued by a Governmental Authority is enforceable; there is no outstanding, pending or,
to the knowledge of Aytu and its Subsidiaries, threatened in writing action, suit, other proceeding or claim by any third person
challenging or contesting the validity, scope, use, ownership, enforceability, or other rights of Aytu or any of its Subsidiaries
in or to any Company IP, and neither Aytu nor any Subsidiary has received any written notice regarding, any such action, suit,
or other proceeding. Each Loan Party owns or has, and will at all times continue to own or have, the valid right to use all material
patents, trademarks, copyrights, software, computer programs, equipment designs, network designs, equipment configurations, technology
and other Intellectual Property used, marketed and sold in such Loan Party’s business, and each Loan Party is in compliance,
and will continue at all times to comply, in all material respects with all licenses, user agreements and other such agreements
regarding the use of Intellectual Property. To the knowledge of Aytu and the Borrower, other than as disclosed in any Paragraph
IV Certification made in connection with a new drug application, neither Aytu nor any of its Subsidiaries has infringed or misappropriated
any material rights of others. Except as set forth on Schedule 3.1(m), there is no pending or, to the knowledge of Aytu
or any of its Subsidiaries, threatened in writing action, suit, other proceeding or claim by others that Aytu or any of its Subsidiaries
infringes upon, violates or uses the Intellectual Property rights of others without authorization, and neither Aytu nor any of
its Subsidiaries has received any written notice regarding, any such action, suit, other proceeding or claim. Except as set forth
on Schedule 3.1(m), neither Aytu nor any of its Subsidiaries is a party to or bound by any material licenses with respect
to IP other than licenses for computer software acquired in the Ordinary Course of Business. Except as set forth in the Perfection
Certificate delivered on the Sixth Amendment Effective Date with respect to each Loan Party Obligor, none of the Intellectual Property
owned by such Loan Party Obligor is the subject of any licensing or franchise agreement pursuant to which such Loan Party Obligor
is the licensor or franchisor. No Loan Party Obligor owns any Intellectual Property, except as set forth in the Perfection Certificate
delivered on the Sixth Amendment Effective Date with respect to each Loan Party Obligor. The term “Intellectual Property”
as used herein means (i) all patents, patent applications, patent disclosures and inventions (whether patentable or unpatentable
and whether or not reduced to practice), (ii) all trademarks, service marks, trade dress, trade names, slogans, logos, and corporate
names and Internet domain names, together with all of the goodwill associated with each of the foregoing, (iii) copyrights, copyrightable
works, and licenses, (iv) registrations and applications for registration for any of the foregoing, (v) computer software (including
but not limited to source code and object code), data, databases, and documentation thereof, (vi) trade secrets and other confidential
information, (vii) other intellectual property, and (viii) copies and tangible embodiments of the foregoing (in whatever form and
medium).


 


(n) Compliance
with Organizational Documents and Material Agreements. Neither Aytu nor any of its Subsidiaries is (i) in violation of the
Organizational Documents, or (ii) except as could not reasonably be expected to have a Material Adverse Effect, in breach of or
otherwise in default under any agreement under which it may be bound, or to which any of its assets is subject.


 


(o) Tax
Matters. All federal and state income and franchise and all other material Tax returns, reports and statements (collectively,
the “Tax Returns”) required to be filed by any Tax Affiliates or extensions have been timely filed with the
appropriate Governmental Authorities, all such Tax Returns are true, correct and complete in all material respects, and all Taxes,
assessments and other governmental charges and impositions reflected therein and all other material Taxes, assessments and other
governmental charges otherwise due and payable have been paid prior to the date on which any liability may be added thereto for
non-payment thereof; except that a Tax Affiliate may defer payment of any contested taxes; provided, that such Tax Affiliate (a)
in good faith contests its obligation to pay such Taxes by appropriate proceedings promptly and diligently instituted and conducted,
(b) notifies the Secured Parties in writing of the commencement of, and any material development in, the proceedings, (c) posts
bonds or takes any other steps required to keep the contested taxes from becoming a Lien upon any of the Collateral and (d) maintains
adequate reserves therefor in conformity with GAAP. As of the Sixth Amendment Effective Date, no income or franchise Tax Return
or other material Tax Return of the Borrower or any other Tax Affiliate is under audit by any Governmental Authority, and no Tax
Affiliate has received written notice from any Governmental Authority of any audit or examination or any assertion of any material
claim for Taxes. No Loan Party is otherwise aware of any claims or adjustments proposed for any prior tax years that could result
in additional taxes becoming due and payable by any Tax Affiliate. No Tax Affiliate has participated in a “listed transaction”
within the meaning of Treasury Regulation Section 1.6011-4(b) or has been a member of an affiliated, combined or unitary group
other than the group of which a Tax Affiliate is the common parent.


 




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(p) Retaining
Rights to Develop, License, Market and Sell Services. Other than as set forth in Schedule 3.1(p), neither Aytu nor any
of its Subsidiaries has granted rights to develop, license, market or sell its services to any other Person, and are not bound
by any agreement that affects the exclusive right of Aytu or any of its Subsidiaries to develop, license, market or sell its services.


 


(q) Governmental,
Law and Authorizations Compliance. Other than as set forth in Schedule 3.1(q), each of Aytu and its Subsidiaries: (A)
is, and will continue at all times to be, in compliance with all Applicable Laws (including those relating to the ownership of
real or personal property, the conduct and licensing of each Loan Party’s business, the payment and withholding of Taxes,
ERISA and other employee matters, and safety and environmental matters) in all material respects; (B) has not received any warning
letter or other correspondence or notice from any Governmental Authority alleging or asserting noncompliance with any Applicable
Laws or any licenses, certificates, approvals, clearances, authorizations, permits and supplements or amendments thereto required
in connection with the business of Aytu or its Subsidiaries by any Applicable Laws (together, the “Authorizations”);
(C) possesses and complies in all material respects with the Authorizations, which are valid and in full force and effect (other
than those Authorizations for which applications have been submitted but which have not yet been issued), in each case of this
clause (C), except as would not reasonably be expected to result in a Material Adverse Effect; (D) has not received written
notice that any Governmental Authority has taken, is taking or intends to take action to limit, suspend, modify or revoke any Authorization;
(E) has filed, obtained, maintained or submitted all reports, documents, forms, notices, applications, records, claims, submissions
and supplements or amendments as required by any Applicable Laws or Authorizations as and when required, except, in each case of
this clause (E), as would not reasonably be expected to result in a Material Adverse Effect. No Loan Party has received
written notice of default or violation, or is in default or violation, with respect to any judgment, order, writ, injunction, decree,
demand or assessment issued by any court or any federal, state, local, municipal or other Governmental Authority relating to any
aspect of any Loan Party’s business, affairs, properties or assets. No Loan Party has received written notice of or been
charged with, or is, to the knowledge of any Loan Party, under investigation with respect to, any violation in any material respect
of any provision of any Applicable Law.


 


(r) Financial
Statements and Reports. All financial statements included in the SEC Reports, or delivered to the Secured Parties by or on
behalf of any Loan Party, have been, and at all times will be, prepared in conformity with GAAP and fairly present in all material
respects the financial condition, results of operations and cash flows of the Loan Parties covered thereby, at the times and for
the periods therein stated.


 




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(s) ERISA;
Employee Benefit Plans; Pension Contribution. (i) To the knowledge of Aytu and its Subsidiaries, no “prohibited transaction”
as defined under Section 406 of ERISA or Section 4975 of the Code that is not exempt under ERISA Section 408 or Section 4975 of
the Code, under any applicable regulations and published interpretations thereunder or under any applicable prohibited transaction,
individual or class exemption issued by the Department of Labor, has occurred with respect to any Employee Benefit Plan, except
as for such transaction that would not reasonably be expected to have a Material Adverse Effect, (ii) at no time within the last
seven (7) years has Aytu or any ERISA Affiliate maintained, sponsored, participated in, contributed to or has or had any liability
or obligation in respect of any Employee Benefit Plan subject to Section 302 of ERISA, Title IV of ERISA, or Section 412 of the
Code or any “multiemployer plan” as defined in Section 3(37) of ERISA, (iii) no Employee Benefit Plan represents any
current or future liability for retiree health, life insurance, or other retiree welfare benefits except as may be required by
the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or similar state law, (iv) each Employee Benefit Plan is
and has been operated in compliance in all material respects with its terms and all Applicable Laws, including but not limited
to ERISA and the Code, (v) no event has occurred (including a “reportable event” as such term is defined in Section
4043 of ERISA) and no condition exists that would subject the Borrower to any tax, fine, lien, penalty or liability imposed by
ERISA, the Code or other Applicable Law, except for any such tax, fine, lien, penalty or liability that would not reasonably be
expected to, individually or in the aggregate, have a Material Adverse Effect and (vi) the Borrower does not have any obligations
under any collective bargaining agreement. Each Employee Benefit Plan is in compliance in all material respects with the applicable
provisions of ERISA, the Code and other Applicable Laws. Each Employee Benefit Plan that is intended to be a qualified plan under
Section 401(a) of the Code has received a favorable determination letter or opinion letter from the IRS to the effect that the
form of such Employee Benefit Plan is qualified under Section 401(a) of the Code and the trust related thereto has been determined
by the IRS to be exempt from federal income tax under Section 501(a) of the Code, or an application for such a letter is currently
being processed by the IRS. To the knowledge of any Loan Party, nothing has occurred that would prevent or cause the loss of such
tax-qualified status. There are no pending or, to the best knowledge of any Loan Party, threatened claims, actions or lawsuits,
or action by any Governmental Authority, with respect to any Employee Benefit Plan that could reasonably be expected to result
in liabilities individually or in the aggregate in excess of $50,000 of any Loan Party. There has been no prohibited transaction
or violation of the fiduciary responsibility rules with respect to any Employee Benefit Plan that has resulted or could reasonably
be expected to result in liabilities individually or in the aggregate of any Loan Party in excess of $50,000. No ERISA Event has
occurred, and no Loan Party is aware of any fact, event or circumstance that could reasonably be expected to constitute or result
in an ERISA Event with respect to any Pension Plan, in each case that could reasonably be expected to result in liabilities individually
or in the aggregate in excess of $50,000. Each Loan Party and each ERISA Affiliate has met all applicable requirements under the
Pension Funding Rules in respect of each Pension Plan, and no waiver of the minimum funding standards under the Pension Funding
Rules has been applied for or obtained, in each case except as could not reasonably be expected to result in liabilities individually
or in the aggregate to the Loan Parties in excess of $50,000. As of the most recent valuation date for any Pension Plan, the funding
target attainment percentage (as defined in Section 430(d)(2) of the Code) is sixty (60%) or higher and no Loan Party knows of
any facts or circumstances that could reasonably be expected to cause the funding target attainment percentage for any such plan
to drop below sixty (60%) as of the most recent valuation date. No Loan Party or any ERISA Affiliate has incurred any liability
to the PBGC other than for the payment of premiums, and there are no premium payments which have become due that are unpaid, except
as could not reasonably be expected to result in liabilities individually or in the aggregate to the Loan Parties in excess of
$50,000. No Loan Party or any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or Section 4212(c)
of ERISA except as could not reasonably be expected to result in liabilities individually or in the aggregate to the Loan Parties
in excess of $50,000. No Pension Plan has been terminated by the plan administrator thereof or by the PBGC, and no event or circumstance
has occurred or exists that could reasonably be expected to cause the PBGC to institute proceedings under Title IV of ERISA to
terminate any Pension Plan, except as could not reasonably be expected to result in liabilities individually or in the aggregate
to the Loan Parties in excess of $50,000.


 




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As used in
this clause (s), “Employee Benefit Plan” means any “employee benefit plan” within the meaning
of Section 3(3) of ERISA (including a Pension Plan), and all Stock purchase, Stock option, Stock-based severance, employment, change-in-control,
medical, disability, fringe benefit, bonus, incentive, deferred compensation, employee loan and all other employee benefit plans,
agreements, programs, policies or other arrangements, whether or not subject to ERISA, under which (A) any current or former employee,
director or independent contractor of the Borrower or any of its Subsidiaries has any present or future right to benefits and which
are contributed to, sponsored by or maintained by the Borrower or any of its respective Subsidiaries, (B) the Borrower or any of
its Subsidiaries has had or has any present or future obligation or liability on behalf of any such employee, director or independent
contractor; “ERISA” means the Employee Retirement Income Security Act of 1974, as amended; and “ERISA
Affiliate” means any member of the Borrower’s controlled group as defined in Code Section 414 (b), (c), (m) or
(o).


 


(t) Aytu’s
Subsidiaries. Aytu’s Subsidiaries are set forth in Schedule 3.1(t).


 


(u) Compliance
with Health Care Laws. Other than as set forth in Schedule 3.1(u), each of Aytu and its Subsidiaries is in compliance
in all material respects with all Health Care Laws applicable to it, its assets, business or operations.


 


(v) Health
Care Permits. Each of Aytu and its Subsidiaries holds all Health Care Permits necessary for it to own, lease, sublease or operate
its assets or to conduct its business or operations as presently conducted. All such Health Care Permits are in full force and
effect and there is and has been no default under, violation of, or other noncompliance with the terms and conditions of any such
Health Care Permit, except as would not reasonably be expected to result in a Material Adverse Effect. No Governmental Authority
has taken, or to the knowledge of Aytu or any of its Subsidiaries intends to take, action to suspend, revoke, terminate, place
on probation, materially restrict or not renew any material Health Care Permit of Aytu or any of its Subsidiaries.


 


(w) Title
to Collateral; Third Party Locations; Permitted Liens. Each Loan Party Obligor has, and at all times will continue to have,
good and marketable title to all of the Collateral. The Collateral now is, and at all times will remain, free and clear of any
and all Liens, except for Permitted Liens. The Collateral Agent (for the benefit of the Secured Parties) now has, and will at all
times continue to have, a first-priority (subject only to Liens of the type set forth in clause (i) of the definition of
“Permitted Liens”) perfected and enforceable security interest and Lien in all of the Term Loan Priority Collateral,
and a second-priority (or, after the Payment in Full (as defined in the Intercreditor Agreement) of the ABL Priority Debt (as defined
in the Intercreditor Agreement, a first-priority) (subject only to Liens of the type set forth in clause (i) of the definition
of “Permitted Liens”) perfected and enforceable security interest and Lien in all of the ABL Priority Collateral, and
each Loan Party Obligor will at all times defend the Collateral Agent and the Collateral against all claims of others. Except as
otherwise disclosed in writing to the Secured Parties by the Borrower, none of the Collateral which is Equipment is, or will at
any time, be affixed to any real property in such a manner, or with such intent, as to become a fixture. Except for leases or subleases
as to which the applicable Loan Party has delivered to the Secured Parties a landlord’s waiver in form and substance reasonably
satisfactory to the Required Lenders (unless waived in writing by the Required Lenders in their sole discretion), no Loan Party
Obligor is or will be a lessee or sublessee under any real property lease or sublease. Except for warehouses as to which the applicable
Loan Party has delivered to the Secured Parties a warehouseman’s waiver in form and substance reasonably satisfactory to
the Required Lenders (unless waived in writing by the Required Lenders in their sole discretion), no Loan Party Obligor is or will
at any time be a bailor of any goods at any warehouse or otherwise. Prior to causing or permitting any Collateral valued in excess
of $50,000 (other than mobile equipment such as laptop computers in the possession of the applicable Loan Party’s employees
or agents) to at any time be located upon premises in which any third party (including any landlord, warehouseman, or otherwise)
has an interest, the Borrower shall notify the Secured Parties and the applicable Loan Party Obligor shall cause each such third
party to execute and deliver to the Secured Parties, in form and substance reasonably acceptable to the Required Lenders, such
waivers, collateral access agreements, and subordinations as the any Secured Party shall specify, so as to, among other things,
ensure that the Secured Parties’ rights and interests in the Collateral are, and will at all times continue to be, superior
to the rights and interests of any such third party or Person and that the Secured Parties have access to such Collateral. Each
applicable Loan Party Obligor will keep at all times in full force and effect, and will comply at all times with all the terms
of, any lease of real property where any of the Collateral now or in the future may be located. Notwithstanding any of the foregoing
or anything in the Loan Documents to the contrary, (x) for each location leased or otherwise occupied by Aytu and its Subsidiaries
(other than Borrower Loan Parties) as reflected in the Perfection Certificate delivered on the Sixth Amendment Effective Date,
Aytu and its Subsidiaries shall use commercially reasonable efforts to deliver, within sixty (60) days (or such later date as Collateral
Agent may agree in its sole discretion) after the Sixth Amendment Effective Date, landlord and warehousemen waivers, as applicable,
for each such location, in form and substance reasonably satisfactory to the Required Lenders and (y) the Borrower shall have ten
(10) days after the Sixth Amendment Effective Date to deliver, or cause to be delivered, a certificate representing 100% of its
Stock reflecting Aytu as the owner of such Stock.


 




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(x) Health
Care Proceedings, Audits and Permits. Other than as set forth on Schedule 3.1(x), there are no pending (or, to the knowledge
of Aytu or the Borrower, threatened in writing) audits, actions, hearings or proceedings (collectively, “Proceedings”)
against or affecting Aytu or any of its Subsidiaries relating to any actual or alleged non-compliance with any Health Care Law.
There exist no restrictions, deficiencies, required plans of correction or other such remedial measures with respect to any material
Health Care Permit of Aytu or any of its Subsidiaries.


