# EDGAR Filing Document

**Accession Number:** 0001477246
**File Stem:** 0000950170-23-002539
**Filing Date:** 2023-2
**Character Count:** 969809
**Document Hash:** f03cf4991c21c1977c96049f1e7a1360
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000950170-23-002539.hdr.sgml**: 20230213

**ACCESSION NUMBER**: 0000950170-23-002539

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 94

**CONFORMED PERIOD OF REPORT**: 20221231

**FILED AS OF DATE**: 20230213

**DATE AS OF CHANGE**: 20230213

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** S&W Seed Co
- **CENTRAL INDEX KEY:** 0001477246
- **STANDARD INDUSTRIAL CLASSIFICATION:** AGRICULTURE PRODUCTION - CROPS [0100]
- **IRS NUMBER:** 271275784
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 0630

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-34719
- **FILM NUMBER:** 23614935

**BUSINESS ADDRESS:**
- **STREET 1:** 2101 KEN PRATT BLVD.
- **STREET 2:** SUITE 201
- **CITY:** LONGMONT
- **STATE:** CO
- **ZIP:** 80501
- **BUSINESS PHONE:** (720) 506-9191

**MAIL ADDRESS:**
- **STREET 1:** 2101 KEN PRATT BLVD.
- **STREET 2:** SUITE 201
- **CITY:** LONGMONT
- **STATE:** CO
- **ZIP:** 80501

?xml version="1.0" encoding="ASCII"? 10-Q

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

------

**FORM** 10-Q

------

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2022

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to _____________

Commission File Number: 001-34719

S&W SEED CO**MPANY**

(Exact Name of Registrant as Specified in Its Charter)

---

| | |
|:---|:---|
| Nevada | 27-1275784 |
| (State or Other Jurisdiction of<br>Incorporation or Organization) | (I.R.S. Employer<br>Identification No.) |
| 2101 Ken Pratt Blvd**,** Suite 201**,** Longmont**,** CO | 80501 |
| (Address of Principal Executive Offices) | (Zip Code) |

---

**(**720**)** 506-9191

(Registrant's Telephone Number, Including Area Code)

**Securities Registered Pursuant to Section 12(b) of the Act:**

---

| | | |
|:---|:---|:---|
| **Title of Each Class** | **Trading Symbol(s)** | **Name of Each Exchange on Which Registered** |
| Common Stock, par value $0.001 per share | SANW | The Nasdaq Capital Market |

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

---

| | | | |
|:---|:---|:---|:---|
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
| Emerging growth company | ☐ |  |  |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

The number of shares outstanding of common stock of the registrant as of February 7, 2023 was 42,785,565.

------

**S&W SEED COMPANY**

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
| [**<u>PART I.</u>**](#part_i) | [**<u>FINANCIAL INFORMATION</u>**](#financial_information) | **Page No.** |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 1. | [<u>Financial Statements (Unaudited):</u>](#item_1_financial_statements) | 4 |
|  | [<u>Condensed Consolidated Balance Sheets at December 31, 2022 and June 30, 2022</u>](#consolidated_balance_sheets) | 4 |
|  | [<u>Condensed Consolidated Statements of Operations for the Three Months and Six Months Ended December 31, 2022 and 2021</u>](#consolidated_statements_operations) | 5 |
|  | [<u>Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three Months and Six Months Ended December 31, 2022 and 2021</u>](#consolidated_statements_comprehensive_in) | 6 |
|  | [<u>Condensed Consolidated Statements of Mezzanine Equity and Stockholders' Equity for the Three Months and Six Months Ended December 31, 2022 and 2021</u>](#consolidated_statements_stockholders_equ) | 7 |
|  | [<u>Condensed Consolidated Statements of Cash Flows for the Six Months Ended December 31, 2022 and 2021</u>](#consolidated_statements_cash_flows) | 8 |
|  | [<u>Notes to Condensed Consolidated Financial Statements</u>](#notes_to_consolidated_financial_statemen) | 9 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 2. | [<u>Management's Discussion and Analysis of Financial Condition and Results of Operations</u>](#item_2_managements_discussion_analysis_f) | 22 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 3. | [<u>Quantitative and Qualitative Disclosures About Market Risk</u>](#item_3_quantitative_qualitative_disclosu) | 34 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 4. | [<u>Controls and Procedures</u>](#item_4_controls_procedures) | 34 |
| [**<u>PART II.</u>**](#part_ii) | [**<u>OTHER INFORMATION</u>**](#or_information) | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 1. | [<u>Legal Proceedings</u>](#item_1_legal_proceedings) | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 1A. | [<u>Risk Factors</u>](#item_1a_risk_factors) | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 2. | [<u>Unregistered Sales of Equity Securities and Use of Proceeds</u>](#item_2_unregistered_sales_equity_securit) | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 3. | [<u>Defaults Upon Senior Securities</u>](#item_3_defaults_upon_senior_securities) | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 4. | [<u>Mine Safety Disclosures</u>](#item_4_mine_safety_disclosures) | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 5. | [<u>Other Information</u>](#item_5_or_information) | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;Item 6. | [<u>Exhibits</u>](#item_6_exhibits) | 37 |

---

------

**FORWARD-LOOKING STATEMENTS**

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. All statements other than statements of historical fact could be deemed forward-looking statements, including, but not limited to: statements concerning our loan agreements, including our ability to comply with and/or secure refinancing for such loan agreements; the potential effects of global macroeconomic events and the COVID-19 pandemic on our business; the plans, strategies and objectives of management for our future operations, including our expectations for new product introductions during fiscal 2023; our implementation of our recently implemented strategic review (which includes our plans to reduce annual operating expenses) our recent partnerships with Trigall Genetics and Shell and their role in enabling us to reduce our operating expenses and sharpen our focus on key growth priorities; our ability to raise capital in the future; expected development, performance or market acceptance relating to our products or services or our ability to expand our grower or customer bases or to diversify our product offerings; future economic conditions or performance; our ability to retain key employees; and our assumptions, expectations and beliefs underlying any of the foregoing. These forward-looking statements are often identified by the use of words such as, but not limited to, "anticipate," "believe," "can," "continue," "could," "designed," "estimate," "expect," "intend," "may," "plan," "potential," "project," "seek," "should," "target," "will," "would," and similar expressions or variations intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We have based these forward-looking statements on our current expectations about future events. Such forward-looking statements are subject to risks, uncertainties and other important factors, including certain assumptions, that, if they never materialize or they prove incorrect, could cause our actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements. Risks, uncertainties and assumptions include the following:

• whether we are successful in implementing our strategies focused on growth opportunities, changes in our cost structure and improved financial performance;

• whether we are able to maintain compliance with our current loan agreements or secure replacement loan financing, including to provide access to sufficient liquidity to pay our growers and suppliers;

• the COVID-19 pandemic and other geopolitical and macroeconomic events, such as global inflation, supply chain disruptions, uncertain market conditions and the ongoing military conflict between Russia and Ukraine and related sanctions, and the extent to which they continue to disrupt the local and global economies, as well as our business and the businesses of our customers, distributors and suppliers;

• changes in demand for our seed products, including Double Team<sup>TM</sup>, our non-GMO herbicide tolerant sorghum solution;

• whether we are able to develop and successfully launch additional trait technology products;

• whether we are successful in commercializing our current and future trait technology products, including Double Team<sup>TM</sup>;

• our plans for expansion of our business (including by expanding crop offerings and market share of existing offerings through acquisitions, partnerships, joint ventures and other strategic transactions) and our ability to successfully integrate acquisitions into our operations;

• whether we continue to invest in research and development and whether such investment results in trait improvement across our crop categories;

• the continued ability of our distributors and suppliers to have access to sufficient liquidity to fund their operations;

• market trends and other factors affecting our financial condition or results of operations from period to period;

• the impact of crop disease, severe weather conditions, such as flooding, or natural disasters, such as earthquakes, on crop quality and yields and on our ability to grow, procure or export our products;

• the impact of pricing of other crops that may influence what crops our growers elect to plant;

• whether we are successful in aligning expense levels to revenue changes;

• whether we are successful in monetizing camelina and stevia;

• the cost and other implications of pending or future legislation or court decisions and pending or future accounting pronouncements;

• our recent partnerships with Trigall Genetics and Shell may not provide the anticipated benefits; and

• other risks that are described herein and in the section titled "Risk Factors" contained in Part I, Item 1A. of our Annual Report on Form 10-K for the fiscal year ended June 30, 2022, or the Annual Report, and that are otherwise described or updated from time to time in our filings with the Securities Exchange Commission.

You are urged to carefully review the disclosures made concerning risks and uncertainties that may affect our business or operating results, which include, among others, those described above.

------

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Many factors discussed in this Quarterly Report on Form 10-Q, some of which are beyond our control, will be important in determining our future performance. Consequently, these statements are inherently uncertain and actual results may differ materially from those that might be anticipated from the forward-looking statements. In light of these and other uncertainties, you should not regard the inclusion of a forward-looking statement in this Quarterly Report on Form 10-Q as a representation by us that our plans and objectives will be achieved, and you should not place undue reliance on such forward-looking statements. All forward-looking statements included herein are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Furthermore, such forward-looking statements represent our views as of, and speak only as of, the date of this Quarterly Report on Form 10-Q, and such statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. We undertake no obligation to publicly update any forward-looking statements, or to update the reasons why actual results could differ materially from those anticipated in any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

When used in this Quarterly Report on Form 10-Q, the terms "we," "us," "our," "the Company," "S&W" and "S&W Seed" refer to S&W Seed Company and its subsidiaries or, as the context may require, S&W Seed Company only. Our fiscal year ends on June 30, and accordingly, the terms "fiscal 2023," "fiscal 2022," and "fiscal 2021" in this Quarterly Report on Form 10-Q refer to the respective fiscal year ended June 30, 2023, 2022 and 2021, respectively, with corresponding meanings to any fiscal year reference beyond such dates. Trademarks, service marks and trade names of other companies appearing in this report are the property of their respective holders.

------

**PART I**

**FINANCIAL INFORMATION**

**Item 1. Financial Statements** 

**S&W SEED COMPANY** 

**CONDENSED CONSOLIDATED BALANCE SHEETS** 

**(UNAUDITED)**

---

| | | |
|:---|:---|:---|
| **ASSETS** | **December 31,<br>2022** | **June 30,<br>2022** |
| CURRENT ASSETS | CURRENT ASSETS | CURRENT ASSETS |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $1328172 | $2056508 |
| &nbsp;&nbsp;&nbsp;Accounts receivable, net | 24099180 | 19051236 |
| &nbsp;&nbsp;&nbsp;Inventories, net | 52952095 | 54515894 |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 3282244 | 1605987 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL CURRENT ASSETS | 81661691 | 77229625 |
| Property, plant and equipment, net | 15706571 | 16871669 |
| Intangibles, net | 30951270 | 34095827 |
| Right of use assets - operating leases | 4234241 | 4094253 |
| Other assets | 1667034 | 1496477 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL ASSETS | $134220807 | $133787851 |
| **LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY** |  |  |
| CURRENT LIABILITIES |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable | $15275082 | $15901116 |
| &nbsp;&nbsp;&nbsp;Deferred revenue | 6184025 | 605960 |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | 9452112 | 10788740 |
| &nbsp;&nbsp;&nbsp;Current portion of working capital lines of credit, net | 41410217 | 12678897 |
| &nbsp;&nbsp;&nbsp;Current portion of long-term debt, net | 7743900 | 8316783 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL CURRENT LIABILITIES | 80065336 | 48291496 |
| Long-term working capital lines of credit, less current portion |  | 21703286 |
| Long-term debt, net, less current portion | 3731856 | 3992540 |
| Other non-current liabilities | 3338740 | 3587041 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL LIABILITIES | 87135932 | 77574363 |
| MEZZANINE EQUITY |  |  |
| &nbsp;&nbsp;&nbsp;Preferred stock, $0.001 par value; 3,323 shares authorized; 1,695 issued and outstanding at December 31, 2022 and June 30, 2022 | 5032942 | 4804819 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL MEZZANINE EQUITY | 5032942 | 4804819 |
| STOCKHOLDERS' EQUITY |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, $0.001 par value; 75,000,000 shares authorized; 42,788,423 issued and 42,763,423 outstanding at December 31, 2022; 42,608,758 issued and 42,583,758 outstanding at June 30, 2022 | 42788 | 42609 |
| &nbsp;&nbsp;&nbsp;Treasury stock, at cost, 25,000 shares | (134196) | (134196) |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital | 165444354 | 163892575 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (116596626) | (105873557) |
| &nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (6735375) | (6560600) |
| &nbsp;&nbsp;&nbsp;Noncontrolling interests | 30988 | 41838 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL STOCKHOLDERS' EQUITY | 42051933 | 51408669 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY | $134220807 | $133787851 |

---

See notes to condensed consolidated financial statements.

