Exhibit
10.2


 


 






 


 


 


 


 


 


 


 


 


 


 


SECURITY AGREEMENT


 


made by


 


CADIZ INC.

and

CADIZ REAL ESTATE LLC,

as Loan Parties,


 


in favor of


 


B. Riley
Securities, Inc.,

as Agent


 


Dated as of July 2, 2021


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 



 




    


     


    

 


	TABLE OF CONTENTS
	 
	 	 	Page
	 	 	 
	Section 1
	 
	DEFINED TERMS
	 
	1.1	Definitions	1
	1.2	Other Definitional Provisions	3
	 	 	 
	Section 2
	 	 	 
	GRANT OF SECURITY INTEREST
	 
	Section 3
	 	 	 
	REPRESENTATIONS AND WARRANTIES
	 	 	 
	3.1	Title; No Other Liens	5
	3.2	Perfected First Priority Liens	5
	3.3	Jurisdiction of Organization; Chief Executive Office	6
	3.4	Real Property	6
	3.5	Inventory and Equipment	6
	3.6	Farm Products	6
	3.7	Investment Property	6
	3.8	Receivables	6
	3.9	Intellectual Property	6
	3.10	Deposit Accounts and Securities Accounts	7
	3.11	Letter-of-Credit Rights	7
	3.12	Commercial Tort Claims	7
	 	 	 
	Section 4
	 
	COVENANTS
	 	 	 
	4.1	Delivery of Instruments, Certificated Securities and Chattel Paper	7
	4.2	Payment of Obligations	7
	4.3	Maintenance of Perfected Security Interest; Further Documentation	8
	4.4	Changes in Locations, Name, etc.	8
	4.5	Notices	9
	4.6	Investment Property	9
	4.7	Receivables	10
	4.8	Deposit Accounts and Securities Accounts	10
	4.9	Letters of Credit	10
	4.10	Equipment	10
	4.11	General Intangibles	11
	4.12	Commercial Tort Claims	11


 






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	Section 5
	 	 	 
	REMEDIAL PROVISIONS
	 	 	 
	5.1	Certain Matters Relating to Receivables	11
	5.2	Communications with Obligors; Loan Parties Remain Liable	11
	5.3	Pledged Stock	12
	5.4	Proceeds to Be Turned Over to Agent	12
	5.5	Application of Proceeds	12
	5.6	Code and Other Remedies	13
	5.7	Deficiency	13
	 	 	 
	Section 6
	 	 	 
	MISCELLANEOUS
	 	 	 
	6.1	Amendments in Writing	14
	6.2	Notices	14
	6.3	No Waiver by Course of Conduct; Cumulative Remedies	14
	6.4	Enforcement Expenses; Indemnification	14
	6.5	Successors and Assigns	14
	6.6	Set-off	15
	6.7	Counterparts	15
	6.8	Severability	15
	6.9	Section Headings	15
	6.10	Integration	15
	6.11	Governing Law	16
	6.12	Submission to Jurisdiction; Waivers	16
	6.13	Acknowledgments	16
	6.14	Releases	17
	6.15	Waiver of Jury Trial	17
	6.16	The Agent	17


 



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	SCHEDULES
	 	 
	Schedule 1	Notice Addresses of Loan Parties
	Schedule 2	Description of Investment Property
	Schedule 3	Filings and Other Actions Required to Perfect Security Interests
	Schedule 4	Jurisdiction of Organization, Organizational Number, FEIN and Chief Executive Office
	Schedule 5	Owned and Leased Property
	Schedule 6	Locations of Inventory and Equipment
	Schedule 7	Intellectual Property
	Schedule 8	Deposit Accounts and Securities Accounts
	Schedule 9	Letter of Credit Rights
	Schedule 10	Commercial Tort Claims


 






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SECURITY AGREEMENT


 


SECURITY AGREEMENT, dated as
of July 2, 2021, made by Cadiz Inc., a Delaware corporation (“Parent”), and Cadiz Real Estate LLC, a Delaware limited
liability company (“CRE”) (together with any other entity that may become a party hereto as provided herein, the “Loan
Parties”), in favor of B. Riley Securities, Inc., as administrative agent and collateral agent (in such capacity, the “Agent”),
on behalf of the Lenders under the Credit Agreement, dated as of July 2, 2021 (as amended, restated, supplemented or otherwise modified
from time to time, the “Credit Agreement”), among Parent and CRE, as borrowers (together, the “Borrower”),
the lenders party thereto (the “Lenders”) and the Agent.


 


W I T N E S S E T H:


 


WHEREAS, it is a condition precedent
to the Credit Agreement that the Loan Parties shall have executed and delivered this Agreement to the Agent;


 


NOW, THEREFORE, in consideration
of the premises hereunder, and to induce the Agent and the Lenders to enter into the Credit Agreement, each Loan Party hereby agrees with
the Agent as follows:


 


Section 1



DEFINED TERMS


 


1.1 Definitions.Unless
otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement,
and the following terms are used herein as defined in the New York UCC: Accounts, Certificated Security, Chattel Paper, Commercial Tort
Claims, Contracts, Control, Documents, Equipment, Farm Products, Fixtures, General Intangibles, Goods, Instruments, Inventory, Letter-of-Credit
Rights, Securities Accounts and Supporting Obligations. The following terms shall have the following meanings:


 


(a) “Agreement”:
this Security Agreement, as the same may be amended, restated, supplemented or otherwise modified from time to time.


 


(b) “Borrower
Obligations”: the collective reference to the Obligations, as defined in the Credit Agreement.


 


(c) “Collateral”:
as defined in Section 2.


 


(d) “Collateral
Account”: any collateral account established by the Agent as provided in Section 5.1 or 5.4.


 


(e)
“Copyright Licenses”: any written agreement naming any Loan Party as licensor or licensee (including, without limitation,
those listed in Schedule 7), granting any right under any Copyright, including, without limitation, the grant of rights to manufacture,
distribute, exploit and sell materials derived from any Copyright.


 






     


    


    

 


(f) “Copyrights”:
(i) all copyrights arising under the laws of the United States, whether registered or unregistered and whether published or unpublished
(including, without limitation, those listed in Schedule 7), all registrations and recordings thereof, and all applications in
connection therewith, including, without limitation, all registrations, recordings and applications in the United States Copyright Office,
and (ii) the right to obtain all renewals thereof.


 


(g) “Deposit
Account”: as such term is defined in the New York UCC, including the deposit accounts listed on Schedule 8.


 


(h) “Excluded
Account(s)”: as defined in Section 4.8.


 


(i) “Intellectual
Property”: the collective reference to all rights, priorities and privileges relating to intellectual property arising under
United States laws, including, without limitation, the Copyrights, the Copyright Licenses, the Patents, the Patent Licenses, the Trademarks
and the Trademark Licenses.