 


(y) ABL
Debt and ABL Documents. The Borrower has furnished the Secured Parties with a true, correct and complete copy of each of the
ABL Documents (in each case, including all certificates, schedules, exhibits, annexes, amendments, restatements, supplements, modifications,
waivers, consents, extensions, forbearances, assignments and all other reports, notices, agreements, instruments and documents
delivered pursuant thereto or in connection therewith). No statement, representation, warranty or certification made in any of
the ABL Documents by the Borrower or any other Loan Party or, to the Loan Parties’ knowledge, any other Person, contains
any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary in order
to make the statements made therein, in light of the circumstances under which they are made, not misleading in any material respect
as of the time that such statement, representation, warranty or certification is made (or deemed made). Each of the representations,
warranties and certifications of the Loan Parties set forth in each of the ABL Documents are true, correct and complete in all
material respects (without giving effect to any double materiality). No portion of the ABL Debt is, or at any time shall be, (i)
secured by any assets of any of the Loan Parties or any other Person or any Stock issued by any of the Loan Parties or any other
Person (except to the extent expressly permitted by the Intercreditor Agreement) or (ii) guaranteed by any Person (except to the
extent expressly permitted by the Intercreditor Agreement). The provisions of the Intercreditor Agreement are enforceable against
each of the “ABL Lender Parties” (as defined in the Intercreditor Agreement) and each other holder of the ABL Debt,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law. The Borrower
and each other Loan Party acknowledges that the Collateral Agent and the Lenders are entering into the Fourth Amendment and the
other Loan Documents and continuing to allow the Loans to remain outstanding in reliance upon the Intercreditor Agreement and this
Section 3.1(y).


 




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(z) Electronic
Chattel Paper. To the extent that any Loan Party Obligor obtains or maintains any Electronic Chattel Paper, such Loan Party
Obligor shall at all times create, store and assign the record or records comprising the Electronic Chattel Paper in such a manner
that (a) a single authoritative copy of the record or records exists which is unique, identifiable and except as otherwise provided
below, unalterable, (b) the authoritative copy identifies the Collateral Agent (for the benefit of the Secured Parties) as the
assignee of the record or records, (c) the authoritative copy is communicated to and maintained by the Collateral Agent or its
designated custodian (for the benefit of the Secured Parties), (d) copies or revisions that add or change an identified assignee
of the authoritative copy can only be made with the participation of the Collateral Agent, (e) each copy of the authoritative copy
and any copy of a copy is readily identifiable as a copy that is not the authoritative copy and (f) any revision of the authoritative
copy is readily identifiable as an authorized or unauthorized revision.


 


(aa) Capitalization;
Investment Property.


 


(i) No Loan
Party, directly or indirectly, owns, or shall at any time own, any capital stock or other Stock of any other Person except as set
forth in Schedule 3.1(aa) other than the acquisition of capital stock or other Stock by Aytu or any of its Subsidiaries
as permitted hereunder.


 


(ii) None of
the Pledged Equity has been issued or otherwise transferred in violation of the Securities Act, or other Applicable Laws of any
jurisdiction to which such issuance or transfer may be subject. The Pledged Equity pledged by each Loan Party Obligor under the
Loan Documents constitutes all of the issued and outstanding Stock of each Issuer owned by such Loan Party Obligor.


 


(iii) All of
the Pledged Equity has been duly and validly issued and is fully paid and non-assessable, and the holders thereof are not entitled
to any preemptive, first refusal or other similar rights. There are no outstanding options, warrants or similar agreements, documents,
or instruments with respect to any of the Pledged Equity.


 


(iv) Each Loan
Party Obligor has caused each Issuer to amend or otherwise modify its Organizational Documents, books, records, and related agreements,
documents and instruments, as applicable, to reflect the rights and interests of the Collateral Agent (for the benefit of the Secured
Parties) under the Security Agreement and the other Loan Documents, and to the extent required to enable and empower the Collateral
Agent and the other Secured Parties to exercise and enforce its and their rights and remedies under the Loan Documents in respect
of the Pledged Equity and other Investment Property.


 




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(v) Each Loan
Party Obligor will take any and all actions reasonably requested by any Secured Party, from time to time, to (i) cause the Collateral
Agent (for the benefit of the Secured Parties) to obtain exclusive control of any Investment Property in a manner reasonably acceptable
to the Collateral Agent and the Required Lenders and (ii) obtain from any Issuers and such other Persons as the Collateral Agent
or the Required Lenders shall specify, for the benefit of the Collateral Agent and the other Secured Parties, written confirmation
of the Collateral Agent’s (for the benefit of the Secured Parties) exclusive control over such Investment Property and take
such other actions as the Collateral Agent may request to perfect the Collateral Agent’s (for the benefit of the Secured
Parties) security interest and Lien in any Investment Property. For purposes of this Section 3.1(aa), the Collateral Agent
(for the benefit of the Secured Parties) shall have exclusive control of Investment Property if (A) pursuant to Section 5.5 of
the Security Agreement and the other applicable provisions of the Security Agreement, such Investment Property consists of certificated
securities and the applicable Loan Party Obligor delivers such certificated securities to the Collateral Agent (with all appropriate
endorsements and transfer forms executed and delivered in blank), (B) such Investment Property consists of uncertificated securities
and either (x) the applicable Loan Party Obligor delivers such uncertificated securities to the Collateral Agent or (y) the Issuer
thereof agrees, pursuant to documentation in form and substance reasonably satisfactory to the Collateral Agent and the Required
Lenders, that it will comply with instructions originated by the Collateral Agent without further consent by the applicable Loan
Party Obligor and (C) such Investment Property consists of security entitlements and either (x) the Collateral Agent (for the benefit
of the Secured Parties) becomes the entitlement holder thereof or (y) the appropriate securities intermediary agrees, pursuant
to documentation in form and substance reasonably satisfactory to the Collateral Agent and the Required Lenders, that it will comply
with entitlement orders originated by the Collateral Agent without further consent by the applicable Loan Party Obligor. Each Loan
Party Obligor that is a limited liability company or a partnership hereby represents, warrants and covenants that it has not, and
at no time will, elect pursuant to the provisions of Section 8-103 of the UCC to provide that its equity interests or other Stock
are securities governed by Article 8 of the UCC.


 


(vi) No Loan
Party owns, or has any present intention of acquiring, any “margin security” or any “margin stock” within
the meaning of Regulations T, U or X of the Board of Governors of the Federal Reserve System (herein called “margin security”
and “margin stock”). None of the proceeds of the Loans or Notes will be used, directly or indirectly, for the purpose
of purchasing or carrying, or for the purpose of reducing or retiring any Indebtedness which was originally incurred to purchase
or carry, any margin security or margin stock or for any other purpose which might constitute the transactions contemplated hereby
a “purpose credit” within the meaning of said Regulations T, U or X, or cause this Agreement to violate any other regulation
of the Board of Governors of the Federal Reserve System or the Exchange Act, or any rules or regulations promulgated under such
statutes.


 


(vii) Other
than in cases where the Collateral Agent will retain a perfected, first-priority Lien on all such equity interests or Stock pursuant
to the terms and conditions of the Security Agreement, no Loan Party Obligor shall vote to enable, or take any other action to
cause or to permit, any Issuer to issue any equity interests or other Stock of any nature, or to issue any other securities or
interests convertible into or granting the right to purchase or exchange for any equity interests or other Stock of any nature
of any Issuer.


 


(viii) Aytu
shall not, and shall not permit any of its Subsidiaries to, take, or fail to take, any action that would in any manner impair the
value or the enforceability of the Collateral Agent’s Lien on any of the Investment Property, or any of the Collateral Agent’s
or other Secured Party’s rights or remedies under this Agreement or any other Loan Document with respect to any of the Investment
Property.


 




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(ix) In the
case of any Loan Party Obligor which is an Issuer, such Issuer agrees that the terms of Section 6.3 of the Security Agreement shall
apply to such Loan Party Obligor with respect to all actions that may be required of it pursuant to such Section 6.3 regarding
the Investment Property issued by it.


 


(x) Each Loan
Party Obligor has made all capital contributions heretofore required to be made to the respective Issuer in respect of any Investment
Property constituting limited liability company interests and no additional capital contributions are required to be made in respect
of the respective limited liability company interests.


 


(bb) Commercial
Tort Claims. No Loan Party Obligor has any Commercial Tort Claim with a value in excess of Fifty Thousand Dollars ($50,000.00)
pending other than those listed in the Perfection Certificate delivered on the Sixth Amendment Effective Date, and each Loan Party
Obligor shall promptly (but in any case, no later than five Business Days thereafter) notify the Secured Parties in writing upon
incurring or otherwise obtaining a Commercial Tort Claim after the date hereof against any third party. Such notice shall constitute
such Loan Party Obligor’s authorization to amend the Perfection Certificate delivered on the Sixth Amendment Effective Date
to add such Commercial Tort Claim and shall automatically be deemed to amend the Perfection Certificate delivered on the Sixth
Amendment Effective Date to include such Commercial Tort Claim.


 


(cc) Jurisdiction
of Organization; Location of Collateral. With respect to each Loan Party Obligor, the Perfection Certificate delivered on the
Sixth Amendment Effective Date sets forth (i) each place of business of such Loan Party Obligor (including its chief executive
office), (ii) all locations where all Inventory, Equipment, and other Collateral owned by such Loan Party Obligor is kept and (iii)
whether each such Collateral location and place of business (including such Loan Party Obligor’s chief executive office)
is owned by a Loan Party or leased (and if leased, specifies the complete name and notice address of each lessor). No Collateral
is located outside the United States or in the possession of any lessor, bailee, warehouseman or consignee, except as expressly
indicated in Perfection Certificate delivered on the Sixth Amendment Effective Date. Each Loan Party Obligor will give the Secured
Parties at least thirty (30) days’ prior written notice before changing its jurisdiction of organization, opening any additional
place of business, changing its chief executive office or the location of its books and records, or moving any of the Collateral
to a location other than one of the locations set forth in the Perfection Certificate delivered on the Sixth Amendment Effective
Date, and will execute and deliver all Financing Statements, landlord waivers, collateral access agreements, mortgages, and all
other agreements, instruments and documents which any Secured Party shall require in connection therewith prior to making such
change, all in form and substance reasonably satisfactory to the Secured Parties. Without the prior written consent of the Collateral
Agent and the Lenders, no Loan Party Obligor will at any time (i) change its jurisdiction of organization or (ii) allow any Collateral
to be located outside of the continental United States of America.


 


(dd) There
is no claim, suit, litigation, proceeding or investigation pending or (to the best of each Loan Party Obligor’s knowledge)
threatened by or against or affecting any Loan Party in any court or before any Governmental Authority (or any basis therefor known
to any Loan Party Obligor) which could reasonably be expected to result, either separately or in the aggregate, in liability in
excess of $500,000 for the Loan Parties, in any Material Adverse Effect, or in any material impairment in the ability of any Loan
Party to carry on its business in substantially the same manner as it is now being conducted.


 




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(ee) Material
Contracts. No Loan Party is (i) a party to any contract which has had or could reasonably be expected to have a Material Adverse
Effect or (ii) in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained
in (A) any contract to which it is a party or by which any of its assets or properties is bound, which default, individually or
in the aggregate, could reasonably be expected to have a Material Adverse Effect or result in liabilities in excess of $500,000
or (B) any Material Contract. Except for the contracts and other agreements listed in the Perfection Certificate delivered on the
Sixth Amendment Effective Date, no Loan Party is party, as of date of such Perfection Certificate, to any (1) employment agreements
covering the management of any Loan Party, (2) collective bargaining agreements or other labor agreements covering any employees
of any Loan Party, (3) agreements for managerial, consulting or similar services to which any Loan Party is a party or by which
it is bound, (4) agreements regarding any Loan Party, its assets or operations or any investment therein to which any of its equity
holders is a party, (5) patent licenses, trademark licenses, copyright licenses or other lease or license agreements to which any
Loan Party is a party, either as lessor or lessee, or as licensor or licensee, (6) distribution, marketing or supply agreements
to which any Loan Party is a party, (7) customer agreements to which any Loan Party is a party (in each case with respect to any
contract of the type described in the preceding clauses (1), (3), (4), (5), (6) and (7) requiring
payments of more than $500,000 in the aggregate in any Fiscal Year), (8) partnership agreements to which any Loan Party is a partner,
limited liability company agreements to which any Loan Party is a member or manager, or joint venture agreements to which any Loan
Party is a party, (9) real estate leases, or (10) any other contract to which any Loan Party is a party, in each case with respect
to this clause (10) the breach, nonperformance or cancellation of which, could reasonably be expected to have a Material
Adverse Effect (each such contract and agreement, described in the preceding clauses (1) to (10), a “Material
Contract”).


 


(ff) No
Material Adverse Effect. Since December 31, 2018, no event has occurred which has had, or could reasonably be expected to have,
a Material Adverse Effect on any Loan Party.


 


(gg) Full
Disclosure. Excluding projections and other forward-looking information, pro forma financial information and information of
a general economic or industry nature, no report, notice, certificate, information or other statement delivered or made (including,
in electronic form) by or on behalf of any Loan Party, any Other Obligor or any of their respective Affiliates to any Secured Party
in connection with this Agreement or any other Loan Document contains or will at any time contain any untrue statement of a material
fact, or omits or will at any time omit to state any material fact necessary to make any statements contained herein or therein
not misleading in light of the circumstances in which they were made. Except for matters of a general economic or political nature
which do not affect any Loan Party or any Other Obligor uniquely, there is no fact presently known to any Loan Party Obligor which
has not been disclosed to the Collateral Agent and the Lenders, which has had or could reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect. Any projections and other forward-looking information and pro forma financial information
contained in such materials were prepared in good faith based upon assumptions that were believed by such Loan Party to be reasonable
at the time prepared and at the time furnished in light of conditions and facts then known (it being recognized that such projections
and other forward-looking information and pro forma financial information are not to be viewed as facts and that actual results
during the period or periods covered by any such projections or information may differ from the projected results, and such differences
may be material).


 


(hh) Sensitive
Payments. No Loan Party (i) has made or will at any time make any contributions, payments or gifts to or for the private use
of any governmental official, employee or agent where either the payment or the purpose of such contribution, payment or gift is
illegal under the applicable laws of the United States or the jurisdiction in which made or any other applicable jurisdiction,
(ii) has established or maintained or will at any time establish or maintain any unrecorded fund or asset for any purpose or made
any false or artificial entries on its books, (iii) has made or will at any time make any payments to any Person with the intention
that any part of such payment was to be used for any purpose other than that described in the documents supporting the payment
or (iv) has engaged in or will at any time engage in any “trading with the enemy” or other transactions violating any
rules or regulations of the Office of Foreign Assets Control or any similar applicable laws, rules or regulations.


 




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(ii) Access
to Collateral, Books and Records. At reasonable times and upon reasonable prior notice, each Secured Party and its representatives
and agents shall have the right to inspect the Collateral and to examine and copy each Loan Party’s books and records. Each
Loan Party Obligor agrees to give the Collateral Agent access to any or all of such Loan Party Obligor’s, and each of its
Subsidiaries’, premises to enable each Secured Party to conduct such inspections and examinations. Such inspections and examinations
shall be at the Loan Party Obligors’ sole expense and the charge therefor shall be $1,200 per person per day (or such higher
amount as shall represent such Secured Party’s then current standard charge), plus out-of-pocket expenses. Each Secured Party
may, at the Loan Party Obligors’ sole expense, use each Loan Party’s personnel, computer and other equipment, programs,
printed output and computer readable media, supplies and premises for the collection, sale or other disposition of Collateral to
the extent such Secured Party, in its sole discretion, deems appropriate. Each Loan Party Obligor hereby irrevocably authorizes
all accountants and third parties to disclose and deliver to the Secured Parties, at the Loan Party Obligors’ sole expense,
all financial information, books and records, work papers, management reports and other information in their possession regarding
the Loan Parties. Without limiting the foregoing, each Loan Party Obligor hereby authorizes the Collateral Agent and each other
Secured Party as an “authorized user” under its third party logistics arrangements with SPS (or any replacement thereof)
and agrees that the Collateral Agent and such other Secured Parties shall have all powers and access rights incidental thereto,
in each case to take such actions as may be necessary for the Collateral Agent and such other Secured Parties to view all activities
and reports through any applicable portal associated with such third party logistics and related services. In furtherance of the
foregoing authorization, each Loan Party Obligor will, and will cause each Subsidiary to, execute and deliver, or cause to be executed
and delivered, to the Secured Parties such documents, agreements and instruments, and will take or cause to be taken such further
actions for which any Secured Party may, from time to time, reasonably request to become an “authorized user” in respect
of such portal, all in form and substance reasonably satisfactory to such Secured Party and at the sole expense of the Loan Party
Obligors.


 


(jj) Interrelated
Business. Loan Parties make up a related organization of various entities constituting a single economic and business enterprise
so that Loan Parties share an identity of interests such that any benefit received by any one of them benefits the others. From
time to time each of the Loan Parties may render services to or for the benefit of the other Loan Parties, purchase or sell and
supply goods to or from or for the benefit of the others, make loans, advances and provide other financial accommodations to or
for the benefit of the other Loan Parties (including inter alia, the payment by such Loan Parties of creditors of the other Loan
Parties and guarantees by such Loan Parties of indebtedness of the other Loan Parties and provides administrative, marketing, payroll
and management services to or for the benefit of the other Loan Parties). Loan Parties have the same centralized accounting and
legal services, certain common officers and directors and generally do not provide stand-alone consolidating financial statements
to creditors.