------

**S&W SEED COMPANY**

**CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS**

**(UNAUDITED)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2022** | **2021** | **2022** | **2021** |
| Revenue | $12937802 | $12631409 | $32803667 | $28163090 |
| Cost of revenue | 10188511 | 10971045 | 25549865 | 23376057 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit | 2749291 | 1660364 | 7253802 | 4787033 |
| Operating expenses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 6241461 | 7073320 | 11294058 | 12642887 |
| &nbsp;&nbsp;&nbsp;Research and development expenses | 1503473 | 2110413 | 3018853 | 4105541 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 1253904 | 1373653 | 2590338 | 2704698 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 8998838 | 10557386 | 16903249 | 19453126 |
| Loss from operations | (6249547) | (8897022) | (9649447) | (14666093) |
| Other (income) expense |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Foreign currency loss | 176624 | 258482 | 367539 | 421028 |
| &nbsp;&nbsp;&nbsp;Gain on disposal of intangible assets | (1796252) |  | (1796252) |  |
| &nbsp;&nbsp;&nbsp;Change in contingent consideration obligation |  | (466376) |  | (528630) |
| &nbsp;&nbsp;&nbsp;Interest expense - amortization of debt discount | 578112 | 221196 | 861755 | 413391 |
| &nbsp;&nbsp;&nbsp;Interest expense, net | 1092327 | 589694 | 1879006 | 1142539 |
| &nbsp;&nbsp;&nbsp;Gain on sale of equity investment | (32030) |  | (32030) |  |
| &nbsp;&nbsp;&nbsp;Other income (expense) | 4561 | 23771 | (39709) | (10589) |
| Loss before income taxes | (6272889) | (9523789) | (10889756) | (16103832) |
| &nbsp;&nbsp;&nbsp;(Benefit from) provision for income taxes | (282296) | 257776 | (383960) | 91974 |
| Net loss | $(5990593) | $(9781565) | $(10505796) | $(16195806) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Loss) income attributable to noncontrolling interests | (4588) | 13537 | (10850) | (729) |
| Net loss attributable to S&W Seed Company | $(5986005) | $(9795102) | $(10494946) | $(16195077) |
| Calculation of net loss per share: |  |  |  |  |
| &nbsp;&nbsp;Net loss attributable to S&W Seed Company | $(5986005) | $(9795102) | $(10494946) | $(16195077) |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividends accrued for participating securities and accretion | (114062) |  | (228123) |  |
| &nbsp;&nbsp;Net loss attributable to common shareholders | $(6100067) | $(9795102) | $(10723069) | $(16195077) |
| &nbsp;&nbsp;Net loss attributable to S&W Seed Company per common share,<br>&nbsp;&nbsp;&nbsp;&nbsp;basic and diluted | $(0.14) | $(0.25) | $(0.25) | $(0.43) |
| &nbsp;&nbsp;Weighted average number of common shares outstanding, <br>&nbsp;&nbsp;&nbsp;&nbsp;basic and diluted | 42651270 | 38461049 | 42627645 | 37617457 |

---

See notes to condensed consolidated financial statements.

------

**S&W SEED COMPANY**

**CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)**

**(UNAUDITED)** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2022** | **2021** | **2022** | **2021** |
| Net loss | $(5990593) | $(9781565) | $(10505796) | $(16195806) |
| Foreign currency translation adjustment, net of income taxes | 539520 | 253349 | (174775) | (207778) |
| Comprehensive loss | (5451073) | (9528216) | (10680571) | (16403584) |
| Comprehensive (loss) income attributable to noncontrolling interests | (4588) | 13537 | (10850) | (729) |
| Comprehensive loss attributable to S&W Seed Company | $(5446485) | $(9541753) | $(10669721) | $(16402855) |

---

See notes to condensed consolidated financial statements.

------

**S&W SEED COMPANY**

**CONDENSED CONSOLIDATED STATEMENTS OF MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY**

**(UNAUDITED)**

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Mezzanine Equity** | **Mezzanine Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** |
|  | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | **Treasury Stock** | **Treasury Stock** | **Additional<br>Paid-In** | **Accumulated** | **Non-<br>controlling** | **Accumulated<br>Other<br>Comprehensive** | **Total<br>Stockholders'** |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Capital** | **Deficit** | **Interests** | **Loss** | **Equity** |
| **Balance, September 30, 2021** |  | $— | 36802094 | $36802 | (25000) | $(134196) | $150040406 | $(75711884) | $(45272) | $(6311953) | $67873903 |
| Stock-based compensation |  |  |  |  |  |  | 1014203 |  |  |  | 1014203 |
| Net issuance to settle RSUs |  |  | 265223 | 265 |  |  | (117838) |  |  |  | (117573) |
| Proceeds from sale of common stock, net expenses |  |  | 1847343 | 1848 |  |  | 4916364 |  |  |  | 4918212 |
| Other comprehensive income (loss) |  |  |  |  |  |  |  |  |  | 253349 | 253349 |
| Net (loss) income |  |  |  |  |  |  |  | (9795102) | 13537 |  | (9781565) |
| **Balance, December 31, 2021** |  | $— | 38914660 | $38915 | (25000) | $(134196) | $155853135 | $(85506986) | $(31735) | $(6058604) | $64160529 |
| **Balance, September 30, 2022** | 1695 | $4918880 | 42632585 | $42633 | (25000) | $(134196) | $164486927 | $(110496559) | $35576 | $(7274895) | $46659486 |
| Stock-based compensation |  |  |  |  |  |  | 305894 |  |  |  | 305894 |
| Series B detachable warrant |  | 25838 |  |  |  |  |  | (25838) |  |  | (25838) |
| Accrued dividends on Series B convertible preferred stock |  | 88224 |  |  |  |  |  | (88224) |  |  | (88224) |
| Subordinated loan & security agreement warrants |  |  |  |  |  |  | 656427 |  |  |  | 656427 |
| Net issuance to settle RSUs |  |  | 155838 | 155 |  |  | (4894) |  |  |  | (4739) |
| Other comprehensive income (loss) |  |  |  |  |  |  |  |  |  | 539520 | 539520 |
| Net (loss) income |  |  |  |  |  |  |  | (5986005) | (4588) |  | (5990593) |
| **Balance, December 31, 2022** | 1695 | $5032942 | 42788423 | $42788 | (25000) | $(134196) | $165444354 | $(116596626) | $30988 | $(6735375) | $42051933 |
|  | **Mezzanine Equity** | **Mezzanine Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** | **Shareholders' Equity** |
|  | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | **Treasury Stock** | **Treasury Stock** | **Additional<br>Paid-In** | **Accumulated** | **Non-<br>controlling** | **Accumulated<br>Other<br>Comprehensive** | **Total<br>Stockholders'** |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Capital** | **Deficit** | **Interests** | **Loss** | **Equity** |
| **Balance, June 30, 2021** |  | $— | 36772983 | $36773 | (25000) | $(134196) | $149684357 | $(69311909) | $(31006) | $(5850826) | $74393193 |
| Stock-based compensation |  |  |  |  |  |  | 1408515 |  |  |  | 1408515 |
| Net issuance to settle RSUs |  |  | 293486 | 293 |  |  | (158581) |  |  |  | (158288) |
| Proceeds from sale of common stock, net of expenses |  |  | 1848191 | 1849 |  |  | 4918844 |  |  |  | 4920693 |
| Other comprehensive loss |  |  |  |  |  |  |  |  |  | (207778) | (207778) |
| Net loss |  |  |  |  |  |  |  | (16195077) | (729) |  | (16195806) |
| **Balance, December 31, 2021** |  | $— | 38914660 | $38915 | (25000) | $(134196) | $155853135 | $(85506986) | $(31735) | $(6058604) | $64160529 |
| **Balance, June 30, 2022** | 1695 | $4804819 | 42608758 | $42609 | (25000) | $(134196) | $163892575 | $(105873557) | $41838 | $(6560600) | $51408669 |
| Stock-based compensation |  |  |  |  |  |  | 762006 |  |  |  | 762006 |
| Series B detachable warrant |  | 51676 |  |  |  |  |  | (51676) |  |  | (51676) |
| Accrued dividends on Series B convertible preferred stock |  | 176447 |  |  |  |  |  | (176447) |  |  | (176447) |
| Subordinated loan & security agreement warrants |  |  |  |  |  |  | 802901 |  |  |  | 802901 |
| Net issuance to settle RSUs |  |  | 179665 | 179 |  |  | (13128) |  |  |  | (12949) |
| Other comprehensive loss |  |  |  |  |  |  |  |  |  | (174775) | (174775) |
| Net loss |  |  |  |  |  |  |  | (10494946) | (10850) |  | (10505796) |
| **Balance, December 31, 2022** | 1695 | $5032942 | 42788423 | $42788 | (25000) | $(134196) | $165444354 | $(116596626) | $30988 | $(6735375) | $42051933 |

---

See notes to condensed consolidated financial statements.