 


(j) “Intercompany
Note”: any promissory note evidencing loans made by any Loan Party to another Loan Party.


 


(k) “Investment
Property”: the collective reference to (i) all “Investment Property” as such term is defined in Section 9-102(a)(49)
of the New York UCC and (ii) in any event, all Pledged Notes and all Pledged Stock.


 


(l) “Issuers”:
the collective reference to each issuer of any Investment Property.


 


(m) “New
York UCC”: the Uniform Commercial Code as from time to time in effect in the State of New York.


 


(n) “Loan
Party Obligations”: with respect to any Loan Party, all obligations and liabilities of such Loan Party to the Lenders and the
Agent which may arise under or in connection with this Agreement, any other Loan Document to which such Loan Party is a party, in each
case whether on account of guarantee obligations, reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the Agent that are required to be paid by such Loan Party pursuant to the
terms of this Agreement, any other Loan Document).


 


(o) “Obligations”:
(i) in the case of the Borrower, the Borrower Obligations, and (ii) in the case of each other Loan Party, its Loan Party Obligations.


 


(p) “Patent
License”: all agreements, whether written or oral, providing for the grant by or to any Loan Party of any right to manufacture,
use or sell any invention covered in whole or in part by a Patent, including, without limitation, any of the foregoing referred to in
Schedule 7.


 


(q) “Patents”:
(i) all letters patent of the United States, all reissues and extensions thereof and all goodwill associated therewith, including, without
limitation, any of the foregoing referred to in Schedule 7, (ii) all applications for letters patent of the United States, continuations
and continuations-in-part thereof, including, without limitation, any of the foregoing referred to in Schedule 7, and (iii) all
rights to obtain any reissues or extensions of the foregoing.


 






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(r) “Pledged
Notes”: all promissory notes listed on Schedule 2 and all Intercompany Notes at any time issued to any Loan Party and
all other promissory notes issued to or held by any Loan Party.


 


(s) “Pledged
Stock”: (i) the shares of Capital Stock listed on Schedule 2 and (ii) any other shares, stock certificates, options,
interests or rights of any nature whatsoever in respect of the Capital Stock of any Person that may be issued or granted to, or directly
held by, any Loan Party while this Agreement is in effect.


 


(t)
“Proceeds”: all “Proceeds” as such term is defined in Section 9-102(a)(64) of the New York UCC and,
in any event, shall include, without limitation, all dividends or other income from the Investment Property, collections thereon or
distributions or payments with respect thereto.


 


(u) “Receivable”:
any right to payment for goods sold or leased or for services rendered, whether or not such right is evidenced by an Instrument or Chattel
Paper and whether or not it has been earned by performance (including, without limitation, any Account).


 


(v) “Securities
Act”: the Securities Act of 1933, as amended.


 


(w) “Trademark
License”: any agreement, whether written or oral, providing for the grant by or to any Loan Party of any right to use any Trademark,
including, without limitation, any of the foregoing referred to in Schedule 7.


 


(x) “Trademarks”:
(i) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks,
logos and other source or business identifiers, and all goodwill associated therewith, now existing or hereafter adopted or acquired,
all registrations and recordings thereof, and all applications in connection therewith, whether in the United States Patent and Trademark
Office or in any similar office or agency of the United States or any State thereof, or otherwise, and all common-law rights related thereto,
including, without limitation, any of the foregoing referred to in Schedule 7, and (ii) the right to obtain all renewals thereof.


 


1.2 Other Definitional Provisions.
(a) The words “hereof,” “herein,” “hereto” and “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section
and Schedule references are to this Agreement unless otherwise specified.


 


(b) The
meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.


 


(c) Where
the context requires, terms relating to the Collateral or any part thereof, when used in relation to a Loan Party, shall refer to such
Loan Party’s Collateral or the relevant part thereof.


 






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Section 2



GRANT OF SECURITY INTEREST


 


Each Loan Party hereby grants
to the Agent, for its benefit and on behalf of, and for the benefit of, the Lenders, a security interest in, all of the following property
now owned or at any time hereafter acquired by such Loan Party or in which such Loan Party now has or at any time in the future may acquire
any right, title or interest (collectively, the “Collateral”), as collateral security for the prompt and complete payment
and performance when due (whether at the stated maturity, by acceleration or otherwise) of such Loan Party’s Obligations:


 


(a) all
Accounts;


 


(b) all
cash and Cash Equivalents;


 


(c) all
Chattel Paper;


 


(d) all
Contracts;


 


(e) the
Deposit Accounts;


 


(f) all
Documents;


 


(g) all
Equipment;


 


(h) all
Fixtures;


 


(i) all
General Intangibles;


 


(j) all
Instruments;


 


(k) all
Intellectual Property;


 


(l) all
Inventory;


 


(m) all
Investment Property;


 


(n) all
Letter-of-Credit Rights;


 


(o) all
Securities Accounts;


 


(p) all
Goods not otherwise described above;


 


(q) all
books and records pertaining to the foregoing; and


 


(r) to
the extent not otherwise included, all Proceeds, Supporting Obligations and products of any and all of the foregoing and all collateral
security and guarantees given by any Person with respect to any of the foregoing;


 






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provided, however, that notwithstanding
any of the other provisions set forth in this Section 2, this Agreement shall not constitute a grant of a security interest in (i) any
property to the extent that such grant of a security interest is prohibited by any Requirements of Law of a Governmental Authority, requires
a consent not obtained of any Governmental Authority pursuant to such Requirement of Law or is prohibited by, or constitutes a breach
or default under or results in the termination of or requires any consent not obtained under, any contract, license, agreement, instrument
or other document evidencing or giving rise to such property or, in the case of any Investment Property, Pledged Stock or Pledged Note,
any applicable shareholder or similar agreement, except to the extent that such Requirement of Law or the term in such contract, license,
agreement, instrument or other document or shareholder or similar agreement providing for such prohibition, breach, default or termination
or requiring such consent is ineffective under applicable law; (ii) any Excluded Accounts, and (iii) any intent to use trademark application
prior to the filing and acceptance of a “Statement of Use” or “Amendment to Allege Use” with respect thereto,
to the extent, if any, that, and solely during the period, if any, in which the grant of a security interest therein would impair the
validity, enforceability, or registrability of such intent to use trademark application under applicable federal Law.


 


Section 3



REPRESENTATIONS AND WARRANTIES


 


To induce the Lenders and the
Agent to enter into the Credit Agreement and the Lenders to make their extensions of credit to the Borrowers thereunder, each Loan Party
hereby represents and warrants to the Agent for the benefit of the Lenders that:


 


3.1 Title; No Other Liens.
Except for the security interest granted to the Agent pursuant to this Agreement and the other Liens permitted to exist on the Collateral
by the Credit Agreement, such Loan Party owns each item of the Collateral free and clear of any and all Liens or claims of others. No
financing statement or other public notice with respect to all or any part of the Collateral is on file or of record in any public office,
except such as have been filed in favor of the Agent, for the benefit of the Lenders, pursuant to this Agreement or as are permitted
by the Credit Agreement.