 




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(kk) Deposit
Accounts and Other Accounts. (i) All Deposit Accounts, Securities Accounts and Commodity Accounts and all other
depositary, securities, commodity and other accounts maintained by each Loan Party Obligor as of the Sixth Amendment
Effective Date are described in the Perfection Certificate delivered on the Sixth Amendment Effective Date, which description
includes for each such account the name of the Loan Party Obligor maintaining the account, the name of the financial
institution at which the account is maintained, the account number and the purpose of the account, (ii) the only collection
Deposit Accounts, lockbox accounts and Deposit Accounts of the Loan Parties into which proceeds of revolving loans under the
ABL Documents are directly funded (or that otherwise would constitute ABL Priority Collateral under the Intercreditor
Agreement) are those Deposit Accounts maintained at First Republic Bank (routing number
        ) with account numbers          and
       , (iii) other than those Deposit Accounts specifically referenced in clause
(ii) above, all Deposit Accounts and all other depositary and other accounts (including Securities Accounts) of the Loan
Parties are Term Priority Deposit Accounts (or, with respect to clause (B) below, Term Priority Collateral) under the
Intercreditor Agreement (including (A) all Deposit Accounts maintained at First Republic Bank (routing number
       ) with account numbers         and
         , and (B)
the Securities Account maintained at US Bank (routing number
       )
with account number Neos:
         , and (iv)
all Deposit Accounts and all other depositary and other accounts indicated in any Perfection Certificate as a Restricted
Account or an Excluded Account (as defined in the Security Agreement) meet at all time the requirements set forth in both the
definition of Restricted Account and the definition of Excluded Account (as defined in the Security Agreement). (1) All
Deposit Accounts, Securities Accounts and Commodity Accounts and all other depositary, securities, commodity and other
accounts (other than Restricted Accounts and, in the case of Aytu, that certain deposit account owned by Aytu and maintained
by American Express Bank as reflected in the Perfection Certificate delivered on the Sixth Amendment Effective Date, but only
so long as such deposit account serves as collateral for the reimbursement obligations of Aytu to American Express Bank) of
the Loan Party Obligors are, or, with respect to any such Deposit Accounts, Securities Accounts and Commodity Account of Aytu
and its Subsidiaries (other than the Borrower and its Subsidiaries), within sixty (60) days (or such later date as Collateral
Agent may agree in its sole discretion) after the Sixth Amendment Effective Date, will be, subject to a Control Agreement in
favor of the Collateral Agent (for the benefit of the Secured Parties) at all times, and (2) the Collateral Agent (for the
benefit of the Secured Parties) (I) has or, with respect to any such Deposit Accounts, Securities Accounts and Commodity
Account of Aytu and its Subsidiaries (other than the Borrower and its Subsidiaries), within sixty (60) days (or such later
date as Collateral Agent may agree in its sole discretion) after the Sixth Amendment Effective Date, will have, (X)
“control” (as defined in 8-106 and 9-104 of the UCC) of all such accounts and (Y) a first-priority security
interest and Lien on all of the Term Priority Deposit Accounts and (III) has a second-priority (or, after the Payment in Full
(as defined in the Intercreditor Agreement) of the ABL Priority Debt (as defined in the Intercreditor Agreement),
first-priority) security interest and Lien on all of the ABL Priority Deposit Accounts.


 


(ll) Insurance.
A true, correct and complete listing of all insurance covered by Section 5.1(xvi)(A) as of the Sixth Amendment Effective
Date, including issuers, coverages and deductibles, is set forth on Schedule 3.1(ll).


 


(mm) Fair
Labor Standards Act. All of the Inventory of each Loan Party has at all times been, and at all times will be, produced only
in accordance with the Fair Labor Standards Act of 1938 and all rules, regulations and orders promulgated thereunder.


 


(nn) Accounts
and Chattel Paper. (i) All Accounts of any Loan Party Obligor, and all Chattel Paper owned by any Loan Party Obligor, (A) are
genuine and in all respects what they purport to be, and (B) arise out of a completed, bona fide and unconditional and non-contingent
sale and delivery of goods or rendition of services by a Loan Party Obligor in the Ordinary Course of Business and in accordance
with the terms and conditions of all purchase orders, contracts or other documents relating thereto, (ii) each Account Debtor under
each such purchase order, contract and other document had the capacity to contract at the time any purchase order, contract or
other document giving rise to such Accounts and Chattel Paper were executed and/or delivered, and (iii) the transactions giving
rise to such Accounts and Chattel Paper comply with all Applicable Laws and governmental rules and regulations.


 




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(oo) [Reserved.]


 


(pp) SEC
Reports. Aytu has filed all reports, schedules, forms, statements and other documents required to be filed by it under the
Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date
this representation is made (the foregoing materials, including the registration on form S-4 of the joint proxy statement, projections
included therein, in each case including the exhibits thereto and documents incorporated by reference therein, being collectively
referred to herein as the “SEC Reports”). As of their respective dates, the SEC Reports complied in all material
respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed,
contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.


 


(qq) Exemption
from Registration. Neither the Borrower, nor any of its Affiliates, nor any Person acting on its or their behalf, has offered
or issued any of the Securities by any form of general solicitation or general advertising (as those terms are used in Regulation
D promulgated under the Securities Act). Assuming the accuracy of the Lenders’ representations and warranties set forth in
Section 3.3, no registration under the Securities Act is required for the offer and issuance of the Securities by the Borrower
to the Lenders as contemplated hereby. The transactions contemplated hereby, including the issuance and sale of the Securities,
do not contravene, or require stockholder approval pursuant to, the rules and regulations of NASDAQ. Neither the Borrower, nor
any of its Affiliates, nor any Person acting on its behalf has, directly or indirectly, made any offers or sales of any security
or solicited any offers to buy any security, under circumstances that would cause this offering and issuance of the Securities
to be integrated with prior or contemporaneous offerings by the Borrower for purposes of the Securities Act and which would require
the registration of any such securities under the Securities Act.


 


(rr) Certain
Fees. No brokerage or finder’s fees or commissions are or will be required to be paid by the Aytu or any of its Affiliates
or representatives to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person
with respect to the transactions contemplated by the Loan Documents. The Lenders shall have no obligation with respect to any fees
or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section 3.1(rr)
that may be due in connection with the transactions contemplated by the Loan Documents.


 


(ss) [Reserved.]


 


(tt) Perfection
Certificate. The information in each Perfection Certificate is true, correct and complete in all respects.


 


Section 3.2 Borrower
and other Loan Party Obligors Acknowledgment. The Borrower and each other Loan Party Obligor hereby acknowledges that it has
made the representations and warranties referred to in Section 3.1 with the intention of persuading the Collateral Agent
and the Lenders to enter into the Loan Documents and that the Collateral Agent and the Lenders have entered into the Loan Documents
on the basis of, and in full reliance on, each of such representations and warranties and such representations and warranties shall
survive the execution of this Agreement until the Obligations are repaid in full.


 




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Article
4

[RESERVED]


 


Article
5

PARTICULAR COVENANTS AND EVENTS OF DEFAULT


 


Section 5.1 Affirmative
Covenants. Unless the Required Lenders shall otherwise agree:


 


(i) Maintain
Existence and Qualification. Borrower and Aytu shall, and Aytu shall cause each of its other Subsidiaries to, maintain its
respective existence and qualify and remain qualified to do its business as currently conducted, except for any merger or dissolution
of a Subsidiary in accordance with Section 5.2(i) and except where the failure to so qualify would not reasonably be expected
to result in a Material Adverse Effect.


 


(ii) Compliance
with Laws. Aytu shall, and shall cause its Subsidiaries to, comply in all material respects with all Applicable Laws.


 


(iii) Authorizations.
Aytu shall, and shall cause its Subsidiaries to, obtain and keep in full force and effect all Authorizations, except where the
failure to do so would not reasonably be expected to result in a Material Adverse Effect.


 


(iv) Notices
of Default, Proceedings, Material Adverse Effect Occurrences, Etc.; Additional Information Requests. Aytu shall, and shall
cause its Subsidiaries to, promptly (but in no case later than the earlier of (y) within three (3) Business Days after the occurrence
thereof and (z) such other date that such information is required to be delivered pursuant to this Agreement or any other Loan
Document) notify the Secured Parties of the occurrence of (i) any Default or Event of Default (including any noncompliance with
any of the financial covenants specified in Section 5.3 or the minimum cash balance specified in Section 5.1(vii)),
(ii) any claims, litigation, arbitration, mediation or administrative or regulatory proceedings that are instituted or threatened
in writing against the Borrower or any of its Subsidiaries in which an adverse decision would reasonably be expected to result
in a Material Adverse Effect, and (iii) any event or the existence of any circumstance that has resulted in, or could reasonably
be expected to result in, a Material Adverse Effect. Promptly upon such request, the Aytu shall, and shall cause its Subsidiaries
to, provide to the Secured Parties such data and information (financial and otherwise) as any Secured Party, from time to time,
may reasonably request, including any information bearing upon or related to the Collateral or each Loan Party’s and each
Other Obligor’s business or financial condition or results of operations.


 




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(v) Financial
Statements, SEC Reports, Etc. Aytu will, and will cause its Subsidiaries to, at all times keep, adequate records and books
of account with respect to its business activities and the Collateral in which proper entries are made in accordance with GAAP
reflecting all its financial transactions. Promptly (and, in any event, within two (2) Business Days) after the sending or filing
thereof, as the case may be, the Aytu shall, and shall cause its Subsidiaries to, provide to the Secured Parties financial statements,
proxy statements or reports which each Loan Party has made available to its stockholders and copies of any regular, periodic and
special reports or registration statements which any Loan Party files with the SEC or any Governmental Authority which may be substituted
therefor, or any national securities exchange. If Aytu is required to file reports pursuant to Section 13 or 15(d) of the Exchange
Act, Aytu will, and will cause its Subsidiaries to, (I) timely file with the SEC (subject to appropriate extensions made under
Rule 12b-25 of the Exchange Act) any annual reports, quarterly reports and other periodic reports required to be filed by Borrower
pursuant to Section 13 or 15(d) of the Exchange Act and (II) concurrently with the delivery of such annual and quarterly reports,
deliver to the Collateral Agent and the Lenders a Compliance Certificate, indicating whether (i) the Borrower Loan Parties are
in compliance with each of the financial covenants specified in Section 5.3 and the minimum cash balance specified in Section
5.1(vii), and setting forth a reasonably detailed calculation of such covenants to the extent required thereby, and (ii) any
Default or Event of Default is then in existence. With respect to any Compliance Certificate delivered, the related annual or quarterly
report (as applicable) that is filed with the SEC shall disclose the compliance, including, for the avoidance of doubt, any noncompliance,
of the Borrower Loan Parties with the financial covenants specified in Section 5.3, including the financial information
utilized to determine such compliance (or noncompliance) and any other material, non-public information related to the determination
of such compliance (or noncompliance). Aytu will, and will cause its Subsidiaries to, provide to the Secured Parties copies of
all documents, reports, financial data and other information not available on the SEC EDGAR system and not containing any material
non-public information generally prepared in the ordinary course of Aytu’s business that any Secured Party may reasonably
request. If Aytu is not required to file (and is not voluntarily filing) annual reports, quarterly reports and other periodic reports
pursuant to Section 13 or 15(d) of the Exchange Act, Aytu will, and will cause its Subsidiaries to, provide to the Secured Parties
the following items:


 


(A)
Annual Financial Statements. Not later than ninety (90) days after the close of each Fiscal Year, unqualified, audited
financial statements of the Loan Parties on a consolidated basis as of the end of such Fiscal Year, including balance sheet, income
statement, and statement of cash flow for such Fiscal Year, in each case on a consolidated and consolidating basis, certified by
a firm of independent certified public accountants of recognized standing selected by Aytu but acceptable to the Collateral Agent
and the Lenders, together with a copy of any management letter issued in connection therewith. Concurrently with the delivery of
such financial statements, Aytu shall deliver to the Collateral Agent and the Lenders a Compliance Certificate, indicating whether
(i) the Borrower Loan Parties are in compliance with each of the financial covenants specified in Section 5.3 (and the minimum
cash balance specified in Section 5.1(vii)), and setting forth a reasonably detailed calculation of such covenants to the
extent required thereby, and (ii) any Default or Event of Default is then in existence; and


 


(B)
Interim Financial Statements. Not later than thirty (30) days after the end of each month, including the last month
of each Fiscal Year, unaudited interim financial statements of the Loan Parties on a consolidated basis as of the end of such month
and of the portion of such Fiscal Year then elapsed, including balance sheet, income statement, statement of cash flow, and results
of their respective operations during such month and the then-elapsed portion of the Fiscal Year, together with comparative figures
for the same periods in the immediately preceding Fiscal Year and the corresponding figures from the budget for the Fiscal Year
covered by such financial statements, in each case on a consolidated and consolidating basis, certified by the principal financial
officer of the Borrower as prepared in accordance with GAAP and fairly presenting the consolidated financial position and results
of operations of each Loan Party for such month and period subject only to changes from ordinary course year end audit adjustments
and except that such statements need not contain footnotes. Concurrently with the delivery of such financial statements, the Borrower
shall deliver to the Collateral Agent and the Lenders a Compliance Certificate, indicating whether (i) the Borrower Loan Parties
are in compliance with each of the financial covenants specified in Section 5.3 (and the minimum cash balance specified
in Section 5.1(vii)) and setting forth a reasonably detailed calculation of such covenants to the extent required thereby,
and (ii) any Default or Event of Default is then in existence.


 




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All the financial statements covered
in this Section 5.1(v) (for the avoidance of doubt, whether or not Aytu is required to file reports pursuant to Section
13 or 15(d) of the Exchange Act) shall (1) in the case of annual financial statements, contain an unqualified opinion of independent
registered public accountants, and (2) not include any explanatory paragraph expressing substantial doubt as to going concern status.


 


(vi) Expense
Reimbursement. Aytu shall, and shall cause the other Loan Party Obligors to, reimburse the Secured Parties on the Sixth Amendment
Effective Date (and the date of any other amendment, restatement, supplement, modification, extension or waiver of (or consent
with respect to any departure from) any Loan Document) for all reasonable documented out-of-pocket costs, fees and expenses, including
reasonable documented out-of-pocket attorneys’ fees and expenses, in connection with the negotiation, documentation and closing
of this Agreement and the other Loan Documents.


 


(vii) Minimum
Cash Balance. The Borrower shall at all times maintain cash on deposit in accounts subject to a Control Agreement in favor
of the Collateral Agent (for the benefit of the Secured Parties) of not less than $5,000,000.


 


(viii) ABL
Documents, Deliverables and Reports. The Borrower shall, and shall cause its Subsidiaries to, promptly (and, in any event,
within two Business Days) (A) notify each Secured Party of the occurrence of any breaches, defaults or events of default under,
and any amendments, restatements, supplements, changes, consents, waivers, forbearances, joinders or other modifications to the
ABL Documents or the entering into after the Sixth Amendment Effective Date of any ABL Documents and provide copies of any documentation
related to the foregoing, and (B) deliver to each Secured Party true, correct and complete copies of any material notices, documents,
instruments, agreements or other material written information provided or received pursuant to, or in connection with, the ABL
Facility (including those delivered to the Borrower, any of its Subsidiaries that are guarantors of the Obligations or any of their
respective Affiliates by any lender (or any agent of any lender) under the ABL Facility).


 


(ix) Perfection
Certificate Updates. The Borrower shall, and shall cause its Subsidiaries to, provide to the legal counsel of the Secured Parties,
bi-annually in January and July of each calendar year, a new or updated Perfection Certificate, true, correct and complete in all
material respects as of the date of delivery, accompanied by a certificate executed by an officer of each Loan Party Obligor (it
being understood and agreed that no such update shall serve to cure or waive any existing Event of Default, including any Event
of Default resulting from any failure to provide any such disclosure to a Secured Party on an earlier date or any breach of any
earlier made representation and/or warranty).


  


(x) Litigation
Cooperation. Should any third-party suit, regulatory action, or any other judicial, administrative, or similar proceeding be
instituted by or against the Collateral Agent or any Lender with respect to any Collateral or in any manner relating to any Loan
Party, this Agreement, any other Loan Document or the transactions contemplated hereby or thereby, the Borrower shall, and shall
cause each of its Subsidiaries to, without expense to any Secured Party, make available each Loan Party, such Loan Party’s
officers, employees and agents, and any Loan Party’s books and records, without charge, to the extent that any Secured Party
may deem them reasonably necessary in order to prosecute or defend any such suit or proceeding.


 


(xi) [Reserved.]


 


(xii) Blue
Sky Filings. The Borrower shall take such action, if any, as is reasonably necessary in order to obtain an exemption for, or
to qualify the Securities for, issuance and sale to the Lenders under applicable securities or “Blue Sky” laws of the
states of the United States, and shall provide evidence of such actions promptly upon request of any Lender.