------

**S&W SEED COMPANY**

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(UNAUDITED)**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2022** | **2021** |
| CASH FLOWS FROM OPERATING ACTIVITIES |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | $(10505796) | $(16195806) |
| &nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss from operating activities to net |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 762006 | 1408515 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for doubtful accounts | (125209) | 221163 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory write-down | 685200 | 742035 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 2590338 | 2704698 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on disposal of property, plant and equipment | (4411) | (35840) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of equity investment | (32030) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on disposal of intangible assets | (1796252) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in deferred tax provision | (259747) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in foreign exchange contracts | 19466 | 239713 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign currency transactions | (200666) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in contingent consideration obligation |  | (528630) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of debt discount | 861755 | 413391 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (3968108) | 2513639 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | 557442 | (5741778) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 20736 | 170844 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current assets | (733165) | (95186) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | (385529) | 1131032 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenue | 5578365 | 5504147 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | (1256423) | (505240) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current liabilities | (207625) | (12521) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in operating activities | (8399653) | (8065824) |
| CASH FLOWS FROM INVESTING ACTIVITIES |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Additions to property, plant and equipment | (154997) | (1227368) |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from disposal of property, plant and equipment | 3660 | 21113 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net proceeds from sale of equity investment | 400000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from partnership transaction | 2000000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by (used in) investing activities | 2248663 | (1206255) |
| CASH FLOWS FROM FINANCING ACTIVITIES |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net proceeds from sale of common stock |  | 4920693 |
| &nbsp;&nbsp;&nbsp;&nbsp;Taxes paid related to net share settlements of stock-based compensation awards | (12949) | (158288) |
| &nbsp;&nbsp;&nbsp;&nbsp;Borrowings and repayments on lines of credit, net | 6598076 | 3911452 |
| &nbsp;&nbsp;&nbsp;&nbsp;Borrowings of long-term debt | 285005 | 875683 |
| &nbsp;&nbsp;&nbsp;&nbsp;Debt issuance costs | (359527) | (112084) |
| &nbsp;&nbsp;&nbsp;&nbsp;Repayments of long-term debt | (1063661) | (737843) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by financing activities | 5446944 | 8699613 |
| EFFECT OF EXCHANGE RATE CHANGES ON CASH | (24290) | (233405) |
| NET DECREASE IN CASH & CASH EQUIVALENTS | (728336) | (805871) |
| CASH AND CASH EQUIVALENTS, beginning of the period | 2056508 | 3527937 |
| CASH AND CASH EQUIVALENTS, end of period | $1328172 | $2722066 |

---

See notes to condensed consolidated financial statements.

------

**S&W SEED COMPANY**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**NOTE 1 - GENERAL** 

The Company is a global multi-crop, middle-market agricultural company that is principally engaged in breeding, growing, processing and selling agricultural seeds. The Company operates seed cleaning and processing facilities, which are located in Idaho, Texas, New South Wales and South Australia. The Company's seed products are primarily grown under contract by farmers. The Company is currently focused on commercializing stevia products, entering the camelina market and developing products to address unmet market needs through high-value improved traits in its crops.

**Investments and Partnership Activity** 

Bioceres Investment

As of June 30, 2021, the Company held an investment in Bioceres, S.A., a provider of crop productivity solutions headquartered in Argentina. During the third quarter of fiscal year 2022, the Company sold 71.4% of the investment in Bioceres, S.A. for net proceeds of $988,504, which included a gain on the sale of marketable securities of $68,967. The carrying value of the remainder of the investment was $367,980 at June 30, 2022, which was reported in Other assets on the Company's consolidated balance sheet. During the six months ended December 31, 2022, the Company sold off the remainder of its investment in Bioceres, S.A. for net proceeds of $400,000, which included a gain on the sale of equity investment of $32,030.

Trigall Australia Partnership

Effective December 23, 2022, the Company's wholly owned subsidiary, S&W Seed Company Australia Pty Ltd, or S&W Australia, entered into a partnership with Trigall Genetics S.A., or Trigall, for the development and marketing of wheat varieties in Australia. Under the terms of the partnership agreement, S&W Australia transferred certain intellectual property license rights and equipment into a wholly owned subsidiary and subsequently sold an 80% interest in the subsidiary to Trigall. The subsidiary was renamed Trigall Australia Pty Ltd, or Trigall Australia. In return, S&W Australia received $2.0 million in cash, a $1.0 million promissory note to be paid in December 2023, and a 20% ownership interest in Trigall Australia. S&W Australia realized a $1.8 million gain on the sale. The ownership interest in Trigall Australia was recorded using the equity method and, along with the $1.0 million promissory note, is reported within the "Other assets" caption on the condensed consolidated balance sheet.

S&W Australia is obligated to make an aggregate of $560,000 in capital contributions to Trigall Australia through June 2025, and has agreed to provide certain marketing, collection and other operational services in support of the partnership.

Shell Partnership

On February 6, 2023, S&W and Equilon Enterprises LLC (dba Shell Oil Products US, or Shell), entered into a partnership for the development and production of sustainable biofuel feedstocks through Vision Bioenergy Oilseeds LLC, or Vision Bioenergy (see Note 13).

**Basis of Presentation**

The accompanying condensed consolidated financial statements are unaudited and, in the Company's opinion, include all adjustments, consisting of normal recurring adjustments and accruals, necessary for a fair statement of the Company's consolidated balance sheets, statements of operations, comprehensive income (loss), cash flows and mezzanine equity and stockholders' equity for the periods presented. Operating results for the periods presented are not necessarily indicative of the results to be expected for the full year ending June 30, 2023. Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been omitted in accordance with the rules and regulations of the SEC. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Annual Report on Form 10-K for the fiscal year ended June 30, 2022, as filed with the SEC.

Certain prior period information has been reclassified to conform to the current period presentation. Operating lease right-of-use assets were reclassified from "Other assets" to "Right-of-use assets – operating leases" on the balance sheet in accordance with the disclosure guidance of ASC 842. Previously, the operating lease right-of-use assets were disclosed in the footnotes.

**Use of Estimates**

The preparation of financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Estimates are adjusted to reflect actual experience when necessary. Significant estimates and assumptions affect many items in the financial statements. These include allowance for doubtful

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trade receivables, inventory valuation, asset impairments, provisions for income taxes, grower accruals (an estimate of amounts payable to farmers who grow seed for the Company), contingent consideration obligations, contingencies and litigation. Significant estimates and assumptions are also used to establish the fair value and useful lives of depreciable tangible and certain intangible assets, goodwill as well as valuing stock-based compensation. Actual results may differ from those estimates and assumptions, and such results may affect income, financial position or cash flows.

The Company believes the estimates and assumptions underlying the accompanying condensed consolidated financial statements are reasonable and supportable based on the information available at the time the financial statements were prepared. However, certain adverse geopolitical and macroeconomic events, such as the continued impact of COVID-19, the ongoing conflict between Ukraine and Russia and related sanctions, and uncertain market conditions, including higher inflation and supply chain disruptions, have, among other things, negatively impacted the global economy, created significant volatility and disruption of financial markets, and significantly increased economic and demand uncertainty. These factors make many of the estimates and assumptions reflected in these condensed consolidated financial statements inherently less certain. Therefore, actual results may ultimately differ from those estimates to a greater degree than historically.

**NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

**Liquidity and Going Concern**

For the six months ended December 31, 2022, we reported a net loss of $10.5 million and net cash used in operations of $8.4 million. At December 31, 2022, we had cash on hand of $1.3 million.

The Company's Loan and Security Agreement, dated December 26, 2019, or the CIBC Loan Agreement, with CIBC Bank USA, or CIBC, which matures on March 23, 2023 ($16.2 million outstanding as of December 31, 2022), and its debt facilities with National Australia Bank, or NAB, contain various operating and financial covenants (see Note 7). Adverse geopolitical and macroeconomic events and other factors affecting the Company's results of operations have increased the risk of the Company's inability to comply with these covenants, which could result in acceleration of its repayment obligations and foreclosure on its pledged assets. For example, the Company was not in compliance with certain covenants in the CIBC Loan Agreement as of June 30, 2021, December 31, 2021, March 31, 2022, June 15, 2022 and June 30, 2022, and was required to obtain waivers and/or amendments from CIBC. The CIBC Loan Agreement as presently in effect requires the Company to maintain minimum liquidity of no less than $1.0 million, and the NAB Finance Agreement (as defined below) includes an undertaking that requires the Company to maintain a net related entity position of not more than USD $18.5 million. The Company is actively pursuing refinancing of the CIBC Loan Agreement. There can be no assurance the Company will be successful in raising additional capital, securing future waivers and/or amendments from its lenders, renewing or refinancing its existing debt or securing new financing. If the Company is unsuccessful in doing so, it may need to reduce the scope of its operations, repay amounts owing to its lenders or sell certain assets. These operating and liquidity factors raise substantial doubt regarding the Company's ability to continue as a going concern. The Company's consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

**Accounts Receivable** 

The Company provides an allowance for doubtful trade receivables equal to the estimated uncollectible amounts. That estimate is based on historical collection experience, current economic and market conditions and a review of the current status of each customer's trade accounts receivable. The allowance for doubtful trade receivables was $180,334 and $233,927 at December 31, 2022 and June 30, 2022, respectively.

**Inventories**

Components of inventory are as follows:

---

| | | |
|:---|:---|:---|
|  | **As of** | **As of** |
|  | **December 31, 2022** | **June 30, 2022** |
| Raw materials and supplies | $3808923 | $2645764 |
| Work in progress | 11035458 | 6677980 |
| Finished goods | 38107714 | 45192150 |
| &nbsp;&nbsp;&nbsp;Inventories, net | $52952095 | $54515894 |

---

**Income Taxes** 

Deferred tax assets and liabilities are determined based on differences between the financial statement and tax basis of assets and liabilities, as well as a consideration of net operating loss and credit carry forwards, using enacted tax rates in effect for the period in which the differences are expected to impact taxable income. A valuation allowance is established, when necessary, to reduce deferred tax

------

assets to the amount that is more likely than not to be realized. The Company's effective tax rate for the three and six months ended December 31, 2022 and December 31, 2021 has been affected by the valuation allowance on the Company's deferred tax assets as well as the gain related to the formation of our wheat partnership with Trigall.

**Net Loss Per Common Share Data** 

The Company computes earnings per share using the two-class method. The two-class method requires an earnings allocation formula that determines earnings per share for common shareholders and participating security holders according to dividends declared and participating rights in undistributed earnings. The Company's Series B Preferred Stock and related warrant, or Series B Warrant (see Note 14 of the Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended June 30, 2022, as filed with the SEC) are participating securities because holders of such shares have non-forfeitable dividend rights and participate in any undistributed earnings with common stock. Under the two-class method, total dividends provided to the holders of participating securities and undistributed earnings allocated to participating securities, are subtracted from net income attributable to the Company in determining net loss attributable to common shareholders. There were $88,224 and $176,447 in accrued dividends subtracted from net income attributable to common shareholders during the three and six months ended December 31, 2022, respectively; there were no undistributed earnings to allocate to the participating securities. Additionally, any accretion to the redemption value for the Series B Preferred Stock is treated as a deemed dividend in the two-class earnings per share, or EPS, calculation. During the three and six months ended December 31, 2022, $25,838 and $51,676, respectively, was accreted to the redemption value of the Series B Preferred Stock and subtracted from net income attributable to common shareholders. During the three and six months ended December 31, 2022, there were no undistributed earnings to allocate to the participating securities.

The calculation of net loss per common share is shown in the table below.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended <br>December 31,** | **Three Months Ended <br>December 31,** | **Six Months Ended <br>December 31,** | **Six Months Ended <br>December 31,** |
|  | **2022** | **2021** | **2022** | **2021** |
| **Numerator:** |  |  |  |  |
| Net loss attributable to S&W Seed Company | $(5986005) | $(9795102) | $(10494946) | $(16195077) |
| &nbsp;&nbsp;Dividends accrued for participating securities | (88224) |  | (176447) |  |
| &nbsp;&nbsp;Accretion of Series B Preferred Stock redemption value | (25838) |  | (51676) |  |
| **Numerator for net loss per common share - basic and diluted** | $(6100067) | $(9795102) | $(10723069) | $(16195077) |
| **Denominator:** |  |  |  |  |
| Weighted average shares outstanding - basic and diluted | 42651270 | 38461049 | 42627645 | 37617457 |
| Net loss per common share - basic and diluted | $(0.14) | $(0.25) | $(0.25) | $(0.43) |

---

Anti-dilutive shares, which have been excluded from the computation of diluted loss per share, included 4,580,057 employee stock options, 497,921 restricted stock units, or RSUs, and warrants to purchase 1,333,400 shares of common stock related to the MFP Loan Agreement (as defined below), and 559,350 Warrants issued with the Company's Series B Convertible Preferred Stock. The terms and conditions of these securities are more fully described in Note 9 and Note 10 in these condensed consolidated financial statements and in Note 13 and Note 14 of the Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended June 30, 2021, as filed with the SEC. For the periods ending December 31, 2022 and 2021, all potentially dilutive shares were anti-dilutive and excluded from the calculation of diluted loss per share because net losses were recognized.