 


3.2 Perfected First Priority
Liens. The security interests granted pursuant to this Agreement (a) upon completion of the filings and other actions specified on
Schedule 3 (which, in the case of all filings and other documents referred to on said Schedule, have been delivered to the Agent
in completed and duly executed form) will constitute valid perfected security interests in all of the Collateral in favor of the Agent
as collateral security for such Loan Party’s Obligations, enforceable in accordance with the terms hereof against all creditors
of such Loan Party and any Persons purporting to purchase any Collateral from such Loan Party and (b) are prior to all other Liens
on the Collateral in existence on the date hereof except, in the case of Collateral other than Pledged Stock and Pledged Note, to the
extent permitted by the Credit Agreement.


 






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3.3 Jurisdiction of Organization;
Chief Executive Office. On the date hereof, such Loan Party’s exact legal name as such name appears in its organizational documents,
jurisdiction of organization, identification number from the jurisdiction of organization (if any), Federal Taxpayer Identification Number
(if any) and the location of such Loan Party’s chief executive office or sole place of business or principal residence, as the
case may be, are specified on Schedule 4. Such Loan Party has furnished to the Agent a certified charter, certificate of incorporation
or other organization document and good standing certificate in such Loan Party’s organizational jurisdiction and each jurisdiction
where the failure to be so qualified could reasonably be expected to have a Material Adverse Effect, in each case as of a date which
is recent to the date hereof.


 


3.4 Real Property. Schedule
5 is a list of all U.S. real property owned in fee or leased by such Loan Party as of the date hereof.


 


3.5 Inventory and Equipment.
On the date hereof, a material portion of the Inventory and the Equipment (other than mobile goods) are kept at the locations listed
on Schedule 6.


 


3.6 Farm Products. None
of the Collateral constitutes, or is the Proceeds of, Farm Products in any material respect.


 


3.7 Investment Property.
The shares of Pledged Stock pledged by such Loan Party hereunder constitute all the issued and outstanding shares of all classes of the
Capital Stock of each Issuer owned by such Loan Party. All the shares of the Pledged Stock have been duly and validly issued and are
fully paid and nonassessable. Each of the Pledged Notes constitutes the legal, valid and binding obligation of the obligor with respect
thereto, enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered
in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing. Such Loan Party is the record and beneficial
owner of, and has good and marketable title to, the Investment Property pledged by it hereunder, free of any and all Liens or options
in favor of, or claims of, any other Person, except the security interest created by this Agreement.


 


3.8 Receivables. No
material amount payable to such Loan Party under or in connection with any Receivable is evidenced by any Instrument or Chattel Paper
which has not been delivered to the Agent. The amounts represented by such Loan Party to the Agent from time to time as owing to such
Loan Party in respect of the Receivables will at such times be accurate in all material respects.


 


3.9 Intellectual Property.
(a) Schedule 7 lists all registered or applied for Intellectual Property owned by such Loan Party in its own name on the date
hereof which is material to such Loan Party.


 


(b) On
the date hereof, all material Intellectual Property is valid, subsisting, unexpired and enforceable, has not been abandoned and, to the
best knowledge of such Loan Party, does not infringe the intellectual property rights of any other Person.


 






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(c) Except
as set forth in Schedule 7, on the date hereof, no material Intellectual Property is the subject of any licensing or franchise
agreement pursuant to which such Loan Party is the licensor or franchisor.


 


(d) No
holding, decision or judgment has been rendered by any Governmental Authority which would limit, cancel or question the validity of, or
such Loan Party’s rights in, any Intellectual Property in any respect that could reasonably be expected to have a Material Adverse
Effect.


 


(e) There
is no action or proceeding pending, or, to the knowledge of such Loan Party, threatened, on the date hereof seeking to limit, cancel or
question the validity of any Intellectual Property or such Loan Party’s ownership interest therein that could reasonably be expected
to have a Material Adverse Effect.


 


3.10 Deposit Accounts and
Securities Accounts. Schedule 8 is a true and complete list of all deposit accounts, brokerage accounts or securities investment
accounts maintained by such Loan Party as of the date hereof, including the name and address of each institution where each such account
is held, the type of each such account and the name of such Loan Party that holds each account. Except for Control arising by operation
of law in favor of banks and securities intermediaries having custody over deposit accounts and securities accounts set forth on Schedule
8, no Person has Control of any deposit accounts and securities accounts in which any Loan Party has any interest.


 


3.11 Letter-of-Credit Rights.
Schedule 9 is a true and correct list of all letters of credit issued in favor of such Loan Party, as beneficiary thereunder,
as of the date hereof.


 


3.12 Commercial Tort Claims.
Attached hereto as Schedule 10 is a list of Commercial Tort Claims held by such Loan Party as of the date hereof, including a
brief description thereof.


 


Section 4



COVENANTS


 


Each Loan Party covenants and
agrees with the Agent that, from and after the date of this Agreement until the Obligations shall have been paid in full:


 


4.1 Delivery of Instruments,
Certificated Securities and Chattel Paper. If any amount in excess of an aggregate principal amount of $100,000 payable under or
in connection with any of the Collateral shall be or become evidenced by any Instrument, Certificated Security or Chattel Paper, such
Instrument, Certificated Security or Chattel Paper shall be promptly delivered to the Agent, duly indorsed in a manner satisfactory to
the Agent, to be held as Collateral pursuant to this Agreement.


 


4.2 Payment of Obligations.
Such Loan Party will pay and discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be,
all taxes, assessments and governmental charges or levies imposed upon the Collateral or in respect of income or profits therefrom, as
well as all claims of any kind (including, without limitation, claims for labor, materials and supplies) against or with respect to the
Collateral, except that no such tax, assessment, charge or levy need be paid if the amount or validity thereof is currently being contested
in good faith by appropriate proceedings, reserves in conformity with GAAP with respect thereto have been provided on the books of such
Loan Party or such failure to pay could not reasonably be expected to result in the sale, forfeiture or loss of any material portion
of the Collateral or any interest therein.