 




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(xiii) Disclosure;
No MNPI. At or prior to 5:30 a.m. (New York City time) on the first Business Day following the entering into of any material
Loan Document or ABL Document, Aytu shall file a Form 8-K with the SEC describing the terms of thereof and any other material transactions
occurring in connection therewith. Each Loan Party shall not, and shall cause each of its Subsidiaries and its and each of their
respective officers, directors, employees. Attorneys, representatives and agents to not, provide any Secured Party or any of its
Affiliates with any material nonpublic information regarding Aytu or any of its Subsidiaries from and after the filing of the Announcing
Form 8-K with the SEC without the express prior written consent of such Secured Party. Each Loan Party hereby acknowledges and
agrees that, notwithstanding the provisions of Section 6.14, no Secured Party (nor any of such Secured Party’s Affiliates,
agents or representatives) shall have any duty of trust or confidence with respect to, or any obligation not to trade in any securities
while aware of, any material nonpublic information regarding the Aytu (A) provided by, or on behalf of, Aytu, any of its Subsidiaries,
any of their respective Affiliates or any of their respective officers, directors (or equivalent Persons), employees, attorneys,
accountants, consultants, representatives or agents, in violation of any of the representations, covenants, provisions or agreements
set forth in this Section 5.1(xiii) or (B) otherwise possessed (or continued to be possessed) by any Secured Party (or any
Affiliate, agent or representative thereof) as a result of any breach or violation of any representation, covenant, provision or
agreement set forth in this Section 5.1(xiii). Subject to the foregoing, no Loan Party shall (and no Loan Party shall permit
any of its Subsidiaries to) issue any press releases or any other public statements with respect to the transactions contemplated
by any Loan Document or any ABL Document or disclosing the name of any Secured Party or any of its Affiliates; provided,
however, that the Borrower shall be entitled, without the prior approval of any Secured Party, to make any press release
or other public disclosure with respect to such transactions (A) in substantial conformity with the Announcing Form 8-K and contemporaneously
therewith and (B) as is required by Applicable Law and regulations (provided that each Secured Party shall be consulted
by Aytu in connection with any such press release or other public disclosure prior to its release and shall be provided with a
copy thereof). Notwithstanding anything to the contrary herein, in the event that any Loan Party believes that a notice or communication
to any Secured Party or any of its Affiliates contains material, nonpublic information relating to any Loan Party, any of its Subsidiaries
or Affiliates or any of their respective property or Stock, Aytu shall so indicate to the Secured Parties contemporaneously with
delivery of such notice or communication, and such indication shall provide the Secured Parties the means to refuse to receive
such notice or communication; and in the absence of any such indication, the Secured Parties, the other holders of the Securities
and their respective Affiliates and representatives shall be allowed to presume that all matters relating to such notice or communication
do not constitute material, nonpublic information relating to any Loan Party, any of its Subsidiaries or Affiliates or any of their
respective property or Stock. Upon receipt or delivery by any Loan Party or any of its Subsidiaries of any notice in accordance
with the terms of the Loan Documents, unless Aytu has in good faith determined that the matters relating to such notice do not
constitute material, nonpublic information relating to any Loan Party or any of its Subsidiaries or its Affiliates or their respective
property or Stock, the Loan Parties shall within one Business Day after any such receipt or delivery publicly disclose such material,
nonpublic information. In the event of a breach of any of the foregoing covenants by any Loan Party, any of the Subsidiaries or
its Affiliates, or any of its or their respective officers, directors (or equivalent Persons), employees, attorneys, accountants,
consultants, representatives or agents, in addition to any other remedies provided in the Loan Documents or otherwise available
at law or in equity, the Secured Parties shall have the right to make a public disclosure in the form of a press release, public
advertisement or otherwise, of the applicable material nonpublic information regarding the Loan Parties, their Subsidiaries, their
Affiliates and/or their respective property or Stock without the prior approval by any Loan Party, its Subsidiaries or Affiliates,
or any of its or their respective officers, directors (or equivalent Persons), employees, stockholders, attorneys, accountants,
consultants, representatives or agents, and no Secured Party (nor any of its Affiliates, agents or representatives) shall have
any liability to any Loan Party, any of its Subsidiaries or Affiliates or any of its or their respective officers, directors (or
equivalent persons), employees, stockholders, attorneys, accountants, consultants, representatives or agents for any such disclosure.
Notwithstanding the foregoing, to the extent the Borrower reasonably and in good faith determines that it is necessary to disclose
material non-public information to a Secured Party for purposes relating to any of the Loan Documents (a “Necessary Disclosure”),
the Borrower shall inform counsel to such Secured Party (which shall be Katten Muchin Rosenman LLP (Attn: Mark D. Wood) or such
other counsel as shall have been designated in writing by such Secured Party) of such determination without disclosing the applicable
material non-public information, and the Borrower and such counsel on behalf of the applicable Secured Party shall endeavor to
agree upon a process for making such Necessary Disclosure to the applicable Secured Party or its representatives that is mutually
acceptable to such Secured Party and the Borrower (an “Agreed Disclosure Process”). Thereafter, Aytu shall be
permitted to make such Necessary Disclosure (only) in accordance with the Agreed Disclosure Process.


 






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(xiv) [Reserved.]


  


(xv) Further
Assurances. Aytu shall, and shall cause each of its Subsidiaries to, at the Aytu’s and its Subsidiaries’ own cost
and expense, promptly and duly take, execute, acknowledge and deliver (or cause each other applicable Person to take, execute,
acknowledge and deliver) all such further acts, documents, agreements and instruments as any Secured Party may from time to time
reasonably request in order to (a) carry out the intent and purposes of the Loan Documents and the transactions contemplated hereby
and thereby, (b) establish, create, preserve, protect and perfect a first priority security interest and Lien (subject only to
Liens of the type set forth in clause (i) of the definition of “Permitted Liens”) in favor of the Collateral
Agent (for the benefit of the Secured Parties) in all the Term Loan Priority Collateral (wherever located) from time to time owned
by the Loan Party Obligors and a second priority (or, after the Payment in Full (as defined in the Intercreditor Agreement) of
the ABL Priority Debt (as defined in the Intercreditor Agreement), first priority) security interest and Lien (subject only to
Liens of the type set forth in clause (i) of the definition of “Permitted Liens”) in favor of the Collateral
Agent (for the benefit of the Secured Parties) in all the ABL Priority Collateral (wherever located) from time to time owned by
the Loan Party Obligors (including appraisals of real property in compliance with FIRREA), (c) cause the Borrower and each Subsidiary
of the Borrower to guaranty (including Guaranty) all of the Obligations, all pursuant to documentation that is in form and substance
reasonably satisfactory to the Required Lenders and (d) facilitate the collection of the Collateral. Without limiting the foregoing,
each Loan Party Obligor shall, at its own cost and expense, promptly and duly take, execute, acknowledge and deliver (or cause
each other applicable Person to take, execute, acknowledge and deliver) to Collateral Agent all promissory notes, security agreements,
agreements with landlords, mortgagees and processors and other bailees, subordination and intercreditor agreements and other agreements,
instruments and documents, in each case in form and substance reasonably acceptable to the Required Lenders, as any Secured Party
may reasonably request from time to time to perfect, protect and maintain the Collateral Agent’s (for the benefit of the
Secured Parties) security interests and Liens in the Collateral, including the required priority thereof, and to fully carry out
the transactions contemplated by the Loan Documents.


 


(xvi) Insurance.


 


(A)
Aytu will, and will cause each of its Subsidiaries to, at all times carry property, liability and other insurance, with
insurers reasonably acceptable to the Secured Parties, in such form and amounts, and with such deductibles and other provisions,
as the Secured Parties shall reasonably require, but in any event, in such amounts and against such risks as is usually carried
by companies engaged in similar business and owning similar properties in the same general areas in which such Loan Party operates,
and Aytu will (and Aytu will cause each of its Subsidiaries to) provide the Secured Parties with evidence reasonably satisfactory
to the Secured Parties that such insurance is, at all times, in full force and effect. Each property insurance policy shall name
the Collateral Agent (for the benefit of the Secured Parties) as lender loss payee and mortgagee, if applicable, and shall contain
a lender’s loss payable endorsement, and a mortgage endorsement, if applicable, and each liability insurance policy shall
name the Collateral Agent (for the benefit of the Secured Parties) as an additional insured, and each business interruption insurance
policy shall be collaterally assigned to the Collateral Agent (for the benefit of the Secured Parties), all in form and substance
reasonably satisfactory to the Collateral Agent and the Required Lenders. All policies of insurance shall provide that they may
not be cancelled or changed without at least thirty (30) days’ (or, with respect to nonpayment of premiums, ten (10) days’)
prior written notice to the Secured Parties, and shall otherwise be in form and substance reasonably satisfactory to the Collateral
Agent and the Required Lenders. Aytu shall advise the Secured Parties promptly of any policy cancellation, non-renewal, reduction,
or material amendment with respect to any insurance policies maintained by any Loan Party or any receipt by any Loan Party of any
notice from any insurance carrier regarding any intended or threatened cancellation, non-renewal, reduction or material amendment
of any of such policies, and the Borrower shall promptly deliver to the Secured Parties copies of all notices and related documentation
received by any Loan Party in connection with the same.


 




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(B)
Aytu shall deliver to the Secured Parties no later than fifteen (15) days prior to the expiration of any then current insurance
policies, insurance certificates evidencing renewal of all such insurance policies required by this Section 5.1(xvi). Aytu
shall deliver to a Secured Party, upon such Secured Party’s request, certificates and endorsements evidencing such insurance
coverage in such form as such Secured Party shall specify.


 


(C)
IF ANY LOAN PARTY AT ANY TIME OR TIMES HEREAFTER SHALL FAIL TO OBTAIN OR MAINTAIN ANY OF THE POLICIES OF INSURANCE REQUIRED
ABOVE (AND PROVIDE EVIDENCE THEREOF TO THE SECURED PARTIES) OR TO PAY ANY PREMIUM RELATING THERETO, THEN ANY SECURED PARTY, WITHOUT
WAIVING OR RELEASING ANY OBLIGATION OR DEFAULT BY ANY LOAN PARTY HEREUNDER, MAY (BUT SHALL BE UNDER NO OBLIGATION TO) OBTAIN AND
MAINTAIN SUCH POLICIES OF INSURANCE AND PAY SUCH PREMIUMS AND TAKE SUCH OTHER ACTIONS WITH RESPECT THERETO AS SUCH SECURED PARTY
DEEMS ADVISABLE UPON NOTICE TO AYTU. SUCH INSURANCE, IF OBTAINED BY A SECURED PARTY, MAY, BUT NEED NOT, PROTECT ANY LOAN PARTY’S
INTERESTS OR PAY ANY CLAIM MADE BY OR AGAINST ANY LOAN PARTY WITH RESPECT TO THE COLLATERAL. SUCH INSURANCE MAY BE MORE EXPENSIVE
THAN THE COST OF INSURANCE ANY LOAN PARTY MAY BE ABLE TO OBTAIN ON ITS OWN AND MAY BE CANCELLED ONLY UPON THE APPLICABLE LOAN PARTY
PROVIDING EVIDENCE THAT IT HAS OBTAINED THE INSURANCE AS REQUIRED ABOVE. ALL SUMS DISBURSED BY ANY SECURED PARTY IN CONNECTION
WITH ANY SUCH ACTIONS, INCLUDING COURT COSTS, EXPENSES, OTHER CHARGES RELATING THERETO AND REASONABLE INTERNAL AND EXTERNAL ATTORNEY
COSTS, SHALL CONSTITUTE OBLIGATIONS UNDER THE LOAN DOCUMENTS, SHALL BE PAYABLE ON DEMAND BY ANY SECURED PARTY TO ANY LOAN PARTY
AND, UNTIL PAID, SHALL BEAR INTEREST AT THE HIGHEST RATE THEN APPLICABLE TO LOANS AND OTHER OBLIGATIONS UNDER THE LOAN DOCUMENTS.


 


(xvii) Invoices.
At any Secured Party’s request during an Event of Default, the Borrower will (and will cause each of its Subsidiaries to)
cause all invoices and statements that it sends to Account Debtors or other third parties to be marked and authenticated, in a
manner reasonably satisfactory to the Secured Parties, to reflect the Collateral Agent’s (for the benefit of the Secured
Parties) security interest and Lien therein and payment instructions (including, but not limited to, in a manner to meet the requirements
of Section 9-404(a)(2) of the UCC).


 


(xviii) Name
Changes. Aytu shall, and shall cause each of its Subsidiaries, give the Secured Parties at least thirty (30) days’ prior
written notice before Aytu or any other Loan Party Obligor changes its legal name or does business under any other name; provided,
however, that Aytu may change its name on one occasion following the closing of the transactions to occur on the Sixth Amendment
Effective Date to Aytu Biopharma, Inc. (or similar variation) without delivery of such prior written notice so long as it provides
notice and evidence of the same via email to the Secured Parties on the date of such change.


 




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(xix) Intellectual
Property. Aytu shall, and shall cause each of its Subsidiaries to, (A) promptly (but in any event within thirty (30) days thereafter)
notify the Secured Parties in writing of any additional Intellectual Property rights acquired or arising after the Sixth Effective
Amendment Date and shall submit to the Secured Parties a supplement to the applicable Perfection Certificate to reflect such additional
rights; provided, that Aytu’s or such Subsidiary’s failure to do so shall not impair the Collateral Agent’s
(for the benefit of the Secured Parties) security interest or Lien therein, and (B) execute a separate security agreement granting
the Collateral Agent (for the benefit of the Secured Parties) a security interest and Lien in such Intellectual Property (whether
owned on the Sixth Amendment Effective Date or thereafter), in form and substance reasonably acceptable to the Secured Parties
and suitable for registering such security interest in such Intellectual Property with the United States Patent and Trademark Office
and/or United States Copyright Office, as applicable; provided, that Aytu or such Subsidiary’s failure to do so shall
not impair the Collateral Agent’s (for the benefit of the Secured Parties) security interest or Lien therein.


 


(xx) Deposit
Accounts and Other Accounts. Aytu shall, and shall cause each other Loan Party Obligor, to (A) have at all times (or, with
respect to any such Deposit Accounts, Securities Accounts and Commodity Account of Aytu and its Subsidiaries (other than the Borrower
and its Subsidiaries), at any time from and after the sixtieth (60th) day (or such later date as Collateral Agent may
agree in its sole discretion) after the Sixth Amendment Effective Date, all Deposit Accounts, Securities Accounts, Commodity Accounts
and all other depositary, securities, commodity and other accounts (other than Restricted Accounts and, in the case of Aytu, that
certain deposit account owned by Aytu and maintained by American Express Bank as reflected in the Perfection Certificate delivered
on the Sixth Amendment Effective Date, but only so long as such deposit account serves as collateral for the reimbursement obligations
of Aytu to American Express Bank) of the Loan Party Obligors be subject to a Control Agreement in favor of the Collateral Agent
(for the benefit of the Secured Parties), and (B) cause the Collateral Agent (for the benefit of the Secured Parties) have at all
times (or, with respect to any such Deposit Accounts, Securities Accounts and Commodity Account of Aytu and its Subsidiaries (other
than the Borrower and its Subsidiaries), at any time from and after the sixtieth (60th) day (or such later date as Collateral
Agent may agree in its sole discretion) after the Sixth Amendment Effective Date) (I) “control” (as defined in 8-106
and 9-104 of the UCC) of all such accounts, (II) a first-priority security interest and Lien on all of the Term Priority Deposit
Accounts and (III) a second-priority (or, after the Payment in Full (as defined in the Intercreditor Agreement) of the ABL Priority
Debt (as defined in the Intercreditor Agreement), first priority) security interest and Lien on all of the ABL Priority Deposit
Accounts.


 






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Section 5.2 Negative
Covenants. Unless the Required Lenders shall otherwise agree:


  


(i) Fundamental
Changes. (a) Aytu shall not, and shall not permit any of its Subsidiaries to, (i) liquidate, provided that a Subsidiary may
merge into the Borrower (so long as the Borrower is the surviving entity) or any other Subsidiary (so long as if any party to such
merger is a Loan Party, the surviving entity is (or becomes) a Loan Party concurrently with such merger), or dissolve (unless such
Subsidiary ceases to own any operating assets or conduct business and such dissolution could not reasonably be expected to have
a Material Adverse Effect or otherwise result in a Default or Event of Default hereunder), wind-up its business operations or cease
substantially all or any material portion of its normal business operations, or (ii) divide (or otherwise split or Divide) itself
or themselves into two or more limited liability companies or other entities or Persons. The Borrower shall not establish any Subsidiary
(including any Subsidiaries, limited liability companies, other entities or other Persons for which any Loan Party divides (including
Divides) or splits itself into) or acquire any interest in any Person, and, (b) except pursuant to the Aytu merger, the Borrower
shall not, and shall not permit any of its Subsidiaries to, enter into any merger, consolidation or reorganization, unless the
Borrower or a Subsidiary is the surviving corporation.


 


(ii) JV
and Royalty Arrangements; Management Arrangements; Distributions and Restricted Payments. The Borrower shall not, and shall
not permit any of its Subsidiaries, to, (a) except for Excluded Transactions, enter into any partnership, joint venture, syndicate,
pool, profit-sharing or royalty agreement or other combination, or engage in any transaction with any stockholder of the Borrower,
any Affiliate of the Borrower or any equity holder of such Affiliate, whereby its income or profits are, or might be, shared with
another Person other than a wholly owned Subsidiary (other than royalty agreements with owners of IP resulting from the challenge
of any Paragraph IV Certification made in connection with a new drug application), (b) enter into any management contract or similar
arrangement whereby a substantial part of its business is managed by another Person, or (c) distribute, or permit the distribution
of, any of its assets, including its intangibles, to any stockholder of the Borrower, any Affiliate of the Borrower or any equity
holder of such Affiliate or pay or declare any Restricted Payments other than (w) as may be required under an Employee Benefit
Plan (as defined in Section 3.1(s)), (x) any Tax distributions by any Subsidiary to permit Borrower to pay any Tax liabilities
with respect to the income of such Subsidiary, (y) subject to compliance with the other provisions of this Agreement and the other
Loan Documents, the Borrower and each Loan Party may declare and pay non-cash dividends with respect to its common stock payable
solely in additional shares of its common stock, and (z) Subsidiaries of the Borrower may declare and pay dividends ratably with
respect to their Stock to any other Loan Party as the holder of such Stock.