**Concentrations**

One customer accounted for 8% and 11% of the Company's revenue for the three and six months ended December 31, 2022, respectively, and no single customer accounted for more than 10% of the Company's revenue for the three and six months ended December 31, 2021.

One customer accounted for approximately 15% of the Company's accounts receivable as of December 31, 2022. No customer accounted for more than 10% of the Company's accounts receivable as of June 30, 2022.

The Company sells a substantial portion of its products to international customers (see Note 4). Sales to international markets represented 86% and 81% of revenue during the three months ended December 31, 2022 and 2021, respectively. Sales to international markets represented 81% and 78% of revenue during the six months ended December 31, 2022 and 2021, respectively. The net book value of fixed assets located outside the United States was 21% and 22% of total fixed assets at December 31, 2022 and June 30, 2022, respectively. Cash balances located outside of the United States may not be insured and totaled $420,595 and $811,551 at December 31, 2022 and June 30, 2022, respectively.

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**Derivative Financial Instruments**

The Company's subsidiary, S&W Australia, is exposed to foreign currency exchange rate fluctuations in the normal course of its business, which the Company at times manages through the use of foreign currency derivative financial instruments.

The Company has entered into foreign currency forward contracts and foreign currency call options (see Note 8) and accounts for these instruments in accordance with ASC Topic 815, "Derivatives and Hedging," which establishes accounting and reporting standards requiring that derivative instruments be recorded on the balance sheet as either an asset or liability measured at fair value. The Company's foreign currency contracts and options are not designated as hedging instruments under ASC 815; accordingly, changes in the fair value are recorded in current period earnings.

Premiums paid for foreign currency options with strike prices below the spot market price when acquired represent the time value of the option, as there is no intrinsic value. Such premiums are recorded as a current asset and amortized over the option term. Currency options are measured at fair value if the market price at the reporting date exceeds the strike price. When the strike price exceeds the market price, no liability is recorded as the Company has no obligation to exercise the options.

**Fair Value of Financial Instruments** 

The Company discloses assets and liabilities that are recognized and measured at fair value, presented in a three-tier fair value hierarchy, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Level 1. Observable inputs such as quoted prices in active markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The carrying value of cash and cash equivalents, financial commitment assets (see Note 9), the promissory note issued from Trigall (see Note 1), accounts payable, short-term and all long-term borrowings, as reflected in the condensed consolidated balance sheets, approximate fair value because of the short-term maturity of these instruments or interest rates commensurate with market rates. There have been no changes in operations and/or credit characteristics since the date of issuance that could impact the relationship between interest rate and market rates.

Assets and liabilities that are recognized and measured at fair value on a recurring basis are categorized as follows:

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| | | | |
|:---|:---|:---|:---|
|  | **Fair Value Measurements as of December 31, 2022 Using:** | **Fair Value Measurements as of December 31, 2022 Using:** | **Fair Value Measurements as of December 31, 2022 Using:** |
|  | **Level 1** | **Level 2** | **Level 3** |
| Foreign exchange contract liability | $— | $1009469 | $— |
| &nbsp;&nbsp;&nbsp;Total | $— | $1009469 | $— |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Fair Value Measurements as of June 30, 2022 Using:** | **Fair Value Measurements as of June 30, 2022 Using:** | **Fair Value Measurements as of June 30, 2022 Using:** |
|  | **Level 1** | **Level 2** | **Level 3** |
| Foreign exchange contract liability | $— | $996106 | $— |
| &nbsp;&nbsp;&nbsp;Total | $— | $996106 | $— |

---

**Recent Accounting Pronouncements Not Yet Adopted**

We have evaluated all issued and unadopted Accounting Standards Updates and believe the adoption of these standards will not have a material impact on our condensed consolidated statements of operations, comprehensive income, balance sheets, or cash flows.

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**NOTE 3 - LEASES**

The Company leases office and laboratory space, research plots and equipment used in connection with its operations under various operating and finance leases. The components of lease assets and liabilities as of December 31, 2022 are as follows:

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| | | |
|:---|:---|:---|
| **Leases** | **Balance Sheet Classification:** | **December 31, 2022** |
| **Assets:** |  |  |
| Right of use assets - operating leases | Right of use assets - operating leases | 4234241 |
| Right of use assets - finance leases |  | 2011082 |
| Accumulated amortization - finance leases |  | (1361998) |
| &nbsp;&nbsp;Right of use assets - finance leases, net | Other assets | 649084 |
| &nbsp;&nbsp;&nbsp;Total lease assets |  | 4883325 |
| **Liabilities:** |  |  |
| Current lease liabilities - finance leases | Current portion of long-term debt, net | 608663 |
| Current lease liabilities - operating leases | Accrued expenses and other current liabilities | 1429482 |
| Long-term portion of lease liabilities - finance leases | Long-term debt, net, less current portion | 239238 |
| Long-term portion of lease liabilities - operating leases | Other non-current liabilities | 3078345 |
| &nbsp;&nbsp;&nbsp;Total lease liabilities |  | 5355728 |

---

The components of lease cost are as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Lease cost:** | **Income Statement Classification:** | **Three Months Ended December 31, 2022** | **Six Months Ended December 31, 2022** |
| Operating lease cost | Cost of revenue | $163389 | $347249 |
| Operating lease cost | Selling, general and administrative expenses | 54914 | 110248 |
| Operating lease cost | Research and development expenses | 88620 | 224817 |
| Finance lease cost | Depreciation and amortization | 125949 | 265639 |
| Finance lease cost | Interest expense, net | 12841 | 28791 |
| &nbsp;&nbsp;&nbsp;Total lease costs |  | $445713 | $976744 |

---

Maturities of lease liabilities as of December 31, 2022 are as follows:

---

| | | |
|:---|:---|:---|
|  | **Operating Leases** | **Finance Leases** |
| 2023 | $907671 | $440777 |
| 2024 | 1527845 | 321631 |
| 2025 | 1024653 | 98337 |
| 2026 | 791258 | 23091 |
| 2027 | 509239 |  |
| Thereafter | 102165 |  |
| &nbsp;&nbsp;&nbsp;Total lease payments | 4862831 | 883836 |
| Less: Interest | (355004) | (35935) |
| &nbsp;&nbsp;&nbsp;Present value of lease liabilities | $4507827 | $847901 |

---

The following are the weighted average assumptions used for lease term and discount rate and supplemental cash flow information related to leases as of December 31, 2022:

---

| | |
|:---|:---|
| Operating lease remaining lease term | 3.5 |
| Operating lease discount rate | 4.14% |
| Finance lease remaining lease term | 1.2 years |
| Finance lease discount rate | 5.49% |
| Cash paid for operating leases | $603304 |
| Cash paid for finance leases | 527384 |

---

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**NOTE 4 - REVENUE RECOGNITION**

The Company derives its revenue primarily from the sale of seed products to seed distributors. From time to time, the Company utilizes excess capacity to provide conditioning, treating and packaging services to other seed producers.

Revenue from seed product sales is recognized at the point in time at which control of the product is transferred to the customer. Generally, this occurs upon shipment of the product. Pricing for such transactions is negotiated and determined at the time the contracts are signed. We have elected the practical expedient that allows us to account for shipping and handling activities as a fulfillment cost, and we accrue those costs when the related revenue is recognized.

The Company has certain contracts with customers that offer a limited right of return on certain branded products through the end of the current sales year (September through August). The products must be in an unopened and undamaged state and must be resalable in the sole opinion of the Company to qualify for refund. The Company uses a historical returns percentage to estimate the refund liability and records a reduction of revenue in the period in which revenue is recognized.

**Contract Assets and Liabilities**

Accounts receivable represent amounts that are payable to the Company by its customers subject only to the passage of time. Payment terms on invoices are generally 30 to 180 days for export customers and end of sales season (September 30<sup>th</sup>) for branded products sold within the United States. As the period between the transfer of goods and/or services to the customer and receipt of payment is less than one year, the Company does not separately account for a financing component in its contracts with customers.

The Company provides an allowance for doubtful trade receivables equal to the estimated uncollectible amounts (see Note 2). When it becomes probable that a trade receivable will not be collected, it is written off against the allowance for doubtful accounts. If an account that has been written off is subsequently corrected, the provision for doubtful receivables is reversed, which can result in a net negative provision in a period. During the three and six months ended December 31, 2022, the Company recorded a net provision for doubtful receivables of $30,212 and a net reversal of the provision for doubtful receivables of $(125,209), respectively.

Deferred revenue represents payments received from customers in advance of completion of the Company's performance obligation. During the six months ended December 31, 2022, the Company recognized $0.6 million of revenue that was included in the deferred balance as of June 30, 2022. During the six months ended December 31, 2021, the Company recognized $0.4 million of revenue that was included in the deferred balance as of June 30, 2021.

**Disaggregation of Revenue**

The Company disaggregates revenue by type of contract and by destination country. The following table shows revenue from external sources by type of contract:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2022** | **2021** | **2022** | **2021** |
| Seed sales | $12834831 | $11818392 | $32672618 | $26723793 |
| Services | 102971 | 813017 | 131049 | 1439297 |
| &nbsp;&nbsp;&nbsp;Total revenue | $12937802 | $12631409 | $32803667 | $28163090 |

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The following tables show revenue and percentage of revenue from external sources by destination country:

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2022** | **2022** | **2021** | **2021** | **2022** | **2022** | **2021** | **2021** |
| Saudi Arabia | $2165680 | 17% | $1680546 | 13% | $7337966 | 22% | $5147756 | 18% |
| United States | 1843826 | 14% | $2404078 | 19% | 6104580 | 19% | 6069406 | 22% |
| Australia | 2501634 | 19% | $2245847 | 18% | 5059366 | 15% | 5679852 | 20% |
| Libya | 1162 | 0% | $44000 | 0% | 2999209 | 9% | 1088000 | 4% |
| Mexico | 1799590 | 14% | $94000 | 1% | 2530690 | 8% | 322420 | 1% |
| Sudan | 1508599 | 12% | $— | 0% | 2310643 | 7% | 819618 | 3% |
| Pakistan | 531471 | 4% | $2067506 | 16% | 1353091 | 4% | 2231561 | 8% |
| South Africa | 933927 | 7% | $1378781 | 11% | 933927 | 3% | 1378781 | 5% |
| Argentina | 443474 | 3% | $1058308 | 8% | 806452 | 2% | 1409147 | 5% |
| Algeria |  | 0% | $186000 | 1% | 754680 | 2% | 186000 | 1% |
| Other | 1208439 | 9% | $1472343 | 12% | 2613063 | 8% | 3830549 | 14% |
| &nbsp;&nbsp;&nbsp;Total revenue | $12937802 | 100% | $12631409 | 100% | $32803667 | 100% | $28163090 | 100% |