 






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4.3 Maintenance of Perfected
Security Interest; Further Documentation. Such Loan Party shall maintain the security interest created by this Agreement as a perfected
security interest having at least the priority described in Section 3.2 and shall defend such security interest against the claims and
demands of all Persons whomsoever subject to the rights of such Loan Party under the Loan Documents to dispose of the Collateral. Such
Loan Party will furnish to the Agent from time to time statements and schedules further identifying and describing the assets and property
of such Loan Party and such other reports in connection therewith as the Agent may reasonably request, all in reasonable detail. At any
time and from time to time, upon the written request of the Agent or the Required Lenders, and at the sole expense of such Loan Party,
such Loan Party will promptly and duly execute and deliver, and have recorded, such further instruments and documents and take such further
actions as may be necessary or advisable or as required by applicable law for the purpose of obtaining or preserving the full benefits
of this Agreement and of the rights and powers herein granted, including, without limitation, (i) filing any financing or continuation
statements under the Uniform Commercial Code (or other similar laws) in effect in any jurisdiction with respect to the security interests
created hereby and (ii) to the extent commercially reasonable, in the case of Investment Property, the Deposit Accounts, Letter-of-Credit
Rights and any other relevant Collateral, taking any actions necessary to enable the Agent to obtain “control” (within the
meaning of the applicable Uniform Commercial Code) with respect thereto. Notwithstanding anything to the contrary contained herein or
in the UCC, the Agent shall not have any obligation to (i) prepare, record, file, re-record, or re-file any financing statement, perfection
statement, continuation statement or other instrument in any public office or for otherwise ensure the perfection, maintenance, priority
or enforceability of any security interest granted pursuant to, or contemplated by, any Loan Document, (ii) take any necessary steps
to preserve rights against any parties with respect to any Collateral, or (iii) take any action to protect against any diminution in
value of the Collateral.


 


4.4 Changes in Locations,
Name, etc. Such Loan Party will not, except upon ten (10) days’ prior written notice to the Agent and delivery to the Agent
of (a) all additional executed financing statements and other documents as may be necessary or advisable or as required by applicable
law to maintain the validity, perfection and priority of the security interests provided for herein and (b) if applicable, a written
supplement to Schedule 6 showing any additional location at which material Inventory or Equipment shall be kept:


 


(a) change
its jurisdiction of organization or the location of its chief executive office or sole place of business or principal residence from that
referred to in Section 3.3; or


 


(b) change
its name, identity or corporate structure to such an extent that any financing statement filed in connection with this Agreement would
be misleading.


 






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4.5 Notices. Such Loan
Party will advise the Agent promptly in reasonable detail of:


 


(a) any
Lien (other than security interests created hereby or Liens permitted under the Credit Agreement) on any of the Collateral which would
materially adversely affect the ability of the Agent to exercise any of its remedies hereunder; and


 


(b) of
the occurrence of any other event which could reasonably be expected to have a Material Adverse Effect on the aggregate value of the Collateral
or on the security interests created hereby.


 


4.6 Investment Property.
(a) If such Loan Party shall become entitled to receive or shall receive after the date hereof any certificate (including, without limitation,
any certificate representing a dividend or a distribution in connection with any reclassification, increase or reduction of capital or
any certificate issued in connection with any reorganization), option or rights in respect of the Capital Stock of any Issuer, whether
in addition to, in substitution of, as a conversion of, or in exchange for, any shares of the Pledged Stock, or otherwise in respect
thereof, such Loan Party shall accept the same as the agent of the Agent, hold the same in trust for the Agent and deliver the same forthwith
to the Agent in the exact form received, duly indorsed by such Loan Party to the Agent, if required, together with an undated stock power
covering such certificate duly executed in blank by such Loan Party and with, if the Agent so requests, signature guaranteed, to be held
by the Agent, subject to the terms hereof, as additional collateral security for the Obligations. Any sums paid upon or in respect of
the Investment Property upon the liquidation or dissolution of any Issuer shall be paid over to the Agent to be held by it hereunder
as additional collateral security for the Obligations, and in case any distribution of capital shall be made on or in respect of the
Investment Property or any property shall be distributed upon or with respect to the Investment Property pursuant to the recapitalization
or reclassification of the capital of any Issuer or pursuant to the reorganization thereof, the property so distributed shall, unless
otherwise subject to a perfected security interest in favor of the Agent, be delivered to the Agent to be held by it hereunder as additional
collateral security for the Obligations. If any sums of money or property so paid or distributed in respect of the Investment Property
shall be received by such Loan Party, such Loan Party shall, until such money or property is paid or delivered to the Agent, hold such
money or property in trust for the Agent, segregated from other funds of such Loan Party, as additional collateral security for the Obligations.


 


(b) Without
the prior written consent of the Agent acting at the direction of the Required Lenders, such Loan Party will not (i) vote to enable, or
take any other action to permit, any Issuer to issue any Capital Stock of any nature or to issue any other securities convertible into
or granting the right to purchase or exchange for any Capital Stock of any nature of any Issuer, (ii) sell, assign, transfer, exchange,
or otherwise dispose of, or grant any option with respect to, the Investment Property or Proceeds thereof (except pursuant to a transaction
permitted by the Credit Agreement), (iii) create, incur or permit to exist any Lien or option in favor of, or any claim of any Person
with respect to, any of the Investment Property or Proceeds thereof, or any interest therein, except for the security interests created
by this Agreement or permitted by the Credit Agreement or (iv) enter into any agreement or undertaking restricting the right or ability
of such Loan Party or the Agent to sell, assign or transfer any of the Investment Property or Proceeds thereof except as permitted by
the Credit Agreement.


 






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(c) In
the case of each Loan Party which is an Issuer, such Issuer agrees that it will be bound by the terms of this Agreement relating to the
Investment Property issued by it and will comply with such terms insofar as such terms are applicable to it.


 


(d) In
the case of each Loan Party which holds Pledged Notes that have not been delivered into the possession of the Agent, such Loan Party agrees
that it will not sell, transfer or otherwise dispose of such Pledged Notes to any other party other than another Loan Party under the
Loan Documents.


 


4.7 Receivables. Other
than in the ordinary course of business consistent with its past practice and unless commercially reasonable, such Loan Party will not
(i) (as to any Receivable which is a material amount) grant any extension of the time of payment of any Receivable, (ii) compromise or
settle any Receivable for less than the full amount thereof, (iii) release, wholly or partially, any Person liable for the payment
of any Receivable, (iv) allow any credit or discount whatsoever on any Receivable or (v) amend, supplement or modify any Receivable in
any manner that could materially adversely affect the value thereof. Such Loan Party will deliver to the Agent a copy of each material
demand, notice or document received by it that questions or calls into doubt the validity or enforceability of more than 5% of the aggregate
amount of the then outstanding Receivables.


 


4.8 Deposit Accounts and
Securities Accounts. Upon the written request of the Agent or the Required Lenders, and subject to Section 4.3, each Loan Party will
obtain control agreements, in form and substance satisfactory to the Agent and the Required Lenders, with respect to deposit accounts
(excluding (i) deposit accounts established exclusively for petty cash for which amounts on deposit do not exceed $25,000 in the aggregate
with respect to all such accounts at any one time, (ii) payroll accounts, (iii) zero balance accounts and (iv) withholding and trust
accounts (collectively, the “Excluded Accounts”)) and securities accounts.