 


(iii) Liens;
Disposition of Loan Documents Rights and Obligations. Aytu shall not, and shall not permit any of its Subsidiaries to, (a)
create, incur, assume or suffer to exist any Lien or other encumbrance of any nature whatsoever or authorize under the UCC of any
jurisdiction a Financing Statement naming any such Person as debtor, or execute any security agreement authorizing any secured
party thereunder to file such Financing Statement, other than in favor of the Collateral Agent to secure the Obligations, on any
of its assets whether now or hereafter owned, except Permitted Liens, or (b) assign, sell, transfer or otherwise dispose of, any
Loan Document, or its rights and obligations hereunder or thereunder.


 


(iv) Indebtedness.
Aytu shall not, and shall not permit any of its Subsidiaries to, create, incur, assume, guarantee or be liable with respect to
any Indebtedness, other than Permitted Indebtedness.


 


(v) Acquisitions.
The Borrower shall not, and shall not permit any of its Subsidiaries to, acquire any assets (other than assets acquired in the
Ordinary Course of Business), directly or indirectly, in one or more related transactions, for a consideration, in cash or other
property (valued at its fair market value) greater than $500,000.


 




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(vi) Asset
Sales and Other Dispositions. Aytu shall not, and shall not permit any of its Subsidiaries to, sell, return, dispose or otherwise
transfer any Collateral or any of their respective other assets (including pursuant to any division or Division) other than:


 


(A)
sales, transfers and dispositions of (1) Inventory in the Ordinary Course of Business and (2) used, obsolete, worn out or
surplus Equipment or property no longer material to the operation of a Loan Party’s business and in the Ordinary Course of
Business;


 


(B)
sales, transfers and dispositions (1) constituting an investment permitted by Section 5.2(ix) and (2) dispositions
of cash, cash equivalents and Stock by Aytu and its Subsidiaries (other than the Borrower and its Subsidiaries) in connection with
the consummation of any acquisition or investment;


 


(C)
dispositions resulting from any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation
or similar proceeding of, any property or asset of (1) the Borrower or any of its Subsidiaries or (2) a customer or other Person
being held by the Borrower or any of its Subsidiaries;


 


(D)
other sales, returns, dispositions or other transfers (i) from one Loan Party to another Loan Party to the extent following
any such transfer or disposition Collateral Agent’s Lien in any such asset remains in place subject to the terms and conditions
of the Security Agreement or (ii) having an aggregate fair market value not to exceed $250,000 per Fiscal Year;


 


(E)
the divestiture of the Mioxsys product line and related Intellectual Property; and


 


(F)
the disposition of the rights to the Natesto License.


 


(vii) ABL
Debt Actions. The Borrower shall not and shall not permit any of its Subsidiaries to, (A) make any payment, or take any action,
with respect to the Indebtedness under the ABL Facility that is in violation or breach of the Intercreditor Agreement; (B) make
any amendment, restatement, supplement, modification, waiver, consent or extension of any ABL Documents in violation or breach
of the Intercreditor Agreement; or (C) join any Subsidiary or any Affiliate of the Borrower or any of its Subsidiaries as a borrower,
guarantor or obligor, or have such Person pledge or grant a Lien on any of its property or assets, under the ABL Documents, unless,
in each case, the same Person becomes a guarantor of the Obligations in the same capacity (and/or pledges and grants Liens on the
same property or assets (and with no Person having priority in between the Liens granted under the ABL Documents and the Liens
granted under the Loan Documents in connection with this Section 5.2(vii)) under the Loan Documents and such Person executes
and delivers such agreements, instruments and documents reasonably requested by the Secured Parties to effectuate any of the foregoing.


 


(viii) Anti-Layering.
Notwithstanding anything to the contrary in this Agreement or in any other Loan Documents, the Borrower shall not, and shall not
permit any of its Subsidiaries, to create, incur or suffer to exist any Indebtedness which is subordinated or junior (either in
respect of Lien priority or in right of payment or any combination thereof) to the Indebtedness under the ABL Facility unless such
Indebtedness is expressly subordinated or junior to the Obligations (both in terms of Lien priority and in right of payment) on
terms and conditions reasonably acceptable to the Secured Parties.


 




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(ix) Investments
and Loans. The Borrower shall not, and shall not permit any of its Subsidiaries to, purchase, hold or acquire any capital stock,
evidences of Indebtedness or other Stock (including any option, warrant or other right to acquire any of the foregoing) of, make
any loans or advances to, Guaranty any obligations of, or make or permit to exist any investment in, any other Person, or purchase
or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit
(whether through purchase of assets, merger, division (including a Division) or otherwise), except for Permitted Investments.


 


(x) Nature
of Business. Aytu shall not, and shall not permit any of its Subsidiaries to, engage, directly or indirectly, in a business
other than the business which is being conducted on the Sixth Amendment Effective Date and businesses reasonably related or incidental
thereto, wind up its business operations or cease substantially all, or any material portion, of its normal business operations,
or suffer any material disruption, interruption or discontinuance of a material portion of its normal business operations.


 


(xi) Payments
on Certain Indebtedness. The Borrower shall not, and shall not permit any Subsidiary to, pay, or make any distributions for
the payment of, any principal or other amount on any ABL Debt in violation of the Intercreditor Agreement. Aytu shall not, and
shall not permit any Subsidiary to, pay, or make any distributions for the payment of, any principal or other amount on any Indebtedness
that is contractually subordinated to any of the Obligations, in violation of the applicable subordination or intercreditor agreement
related thereto.


 


(xii) Transactions
with Affiliates. Aytu shall not, and shall not permit any of its Subsidiaries to, enter into any transaction with an Affiliate
of such Loan Party, other than (A) transactions contemplated by the Aytu Merger Agreement and (B) any transaction entered into
in the Ordinary Course of Business, consistent with past practices and on terms and conditions at least as favorable to such Loan
Party as would reasonably be obtained by such Loan Party at that time in a comparable arm’s-length transaction with a Person
other than an Affiliate and which transaction has been disclosed in writing to the Secured Parties prior to the entry thereof.


 


(xiii) Modifications
to Governing Documents. Aytu shall not, and shall not permit any of its Subsidiaries to, agree, consent, permit or otherwise
undertake to amend or otherwise modify any of the terms or provisions of any Loan Party Obligor’s Organizational Documents,
except for (A) amendments pursuant to the Merger Agreement in connection with the consummation of the Aytu Merger and (B) such
amendments or other modifications required by Applicable Law or that are not materially adverse to any Secured Party, and then,
with respect to any such amendments or modifications relating to the Organizational Documents of any Borrower Loan Party, only
to the extent such amendments or other modifications are fully disclosed in writing to the Secured Parties no less than five (5)
Business Days prior to being effectuated; provided, that any change to any jurisdiction of organization, or entering into any transaction
which has the effect of changing any jurisdiction of organization, shall be made in compliance with Section 3.1(cc).


 




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(xiv) Burdensome
Restrictions. Aytu shall not, and shall not permit any of its Subsidiaries to:


 


(A)
enter into any covenant or other agreement that restricts or is intended to restrict it from pledging or granting a security
interest in, mortgaging, assigning, encumbering or otherwise creating a Lien on any of its property, whether, real or personal,
tangible or intangible, existing or hereafter acquired, in favor of the Collateral Agent to secure the Obligations, other than
(a) in connection with any document or instrument governing Liens permitted pursuant to clause (i) of the definition of
“Permitted Liens;” provided that any such restriction contained therein relates only to the asset or assets
subject to such Permitted Lien, and (b) the ABL Documents subject to the Intercreditor Agreement; or


 


(B)
create or otherwise cause or suffer to exist or become effective any encumbrance or restriction (other than any Loan Document
or the ABL Documents subject to the Intercreditor Agreement) of any kind on the ability of any such Person to pay or make any dividends
or distributions to any Loan Party, to pay any of the Obligations, to make loans or advances or to transfer any of its property
or assets to any Loan Party.


 


(xv) Deposit
Accounts; Cash and Other Asset Deposits.


 


(A)
Aytu shall not, and shall not permit any of its Subsidiaries to, open any new Deposit Account or any other depositary or
other account without both (1) the prior written consent of the Required Lenders and (2) updating the applicable Perfection Certificate
to reflect such Deposit Account or other depositary or other account.


 


(B)
Aytu shall not, and shall not permit any of its Subsidiaries to, deposit (or otherwise hold, maintain or keep) in any ABL
Priority Deposit Account (as defined in the Intercreditor Agreement) or any other Deposit Account (other than a Term Priority Deposit
Account) (1) any Term Loan Priority Collateral, (2) any amounts held, maintained or kept in any Term Priority Deposit Account,
(3) any proceeds of any Term Loan Priority Collateral, (4) any proceeds of the sale or other disposition of any Stock in the Borrower
or any of its Affiliates (including, without limitation and for the avoidance of doubt cash and other amounts which are held in
any Term Priority Deposit Account as of the Sixth Amendment Effective Date or at any time after the Sixth Amendment Effective Date),
(5) any proceeds from third party sources that are outside the ordinary course of business of the Borrower, any other Loan Party
Obligor and/or their Subsidiaries, or (6) any proceeds or amounts of loans, credit extensions or other advances under the Loan
Documents.


 






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(xvi) Disputes.
The Borrower will not, and will not permit any of its Subsidiaries to, without the Required Lenders’ prior written consent,
compromise or settle any of its Accounts or Chattel Paper for less than the full amount thereof, grant any extension of time for
payment of any of its Accounts or Chattel Paper, release (in whole or in part) any Account Debtor or other Person liable for the
payment of any of its Accounts or Chattel Paper or grant any credits, discounts, allowances, deductions, return authorizations
or the like with respect to any of its Accounts or Chattel Paper; except (unless otherwise directed by the Collateral Agent or
the Required Lenders during the existence of a Default or an Event of Default) such Loan Party Obligor may take any of such actions
in the Ordinary Course of Business consistent with past practices, provided that the Borrower promptly reports the same to the
Secured Parties.


  


(xvii) Inventory.


 


(A)
Returns. The Borrower will not, and will not permit any of its Subsidiaries to, accept returns of any Inventory from
any Account Debtor except in the Ordinary Course of Business. The Borrower will not, and will not permit any of its Subsidiaries
to, commingle any returned Inventory with any other Inventory of the Loan Parties, and instead the Borrower will, and will cause
its Subsidiaries to, keep any returned Inventory segregated and separate from the other Inventory of the Loan Parties.


 


(B)
Third Party Locations. The Borrower will not, and will not permit any of its Subsidiaries to, without the Required
Lenders prior written consent, at any time, store any Inventory valued in excess of $250,000 with any warehouseman or other third
party other than as set forth in the applicable Perfection Certificate.


 


(C)
Sale on Return, etc. The Borrower will not, and will not permit any of its Subsidiaries to, without the Required
Lenders’ prior written consent, at any time, sell or otherwise dispose of any Inventory on a sale-or-return, guarantied sale,
consignment, or other contingent basis.


 


Section 5.3 Financial
Covenants.


 


(a) Fixed
Charge Coverage Ratio. The Borrower shall not, and shall not allow any of its Subsidiaries to, permit Excess Availability at
any time to be less than $2,500,000, unless as of the last day of the most recently completed month, the Fixed Charge Coverage
Ratio for the twelve consecutive calendar month period then ended is greater than 1:10 to 1:00.


 


(b) Capital
Expenditure Limitation. The Borrower shall not, and shall not permit any of its Subsidiaries to, make any Capital Expenditures
if, after giving effect to such Capital Expenditures, the aggregate cost of all Capital Expenditures of the Loan Parties would
exceed $5,400,000 during any Fiscal Year.


 






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Section 5.4 General
Acceleration Provision upon Events of Default. If one or more of the events specified in this Section 5.4 shall have
happened or occurred and be continuing beyond the applicable cure period (each, an “Event of Default”), the
Required Lenders, by (subject to Section 5.5, which, for the avoidance of doubt, shall not require any such notice and shall
occur automatically) written notice to the Borrower, may declare the outstanding principal of, and accrued and unpaid interest
on, all of the Loans and Notes or any part of any of them (together with any other amounts accrued or payable under the Loan Documents)
and other Obligations (including any Prepayment Amount and the Exit Payment) to be, and the same shall thereupon become, immediately
due and payable, without any further notice and without any presentment, demand, or protest of any kind, all of which are hereby
expressly waived by the Borrower and each other Loan Party, and take any further action available at law or in equity, including,
without limitation, the sale of the Loan and Notes and such other Obligations and all other rights and remedies acquired in connection
with the Loan and Notes and such other Obligations:


  


(a) Payment
Defaults.  The Borrower, any other Loan Party Obligor or any Other Obligor shall have failed to make payment of (i) principal
or interest under the Notes or other Loan Documents or (ii) any other Obligations under the Loan Documents when due and payable.


 


(b) Certain
Covenant Defaults. (i) Any Loan Party or any Other Obligor defaults in the due observance or performance of any covenant, condition
or agreement contained in Sections 2.1, 3.1(w), 3.1(aa), 3.1(bb), 3.1(cc), 3.1(hh), 3.1(ii),
5.1, 5.2, 5.3 or 6.13 of this Agreement or any provision under any Note or the Security Agreement;
or (ii) any Loan Party or any Other Obligor defaults in the due observance or performance of any covenant, condition or agreement
contained in any provision of this Agreement or any other Loan Document and not addressed in Section 5.4(a), (b)(i),
or (c) and, solely with respect to this clause (ii), the continuance of such default unremedied for a period of ten
Business Days; provided that such ten Business Day grace period shall not be available for any default that is not reasonably
capable of being cured within such period or for any intentional default.


 


(c) Representation,
Warranty, Statement, Report and Certification Defaults. Any representation, warranty, statement, report or certificate made
or delivered to any Secured Party by or on behalf of any Loan Party or any Other Obligor under the Loan Documents or otherwise
shall have been incorrect, false or misleading in any material respect (except to the extent that such representation, warranty,
statement, report or certificate is qualified by reference to materiality or Material Adverse Effect, materiality, dollar thresholds
or similar qualifications, in which case such representation, warranty, statement, report or certificate shall be accurate in all
respects).


 


(d) Bankruptcy,
Insolvency, Appointment of Receiver, Etc. Defaults. (i) The Borrower, any other Loan Party or any Other Obligor shall generally
be unable to pay its debts as such debts become due in the Ordinary Course of Business, or shall admit in writing its inability
to pay its debts as they come due or shall make a general assignment for the benefit of creditors; (ii) the Borrower, any other
Loan Party or any Other Obligor shall declare a moratorium on the payment of its debts; (iii) the commencement by the Borrower,
any other Loan Party or any Other Obligor of proceedings to be adjudicated bankrupt or insolvent, or the consent by the Borrower,
any other Loan Party or any Other Obligor to the commencement of bankruptcy or insolvency proceedings against it or such other
Person, or the filing by the Borrower, any other Loan Party or any Other Obligor of a petition or answer or consent seeking reorganization,
intervention or other similar relief under any Applicable Law, or the consent by the Borrower, any other Loan Party or any Other
Obligor to the filing of any such petition or to the appointment of an intervenor, receiver, liquidator, assignee, trustee, sequestrator
(or other similar official) of all or substantially all of its or their assets; (iv) the commencement against the Borrower, any
other Loan Party or any Other Obligor of a proceeding in any court of competent jurisdiction under any bankruptcy or other applicable
law (as now or hereafter in effect) seeking its liquidation, winding up, dissolution, reorganization, arrangement, adjustment,
or the appointment of an intervenor, receiver, liquidator, assignee, trustee, sequestrator (or other similar official), and any
such proceeding shall continue undismissed, or any order, judgment or decree approving or ordering any of the foregoing shall continue
unstayed or otherwise in effect, for a period of forty-five (45) days; (v) the making by the Borrower, any other Loan Party or
any Other Obligor of an assignment for the benefit of creditors.


 


(e) Money
Judgment Defaults. One or more judgments aggregating in excess of $250,000 is obtained against any Loan Party or any Other
Obligor which remains unstayed for more than thirty (30) days or is enforced.


 




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(f) Governmental
Authority Authorization Defaults. Any material authorization of a Governmental Authority necessary for the execution, delivery
or performance of any Loan Document or for the validity or enforceability of any of the Obligations under any Loan Document is
not given or is withdrawn or ceases to remain in full force or effect.


 


(g) Invalidity
or Unenforceability of Guaranties and Loan Documents Defaults. (i) Any Loan Party or Other Obligor shall attempt to revoke,
terminate, or otherwise limit or deny liability under any guaranty of any of the Obligations, or any security document securing
any of the Obligations, (ii) the validity of any Loan Document shall be contested by the Borrower, any other Loan Party or any
of their Affiliates, or (iii) any Applicable Law shall render any Loan Document invalid or unenforceable or shall cause the Obligations
to cease to be in full force and effect.