---

------

**NOTE 5 – INTANGIBLE ASSETS** 

Intangible assets consist of the following:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Balance at<br>June 30, 2022** | **Transfer to Trigall Australia** | **Amortization** | **Currency Translation Adjustment** | **Balance at December 31, 2022** |
| Trade name | $1084791 | $— | $(98148) | $(3290) | $983353 |
| Customer relationships | 5499815 |  | (176526) | (59071) | 5264218 |
| GI customer list | 42983 |  | (3582) |  | 39401 |
| Supply agreement | 775241 |  | (37817) |  | 737424 |
| Grower relationships | 1331581 |  | (52703) |  | 1278878 |
| Intellectual property | 23035925 |  | (692933) |  | 22342992 |
| License agreement | 1986598 | (1885907) | (75610) | (25081) |  |
| Internal use software | 338893 |  | (33889) |  | 305004 |
|  | $34095827 | $(1885907) | $(1171208) | $(87442) | $30951270 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Balance at<br>June 30, 2021** | **Other Additions and Disposals** | **Amortization** | **Currency Translation Adjustment** | **Balance at<br>June 30, 2022** |
| Trade name | $1310489 | $— | $(203009) | $(22689) | $1084791 |
| Customer relationships | 6302591 |  | (373393) | (429383) | 5499815 |
| Non-compete | 5058 |  | (5058) |  |  |
| GI customer list | 50146 |  | (7163) |  | 42983 |
| Supply agreement | 850874 |  | (75633) |  | 775241 |
| Grower relationships | 1436988 |  | (105407) |  | 1331581 |
| Intellectual property | 24427857 |  | (1391932) |  | 23035925 |
| License agreement | 2340269 |  | (172004) | (181667) | 1986598 |
| Internal use software | 406670 |  | (67777) |  | 338893 |
|  | $37130942 | $— | $(2401376) | $(633739) | $34095827 |

---

On December 23, 2022, the Company transferred certain intellectual property rights under a license agreement to Trigall Australia as part of its equity investment in the partnership (see Note 1). Amortization expense totaled $581,212 and $601,649 for the three months ended December 31, 2022 and 2021, respectively. Amortization expense totaled $1,171,208 and $1,206,138 for the six months ended December 31, 2022 and 2021, respectively.

Estimated aggregate remaining amortization is as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2023** | **2024** | **2025** | **2026** | **2027** | **Thereafter** |
| Amortization expense | $1080323 | $2160322 | $2119891 | $1979781 | $1928897 | $21682056 |

---

**NOTE 6 - PROPERTY, PLANT AND EQUIPMENT**

Components of property, plant and equipment were as follows:

---

| | | |
|:---|:---|:---|
|  | **As of** | **As of** |
|  | **December 31, 2022** | **June 30, 2022** |
| Land and improvements | $2260672 | $2265087 |
| Buildings and improvements | 8130736 | 8119960 |
| Machinery and equipment | 14839714 | 14972462 |
| Vehicles | 1082908 | 1085342 |
| Leasehold improvements | 552811 | 552810 |
| Construction in progress | 24585 | 110107 |
| Total property, plant and equipment | 26891426 | 27105768 |
| Less: accumulated depreciation | (11184855) | (10234099) |
| &nbsp;&nbsp;&nbsp;Property, plant and equipment, net | $15706571 | $16871669 |

---

------

Depreciation expense totaled $546,743 and $614,078 for the three months ended December 31, 2022 and 2021, respectively.

Depreciation expense totaled $1,153,491 and $1,184,588 for the six months ended December 31, 2022 and 2021, respectively.

**NOTE 7 - DEBT** 

Total debt outstanding is presented on the consolidated balance sheet as follows:

---

| | | |
|:---|:---|:---|
|  | **December 31, 2022** | **June 30, 2022** |
| Current portion of working capital lines of credit |  |  |
| &nbsp;&nbsp;&nbsp;CIBC | $16207360 | $12804611 |
| &nbsp;&nbsp;&nbsp;National Australia Bank Limited | 24473556 | 338314 |
| &nbsp;&nbsp;&nbsp;National Australia Bank Limited Overdraft Facility | 1160587 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Debt issuance costs | (431286) | (464028) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current portion of working capital lines of credit, net | 41410217 | 12678897 |
| Long-term portion of working capital lines of credit, less current portion |  |  |
| &nbsp;&nbsp;&nbsp;National Australia Bank Limited |  | 21703286 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total long-term portion of working capital lines of credit |  | 21703286 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total working capital lines of credit, net | $41410217 | $34382183 |
| Current portion of long-term debt |  |  |
| &nbsp;&nbsp;&nbsp;Finance leases | $608663 | $804309 |
| &nbsp;&nbsp;&nbsp;Term Loan - National Australia Bank Limited | 340250 | 344400 |
| &nbsp;&nbsp;&nbsp;Machinery & equipment loans - National Australia Bank Limited | 254414 | 246547 |
| &nbsp;&nbsp;&nbsp;Machinery & equipment loans - Hyster | 11957 | 11834 |
| &nbsp;&nbsp;&nbsp;Vehicle loans - Ford Credit | 40341 | 40341 |
| &nbsp;&nbsp;&nbsp;Secured real estate note - Rooster | 6527849 | 6905995 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Debt issuance costs | (39574) | (36643) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current portion, net | 7743900 | 8316783 |
| Long-term debt, less current portion |  |  |
| &nbsp;&nbsp;&nbsp;Finance leases | 239238 | 500723 |
| &nbsp;&nbsp;&nbsp;Term loan - National Australia Bank Limited | 2381750 | 2410800 |
| &nbsp;&nbsp;&nbsp;Machinery & equipment loans - National Australia Bank Limited | 1022603 | 963733 |
| &nbsp;&nbsp;&nbsp;Machinery & equipment loans - Hyster | 22331 | 28722 |
| &nbsp;&nbsp;&nbsp;Vehicle loans - Ford Credit | 65934 | 88583 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Debt issuance costs |  | (21) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total long-term portion, net | 3731856 | 3992540 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total debt, net | $11475756 | $12309323 |

---

**CIBC Loan Agreement**

On December 26, 2019, the Company entered into the CIBC Loan Agreement with CIBC, which originally provided for a $35.0 million credit facility, or the CIBC Credit Facility. As described in Note 8 to the Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended June 30, 2022, the CIBC Loan Agreement was subsequently amended on several occasions through the year ended June 30, 2022. During the six months ended December 31, 2022, the CIBC Loan Agreement was further amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•on September 22, 2022, the CIBC Loan Agreement was amended to, among other things, (i) specify that the borrowing base eligible inventory sublimit cannot be reduced below the proceeds available to be drawn under the MFP Letter of Credit (as defined below), (ii) waive the Company's non-compliance with certain financial covenants under the CIBC Loan Agreement and (iii) establish a minimum liquidity of no less than $1.0 million tested weekly as of the last day of each week for the remainder of the term of the CIBC Loan Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•on October 28, 2022, the CIBC Loan Agreement was amended to, among other things, increase (i) the total revolving loan commitment to $21.0 million from $18.0 million and (ii) the borrowing base eligible inventory sublimit to $12.0 million from $9.0 million; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•on December 23, 2022, the CIBC Loan Agreement was amended to, among other things, extend the maturity date of all revolving loans, advances and other obligations outstanding under the CIBC Loan Agreement from December 23, 2022 to March 23, 2023.

------

As of December 31, 2022, the Company was in compliance with all covenants contained in the CIBC Loan Agreement. As of December 31, 2022, there was approximately $4.8 million of unused availability on the CIBC Credit Facility.

**Rooster Note**

During the six months ended December 31, 2022, the Rooster Note (as defined in Note 8 to the Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended June 30, 2022) was amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•on September 22, 2022, the Company entered into an amendment to extend the Rooster Note's maturity date to December 23, 2022; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•on December 23, 2022, the Company entered into an amendment to the Rooster Note that (i) increased the interest rate on the Rooster Note from 7.75% to 9.25% per annum and (ii) extended the maturity date of the Rooster Note from December 23, 2022 to March 1, 2023.

On February 6, 2023, Shell paid off the approximately $7.0 million of outstanding principal and accrued interest on the Rooster Note in connection with the Vision Bioenergy partnership (see Note 13).

**Australian Facilities**

S&W Australia's debt facilities with National Australia Bank, or NAB, as amended to date, or the NAB Finance Agreement, were amended and restated effective October 24, 2022, and further amended on October 25, 2022. Pursuant to the amendments contained in the NAB Finance Agreement, among other things:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the borrowing base line credit limit under S&W Australia's seasonal credit facility was increased from AUD $32.0 million (USD $21.8 million as of December 31, 2022) to AUD $40.0 million (USD $27.2 million as of December 31, 2022), with a one-year maturity date extension to September 30, 2024;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the overdraft credit limit under S&W Australia's seasonal credit facility was increased from AUD $1.0 million (USD $0.7 million as of December 31, 2022) to AUD $2.0 million (USD $1.4 million as of December 31, 2022), with a one-year maturity date extension to September 29, 2023; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the maturity date of S&W Australia's master asset finance facility was extended by one year to September 29, 2023.

After the amendments, the consolidated debt facilities under the NAB Finance Agreement provide for up to an aggregate of AUD $49.0 (USD $33.3 million as of December 31, 2022) of credit. The NAB Finance Agreement is guaranteed by S&W Seed Company up to a maximum of AUD $15.0 million (USD $10.2 million as of December 31, 2022).

Following the October 2022 amendments, the NAB Finance Agreement contained an undertaking requiring the Company to maintain a net related entity position of not more than AUD $25.0 million, and the Company's ability to comply with this undertaking was subject to fluctuations in foreign currency conversion rates outside of the Company's control. Due to fluctuations in foreign currency conversion rates, the Company was not in compliance with this undertaking as of December 31, 2022, and the Company subsequently obtained a waiver from NAB with respect to such non-compliance as of December 31, 2022. On February 8, 2023, the Company further amended the NAB Finance Agreement to change the required net related entity position from AUD $25.0 million to USD $18.5 million. The Company believes that this amendment will provide the Company with greater control over compliance with this undertaking. As of December 31, 2022, approximately AUD $4.3 million (USD $2.9 million) remained available for use under the NAB Finance Agreement.

**MFP Loan Agreement**

On September 22, 2022, the Company's largest stockholder, MFP Partners, L.P., or MFP, provided a letter of credit issued by JPMorgan Chase Bank, N.A. for the account of MFP, with an initial face amount of $9.0 million, or the MFP Letter of Credit, for the benefit of CIBC, as additional collateral to support the Company's obligations under the CIBC Loan Agreement. The MFP Letter of Credit initially matured on January 23, 2023, one month after the maturity date of the existing CIBC Loan Agreement. Concurrently, on September 22, 2022, the Company entered into a Subordinate Loan and Security Agreement, or the MFP Loan Agreement, with MFP, pursuant to which any draw CIBC may make on the MFP Letter of Credit will be deemed to be a term loan advance made by MFP to the Company. The MFP Loan Agreement initially provided for up to $9.0 million of term loan advances.

Concurrent with the October 28, 2022 amendment to the CIBC Loan Agreement (as described above), MFP amended the MFP Letter of Credit to increase the face amount from $9.0 million to $12.0 million, and the MFP Loan Agreement was amended to increase the maximum amount of term loan advances available to the Company from $9.0 million to $12.0 million. In connection with the December 23, 2022 amendment to the CIBC Loan Agreement, MFP amended the MFP Letter of Credit, extending the maturity date from January 23, 2023 to April 30, 2023.