 


4.9 Letters of Credit.
Each Loan Party shall use commercially reasonable efforts to deliver to the Agent all letters of credit, duly endorsed and accompanied
by duly executed instruments of transfer or assignment, all in form and substance reasonably satisfactory to the Agent and the Required
Lenders. Each Loan Party shall take any and all actions as may be necessary, or that the Agent may reasonably request, from time to time,
to cause the Agent to obtain exclusive Control of any Letter-of-Credit Rights to the extent constituting Collateral owned by any Loan
Party with respect to the letters of credit referred to in the immediately preceding sentence in a manner reasonably acceptable to the
Agent and the Required Lenders.


 


4.10 Equipment. Each
Loan Party shall cause all Equipment owned by such Loan Party to be maintained and preserved in good operating condition, repair and
in working order, ordinary wear and tear excepted, and shall promptly make or cause to be made all repairs, replacements and other improvements
in connection therewith that are necessary or desirable to such end. Upon the request of the Agent after the occurrence and during the
continuance of an Event of Default, each Loan Party shall promptly deliver to the Agent any and all certificates of title, applications
for title or similar evidence of ownership of all Equipment to the extent constituting Collateral and shall cause the Agent to be named
as lienholder on any such certificate of title or other evidence of ownership.


 






    10


    


    

 


4.11 General Intangibles.
Each Loan Party shall use commercially reasonable efforts to obtain any consents, waivers or agreements necessary to enable the Agent
to exercise remedies hereunder and under the other Loan Documents with respect to any of such Loan Party’s rights under any General
Intangibles to the extent constituting Collateral.


 


4.12 Commercial Tort Claims.
Each Loan Party shall promptly advise the Agent in writing upon such Loan Party becoming aware that it has any interest in Commercial
Tort Claims. With respect to any Commercial Tort Claims in which any Loan Party has any interest, such Loan Party shall execute and deliver
such documents as may be necessary or desirable, or that the Agent may reasonably request, to create, perfect and protect the Agent’s
or the Required Lenders’ security interest in such Commercial Tort Claim.


 


Section 5



REMEDIAL PROVISIONS


 


5.1 Certain Matters Relating
to Receivables. If required by the Agent (acting at the direction of the Required Lenders) at any time after the occurrence and during
the continuance of an Event of Default, any payments of Receivables, when collected by any Loan Party, (i) shall be forthwith (and, in
any event, within three (3) Business Days) deposited by such Loan Party in the exact form received, duly indorsed by such Loan Party
to the Agent if required, in a Collateral Account maintained under the sole dominion and control of the Agent, subject to withdrawal
by the Agent only as provided in Section 5.5, and (ii) until so turned over, shall be held by such Loan Party in trust for the Agent,
for the benefit of the Lenders, segregated from other funds of such Loan Party. Each such deposit of Proceeds of Receivables shall be
accompanied by a report identifying in reasonable detail the nature and source of the payments included in the deposit. Upon the occurrence
and during the continuance of an Event of Default, at the reasonable request of the Agent, each Loan Party shall deliver to the Agent
all original and other documents evidencing, and relating to, the agreements and transactions which gave rise to the Receivables, including,
without limitation, all original orders, invoices and shipping receipts.


 


5.2 Communications with
Obligors; Loan Parties Remain Liable. The Agent in its own name or in the name of others may at any time after the occurrence and
during the continuance of an Event of Default communicate with obligors under the Receivables to verify with them to the satisfaction
of the Agent the existence, amount and terms of any Receivables. Upon the request of the Agent at any time after the occurrence and during
the continuance of an Event of Default, each Loan Party shall notify obligors on the Receivables that the Receivables have been assigned
to the Agent and that payments in respect thereof shall be made directly to the Agent. Anything herein to the contrary notwithstanding,
each Loan Party shall remain liable under each of the Receivables to observe and perform all the conditions and obligations to be observed
and performed by it thereunder, all in accordance with the terms of any agreement giving rise thereto. The Agent shall not have any obligation
or liability under any Receivable (or any agreement giving rise thereto) by reason of or arising out of this Agreement or the receipt
by the Agent of any payment relating thereto, nor shall the Agent be obligated in any manner to perform any of the obligations of any
Loan Party under or pursuant to any Receivable (or any agreement giving rise thereto), to make any payment, to make any inquiry as to
the nature or the sufficiency of any payment received by it or as to the sufficiency of any performance by any party thereunder, to present
or file any claim, to take any action to enforce any performance or to collect the payment of any amounts which may have been assigned
to it or to which it may be entitled at any time or times.


 






    11


    


    

 


5.3 Pledged Stock. Unless
an Event of Default shall have occurred and be continuing and the Agent (acting at the direction of the Required Lenders) shall have
given notice to the relevant Loan Party of the intent of the Agent to exercise its rights pursuant to this Section 5.3, each Loan Party
shall be permitted to receive all cash dividends paid in respect of the Pledged Stock and all payments made in respect of the Pledged
Notes, in each case paid in the normal course of business of the relevant Issuer and consistent with past practice, to the extent permitted
in the Credit Agreement, and to exercise all voting and corporate or other organizational rights with respect to the Investment Property;
provided, however, that no vote shall be cast or corporate or other organizational right exercised or other action taken
which, would materially impair the Collateral or which would be inconsistent with or result in any violation of any provision of the
Credit Agreement, this Agreement or any other Loan Document. If an Event of Default shall have occurred and be continuing and the Agent
(acting at the direction of the Required Lenders) shall give notice of its intent to exercise such rights to the relevant Loan Party
or Loan Parties, (i) the Agent shall have the right to receive any and all cash dividends, payments or other Proceeds paid in respect
of the Investment Property and make application thereof to the Obligations in accordance with Section 5.5 hereof and (ii) any or all
of the Investment Property shall be registered in the name of the Agent or its nominee, and the Agent or its nominee may thereafter exercise
(x) all voting, corporate and other rights pertaining to such Investment Property at any meeting of shareholders of the relevant Issuer
or Issuers or otherwise and (y) any and all rights of conversion, exchange and subscription and any other rights, privileges or options
pertaining to such Investment Property as if it were the absolute owner thereof (including, without limitation, the right to exchange
at its discretion any and all of the Investment Property upon the merger, consolidation, reorganization, recapitalization or other fundamental
change in the corporate or other organizational structure of any Issuer, or upon the exercise by any Loan Party or the Agent of any right,
privilege or option pertaining to such Investment Property, and in connection therewith, the right to deposit and deliver any and all
of the Investment Property with any committee, depositary, transfer agent, registrar or other designated agency upon such terms and conditions
as the Agent may determine), all without liability except to account for property actually received by it, but the Agent shall have no
duty to any Loan Party to exercise any such right, privilege or option and shall not be responsible for any failure to do so or delay
in so doing and if it does do so, shall have no liability to the Loan Parties for the sufficiency thereof. Each Loan Party hereby authorizes
and instructs each Issuer of any Investment Property pledged by such Loan Party hereunder to (i) comply with any instruction received
by it from the Agent in writing that (x) states that an Event of Default has occurred and is continuing and (y) is otherwise in accordance
with the terms of this Agreement, without any other or further instructions from such Loan Party, and each Loan Party agrees that each
Issuer shall be fully protected in so complying, and (ii) unless otherwise expressly permitted hereby, pay any dividends or other payments
with respect to the Investment Property directly to the Agent for application to the Obligations in accordance with Section 5.5 hereof.