 


(h) Cross-Default
to Indebtedness other than ABL Debt. Any default occurs with respect to any Indebtedness (other than the Obligations or the
ABL Debt) of any Loan Party or any Other Obligor if (i) such default shall consist of the failure to pay such Indebtedness in excess
of $250,000 when due, whether by acceleration or otherwise or (ii) the effect of such default is to permit the holder, with or
without notice or lapse of time or both, to accelerate the maturity of any such Indebtedness or to cause such Indebtedness to become
due prior to the stated maturity thereof (without regard to the existence of any subordination or intercreditor agreements).


 


(i) Commercial
Products Injunctions and Orders Defaults. If any Governmental Authority issues any injunction or other order that prohibits
Aytu or any of its Subsidiaries from marketing, selling or manufacturing any of Aytu’s or its Subsidiaries’ Products
currently approved by the FDA or any future products of Borrower or its Subsidiaries once approved by the FDA (collectively, the
“Commercial Products”) if sales of such Products covered by such injunction or order accounted for more than
50% of net sales revenue of Aytu and its Subsidiaries for the most recently ended four fiscal quarter periods, and such injunction
or other prohibition shall continue to be in force or otherwise effective for more than 60 consecutive calendar days; provided,
however, that with respect to manufacturing, if there is one or more alternative manufacturers of the Commercial Product manufacturing
on Aytu’s or its Subsidiaries’ behalf that is not enjoined or otherwise prohibited from manufacturing the Commercial
Product and are able to deliver product on Aytu’s or its Subsidiaries’ behalf in a manner that is consistent with prior
levels without a commercial distribution delay, it shall not be an Event of Default under this clause (i) if Aytu or any
of its Subsidiaries are enjoined or otherwise prohibited from manufacturing the Commercial Product.


 


(j) ABL
Debt Cross-Defaults (i) A Default or Event of Default (as each such term is defined in the Term Loan Documents on the Sixth
Amendment Effective Date and any date thereafter) or any similar term or event shall occur with respect to the ABL Debt; or (ii)
the occurrence of any condition or event that results in the ABL Debt becoming due prior to its scheduled maturity as of the Sixth
Amendment Effective Date or permits any holder or holders of the ABL Debt or any trustee or agent on its or their behalf to cause
the ABL Debt to become due, or require the prepayment, repurchase, redemption of defeasance thereof, prior to its scheduled maturity
as of the Sixth Amendment Effective Date.


 


(k) Intercreditor
Agreement Defaults. Any Loan Party or Other Obligor makes any payment on account of the ABL Debt other than payments which
are not prohibited by the applicable provisions of the Intercreditor Agreement, this Agreement and the other Loan Documents pertaining
thereto, or if any holder (or agent or representative of such holder) of any ABL Debt attempts to limit or terminate any applicable
provisions set forth in the Intercreditor Agreement.


 




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(l) Dissolution,
Termination, Insolvency, Suspension, Cessation, Etc. of Business Defaults. The dissolution, termination of existence, insolvency
or business failure or suspension or cessation of business as usual of any Loan Party or any Other Obligor (or of any general partner
of any Loan Party or any Other Obligor if it is a partnership).


 


(m) Criminal
Indictment Defaults. There is any indictment of any Loan Party, any Loan Party’s officers, any Other Obligor or any Other
Obligor’s officers under any criminal statute or commencement of criminal proceedings against any such Person.


 


(n) Perfected
and Priority Liens Defaults. Any Lien purported to be created by any Loan Document shall cease to be a valid perfected first
priority Lien (subject only to any priority accorded by law to Permitted Liens) on any material portion of the Term Loan Priority
Collateral, or second priority (or, after the Payment in Full (as defined in the Intercreditor Agreement) of the ABL Priority Debt
(as defined in the Intercreditor Agreement), first priority) Lien (subject only to any priority accorded by law to Permitted Liens)
on any material portion of the ABL Priority Collateral, or any Loan Party or any Other Obligor shall assert in writing that any
Lien purported to be created by any Loan Document is not a valid perfected first-priority Lien (subject only to any priority accorded
by law to Permitted Liens) on the assets or properties comprising Term Loan Priority Collateral purported to be covered thereby
or second-priority (or, after the Payment in Full (as defined in the Intercreditor Agreement) of the ABL Priority Debt (as defined
in the Intercreditor Agreement), first-priority) Lien (subject only to any priority accorded by law to Permitted Liens) on the
assets or properties comprising ABL Priority Collateral purported to be covered thereby, as applicable.


 


(o) Ineffectiveness
of Loan Documents Defaults. Any of the Loan Documents shall cease to be in full force and effect (other than as a result of
the discharge thereof in accordance with the terms thereof or by written agreement of all parties thereto).


 


(p) Employment
of Persons for Proposed Liquidation of Assets or Store Locations Defaults. Any Loan Party shall determine to employ an agent
or other third party or otherwise engage any Person or solicit proposals for the engagement of any Person in connection with the
proposed liquidation of all or a material portion of its assets or store locations.


 


(q) Uninsured
Collateral Losses or Sale, Lease or Furnishing of Collateral Defaults. The (i) uninsured loss, theft, damage or destruction
of any of the Collateral (other than returned products destroyed by the any Loan Party in the Ordinary Course of Business), (ii)
the insured loss, theft, damage or destruction of any of the Collateral in an amount in excess of $250,000 in the aggregate for
all such events during any Fiscal Year, or (iii) except as permitted hereby, the sale, lease or furnishing under a contract of
service of, any of the Collateral.


 


(r) ERISA
Defaults. (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which has resulted or could reasonably
be expected to result in liability of any Loan Party or any Subsidiary under Title IV of ERISA to the Pension Plan, Multiemployer
Plan or the PBGC in an aggregate amount in excess of $250,000, (ii) the existence of any Lien under Section 430(k) or Section 6321
of the Code or Section 303(k) or Section 4068 of ERISA on any assets of a Loan Party, or (iii) a Loan Party or any ERISA Affiliate
fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of $250,000.


 




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(s) Material
Product Recall Defaults. Any product recall or similar event to remove any drugs or other products sold by any Loan Party from
the market occurs, in each case to the extent such product recall results in a Material Adverse Effect.


 


(t) Change
of Control Defaults. The occurrence of any Change of Control.


 


Section 5.5 Automatic
Acceleration on Dissolution or Bankruptcy. Notwithstanding any other provisions of this Agreement, if an Event of Default under
Section 5.4(d) shall occur, the principal of the Loans and Notes (together with interest and any other amounts owed, accrued
or payable under this Agreement and the other Loan Documents and the other Obligations, including any Prepayment Amount and the
Exit Payment) shall thereupon become immediately due and payable without any presentment, demand, protest or notice of any kind,
all of which are hereby expressly waived by the Borrower and each other Loan Party.


 


Section 5.6 Recovery
of Amounts Due. If any amount payable hereunder is not paid as and when due, the Borrower and each other Loan Party hereby authorizes
the Secured Parties to proceed, to the fullest extent permitted by Applicable Law, without prior notice, by right of set-off, banker’s
lien or counterclaim, against any moneys or other assets of the Borrower and the other Loan Parties to the full extent of all amounts
payable to the Secured Parties.


 


Section 5.7 Power
of Attorney. Without limiting any of the Secured Parties’ other rights and remedies under this Agreement or any other
Loan Document or at law or in equity or otherwise, each Loan Party Obligor hereby grants to the Collateral Agent and the other
Secured Parties an irrevocable power of attorney, coupled with an interest, authorizing and permitting the Collateral Agent and
the other Secured Parties (acting through any of its officers, employees, attorneys or agents), at the Collateral Agent’s
or such other Secured Party’s option but without obligation, with or without notice to such Loan Party Obligor, and at each
Loan Party Obligor’s expense, to do any or all of the following, in such Loan Party Obligor’s name or otherwise:


 


(a) at any
time, when an Event of Default has occurred or is continuing, (i) execute and deliver on behalf of such Loan Party Obligor any
agreements, instruments and documents that the Collateral Agent or any other Secured Party may, in its sole discretion, deem advisable
in order to perfect, protect and maintain the Collateral Agent’s security interests and Liens, and priority thereof, in the
Collateral and to fully consummate all the transactions contemplated by this Agreement and the other Loan Documents (including
any Financing Statements and Continuation Statements, and amendments or other modifications thereto, as the Collateral Agent or
any other Secured Party shall deem necessary or appropriate) and to notify Account Debtors of the Loan Party Obligors that the
Collateral Agent (for the benefit of the Secured Parties) has a security interest and Lien in the Accounts of the Loan Party Obligors
and, subject to the terms of the Intercreditor Agreement, direct such Account Debtors to make payment thereof directly to the Collateral
Agent or such other Secured Party, (ii) endorse such Loan Party Obligor’s name on all checks and other forms of remittances
received by any Secured Party, (iii) pay any sums required on account of such Loan Party Obligor’s taxes or to secure the
release of any Liens therefor, (iv) pay any amounts necessary to obtain, or maintain in effect, any of the insurance described
in Section 5.1(xvi), (v) receive and otherwise take control in any manner of any cash or non-cash items of payment or Proceeds
of Collateral, (vi) receive, open and dispose of all mail addressed to such Loan Party Obligor at any post office box or lockbox
maintained by (or for the benefit of) any Secured Party for such Loan Party Obligor or at any other business premises of any Loan
Party or any Secured Party and (vii) endorse or assign to the Collateral Agent (for the benefit of the Secured Parties) on such
Loan Party Obligor’s behalf any portion of Collateral evidenced by an agreement, Instrument or Document if an endorsement
or assignment of any such items is not made by such Loan Party Obligor pursuant to the Security Agreement; and


 




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(b) at any
time, after the occurrence and during the continuance of an Event of Default, (i) execute and deliver on behalf of such Loan Party
Obligor any agreement, instrument or document exercising, transferring or assigning any option to purchase, sell or otherwise dispose
of or lease (as lessor or lessee) any real or personal property which is part of the Collateral or in which any Secured Party has
an interest, (ii) execute and deliver on behalf of such Loan Party Obligor any invoices relating to any Accounts, any draft against
any Account Debtor, any proof of claim in bankruptcy, any notice of Lien or claim, and any assignment or satisfaction of mechanic’s,
materialman’s or other Lien, (iii) subject to the terms of the Intercreditor Agreement, execute and deliver on behalf of
such Loan Party Obligor any notice to any Account Debtor, (iv) pay, contest or settle any Lien, charge, encumbrance, security interest
and adverse claim in or to any of the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge
the same, (v) grant extensions of time to pay, compromise claims relating to, and settle Accounts, Chattel Paper and General Intangibles
for less than face value and execute all releases and other documents in connection therewith, (vi) settle and adjust, and give
releases of, any insurance claim that relates to any of the Collateral and obtain payment therefor, (vii) instruct any third party
having custody or control of any Collateral or books or records belonging to, or relating to, such Loan Party Obligor to give the
Secured Parties the same rights of access and other rights with respect thereto as such Secured Parties have under this Agreement
or any other Loan Document, (viii) change the address for delivery of such Loan Party Obligor’s mail, (ix) vote any right
or interest with respect to any Investment Property, and (x) subject to the terms of the Intercreditor Agreement, instruct any
Account Debtor to make all payments due to any Loan Party Obligor directly to a Secured Party.


 


(c) Any and
all sums paid, and any and all costs, expenses, liabilities, obligations and attorneys’ fees (internal and external counsel)
of any Loan Party with respect to the foregoing shall be added to and become part of the Obligations, shall be payable on demand,
and shall bear interest at a rate equal to the highest interest rate applicable to any of the Obligations. Each Loan Party Obligor
agrees that each Secured Party’s rights under the foregoing power of attorney and any of such Secured Party’s other
rights under this Agreement or any of the other Loan Documents or in respect of any of the Securities shall not be construed to
indicate that any Secured Party is in control of the business, management or properties of any Loan Party Obligor or any of its
Subsidiaries.


 


Section 5.8
Credit Bidding. The Loan Parties and the Lenders hereby irrevocably authorize the Collateral Agent, based upon the written
instruction of the Required Lenders, to (a) credit bid and in such manner purchase (either directly or through one or more
acquisition vehicles) all or any portion of the Collateral at any sale thereof conducted under the provisions of the
Bankruptcy Code, including under Section 363 of the Bankruptcy Code or any similar laws in any other jurisdictions to which a
Loan Party is subject, or (b) credit bid and in such manner purchase (either directly or through one or more acquisition
vehicles) all or any portion of the Collateral at any other sale or foreclosure conducted by (or with the consent or at the
direction of) the Collateral Agent (whether by judicial action or otherwise) in accordance with Applicable Law. In connection
with any such credit bid and purchase, the Obligations owed to the Lenders shall be entitled to be, and shall be, credit bid
on a ratable basis (with Obligations with respect to contingent or unliquidated claims being estimated for such purpose if
the fixing or liquidation thereof would not unduly delay the ability of Collateral Agent to credit bid and purchase at such
sale or other disposition of the Collateral and, if such claims cannot be estimated without unduly delaying the ability of
the Collateral Agent to credit bid, then such claims shall be disregarded, not credit bid, and not entitled to any interest
in the asset or assets purchased by means of such credit bid) and the Lenders whose Obligations are credit bid shall be
entitled to receive interests (ratably based upon the proportion of their Obligations credit bid in relation to the aggregate
amount of Obligations so credit bid) in the asset or assets so purchased (or in the Stock of the acquisition vehicle or
vehicles that are used to consummate such purchase). Except as provided above and otherwise expressly provided for herein or
in the other Loan Documents, the Collateral Agent will not execute nor deliver a release of any Lien on any Collateral. Upon
request by the Collateral Agent or the Borrower at any time, the Lenders will confirm in writing Collateral Agent’s
authority to release any such Liens on particular types or items of Collateral pursuant to this Section 5.8.


 






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Article
6

MISCELLANEOUS


 


Section 6.1 Notices.
Any notices required or permitted to be given under the terms hereof shall be sent by certified or registered mail (return receipt
requested) or delivered personally or by courier (including a recognized overnight delivery service) or by facsimile or by electronic
mail and shall be effective five (5) days after being placed in the mail, if mailed by regular United States mail, or upon receipt,
if delivered personally or by courier (including a recognized overnight delivery service) or by facsimile, or when received by
electronic mail in each case addressed to a party. The addresses for such communications shall be the following (or such other
addresses provided by written notice to the parties hereto from time to time):


 


If to the Borrower or any other
Loan Party:



c/o Aytu Bioscience, Inc.

373 Inverness Pkwy #206

Englewood, CO 80122

Tel: (720) 437-6520


E-mail: josh.disbrow@aytubio.com

Attention: Josh Disbrow


 


With a copy to:


 


Dorsey & Whitney LLP

111 South Main St., Suite 2100

Salt Lake City, Utah 84111

Tel: (801) 933-7366


Email: taylor.nolan@dorsey.com


Attention: Nolan Taylor


 


If to the Collateral Agent or the
Lenders:



Deerfield Management Company, L.P.

345 Park Avenue South

New York, NY 10010


Tel: (646) 536-5661


Email: dclark@deerfield.com

Attn: David J. Clark


 






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With a copy to:



Katten Muchin Rosenman LLP

575 Madison Avenue


New York, NY 10022

Tel: (212) 940-6600


Email: mark.ramsey@katten.com


Attn: Mark Ramsey


 


and


 


Katten Muchin Rosenman LLP

525 West Monroe Street


Chicago, IL 60661

Tel: (312) 902-5493


Email: mark.wood@katten.com


Attn: Mark Wood


 


Section 6.2 Waiver
of Notice. Whenever any notice is required to be given to the Lenders or the Borrower under any of the Loan Documents, a waiver
thereof in writing signed by the Person or Persons entitled to such notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of such notice.


 


Section 6.3 Reimbursement
of Legal and Other Expenses. The Loan Parties agree to pay on or prior to the Sixth Amendment Effective Date and, within
ten (10) Business Days after delivery of an invoice therefor, after the Sixth Amendment Effective Date, (a) all fees, costs and
expenses of the Secured Parties of negotiation, preparation, execution, delivery, filing and administration of the Loan Documents
the ABL Documents and any amendments, restatements, supplements, waivers, consents, forbearances or other modifications thereto,
(b) all fees, costs and expenses of legal counsel to the Secured Parties in connection with the negotiation, preparation, execution,
delivery, filing and administration of the Loan Documents, the ABL Documents and any amendments, restatements, supplements, waivers,
consents, forbearances or other modifications thereto and any other agreements, instruments, documents or matters requested by
the Borrower or any other Loan Party related thereto, (c) all fees, costs and expenses of creating and perfecting (and providing
first priority) Liens in favor of Collateral Agent on behalf of the Secured Parties pursuant to any Loan Document, including filing
and recording fees, expenses and Taxes, search fees, insurance premiums, and fees, costs, expenses and disbursements of legal
counsel to the Secured Parties and of legal counsel providing any opinions that any Secured Party may request in respect of any
Loan Documents or the Liens created pursuant to the Loan Documents, (d) all fees, costs and expenses incurred by any Secured Party
(including legal counsel, agents and representatives of each Secured Party) in connection with the custody or preservation of
any of the Collateral, the Notes and the Securities, (e) all fees, costs and expenses (including fees, costs and expenses of legal
counsel to the Secured Parties and fees, costs and expenses of accountants, advisors and consultants) incurred by any Secured
Party and its legal counsel relating to efforts to protect, evaluate, assess or dispose of any of the Collateral, the Notes or
the Securities, (f) all fees, costs and expenses, including fees, costs and expenses of legal counsel to Collateral Agent and
the Lenders and all fees, costs and expenses of accountants, advisors and consultants and costs of settlement, incurred by the
Collateral Agent and Lenders in enforcing any of the Loan Documents or any Obligations of, or in collecting any payments due from,
any Loan Party or any of its Subsidiaries hereunder or under the other Loan Documents (including in connection with the sale of,
collection from, or other realization upon any of the Collateral or the enforcement of the Loan Documents) or in connection with
any refinancing or restructuring of the credit arrangements provided under this Agreement or the other Loan Documents in the nature
of a “work-out” or pursuant to any proceeding or event of the type set forth in Section 5.4(d) (or any similar
proceeding or event), and (g) the cost and expense of purchasing insurance that the Loan Parties or any of their Subsidiaries
fail to obtain as required by the Loan Documents. Without limiting any of the foregoing provisions of this Section 6.3,
any action taken by any Loan Party or any of its Subsidiaries under or with respect to any Loan Document, even if required under
any Loan Document or at the request of the Collateral Agent or any other Secured Party, shall be at the sole expense of such Loan
Party, and neither Collateral Agent nor any other Secured Party shall be required under any Loan Document to reimburse any Loan
Party or any Subsidiary of any Loan Party therefor.