------

The MFP Loan Agreement will mature on November 30, 2025. Pursuant to the MFP Loan Agreement, the Company will pay to MFP a cash fee through the maturity date of the MFP Letter of Credit equal to 3.50% per annum on all amounts remaining undrawn under the MFP Letter of Credit. In the event any term advances are deemed made under the MFP Loan Agreement, such advances will bear interest at a rate per annum equal to term SOFR (with a floor of 1.25%) plus 9.25%, 50% of which will be payable in cash on the last day of each fiscal quarter and 50% of which will accrue as payment in kind interest payable on the maturity date, unless, with respect to any quarterly payment date, the Company elects to pay such interest in cash.

The MFP Loan Agreement includes customary affirmative and negative covenants and events of default. The MFP Loan Agreement is secured by substantially all of the Company's assets and is subordinated to the CIBC Loan Agreement. Upon the occurrence and during the continuance of an event of default, MFP may declare all outstanding obligations under the MFP Loan Agreement immediately due and payable and take such other actions as set forth in the MFP Loan Agreement.

**Maturities of Long-Term Debt**

The annual maturities of long-term debt, excluding finance lease liabilities, are as follows:

---

| | |
|:---|:---|
| **Fiscal Year** | **Amount** |
| 2023 | $6699960 |
| 2024 | 675326 |
| 2025 | 585624 |
| 2026 | 2351682 |
| 2027 | 164072 |
| Thereafter | 190765 |
| &nbsp;&nbsp;&nbsp;Total | $10667429 |

---

**NOTE 8 - FOREIGN CURRENCY FORWARD CONTRACTS AND OPTIONS**

The Company held foreign currency forward contracts with a notional value of $18,760,948 at December 31, 2022, with maturities ranging from January 2023 to June 2023.

The Company records an asset or liability on the condensed consolidated balance sheet for the fair value of the foreign currency forward contracts. The foreign currency contract liabilities totaled $1,009,469 and $996,106 at December 31, 2022 and June 30, 2022, respectively. The Company recorded gain of $484,518 and loss of $13,256 on foreign currency forward contracts for the three months ended December 31, 2022 and 2021, respectively, and losses of $19,466 and $252,059 for the six months ended December 31, 2022 and 2021, respectively. Gains and losses on foreign exchange contracts are reflected in cost of revenue.

In December 2022, the Company acquired foreign currency options with a total notional amount of AUD $8,451,123. The strike prices on the transaction dates and as of December 31, 2022, were above the market price, so the options had no intrinsic value. Option premiums of AUD $42,080 are reflected in the caption "Prepaid expenses and other current assets" on the condensed consolidated balance sheet as of December 31, 2022.

The Company's accounting policies for foreign currency contracts and options is found in Note 2 under the section titled "Derivative Financial Instruments."

**NOTE 9 – EQUITY**

On September 22, 2022, the Company entered into a Subordinate Loan and Security Agreement, or the MFP Loan Agreement, with MFP, pursuant to which any draw CIBC may make on the MFP Letter of Credit will be deemed to be a term loan advance made by MFP to the Company (see Note 7). Pursuant to the terms and conditions of the MFP Loan agreement, on September 22, 2022, the Company issued to MFP a warrant, or Initial Warrant, to purchase up to 500,000 shares of the Company's common stock, or Initial Warrant Shares, at $1.60 per share (subject to adjustment in connection with any stock dividends and splits, distributions with respect to the Company's common stock and certain fundamental transactions as described in the Initial Warrant). The Initial Warrant expires 5 years from its issue date, or September 22, 2027.

In connection with the October 28, 2022 and December 22, 2022 amendments to the MFP Letter of Credit, the Company issued to MFP additional warrants to purchase 166,700 and 666,700 shares of the Company's common stock, respectively, at an exercise price of $1.60 per warrant share. The warrants will each expire five years from the date of issuance.

------

In total, warrants to purchase 1,333,400 shares of the Company's common stock were issued to MFP in connection with the MFP Loan Agreement, or MFP Warrants, during the six months ended December 31, 2022. The MFP Warrants were valued using the Black-Scholes-Merton model as of the respective issue dates and recorded as a financial commitment asset within the caption "Prepaid expenses and other current assets" on the condensed consolidated balance sheet. The MFP Warrant current assets are amortized on a straight-line basis over the period from their initial issue dates through the end of the related MFP Letter of Credit commitment periods. During the six months ended December 31, 2022, an aggregate value of $802,901 related to the MFP Warrants was capitalized, of which $291,487 was amortized as interest expense.

MFP is the Company's largest shareholder. One of the Company's directors, Alexander C. Matina, is Vice President and Portfolio Manager of MFP Investors LLC, the general partner of MFP.

**NOTE 10 - EQUITY-BASED COMPENSATION** 

**Stock Options**

During the six months ended December 31, 2022, the Company granted options to purchase 787,502 shares of its common stock to certain of its directors, members of the executive management team and other employees at exercise prices ranging from $0.81 - $1.04 per share. These options vest in either quarterly or annual periods over one to three years and expire ten years from the date of grant.

A summary of stock option activity for the six months ended December 31, 2022 and the year ended June 30, 2022 is presented below:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of <br>Options** | **Weighted -<br>Average<br>Exercise<br>Price<br>Per Share** | **Weighted-<br>Average<br>Remaining<br>Contractual<br>Life (Years)** | **Aggregate<br>Intrinsic<br>Value** |
| Outstanding at June 30, 2021 | 3776568 | $2.65 | 8.0 | $3962766 |
| &nbsp;&nbsp;&nbsp;Granted | 994725 | 2.63 |  |  |
| &nbsp;&nbsp;&nbsp;Exercised | (38774) | 2.33 |  |  |
| &nbsp;&nbsp;&nbsp;Canceled/forfeited/expired | (95419) | 2.82 |  |  |
| Outstanding at June 30, 2022 | 4637100 | 2.64 | 6.6 |  |
| &nbsp;&nbsp;&nbsp;Granted | 787502 | 0.87 |  |  |
| &nbsp;&nbsp;&nbsp;Exercised |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Canceled/forfeited/expired | (844545) | 2.79 |  |  |
| Outstanding at December 31, 2022 | 4580057 | 2.31 | 7.2 | 491508 |
| Options vested and exercisable at December 31, 2022 | 3048678 | $2.63 | 6.2 | $1875.00 |
| Options vested and expected to vest as of December 31, 2022 | 4568721 | 2.31 | 7.2 | 486844 |

---

The weighted average grant date per share fair value of options granted during the three and six months ended December 31, 2022 was $0.47. At December 31, 2022, the Company had $1,019,195 of unrecognized stock compensation expense, net of estimated forfeitures, related to the options under the S&W Seed Company 2009 Equity Incentive Plan and the S&W Seed Company 2019 Equity Incentive Plan, or 2019 Plan, which will be recognized over the weighted average remaining service period of 1.93 years. The Company settles employee stock option exercises with newly issued shares of common stock.

**Restricted Stock Units**

During the six months ended December 31, 2022, the Company issued 431,704 restricted stock units to its directors, certain members of the executive management team, and other employees. The restricted stock units have varying vesting periods ranging from immediate vesting to quarterly or annual installments over one to three-years. The fair value of the awards granted during the six months ended December 31, 2022 and 2021 totaled $443,375 and $829,780, respectively, and was based on the closing stock price on the date of grants.

------

A summary of activity related to non-vested restricted stock units is presented below:

---

| | | | |
|:---|:---|:---|:---|
|  | **Number of <br>Nonvested<br>Restricted Stock<br>Units** | **Weighted-Average<br>Grant Date Fair<br>Value** | **Weighted-Average<br>Remaining<br>Contractual Life<br>(Years)** |
| Nonvested restricted units outstanding at June 30, 2021 | 361570 | $2.51 | 1.3 |
| &nbsp;&nbsp;&nbsp;Granted | 304421 | 2.78 |  |
| &nbsp;&nbsp;&nbsp;Vested | (391036) | 2.62 |  |
| &nbsp;&nbsp;&nbsp;Forfeited | (7036) | 2.35 |  |
| Nonvested restricted units outstanding at June 30, 2022 | 267919 | 2.66 | 1.2 |
| &nbsp;&nbsp;&nbsp;Granted | 431704 | 1.03 |  |
| &nbsp;&nbsp;&nbsp;Vested | (192952) | 2.72 |  |
| &nbsp;&nbsp;&nbsp;Forfeited | (8750) | 2.50 |  |
| Nonvested restricted units outstanding at December 31, 2022 | 497921 | 1.22 | 1.7 |

---

At December 31, 2022, the Company had $546,369 of unrecognized stock compensation expense related to the restricted stock units, which will be recognized over the weighted average remaining service period of 1.72 years.

**Stock-based Compensation Expense**

Stock-based compensation expense recorded for grants of stock options, restricted stock and restricted stock units for the three months ended December 31, 2022 and 2021 totaled $305,894 and $1,014,203, respectively. Stock-based compensation expense recorded for grants of stock options, restricted stock and restricted stock units for the six months ended December 31, 2022 and 2021 totaled $762,006 and $1,418,515, respectively.

At December 31, 2022, there were 2,198,793 shares available under the 2019 Plan for future grants and awards.

Weighted-average assumptions used in the Black-Scholes-Merton model are set forth below for the periods indicated:

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended December 31, 2022** | **Year Ended <br>June 30, 2022** |
| Risk free rate | 2.87% - 4.41% | 0.8% - 1.1% |
| Dividend yield | 0 | 0% |
| Volatility | 64.7% - 66.1% | 61.8% - 62.4% |
| Average forfeiture assumptions | 8.7% | 2.8% |

---

**NOTE 11 – SERIES B CONVERTIBLE PREFERRED STOCK**

The terms and conditions of the Company's Series B Convertible Preferred Stock and accompanying Warrant are presented in Note 14 to the Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended June 30, 2022. No issuances or conversions of Series B Convertible Preferred Stock occurred during the six months ended December 31, 2022. Activity in the period consisted of accrual of dividends and accretion of the discount on the Warrants.

The following summarizes changes to the Series B Convertible Preferred Stock:

---

| | |
|:---|:---|
| Balance at June 30, 2021 | $- |
| &nbsp;&nbsp;&nbsp;Issuance of preferred stock | 4638521 |
| &nbsp;&nbsp;&nbsp;Dividends accrued | 127541 |
| &nbsp;&nbsp;&nbsp;Accretion of discount for warrants | 38757 |
| Balance at June 30, 2022 | $4804819 |
| &nbsp;&nbsp;&nbsp;Dividends accrued | 176447 |
| &nbsp;&nbsp;&nbsp;Accretion of discount for warrants | 51676 |
| Balance at December 31, 2022 | $5032942 |

---

------

**NOTE 12 - NON-CASH ACTIVITIES FOR STATEMENTS OF CASH FLOWS** 

The below table represents supplemental information to the Company's condensed consolidated statements of cash flows for non-cash activities during the six months ended December 31, 2022 and 2021, respectively.