 


5.4 Proceeds to Be Turned
Over to Agent. In addition to the rights of the Agent specified in Section 5.1 with respect to payments of Receivables, if an Event
of Default shall have occurred and be continuing, all Proceeds received by any Loan Party consisting of cash, checks and other near-cash
items shall be held by such Loan Party in trust for the Agent, segregated from other funds of such Loan Party, and shall, forthwith upon
receipt by such Loan Party, be turned over to the Agent in the exact form received by such Loan Party (duly indorsed by such Loan Party
to the Agent, if required). All Proceeds received by the Agent hereunder shall be held by the Agent in a Collateral Account maintained
under its sole dominion and control. All Proceeds while held by the Agent in a Collateral Account (or by such Loan Party in trust for
the Agent) shall continue to be held as collateral security for all the Obligations and shall not constitute payment thereof until applied
as provided in Section 5.5.


 


5.5 Application of Proceeds.
At such intervals as may be agreed upon by the Borrowers and the Agent (acting at the direction of the Required Lenders) or, if an Event
of Default shall have occurred and be continuing, (x) if such event is an Event of Default specified in paragraph (f) of Section 7 of
the Credit Agreement with respect to the Borrowers, automatically, (y) if such event is an Event of Default specified in paragraph (j)
of Section 7 of the Credit Agreement, at any time as the Agent may be so directed by any Lender or (z) if such event is any other Event
of Default, at any time as the Agent may be so directed by the Required Lenders, the Agent may apply all or any part of Proceeds constituting
Collateral, whether or not held in any Collateral Account, in payment of the Obligations in the following order: first, to any
costs, fees, expenses and other amounts incurred by the Agent in connection with this Agreement, the Credit Agreement, any other Loan
Document or any of the Obligations (including the reasonable costs, fees and expenses of its agents and legal counsel, and any costs
or expenses incurred in connection with the exercise by the Agent of any right or remedy under this Agreement, the Credit Agreement or
any other Loan Document); second, to the ratable satisfaction of the Obligations; and third, any balance of remaining Proceeds
to the Borrowers or to whomsoever may be lawfully entitled to receive the same. Any balance of such Proceeds remaining after the Obligations
shall have been paid in full shall be paid over to the Borrowers or to whomsoever may be lawfully entitled to receive the same.


 






    12


    


    

 


5.6 Code and Other Remedies.
If an Event of Default shall have occurred and be continuing, the Agent may exercise, in addition to all other rights and remedies granted
to them in this Agreement and in any other instrument or agreement securing, evidencing or relating to the Obligations, all rights and
remedies of the Agent under the New York UCC or any other applicable law. Without limiting the generality of the foregoing, the Agent,
without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required
by law referred to below) to or upon any Loan Party or any other Person (all and each of which demands, defenses, advertisements and
notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, lease, assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral
or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or private sale or sales, at any exchange,
broker’s board or office of the Agent or elsewhere upon such terms and conditions as it may deem advisable and at such prices as
it may deem best, for cash or on credit or for future delivery without assumption of any credit risk. The Agent shall have the right
upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or
any part of the Collateral so sold, free of any right or equity of redemption in any Loan Party, which right or equity is hereby waived
and released. Each Loan Party further agrees, at the Agent’s request, to assemble the Collateral and make it available to the Agent
at places which the Agent shall reasonably select, whether at such Loan Party’s premises or elsewhere. The Agent shall apply the
net proceeds of any action taken by it pursuant to this Section 5.6, after deducting all reasonable costs and expenses of every kind
incurred in connection therewith or incidental to the care or safekeeping of any of the Collateral or in any way relating to the Collateral
or the rights of the Agent hereunder, including, without limitation, reasonable attorneys’ fees and disbursements, to the payment
in whole or in part of the Obligations, in the order as set forth in Section 5.5, and only after such application and after the payment
by the Agent of any other amount required by any provision of law, including, without limitation, Section 9-615(a) of the New York UCC,
need the Agent account for the surplus, if any, to any Loan Party. To the extent permitted by applicable law, each Loan Party waives
all claims, damages and demands it may acquire against the Agent arising out of the exercise by them of any rights hereunder. If any
notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall be deemed reasonable and proper
if given at least ten (10) days before such sale or other disposition. Each Loan Party recognizes that the Agent may be unable to effect
a public sale of any or all the Collateral and may be compelled to resort to one or more private sales thereof. Each Loan Party also
acknowledges that any private sale may result in prices and other terms less favorable to the seller than if such sale were a public
sale and, notwithstanding such circumstances, agrees that any such private sale shall not be deemed to have been made in a commercially
unreasonable manner solely by virtue of such sale being private and each Loan Party waives, to the extent permitted by applicable law,
any claims against Agent and the Lenders arising by reason of the fact that the price at which the Collateral may have been sold at such
a private sale was less than the price that might have been obtained at a public sale or was less than the aggregate amount of the Obligations,
even if Agent accepts the first offer received and does not offer the Collateral to more than one offeree; provided that such
private sale is conducted in accordance with this Agreement. The Agent shall be under no obligation to delay a sale of any of the Collateral
for the period of time necessary to permit any Loan Party or the issuer of any Collateral to register such securities for public sale
under the Securities Act, or under applicable state securities laws, even if the applicable Loan Party and the issuer would agree to
do so. Each Loan Party hereby agrees that in respect of any sale of any of the Collateral pursuant to the terms hereof, the Agent is
hereby authorized to comply with any limitation or restriction in connection with such sale as it may be advised by counsel is necessary
in order to avoid any violation of applicable law, or in order to obtain any required approval of the sale or of the purchaser by any
governmental authority, and each Loan Party further agrees that such compliance shall not, in and of itself, result in such sale being
considered or deemed not to have been made in a commercially reasonable manner, nor shall Agent be liable or accountable to any Loan
Party for any discount allowed by reason of the fact that such Collateral is sold in compliance with any such limitation or restriction.