 






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Section 6.4 Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed
by and construed and enforced in accordance with the laws of the State of New York applicable to contracts made and to be performed
in such State. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions
contemplated by this Agreement (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders,
employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, borough
of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that
it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient
venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served
in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail to such party at the address
in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner
permitted by law. To the fullest extent permitted by applicable law, the parties hereby
waive all rights to a trial by jury in any suit, action or proceeding arising out of or relating to this Agreement or the other
Loan Documents.


 


Section 6.5 Successors
and Assigns.


 


(a) This
Agreement shall bind and inure to the respective successors and permitted assigns of the Parties, except that (a) none the Borrower,
the other Loan Party Obligors and the Other Obligors may assign or otherwise transfer all or any part of its rights or obligations
under the Loan Documents without the prior written consent of the Lenders and any such prohibited assignment or transfer is absolutely
void ab initio; and (b) absent a Default or an Event of Default the Lenders may not assign or otherwise transfer all or
part of their rights under the Loan Documents to any Person other than an investment fund managed by Deerfield Management, L.P.
or any Affiliate or related fund of any of the Secured Parties, without the prior written consent of the Borrower (which consent
shall not be unreasonably withheld). Before any Lender assigns all or any part of its rights under this Agreement or the Notes
to a party other than an investment fund managed by Deerfield Management, L.P. (or any Affiliate or related fund of any of the
Secured Parties), or there are more than five (5) Lenders, the Parties shall negotiate in good faith to amend this Agreement to
appoint an administrative agent providing such agent and the Parties with rights and duties customary among syndicated credit facilities.
Upon a Lender’s assignment of a Note in accordance with the foregoing sentence, such Lender shall provide notice of a permitted
transfer to Borrower for recordation in the Register pursuant to Section 1.4. Upon receipt of a notice of a transfer of
an interest in a Note, Borrower shall record the identity of the transferee and other relevant information in the Register and
the transferee shall (to the extent of the interests transferred to such transferee) have all the rights and obligations of, and
shall be deemed, a Lender hereunder.


 




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(b) The Loan
Parties acknowledge and agree that the Securities may be pledged by a holder thereof in connection with a bona fide margin agreement
or other loan, financing or Indebtedness secured by the Securities. The pledge of Securities shall not be deemed to be a transfer,
sale or assignment of the Securities under the Loan Documents, and no such holder effecting any such pledge of Securities shall
be required to provide any Loan Party or any of its Subsidiaries with any notice thereof or otherwise make any delivery (including
of any legal opinion) to any Loan Party pursuant to any Loan Document. The Loan Parties hereby agree to execute and deliver such
documentation as a pledgee of the Securities may reasonably request in connection with a pledge of the Securities to such pledgee
by a holder of Securities.


 


Section 6.6 Entire
Agreement. The Loan Documents contain the entire understanding of the Parties with respect to the matters covered thereby and
supersede any and all other written and oral communications, negotiations, commitments and writings with respect thereto (including,
without limitation, any agreement on the reimbursement of costs, etc. referenced in Section 2.9). The provisions of this
Agreement may be waived, modified, supplemented or amended only by an instrument in writing signed by the authorized officer of
each of Borrower and the Required Lenders.


 


Section 6.7 Severability.
If any provision of this Agreement shall be invalid, illegal or unenforceable in any respect under any law, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. The Parties shall endeavor
in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect
of which comes as close as possible to that of the invalid, illegal or unenforceable provision.


 


Section 6.8 Counterparts.
This Agreement may be executed in several counterparts, and by each Party on separate counterparts, each of which and any photocopies
and facsimile copies thereof shall be deemed an original, but all of which together shall constitute one and the same agreement.


 


Section 6.9 Survival.


 


(a) This
Agreement and all agreements, representations and warranties made in the Loan Documents, and in any document, certificate or statement
delivered pursuant thereto or in connection therewith shall be considered to have been relied upon by the other Parties and shall
survive the execution and delivery of this Agreement and the making of the Loan hereunder, and shall continue in force until payment
in full of the Obligations (other than inchoate indemnification or reimbursement obligations or other obligations which, by their
terms, survive termination of this Agreement), and the Lenders shall not be deemed to have waived, by reason of making the Loan,
any Event of Default that may arise by reason of such representation or warranty proving to have been false or misleading, notwithstanding
that the Lenders may have had notice or knowledge of any such Event of Default or may have had notice or knowledge that such representation
or warranty was false or misleading at the time the Disbursement was made.


 


(b) The obligations
of the Borrower under Sections 1.4 and 2.5 and the obligations of the Borrower and the Lenders under this Article
6 shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby,
the repayment of the Loan, or the termination of this Agreement or any provision hereof.


 






    A-61


     


    

 


Section 6.10
No Waiver. Neither the failure of, nor any delay on the part of, any Party in exercising any right, power or privilege
hereunder, or under any agreement, document or instrument mentioned herein, shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, power or privilege hereunder, or under any agreement, document or instrument
mentioned herein, preclude other or further exercise thereof or the exercise of any other right, power or privilege; nor
shall any waiver of any right, power, privilege or default hereunder, or under any agreement, document or instrument
mentioned herein, constitute a waiver of any other right, power, privilege or default or constitute a waiver of any default
of the same or of any other term or provision. No course of dealing and no delay in exercising, or omission to exercise, any
right, power or remedy accruing to the Lenders upon any default under this Agreement, or any other agreement shall impair any
such right, power or remedy or be construed to be a waiver thereof or an acquiescence therein; nor shall the action of the
Lenders in respect of any such default, or any acquiescence by it therein, affect or impair any right, power or remedy of the
Lenders in respect of any other default. All rights and remedies herein provided are cumulative and not exclusive of any
rights or remedies otherwise provided by law.


 


Section 6.11 Indemnity.


 


(a) The Borrower,
each Loan Party and Other Obligor shall, at all times, indemnify and hold each Secured Party harmless (the “Indemnity”)
and each of their respective directors, partners, officers, employees, agents, counsel and advisors (each, an “Indemnified
Person”) in connection with any losses, claims (including the reasonable documented out-of-pocket attorneys’ fees
incurred in defending against such claims), damages, liabilities, penalties, or other expenses arising out of, or relating to,
the Loan Documents, the extension of credit hereunder or the Loan or the use of the Loan, which an Indemnified Person may incur
or to which an Indemnified Person may become subject, but excluding all Taxes (each, a “Loss”). The Indemnity
shall not apply to the extent that a court or arbitral tribunal of competent jurisdiction issues a final judgment that such Loss
resulted from the gross negligence or willful misconduct of any Indemnified Person. The Indemnity is independent of and in addition
to any other agreement of Borrower under any Loan Document to pay any amount to the Secured Parties, and any exclusion of any obligation
to pay any amount under this subsection shall not affect the requirement to pay such amount under any other section hereof or under
any other agreement.


 


(b) Promptly
after receipt by an Indemnified Person under this Section 6.11 of notice of the commencement of any action (including any
governmental action), such Indemnified Person shall, if a Loss in respect thereof is to be made against the indemnifying person
under this Section 6.11, deliver to Borrower a written notice of the commencement thereof, and Borrower shall have the right
to participate in, and, to the extent Borrower so desires, to assume control of the defense thereof.


 


(c) An Indemnified
Person shall have the right to retain its own counsel with the documented reasonable fees and out-of-pocket expenses to be paid
by the indemnifying person, if, in the reasonable opinion of counsel for the Indemnified Person, the representation by such counsel
of the Indemnified Person and Borrower would be inappropriate due to actual or potential differing interests between such Indemnified
Person and any other party represented by such counsel in such proceeding. The Borrower shall pay for only one separate such legal
counsel for all of the Indemnified Persons. The failure of an Indemnified Person to deliver written notice to the Borrower within
a reasonable time of the commencement of any such action shall not relieve the Borrower of any liability to the Indemnified Person
under this Section 6.11, except to the extent that Borrower is actually prejudiced in its ability to defend such action.
The indemnification required by this Section 6.11 shall be made by periodic payments of the amount thereof during the course
of the investigation or defense, as such expense, loss, damage or liability is incurred and is due and payable.


 


(d) In no
circumstance will any of the Indemnified Persons be liable for lost profits or other special, punitive, or consequential damages.
Notwithstanding any provision in this Agreement or any other Loan Document to the contrary, this Section 6.11 shall remain
operative even after the payment in full of the Obligations.


 




    A-62


     


    

 


Section 6.12 No
Usury. The Loan Documents are hereby expressly limited so that in no contingency or event whatsoever, whether by reason of acceleration
or otherwise, shall the amount paid or agreed to be paid to the Lenders for the Loan exceed the maximum amount permissible under
applicable law. If from any circumstance whatsoever fulfillment of any provision hereof, at the time performance of such provision
shall be due, shall involve transcending the limit of validity prescribed by law, then, ipso facto, the obligation to be fulfilled
shall be reduced to the limit of such validity, and if from any such circumstance the Lenders shall ever receive anything which
might be deemed interest under applicable law that would exceed the highest lawful rate, such amount that would be deemed excessive
interest shall be applied to the reduction of the principal amount owing on account of the Loan, or if such deemed excessive interest
exceeds the unpaid balance of principal of the Loan, such deemed excess shall be refunded to the Borrower. All sums paid or agreed
to be paid to the Lenders for the Loan shall, to the extent permitted by applicable law, be deemed to be amortized, prorated, allocated
and spread throughout the full term of the Loan until payment in full so that the deemed rate of interest on account of the Loan
is uniform throughout the term thereof. The terms and provisions of this Section shall control and supersede every other provision
of this Agreement and the Notes.


 


Section 6.13 Further
Assurances. From time to time, the Borrower and the other Loan Party Obligors shall perform (and shall cause their Subsidiaries
to perform) any and all acts and execute and deliver to the Secured Parties such additional agreements, instruments and documents
as may be reasonably requested by any Secured Party to carry out the purposes of any Loan Document or to preserve and protect the
Secured Parties’ rights and remedies as contemplated herein and therein.


 


Section 6.14 Confidentiality.
Subject to Section 5.1(xiii), Lenders agree that they will hold any confidential information they may receive from Borrower
in connection with the Loan Documents in confidence, unless such confidential information (a) is known or becomes known to the
public in general (other than as a result of a breach of this Section 6.14 by Lenders), (b) is or has been independently
developed or conceived by Lenders without use of Borrower’s confidential information, or (c) is or has been made known or
disclosed to Lender by a third party without a breach of any obligation of confidentiality such third party may have to Borrower;
provided, however, that Lenders may disclose confidential information (i) to their attorneys, accountants, consultants, and other
professionals to the extent necessary to obtain their services in connection with this Agreement and the other Loan Documents;
(ii) to any prospective purchaser of any Loan from Lenders, if a transfer to such prospective purchaser is permitted and such prospective
purchaser agrees to be bound by the provisions of this Section 6.14; (iii) to any existing or prospective Affiliate, partner,
member, shareholder or wholly owned subsidiary of a Lender in the Ordinary Course of Business, provided that Lenders inform such
Person that such information is confidential and direct such Person to maintain the confidentiality of such information; (iv) as
may otherwise be required by law, regulation or legal process; (v) to any Person in connection with any legal proceeding to which
it is a party; or (vi) as provided in Section 5.1(xiii).


 






    A-63


     


    

 


Section 6.15 Intercreditor
Agreement.


 


(a) Notwithstanding
anything to the contrary in this Agreement or in any other Loan Document: (i) the Liens granted to the Collateral Agent in favor
of the Secured Parties pursuant to the Loan Documents and the exercise of any right related to any collateral hereunder or thereunder
shall be subject, in each case, to the terms of the Intercreditor Agreement, (ii) in the event of any conflict between the express
terms and provisions of this Agreement or any other Loan Document, on the one hand, and of the Intercreditor Agreement, on the
other hand, the terms and provisions of the Intercreditor Agreement shall control, (iii) any collateral (including the Collateral)
under the Loan Documents held by (or in the possession or control of) the ABL Agent (as defined in the Intercreditor Agreement)
(or its agents or bailees) shall be held as agent and bailee for security, Lien perfection and control purposes in favor of the
Collateral Agent (for the benefit of the Secured Parties) in accordance with the terms of the Intercreditor Agreement and the Loan
Documents, and (iv) each Lender hereunder authorizes and instructs the Collateral Agent to execute the Intercreditor Agreement
on behalf of such Lender, and such Lender agrees to be bound by the terms thereof.


  


(b) Each
Lender hereunder authorizes and instructs the Collateral Agent, as the Collateral Agent and on behalf of such Lender, to enter
into one or more intercreditor agreements (including the Intercreditor Agreement) from time to time pursuant to, or as contemplated
by, the terms of this Agreement and agrees that it will be bound by the terms and provisions thereof and will take no actions contrary
to the terms and provisions thereof.


 


(c) Notwithstanding
anything herein to the contrary, each of (i) the Obligations of the Loan Parties under this Agreement, (ii) the Lien and security
interest granted to the Collateral Agent for the benefit of the Secured Parties pursuant to this Agreement and the other Loan Documents
(including priority thereof), (iii) the release of Collateral from the Lien granted and created by the Loan Documents and (iv)
the exercise of any right or remedy by the Collateral Agent under the Loan Documents are, in each case, subject to the provisions
of the Intercreditor Agreement. In the event of any conflict or inconsistency between the provisions of the Intercreditor Agreement
and this Agreement, the provisions of the Intercreditor Agreement shall control.


 


[SIGNATURE PAGE FOLLOWS]


 




    A-64


     


    

 


IN WITNESS WHEREOF,
the Lenders and the Borrower have caused this Agreement to be duly executed as of the date set forth above.


 


	
        

        BORROWER:
	 
	 	 
	NEOS THERAPEUTICS	 
	 	 
	By: 	                    	 
	Name:	 	 
	Title:	 	 


 


	LENDERS:	 	DEERFIELD PRIVATE DESIGN FUND III, L.P.
	 	 	 
	 	 	By: Deerfield Mgmt III, L.P., General Partner
	 	 	 
	 	 	By: J.E. Flynn Capital III, LLC, General Partner
	 	 	 
	 	 	By:	           
	 	 	Name: 	 
	 	 	Title:	 
	 	 	 
	 	 	DEERFIELD SPECIAL SITUATIONS FUND, L.P.
	 	 	 
	 	 	By: Deerfield Mgmt, L.P., General Partner
	 	 	 
	 	 	By: J.E. Flynn Capital, LLC, General Partner
	 	 	 
	 	 	By:	 
	 	 	Name:	 
	 	 	Title:	 
	 	 	 



 






    A-65


     


    

 


SCHEDULE 1


 


	
LENDER
	 	 	ALLOCATION OF DISBURSEMENTS AND PAYMENTS	 
	Deerfield Private Design Fund III, L.P.	 	 	66 2/3%	 
	Deerfield Special Situations Fund, L.P.
 
	 	 	33 1/3%	 




   



    A-66


     


    

 


COMPLIANCE CERTIFICATE


 


[letterhead of the Borrower]


 


		To:	Deerfield Management Company, L.P.

780 Third Avenue, 37th Floor

New York, NY 10017

Fax: 212-599-3075

Email: dclark@deerfield.com

Attn: David J. Clark



 


Re: Compliance Certificate dated _______________


 


Ladies and Gentlemen:


 


Reference is made to that certain Facility
Agreement dated as of May 11, 2016 (as amended, restated or otherwise modified from time to time, the “Facility Agreement”)
between Neos Therapeutics, Inc., a Delaware corporation (the “Borrower”), and the lenders set forth on the signature
page thereto. Capitalized terms used in this Compliance Certificate have the meanings set forth in the Facility Agreement unless
specifically defined herein.


 


Pursuant to Section 5.1(v) of the Facility
Agreement, the undersigned Chief Financial Officer of the Borrower hereby certifies on behalf of each Borrower Loan Party (solely
in his capacity as an officer of the Borrower and not in his individual capacity) that:


 


1. The financial statements of the Borrower
Loan Parties for the ___ -month period ending _____________ attached hereto have been prepared in accordance with GAAP and fairly
present the financial condition of the Loan Parties for the periods and as of the dates specified therein.