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2022** | **2021** |
| Non-cash investing activities: |  |  |
| &nbsp;&nbsp;Contribution of intangible assets to partnership in exchange for equity investment and promissory note | $1750000 | $— |
| &nbsp;&nbsp;ROU assets financed by lease liabilities |  | (122863) |
| Non-cash financing activities: |  |  |
| &nbsp;&nbsp;Warrants issued for financial commitment asset | 802901 |  |
| &nbsp;&nbsp;Accretion of discount for Series B preferred stock warrants | 51676 |  |
| &nbsp;&nbsp;Dividends accrued for participating securities | 176447 |  |

---

**NOTE 13 – SUBSEQUENT EVENTS**

Shell Partnership

On February 6, 2023, S&W and Shell entered into a Contribution and Membership Interest Purchase Agreement, relating to a joint venture for the development and production of sustainable biofuel feedstocks, pursuant to which:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•S&W (i) contributed its Nampa, Idaho production and research facilities, or the Nampa Facilities, to Vision Bioenergy, along with certain personal property, including vehicles, fixed assets and other similar equipment; (ii) caused Vision Bioenergy to make offers of employment to certain key personnel; (iii) assigned to Vision Bioenergy certain contracts and permits; and (iv) agreed to a two-year non-solicitation covenant with respect to the personnel transferred to Vision Bioenergy; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Shell (i) made a $13.0 million cash contribution to Vision Bioenergy; (ii) paid $7.0 million to S&W; and (iii) paid off in full the Rooster Note, which was secured by a priority security interest in the property, plant and fixtures located at the Nampa Facilities.

In February 2024, Shell will be required to pay an additional $6.0 million, and make an additional $12.0 million cash contribution to Vision Bioenergy.

Shell received a 66% interest in Vision Bioenergy and S&W retained a 34% interest. Additionally, upon the achievement of certain specified milestones, measured as of the fourth and seventh anniversaries of the closing of the joint venture transaction, S&W is eligible to receive up to an additional aggregate 10% interest in Vision Bioenergy. In addition, S&W has a one-time option, exercisable at any time on or before the fourth anniversary of the closing of the joint venture transaction, to purchase a 6% membership interest from Shell for a purchase price ranging between approximately $7.1 and $12.0 million, depending on the date on which such purchase is completed.

Amendment of NAB Finance Agreement

On February 8, 2023, the NAB Finance Agreement was amended to change the maximum permissible net related entity position from AUD $25.0 million to USD $18.5 million.

------

**Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.**

You should read the following discussion of our financial condition and results of operations in conjunction with our condensed consolidated financial statements and the related notes included in Part I, Item 1, "Financial Statements" of this Quarterly Report on Form 10-Q. In addition to our historical condensed consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements as referred to under the heading "Forward-Looking Statements" in this Quarterly Report on Form 10-Q. Factors that could cause or contribute to these differences include those discussed in our Annual Report on Form 10-K for the fiscal year ended June 30, 2022, particularly in Part I, Item 1A., "Risk Factors."

**Strategic Review**

We recently undertook a strategic review of our operations and future growth opportunities to determine areas we believe are key centers of value, including our sorghum technology operations (led by Double Team™, our non-GMO herbicide tolerant sorghum solution), international forage operations, U.S. forage operations and our specialty crops.

With respect to specialty crops, we intend to initially focus on stevia and camelina. We believe that an opportunity exists to bring to market new stevia varieties that can both meet consumer taste requirements and have yield quality that would enable farmers to profitably grow stevia in North and South America. We plan to leverage our proprietary stevia germplasm to form collaborations and commercial agreements with supply chain partners to create a U.S.-based stevia production industry for high-quality stevia sweetener with superior taste profiles that would supply major customers in the U.S. market, including pursuant to our previously announced U.S. stevia pilot production supply agreement with Ingredion. We also believe we have an opportunity to enter the camelina market as a seed and technology provider, where we plan to work with large oil companies for biofuel production leveraging our capabilities in producing, processing, and packaging camelina.

We have also begun working to align our cost structure to support these centers of value while assessing other potential value-generating transactions and means to strengthen our balance sheet.

On January 3, 2023, we and Trigall Genetics S.A., or Trigall Genetics, a leader in transgenic wheat, announced our entry into a partnership for the development and marketing of wheat varieties in Australia through Trigall Australia Pty Ltd, a newly formed Australian corporation, or Trigall Australia. S&W Seed Company Australia Pty Ltd, our wholly owned subsidiary, or S&W Australia, contributed its Australia-based wheat breeding program and related assets to Trigall Australia in exchange for $2.0 million in cash, a $1.0 million promissory note to be paid in December 2023 and a 20% ownership interest in Trigall Australia. Pursuant to the partnership, S&W Australia is obligated to make an aggregate of $560,000 of capital contributions to Trigall Australia through June 2025 and has agreed to provide certain marketing, collection and other operational services in support of the partnership.

On February 6, 2023, S&W entered into a Contribution and Membership Interest Purchase Agreement, or Shell Partnership Agreement, with Equilon Enterprises LLC (dba Shell Oil Products US, or Shell), relating to a partnership for the development and production of sustainable biofuel feedstocks. The closing of the transactions contemplated by the Shell Partnership Agreement occurred on February 6, 2023, or the Shell Partnership Closing. At the Shell Partnership Closing, among other things:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•S&W (i) contributed its Nampa, Idaho production and research facilities, or the Nampa Facilities, to Vision Bioenergy Oilseeds LLC, an entity formed by S&W for purposes of the partnership, or Vision Bioenergy, along with certain personal property, including vehicles, fixed assets and other similar equipment; (ii) caused Vision Bioenergy to make offers of employment to certain key personnel; (iii) assigned to Vision Bioenergy certain contracts and permits; and (iv) agreed to a two-year non-solicitation covenant with respect to the personnel transferred to Vision Bioenergy; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Shell (i) made a $13.0 million cash contribution to Vision Bioenergy; (ii) paid $7.0 million to S&W; and (iii) paid off S&W's outstanding approximately $7.0 million Rooster Note (as defined below), which was secured by a priority security interest in the property, plant and fixtures located at the Nampa Facilities.

In addition, under the terms and conditions of the Shell Partnership Agreement, on the one-year anniversary of the Shell Partnership Closing, Shell is required to pay an additional $6.0 million to S&W and make an additional $12.0 million cash contribution to Vision Bioenergy.

Shell received a 66% interest in Vision Bioenergy and S&W retained a 34% interest. Pursuant to the Shell Partnership Agreement, upon the achievement of certain specified milestones, measured as of the fourth and seventh anniversaries of the Shell Partnership Closing, S&W is eligible to receive up to an additional aggregate 10% interest in Vision Bioenergy. In addition, S&W has a one-time option, exercisable at any time on or before the fourth anniversary of the Shell Partnership Closing, to purchase a 6% membership interest from Shell for a purchase price ranging between approximately $7.1 and $12.0 million, depending on the date on which such purchase is completed.

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We believe these partnerships will, among other things, enable us to reduce our operating expenses, provide immediate liquidity to fund our ongoing operations and sharpen our focus on key growth priorities. Overall, we have begun implementing our plan to reduce annual operating expenses by approximately $4.0 to 5.0 million.

In addition to the above partnerships, we have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•streamlined our European sunflower operations by closing our facilities in Hungary, which we expect to decrease operating expense by approximately $700,000 in fiscal 2023, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•reduced headcount and simplified our organization structure through a reduction in force.

**Global Economic Conditions** 

We are subject to additional risks and uncertainties as a result of adverse geopolitical and macroeconomic events, such as the continued impact of the COVID-19 pandemic, the ongoing military conflict between Ukraine and Russia and related sanctions, uncertain market conditions, including higher inflation and supply chain disruptions, and other global events, which have had and may continue to have an adverse impact on our business, operations and the markets and communities in which we, our partners and customers operate. The COVID-19 pandemic may cause further disruptions in the various markets in which we operate.

The COVID-19 pandemic negatively impacted our operations and financial results in 2021 and 2022, due to broad-based supply chain disruptions across the U.S. and globally. These supply chain issues negatively impacted our ability to book containers for ocean freight, which delayed customer shipments, which in certain cases extended our regular sales and collection cycle. In 2023 we experienced a lessoning of the severity of these supply chain issues, though continue to experience effects in certain jurisdictions that continue to have various restrictions, which have impacted certain of our customers. We continue to work closely with our customers, business units, third party contractors and suppliers and other external business partners to minimize the potential impact on our business.

As COVID-19 continues to affect the areas in which we operate, we believe future outbreaks could have a negative impact on our sales, operating results and financial condition. The extent of the impact of the COVID-19 pandemic on our sales, operating results and financial condition will depend on certain developments, including the location, duration and spread of future outbreaks, and the resulting specific impacts felt by our customers, employees and vendors, all of which are uncertain and cannot be predicted.

Following the invasion of Ukraine by Russia in early 2022, the U.S. and global financial markets experienced volatility, which has led to disruptions to trade, commerce, pricing stability, credit availability, supply chain continuity and reduced access to liquidity globally. In response to the invasion, the United States, United Kingdom and European Union, along with others, imposed significant new sanctions and export controls against Russia, Russian banks and certain Russian individuals and may implement additional sanctions or take further punitive actions in the future. The full economic and social impact of the sanctions imposed on Russia and possible future punitive measures that may be implemented, as well as the counter measures imposed by Russia, in addition to the ongoing military conflict between Ukraine and Russia and related sanctions, which could conceivably expand into the surrounding region, remains uncertain; however, both the conflict and related sanctions have resulted and could continue to result in disruptions to trade, commerce, pricing stability, credit availability, supply chain continuity and reduced access to liquidity on acceptable terms, in both Europe and globally, and has introduced significant uncertainty into global markets.

Our product revenue is predicated on our ability to timely fulfill customer orders, which depends in large part upon the consistent availability and operation of shipping and distribution networks operated by third parties. Farmers typically have a limited window during which they can plant seed, and their buying decisions can be shaped by actual or perceived disruptions in our distribution and supply channels, or concerns about our ability to timely fulfill their orders. If our customers delay or decrease their orders due to potential disruptions in our distribution and supply channels, including as a result of the COVID-19 pandemic or other adverse geopolitical and macroeconomic events, this will adversely affect our product revenue.

During the year ended June 30, 2022 and the six months ended December 31, 2022, we experienced numerous logistical challenges due to limited availability of trucks for product deliveries, congestion at the ports, and overall volatility of shipping and transportation costs. We expect these logistical challenges to persist throughout fiscal 2023, which may, among other things, delay or reduce our ability to recognize revenues within a particular fiscal period and harm our results of operations.

The ultimate impact that COVID-19 and other adverse geopolitical and macroeconomic events will have on our consolidated financial statements remains uncertain and ultimately will be dictated by the length and severity of the pandemic and any broad-based supply chain disruptions, labor shortages, rising levels of inflation and interest rates, tightening of credit markets or other developments resulting from the pandemic or recent geopolitical and macroeconomic events, as well as the economic recovery and actions taken in response to local, state and national governments around the world, including the distribution of vaccinations. We will continue to evaluate the nature and extent of those potential and evolving impacts to our business and consolidated financial statements.

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**Components of Our Statements of Operations Data**

Revenue

We derive most of our revenue from the sale of our proprietary seed varieties and hybrids. We expect that over the next several years, a substantial majority of our revenue will be generated from the sale of alfalfa, sorghum, and pasture seed, although we are continually assessing other possible product offerings or means to increase revenue, including expanding into higher margin crops.

The mix of our product offerings will continue to change over time with the introduction of new seed varieties and hybrids resulting from our robust research and development efforts, including our potential expansion of novel, non-GMO product lines, potential entry into gene-edited product markets, potential entry into specialty crop markets, including stevia and biofuels, and additional strategic transactions.