 


5.7 Deficiency. Each
Loan Party shall remain liable for any deficiency if the proceeds of any sale or other disposition of the Collateral are insufficient
to pay its Obligations and the fees and disbursements of any attorneys employed by the Agent to collect such deficiency.


 






    13


    


    

 


Section 6



MISCELLANEOUS


 


6.1 Amendments in Writing.
None of the terms or provisions of this Agreement may be waived, amended, supplemented or otherwise modified except in accordance with
Section 9.1 of the Credit Agreement.


 


6.2 Notices. All notices,
requests and demands to or upon the Agent or any Loan Party hereunder shall be effected in the manner provided for in Section 9.2 of
the Credit Agreement.


 


6.3 No Waiver by Course
of Conduct; Cumulative Remedies. The Agent shall not by any act (except by a written instrument pursuant to Section 6.1), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event
of Default. No failure to exercise, nor any delay in exercising, on the part of the Agent any right, power or privilege hereunder shall
operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. A waiver by the Agent of any right or remedy hereunder on any
one occasion shall not be construed as a bar to any right or remedy which the Agent would otherwise have on any future occasion. The
rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights
or remedies provided by law.


 


6.4 Enforcement Expenses;
Indemnification. Each Loan Party jointly and severally agrees to pay, and to save the Agent harmless from, any and all liabilities
with respect to, or resulting from any delay in paying, any and all stamp, excise, sales or other taxes which may be payable or determined
to be payable with respect to any of the Collateral or in connection with any of the transactions contemplated by this Agreement, except
to the extent such liabilities were caused by the gross negligence or willful misconduct of the Agent, as determined by a final and nonappealable
decision of a court of competent jurisdiction. Each Loan Party jointly and severally agrees to pay, and to save the Agent harmless from,
any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever with respect to the execution, delivery, enforcement, performance and administration of this Agreement to the
extent the Borrowers would be required to do so pursuant to Section 9.5 of the Credit Agreement. The agreements in this Section 6.4 shall
survive repayment of the Obligations and all other amounts payable under the Credit Agreement and the other Loan Documents and the resignation
or removal of the Agent.


 


6.5 Successors and Assigns.
This Agreement shall be binding upon the successors and assigns of each Loan Party and shall inure to the benefit of the Agent and its
successors and assigns; provided that no Loan Party may assign, transfer or delegate any of its rights or obligations under this
Agreement without the prior written consent of the Agent and the Required Lenders.


 






    14


    


    

 


6.6 Set-off. Each Loan
Party hereby irrevocably authorizes the Agent at any time and from time to time while an Event of Default shall have occurred and be
continuing, without notice to such Loan Party or any other Loan Party, any such notice being expressly waived by each Loan Party, to
set-off and appropriate and apply any and all deposits (general or special, time or demand, provisional or final), in any currency, and
any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured
or unmatured, at any time held or owing by the Agent to or for the credit or the account of such Loan Party, or any part thereof in such
amounts as the Agent may elect, against and on account of the obligations and liabilities of such Loan Party to the Agent hereunder and
claims of every nature and description of the Agent against such Loan Party, in any currency, whether arising hereunder, under the Credit
Agreement or any other Loan Document, as the Agent may elect, whether or not the Agent has made any demand for payment and although such
obligations, liabilities and claims may be contingent or unmatured. The Agent shall notify such Loan Party promptly of any such set-off
and the application made by the Agent of the proceeds thereof, provided that the failure to give such notice shall not affect
the validity of such set-off and application. The rights of the Agent under this Section 6.6 are in addition to other rights and remedies
(including, without limitation, other rights of set-off) which the Agent may have.


 


6.7 Counterparts. This
Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts (including by telecopy),
and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed signature
page of this Agreement by facsimile transmission or electronic transmission shall be effective as delivery of a manually executed counterpart
hereof. A set of the copies of this Agreement signed by all the parties shall be lodged with the Borrowers and the Agent. This Agreement
may be executed by means of (a) an electronic signature that complies with the federal Electronic Signatures in Global and National Commerce
Act, state enactments of the Uniform Electronic Transactions Act, or any other relevant and applicable electronic signatures law; (b)
an original manual signature; or (c) a faxed, scanned, or photocopied manual signature. Each electronic signature or faxed, scanned,
or photocopied manual signature shall for all purposes have the same validity, legal effect, and admissibility in evidence as an original
manual signature.


 


6.8 Severability. Any
provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.


 


6.9 Section Headings.
The Section headings used in this Agreement are for convenience of reference only and are not to affect the construction hereof or be
taken into consideration in the interpretation hereof.


 


6.10 Integration. This
Agreement and the other Loan Documents represent the agreement of the Loan Parties and the Agent with respect to the subject matter hereof,
and there are no promises, undertakings, representations or warranties by the Agent relative to subject matter hereof not expressly set
forth or referred to herein, in the other Loan Documents.


 






    15


    


    

 


6.11 Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK AND APPLICABLE
FEDERAL LAW.


 


6.12 Submission to Jurisdiction;
Waivers. Each Loan Party hereby irrevocably and unconditionally:


 


(a) submits
for itself and its property in any legal action or proceeding relating to this Agreement and the other Loan Documents to which it is a
party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts
of the State and County of New York, the courts of the United States of America for the Southern District of New York, and appellate courts
from any thereof;


 


(b) consents
that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not
to plead or claim the same;


 


(c) agrees
that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to such Loan Party at its address referred to in Section 6.2 or at such other
address of which the Agent shall have been notified pursuant thereto;


 


(d) agrees
that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right
to sue in any other jurisdiction; and


 


(e) waives,
to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in
this Section any special, exemplary, punitive or consequential damages.


 


6.13 Acknowledgments.
Each Loan Party hereby acknowledges that:


 


(a) it
has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents to which it is a
party;


 


(b) the
Agent has no fiduciary relationship with or duty to any Loan Party arising out of or in connection with this Agreement or any of the other
Loan Documents, and the relationship between the Loan Parties, on the one hand, and the Agent, on the other hand, in connection herewith
or therewith is solely that of debtor and creditor; and


 


(c) no
joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby among
the Loan Parties and the Agent or any Lender.