 


2. As of the date hereof, there does not
exist any Default or Event of Default.


 


3. The Borrower Loan Parties are in compliance
with the applicable financial covenants contained in Section 5.3 of the Facility Agreement for the periods covered by this Compliance
Certificate. Attached hereto are statements of all relevant facts and computations in reasonable detail sufficient to evidence
the Loan Parties’ compliance with such financial covenants, which computations were made in accordance with GAAP.


 


IN WITNESS WHEREOF, this Compliance Certificate
is executed by the undersigned this __ day of _______________, ______.


 


	 	NEOS THERAPEUTICS, INC., 
	 	as the Borrower
	 	 
	 	By: 	                       
	 	Name:
	 	Title: Chief Financial Officer



  




    A-67


     


    

 


EXHIBIT B


 


Form of ABL Amendment


 


[Attached.]


 


See Exhibit 10.2 to this Current Report
on Form 8-K


 


 


 


 


 


 


 


 


 


 


 






    B-1


     


    

 





EXHIBIT C


 


Form of Promissory Note


 


SENIOR SECURED NOTE


 


	Original Issuance Date: May 11, 2016	Principal: U.S. $[__________]
	Second Amendment and Restatement Date: May 6, 2020	 
	Sixth Amendment Effective Date: March 19, 2021	 


 


FOR VALUE RECEIVED, NEOS THERAPEUTICS, INC., a Delaware
corporation (the “Company”), hereby promises to pay to [________], or its registered assigns (the “Holder”)
the principal amount of [_______] dollars ($[____________]), pursuant to, and in accordance with, the terms of that certain Facility
Agreement, dated as of May 11, 2016 (as amended by the First Amendment to Facility Agreement, dated as of June 1, 2017, the Second
Amendment to Facility Agreement, dated as of November 5, 2018, the Third Amendment to Facility Agreement, dated as of March 26,
2019, the Fourth Amendment to Facility Agreement, dated as of October 2, 2019, the Fifth Amendment to Facility Agreement, dated
as of May 6, 2020, and the Consent, Waiver and Sixth Amendment to Facility Agreement, dated as of March [19], 2021, in each case,
by and among the Company, the Guarantors specified therein and the Lenders party thereto, and as may be further amended, restated,
modified and supplemented from time to time, the “Facility Agreement”). All capitalized terms used and not otherwise
defined herein shall have the respective meanings set forth in the Facility Agreement.


 


This Senior Secured Note (this “Note”) is
one of the “Notes” issued under the Facility Agreement, was originally issued on May 11, 2016, was amended and restated
on the First Amendment and Restatement Date, was amended on the Third Amendment Date, was amended and restated on the Second Amendment
and Restatement Date, and is again amended and restated as of the Sixth Amendment Effective Date. This Note shall bear interest
on the principal amount hereof pursuant to the provisions of the Facility Agreement. The Company shall make all payments to the
Holder of interest and principal under this Note in the manner provided in and otherwise in accordance with the Facility Agreement.
If an Event of Default has occurred and is continuing, this Note may, in accordance with the applicable provisions of the Facility
Agreement, become immediately due and payable.


 


All payments of any kind due to the Holder from the Company
pursuant to this Note shall be made in the full face amount thereof. Subject to the terms of the Facility Agreement, all such payments
will be free and clear of, and without deduction or withholding for, any present or future taxes. The Company shall pay all and
any costs (administrative or otherwise) imposed by the Company’s banks, clearing houses, or any other financial institution,
in connection with making any payments hereunder.


 


The Company shall pay all reasonable, documented, out-of-pocket
costs of collection, including, without limitation, all reasonable, documented, out-of-pocket legal expenses and attorneys’
fees, paid or incurred by the Holder in collecting and enforcing this Note.


 






    C-1


     


    

 


Other than those notices required to be provided by Holder to
Company under the terms of the Facility Agreement, the Company and every endorser of this Note, or the obligations default, and
notice of any kind with respect to this Note and the Facility Agreement or the performance of the obligations under this Note and/or
the Facility Agreement. No renewal or extension of this Note or the Facility Agreement, no delay in the enforcement of payment
of this Note or the Facility Agreement, and no delay or omission in exercising any right or power under this Note or the Facility
Agreement shall affect the liability of the Company or any endorser of this Note.


 


No delay or omission by the Holder in exercising any power or
right hereunder shall impair such right or power or be construed to be a waiver of any default; nor shall any single or partial
exercise of any power or right hereunder preclude the full exercise thereof or the exercise of any other power or right. The provisions
of this Note may be waived or amended only in a writing signed by the Company and the Holder. This Note may be prepaid in whole
or in part in accordance with the provisions of the Facility Agreement.


 


Each party hereby irrevocably
agrees that any legal action, suit or other proceeding arising out of or relating to this Note may be brought exclusively in the
courts state and federal courts sitting in the City of New York, borough of Manhattan, and hereby consents that personal service
of summons or other legal process may be made as set forth in Section 6.4 of the Facility Agreement, which service such party agrees
shall be sufficient and valid. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HEREBY WAIVE ALL RIGHTS TO
A TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE.


 


This Note shall be governed by, and construed in accordance
with, the laws of the State of New York applicable to contracts made and to be performed in such State.


 


[Signature page follows]


 






    C-2


     


    

 


IN WITNESS WHEREOF, the Company has caused this Note to be duly
executed as of the date first set forth above.


 


	 	COMPANY:
	 	 
	 	NEOS THERAPEUTICS, INC.
	 	 
	 	By:	 
	 	Name: 	                         
	 	Title:	 


 



    C-3


     


    

 


EXHIBIT D


 


Form of Perfection Certificate


 


Perfection Certificate


 


[_], 202[_]


 


Reference is hereby
made to that certain Facility Agreement dated as of May 11, 2016 (as amended by that certain (i) First Amendment to Facility Agreement
dated as of June 1, 2017, by and among Neos Therapeutics, Inc., a Delaware corporation (the “Borrower”)
, the Guarantors party thereto and the Lenders party thereto, (ii) Second Amendment to Facility Agreement dated as of November
5, 2018 among the Borrower, Guarantors and Lenders, (iii) Third Amendment to Facility Agreement dated as of March 29, 2019 among
the Borrower, Guarantors and Lenders, (iv) Fourth Amendment to Facility Agreement, dated as of October 2, 2019, by and among the
Borrower, Guarantors and the Lenders, (v) Fifth Amendment to Facility Agreement, dated as of May 6, 2020, by and among the Borrower,
Guarantors and the Lenders and (vi) the Sixth Amendment dated as of the date hereof among the Borrower, Guarantors and Lenders,
and as it may be further amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Agreement”),
by and among the Lenders party thereto and the Borrower.


 


Capitalized terms used
herein and not otherwise defined shall have the meanings ascribed to them in the Agreement. Any terms (whether capitalized or lower
case) used in this Perfection Certificate that are defined in the UCC shall be construed and defined as set forth in the UCC unless
otherwise defined herein or in the Agreement; provided that to the extent that the UCC is used to define any term used herein
and if such term is defined differently in different Articles of the UCC, the definition of such term contained in Article 9 of
the UCC shall govern.


 


Each of the undersigned
hereby certifies to Collateral Agent (for the benefit of the Secured Parties) and each of the Lenders as follows as of the date
hereof:


 


1. Loan Party Information:


 


(a) Jurisdictions of Formation;
Foreign Business Qualifications:


 


Each Loan Party is (i) the type of entity
disclosed next to its name below, (ii) duly formed and validly existing under the laws of the jurisdiction disclosed next to its
name below and (iii) qualified to do business in the jurisdictions disclosed next to its name below.


 


Except as indicated below, no Loan Party
has changed its jurisdiction of organization at any time during the past four months.


 


	LOAN PARTY	 	 	ENTITY TYPE AND 

JURISDICTION OF 

FORMATION	 	 	FOREIGN BUSINESS

 QUALIFICATIONS	 
	 	 	 	 	 	 	 	 	 	 	 



 




    D-1


     


    

 


(b) Names:


 


The exact legal name of each Loan Party,
as such name appears in its certified certificate of incorporation, articles of incorporation, certificate of formation, or any
other organizational document, is set forth below. Also set forth below next to the name of each Loan Party is (i) a list of any
other prior legal names such Loan Party has had in the past five years, together with the date of the relevant name change, (ii)
a list of all other names used by such Loan Party in connection with any business or organization to which such Loan Party became
the successor by merger, consolidation, acquisition, change in form, nature or jurisdiction of organization or otherwise or on
any filings with the Internal Revenue Service, in each case, at any time in the past five years, and (iii) a list of all of the
present and prior trade names used by such Loan Party at any time in the past five years.


 


	LOAN PARTY LEGAL

 NAME	 	 	PRIOR LEGAL NAMES	 	 	OTHER NAMES	 	 	EXISTING/PRIOR

 TRADE NAMES	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 



 


(c) Collateral Locations:


 


Set forth below is a list
of all real property locations owned or leased by each Loan Party Obligor, including (i) the Collateral located on, and uses
of, such real property, (ii) the addresses of each parcel of real property and (iii) whether owned or leased (and if leased,
the complete name and notice address of the lessor).


 


Except as described below, no Loan Party
Obligor has entered into any leases, subleases, tenancies, franchise agreements, licenses or other occupancy arrangements as owner,
lessor, sublessor, licensor, franchisor or grantor with respect to any real property and no Loan Party Obligor has any leases which
require the consent of the landlord, tenant or other party thereto to the transactions contemplated by the Loan Documents.


 


	LOAN PARTY OBLIGOR	 	 	COLLATERAL 

DESCRIPTION/USE
 (indicate if any fixtures)
	 	 	COLLATERAL

 LOCATION 

OR PLACE OF 

BUSINESS
 (INCLUDING CHIEF 

EXECUTIVE OFFICE)
	 	 	OWNER/LE 

SSOR
 (IF LEASED)
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 






 


Perfection Certificate


 






    D-2


     


    

 





(d) Collateral in Possession
of Lessor, Bailee, Consignee or Warehouseman:


 


Set forth below is a list of all third parties with possession
of any Collateral (including Inventory and Equipment) of any Loan Party Obligor, including (i) the name and address of such third
party, (ii) a description of the Collateral in such third party’s possession, and (iii) the location of such Collateral.


 


	LOAN PARTY

 OBLIGOR	 	 	ADDRESS OF 

COLLATERAL	 	 	BAILEE/
 CONSIGNEE/

 WAREHOUSEMAN
	 	 	DESCRIPTION OF

 COLLATERAL	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 



 


(e) Litigation:


 


Set forth below is a description of all claims, proceedings,
litigation or investigations pending or (to the best of each Loan Party Obligor’s knowledge) threatened against any Loan
Party.


 


(f) Capitalization of Loan
Parties:


 


Attached hereto as Exhibit A
is a corporate organizational chart that lists each Loan Party and each of their respective Subsidiaries, and indicates whether
any of the Loan Parties is inactive and has de minimis assets.


 


Set forth below is a true and correct list
of all of the issued and outstanding Stock of each Loan Party and its Subsidiaries and the record and beneficial owners of such
Stock, along with the certificate number representing such Stock.


 


	Loan Party	 	 	Equityholder	 	 	Equity Description	 	 	Percentage of Outstanding Equity Issued by Loan Party	 	Certificate 

(Indicate No.)	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 



 


(g) Other Stock and Investment
Property:


 


Set forth below is a list of all Investment Property owned by
any Loan Party Obligor, including any Stock not described above in Section 1(f).


 


(h) Material Contracts:


 


Set forth below is a list of all Material Contracts of any Loan
Party.


 


Perfection Certificate


 




    D-3


     


    

 


(i) Extraordinary Transactions:


 


Except for those purchases, mergers, acquisitions, consolidations,
and other transactions described below, all of the Collateral has been originated by each Loan Party in the ordinary course of
business or consists of goods which have been acquired by such Loan Party in the ordinary course of business from a person in the
business of selling goods of that kind.


 


2. Commercial Tort Claims:


 


Set forth below is a true and correct list of all commercial
tort claims held by any Loan Party, including a brief description thereof containing the case name and parties.


 


3. Deposit Accounts / Other accounts:


 


Set forth below is a list of all Deposit Accounts, Securities
Accounts, Commodity Accounts, Securities Entitlements and Commodity Contracts and all other depositary, securities, commodity and
other accounts maintained by each Loan Party Obligor as of the date hereof, including for each such account (i) the name of the
Loan Party Obligor maintaining the account, (ii) the name of the financial institution, securities intermediary, commodity intermediary
or other Person at which the account is maintained, (iii) the account number and the purpose of the account and (iv) whether the
account is a “Restricted Account”.


 


	Loan Party Obligor	 	 	Name of Financial 

Institution	 	 	Account

 Number

 (* indicates 

account is
 approved for

 funding of loan

 proceeds)
	 	 	Purpose of 

Account	 	 	Is the Account

 a “Restricted 

Account” as 

defined in 

Annex II (Yes

 or No?)	 
	 	            	 	 	 	 	 	 	 	 	 	 	 	              	 	 	 	 	 



 


4. Intellectual Property:


 


(a) Patents and Patent
Applications:


 


Set forth below is a complete and correct list of all patents
and applications for patents owned by any Loan Party Obligor.


 


(b) Trademarks and Trademark
Applications:


 


Perfection Certificate


 






    D-4


     


    

 


Set forth below is a complete and correct list of all trademarks
and applications for trademarks owned by any Loan Party Obligor.


  


(c) Copyrights and Copyright
Applications:


 


Set forth below is a complete and correct list of all copyrights
and applications for copyrights owned by any Loan Party Obligor.


 


	Loan Party Obligor	 	 	Copyright Title	 	 	Copyright Registration

 Date	 	 	Copyright

 Registration 

Number	 	 	Copyright 

Application Number	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 



 


(d) Intellectual Property
Licenses:


 


Set forth below is a complete and correct
list of all Intellectual Property licenses entered into by any Loan Party Obligor pursuant to which (i) any Loan Party Obligor
has provided any license or other rights in Intellectual Property owned or controlled by such Loan Party Obligor to any other Person
(other than non-exclusive software licenses granted in the ordinary course of business) or (ii) any Person has granted to any Loan
Party Obligor any license or other rights in Intellectual Property owned or controlled by such Person that is material to the business
of such Loan Party, including any Intellectual Property that is incorporated in any Inventory or other product marketed, sold,
licensed, or distributed by such Loan Party Obligor.


 


by and between NeuRx Pharmaceuticals LLC
and Neos Therapeutics, Inc. dated October 233, 2018 (NRX-101)


 


5. Insurance:


 


A true and complete listing of all insurance carried by any
Loan Party as of the date hereof, including issuers, coverages and deductibles, is set forth below.


 


6. Other Assets:


 


A Loan Party Obligor owns the following kinds of assets:


 


	Aircraft:	Yes ____	No  ____
	 	 	 
	Letter-of-Credit Rights:	Yes  ____	No  ____
	 	 	 
	Indebtedness (including as evidenced by promissory notes, instruments (other than checks to be deposited in the ordinary course of business), tangible chattel paper, and/or electronic chattel paper):	Yes  ____	No  ____
	 	 	 
	Vessels, boats or ships:	Yes  ____	No  ____
	 	 	 
	Railroad rolling stock:	Yes  ____	No  ____
	 	 	 
	Motor Vehicles or similar titled collateral.	Yes  ____	No  ____


 


If the answer is yes to any of these other types of assets,
please describe on Exhibit B.


 


Perfection Certificate


 




    D-5


     


    

 


7. Existing Indebtedness:


 


Set forth below is a complete and correct list of all existing
Indebtedness of any Loan Party:


 


	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 


 


[signature page follows]


 


Perfection Certificate


 




    D-6


     


    

 


IN WITNESS WHEREOF, the undersigned
have signed this Perfection Certificate as of the date first set forth above.


 


	 	NEOS THERAPEUTICS, INC.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	NEOS THERAPEUTICS COMMERCIAL, LLC
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	NEOS THERAPEUTICS BRANDS, LLC
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	PHARMAFAB TEXAS, LLC
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	NEOS THERAPEUTICS, LP
	 	 	 
	 	By:	Pharmafab Texas, LLC, Its General Partner
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 


  




    D-7


     


    

 


Exhibit A


 


CORPORATE
ORGANIZATIONAL CHART


 


 


Perfection Certificate


 




    D-8


     


    

  


Exhibit B


 


DESCRIPTION
OF OTHER ASSETS


 




    D-9


     


    

 


Schedule 1(e)


Litigation


  




    D-10


     


    

  


Schedule 1(h)


Material Agreements


 




    D-11


     


    

 


Schedule 4(a)


Patents


 


	Loan Party Obligor	 	 	Patent

 Registration 

Number	 	 	Registration 

Date	 	 	Patent Application

 Number	 	 	Application 

Date	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 



 




    D-12


     


    

 


Schedule 4(b)


Trademarks


 


	Loan Party Obligor	 	 	Trademark Title	 	 	Trademark

 Application

 Number	 	 	Trademark

 Registration

 Number	 	 	Date of 

Application	 	 	Date of

 Registration	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 



 




    D-13


     


    

 


Schedule 5


Insurance


 


	Issuer	 	 	Coverage	 	 	Aggregate	 	 	Deductible	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 



 






    D-14


     


    

 






EXHIBIT E


 


Closing Checklist


 


[Attached.]
 


 


 


 


 


 


 


 


 


 


 


 


 


 


 



    E-1


     


    

 


DISCLOSURE SCHEDULES


 


[Attached.]


 


 


 


 


 


 


 


 


 


 


 


 


  


 


E-2