 






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6.14 Releases. At such
time as the Loans and the other Obligations shall have been paid in full, the Collateral shall automatically be released from the Liens
created hereby, and this Agreement and all obligations (other than those expressly stated to survive such termination) of the Agent and
each Loan Party hereunder (including all guarantee obligations) shall automatically terminate, all without delivery of any instrument
or performance of any act by any party, and all rights to the Collateral shall revert to the Loan Parties. At the request and sole expense
of any Loan Party following any such termination, the Agent shall (upon receiving the consent of the Required Lenders) deliver to such
Loan Party any Collateral held by the Agent hereunder, and execute and deliver to such Loan Party such documents as such Loan Party shall
reasonably request to evidence such termination; provided that the Loan Parties shall provide to the Agent evidence of such termination
as the Agent shall reasonably request. If any of the Collateral shall be sold, transferred or otherwise disposed of by any Loan Party
in a transaction permitted by the Credit Agreement, then the Agent, at the request and sole expense of such Loan Party, shall (upon receiving
the consent of the Required Lenders) execute and deliver to such Loan Party all releases or other documents reasonably necessary or desirable
for the release of the Liens created hereby on such Collateral; provided that the Loan Parties shall provide to the Agent evidence
of such transaction’s compliance with the Loan Documents as the Agent shall reasonably request.


 


6.15 Waiver of Jury Trial.
EACH LOAN PARTY AND THE AGENT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.


 


6.16 The Agent. It is
expressly understood and agreed by the parties to this Agreement that (i) B. Riley Securities, Inc. is entering into this Agreement and
acting hereunder solely in its capacity as Agent under the Credit Agreement and (ii) in entering into and acting as Agent hereunder,
B. Riley Securities, Inc. shall be afforded all of the rights, protections, benefits, indemnities (in addition to those set forth in
Section 6.4 hereof) and immunities granted to the Agent in the Credit Agreement as if set forth in their entirety herein. Any act, or
refusal to act, hereunder requiring the Agent to exercise discretion (including, but not limited to, the exercise of remedies following
an Event of Default) shall be exercised in accordance with the terms of the Credit Agreement. The permissive authorizations, entitlements,
powers and rights granted to the Agent herein (including the right to (i) request any documentation, (ii) request the taking of any action
and (iii) exercise any remedies) shall not be construed as duties.


 


[REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]


 




    17


    


    

 


IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be duly executed and delivered as of the date first written above.


 


		LOAN PARTIES:



CADIZ INC.
	 	 	 
	 	By:	/s/ Stanley Speer 
	 	 	Name:	Stanley Speer 
	 	 	Title:	Chief
Financial Officer
	 	 	 
	 	CADIZ REAL ESTATE LLC
	 	 	 
	 	By:	/s/
Stanley Speer
	 	 	Name:	Stanley
Speer
	 	 	Title:	Chief
Executive Officer,

 Manager and Chairman


  


[Signature Page to Security Agreement]


 




    


     


    

 





	 	AGENT:


	 	 
	 	B.
Riley Securities, Inc., as Agent


	 	 	 
	 	By:	/s/ Patrice McNicoll
	 	 	Name:	Patrice McNicoll
	 	 	Title:	Co-head Investment Banking



 


[Signature Page to Security Agreement]


 




    


     


    

 


SCHEDULE 1


 


Notice
Addresses of Loan Parties


 


[Reserved]


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 




    Sch. 1-1


     


    

 


SCHEDULE 2


 


Description
of Investment Property


 


Pledged Stock


 


	
    Issuer
	 	
    Class of
    Stock
	 	
    No. of Shares
	 	
    Stock Certificate
    

No.

	Cadiz Real Estate LLC	 	Membership Interest	 	100% Interest	 	N/A
	Octagon Partners LLC	 	Membership Interest	 	100% Interest	 	N/A
	SWI Estate Inc.	 	Common Stock	 	100% Interest	 	C-1
	
    Rancho Cadiz Mutual Water Company
	 	Common Stock	 	100% Interest	 	N/A


 


Pledged Notes


 


None.


 




    Sch. 2-1


     


    

 


SCHEDULE 3


 


Filings
and Other Actions Required to Perfect Security Interests


 


Uniform Commercial Code Filings


 


	
    Loan Party
	 	
    UCC Filing
    Jurisdictions

	Cadiz Inc.	 	Delaware

California

San Bernardino County, California
	 	 	 
	Cadiz Real Estate LLC	 	Delaware

California

San Bernardino County, California


 


Patent and Trademark Filings


None.


 


Actions with Respect to Pledged Stock and Pledged
Note


None.


 




    Sch. 3-1


     


    

 


SCHEDULE 4


 


Jurisdiction
of Organization, Organizational Number, FEIN and Chief

Executive Office 


 


	
    Loan Party
	 	
    Jurisdiction
    of

 Organization
	 	
    Organizational


    Number
	 	
    Federal
    Taxpayer 

ID Number
	 	
    Chief Executive
    

Office

	Cadiz Inc.	 	Delaware	 	2295882	 	77-0313235	 	550 South Hope Street

Suite 2850

Los Angeles, CA  90071
	Cadiz Real Estate LLC	 	Delaware	 	3729320	 	Applied For	 	550 South Hope Street

Suite 2850

Los Angeles, CA  90071


 




    Sch. 4-1


     


    

 


SCHEDULE 5


 


Owned
and Leased Property


 


Owned Property


 


Described in Schedule 1.1B (Mortgaged Properties)
to the Credit Agreement.


 


Leased Property


 


None.


 




    Sch. 5-1


     


    

 


SCHEDULE 6


 


LOCATIONS OF INVENTORY AND EQUIPMENT


 


	
    Loan Party
	 	
    Locations

	Cadiz Inc.	 	550 South Hope Street, Suite 2850, Los Angeles, CA 90071
	Cadiz Real Estate LLC	 	550 South Hope Street, Suite 2850, Los Angeles, CA 90071

96-726 National Trails Highway, CA 92304


 




    Sch. 6-1


     


    

 


SCHEDULE 7


 


INTELLECTUAL PROPERTY


 


Copyrights and Copyright Licenses


None.


 


Patents and Patent Licenses


None.


 


Trademarks and Trademark Licenses


None.


 




    Sch. 7-1


     


    

 


SCHEDULE 8


 


DEPOSIT ACCOUNTS AND SECURITIES ACCOUNTS


 


Deposit Accounts


 


	
    Owner
	 	
    Type of
    Account
	 	
    Bank Name/Address
	 	
    Account
    No.

	Cadiz Inc.	 	Certificate of Deposit	 	US Bank	 	REDACTED
	Cadiz Inc.	 	Escrow	 	US Bank	 	REDACTED
	Cadiz Inc.	 	Checking (Payroll)	 	US Bank	 	REDACTED
	Cadiz Inc.	 	Checking (Operating)	 	US Bank	 	REDACTED
	Cadiz Inc.	 	Checking (Project)	 	US Bank	 	REDACTED
	Cadiz Inc.	 	Checking (Operating)	 	US Bank	 	REDACTED 


 


Securities Accounts


None.


 




    Sch. 8-1


     


    

 


SCHEDULE 9


 


LETTER OF CREDIT RIGHTS


 


None.


 




    Sch. 9-1


     


    

 


SCHEDULE 10


 


COMMERCIAL TORT CLAIMS


 


None.


 


 


Sch. 10-1