Our revenue will fluctuate depending on the timing of orders from our customers and distributors and the extent to which markets are impacted by sources of instability and volatility in global markets and industries, including, among other things, the COVID-19 pandemic, the conflict between Russia and Ukraine, supply chain issues and global inflation. Because some of our large customers and distributors order in bulk only one or two times per year, our product revenue can fluctuate significantly from period to period. Some of this fluctuation is offset by having operations in both the northern and southern hemispheres. In addition, due to the numerous logistical challenges we have experienced in our shipping and distribution networks resulting from current geopolitical and macroeconomic events, including the COVID-19 pandemic, our product revenue has fluctuated, and our ability to recognize revenues within a particular fiscal period has been impacted. We expect our product revenue will fluctuate from period to period as a result of the current geopolitical and macroeconomic conditions.

Our specialty crops, including our stevia breeding program and biofuels program, have yet to generate any meaningful revenue. However, management continues to evaluate this portion of our business and assess various opportunities to monetize the results of our research and development efforts. Such potential opportunities include possible collaborations and/or joint ventures, licensing agreements and royalty-based agreements. For example, we recently entered into our Vision Bioenergy partnership with Shell in order to develop commercially viable camelina sativa and other oilseeds varieties that produce grain from which oil and meal can be extracted for future processing into biofuels, feed and other potential bioproducts. Although we have received upfront payments from Shell pursuant to the partnership and will be entitled to receive additional payments from Shell upon the one-year anniversary of our entry into partnership, there can be no assurance that this will generate any meaningful revenue.

Cost of Revenue and Gross Margin

Cost of revenue relates to sale of our seed products and consists of the cost of procuring seed, plant conditioning and packaging costs, direct labor and raw materials and overhead costs.

**Operating Expenses**

Selling, General and Administrative Expenses

Selling, general, and administrative expenses consist primarily of employee costs, including salaries, employee benefits and share-based compensation, as well as professional service fees, insurance, marketing, travel and entertainment expense, public company expense and other overhead costs. We proactively take steps on an ongoing basis to control selling, general and administrative expense as much as is reasonably possible.

Research and Development Expenses

Research and development expenses consist of costs incurred in the discovery, development, breeding and testing of new products incorporating the traits we have specifically selected. These expenses consist primarily of employee salaries and benefits, consultant services, land leased for field trials, chemicals and supplies and other external expenses.

Overall, we have been focused on controlling research and development expenses, while balancing that objective against the recognition that continued advancement in product development is an important part of our strategic planning. We intend to focus our resources on high value activities. For alfalfa seed, we plan to invest in further development of differentiating forage quality traits. For sorghum, we plan to invest in higher value grain products, proprietary herbicide tolerance traits and improved safety and palatability in forage products. We expect our research and development expenses will fluctuate from period to period as a result of the timing of various research and development projects.

Our internal research and development costs are expensed as incurred, while third-party research and developments costs are expensed when the contracted work has been performed or as milestone results have been achieved. The costs associated with equipment or facilities acquired or constructed for research and development activities that have alternative future uses are capitalized and depreciated on a straight-line basis over the estimated useful life of the asset.

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Depreciation and Amortization

We amortize intangible assets, including those acquired from Pasture Genetics Ltd., or Pasture Genetics, in 2020, Chromatin Inc., or Chromatin, in 2018 and from SV Genetics Pty Ltd in May 2016, using the straight-line method over the estimated useful life of the asset, consisting of periods of 3-30 years for technology/IP/germplasm, 5-20 years for customer relationships and trade names and 3-20 years for other intangible assets. Property, plant and equipment is depreciated using the straight-line method over the estimated useful life of the asset, consisting of periods of 5-35 years for buildings, 2-20 years for machinery and equipment and 2-5 years for vehicles.

**Other (Income) Expense**

Other (income) expense consists primarily of foreign currency gains and losses, gains on disposal of intangible assets and equity investments, changes in contingent consideration obligation, interest expense and interest expense resulting from the amortization of debt discount. Interest expense and Interest expense - amortization of debt discount primarily consists of interest costs related to outstanding borrowings on our working capital credit facilities and our financing with Rooster Capital, LLC, or Rooster. Amortization of the MFP Letter of Credit (as defined below) asset is also recorded under the caption Interest expense - amortization of debt discount.

**Provision (Benefit) for Income Taxes**

Our effective tax rate is based on income, statutory tax rates, differences in the deductibility of certain expenses and inclusion of certain income items between financial statement and tax return purposes, and tax planning opportunities available to us in the various jurisdictions in which we operate. Under U.S. generally accepted accounting principles, or GAAP, if we determine that a tax position is more likely than not of being sustained upon audit, based solely on the technical merits of the position, we recognize the benefit. Tax regulations require certain items to be included in the tax return at different times than when those items are required to be recorded in the condensed consolidated financial statements. As a result, our effective tax rate reflected in our condensed consolidated financial statements is different from that reported in our tax returns. Some of these differences are permanent, such as meals and entertainment expenses that are not fully deductible on our tax return, and some are temporary differences, such as depreciation expense. Temporary differences create deferred tax assets and liabilities. Deferred tax assets generally represent items that can be used as a tax deduction or credit in our tax return in future years for which we have already recorded the tax benefit in our consolidated statements of operations. Based on financial projections, we do not believe that it is more likely than not that our U.S. deferred tax assets will be realized, and a full valuation allowance is recorded against them.

**Results of Operations**

**Three Months Ended December 31, 2022 Compared to the Three Months Ended December 31, 2021**

The following table presents our results of operations for the periods indicated:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Three Months Ended December 31,** |  |
|  | **2022** | **2021** | **2021**<br>**Change** | **Change** |
|  | **% of<br>Revenue(1)** | **% of<br>Revenue(1)** | **% of<br>Revenue(1)** | **% Change** |
| Revenue | 100.0% |  | 100.0% | 2.4% |
| Cost of revenue | 78.7% |  | 86.9%) | (7.1)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit | 21.3% |  | 13.1% | 65.6% |
| Operating expenses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 48.2% |  | 56.0%) | (11.8)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Research and development expenses | 11.6% |  | 16.7%) | (28.8)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 9.7% |  | 10.9%) | (8.7)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 69.6% |  | 83.6%) | (14.8)% |
| Loss from operations) | (48.3)% |  | (70.4)% | (29.8)% |
| Other (income) expense |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign currency loss | 1.4% |  | 2.0%) | (31.7)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on disposal of intangible assets) | (13.9)% |  | —) | &nbsp;&nbsp;&nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in contingent consideration obligation | —) |  | (3.7)% | (100.0)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense - amortization of debt discount | 4.5% |  | 1.8% | 161.4% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense, net | 8.4% |  | 4.7% | 85.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of equity investment) | (0.2)% |  | —) | &nbsp;&nbsp;&nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;&nbsp;Other expense | 0.0% |  | 0.2%) | (80.8)% |
| Loss before income taxes) | (48.5)% |  | (75.4)% | (34.1)% |
| &nbsp;&nbsp;&nbsp;&nbsp;(Benefit from) provision for income taxes | (2.2)% |  | 2.0%) | (209.5)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss) | (46.3)% |  | (77.4)% | (38.8)% |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amount in column may not foot due to rounding

The discussion and analysis presented below is concerned with material changes in our results of operations between the three months ended December 31, 2022 and the three months ended December 31, 2021. All comparisons presented are with respect to the prior-year

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period, unless stated otherwise. This discussion and analysis should be read in conjunction with the "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K for the year ended June 30, 2022, as filed with the SEC on September 28, 2022.

Revenue

The year-over-year increase in revenue for the second quarter ended December 31, 2022 was primarily due to an increase of $1.9 million in alfalfa sales to the Middle East North Africa, or MENA, region, a $1.0 million increase in North America sorghum sales, and a $0.2 million increase in pastures sales in Australia. This was offset by a decrease in sales of sorghum to the MENA region of $1.4 million, a $0.7 million decrease in alfalfa sales to North America, and a $0.7 million decrease in North America service revenue.

Cost of Revenue and Gross Margin

Despite an increase in sales, the cost of revenue for the second quarter ended December 31, 2022 decreased compared to the prior year period, primarily driven by increased sales of higher margin alfalfa in the MENA region and grain sorghum in North America, along with decreased sales of lower margin sorghum products in the MENA region and dormant alfalfa in North America. Write-downs of inventory lots that had deteriorated in quality and germination rates were reduced from $0.4 million in the second quarter of fiscal 2022 to $0.1 million in the second quarter of fiscal 2023.

Selling, General and Administrative Expenses

The decrease in selling, general and administrative expenses for the three months ended December 2022 compared to the three months ended December 31, 2021 is attributable to a $0.7 million decrease in stock-based compensation expense as a result of the accelerated vesting of equity awards of a former executive officer during the three months ended December 2021, $0.3 million in reduced payroll and related expenses as a result of management's cost reduction efforts, offset by a $0.1 million increase in consulting and professional fees.

Research and Development Expenses

The year-over-year decrease in research and development expenses for the second quarter ended December 31, 2022 is attributable to a $0.3 million reduction in field trial related expenses, a $0.2 million reduction in payroll and related expenses as a result of management's cost reduction efforts, and a $0.1 million reduction in consulting and professional fees.

Depreciation and Amortization

The decrease in depreciation and amortization expenses for the three months ended December 31, 2022 compared to the three months ended December 31, 2021 was attributable to decreased depreciation expense on assets held by S&W Australia, our wholly owned Australian subsidiary.

Foreign Currency Loss

The decrease in foreign currency loss for the three months ended December 31, 2022 compared to the three months ended December 31, 2021 was attributable to fluctuations in foreign currency exchange rates between the Australian dollar and U.S. dollar.

Gain on Disposal of Intangible Assets

The $1.8 million gain on disposal of intangible assets in the second quarter of fiscal 2023 was recognized by S&W Australia as a result of the contribution of its Australia-based wheat breeding program and related assets to Trigall Australia in furtherance of the partnership with Trigall Australia, as discussed under the caption "Strategic Review," above.

Change in Contingent Consideration Obligation

The decrease in benefit to non-cash change in contingent consideration compared to the prior year period is due to the February 2022 final valuation of the contingent consideration obligation from the 2020 acquisition of Pasture Genetics Pty Ltd. The valuation resulted in no contingent consideration due, and a reversal of the remaining $0.5 million accrual.

Interest Expense - Amortization of Debt Discount

The increased debt amortization expense in the second quarter of fiscal 2023 compared to the prior year period was due to the amortization of the financial commitment asset established in conjunction with the MFP Loan Agreement beginning in September 2022 (see "Capital Resources and Requirements—MFP Loan Agreement," below).

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Interest Expense, Net

Interest expense for the three months ended December 31, 2022, and 2021 primarily consisted of interest incurred on the working capital credit facilities, the Rooster Note (as defined below), and equipment capital leases. The $0.5 million increase in interest expense for the three months ended December 31, 2022, was primarily driven by increases in average borrowings on the working capital credit facilities and increased interest rates on both our United States and Australian wholly owned subsidiaries.

Gain on Sale of Equity Investment

The gain on sale of equity investment was a result of the sale of the remainder of our investment in Bioceres.

(Benefit from) Provision for Income Tax Benefit

Income tax (benefit) totaled ($0.3) million for the three months ended December 31, 2022 compared to income tax expense of $0.3 million for the three months ended December 31, 2021. Our effective tax rate was 4.5% for the three months ended December 31, 2022 compared to an effective tax rate of (2.7)% for the three months ended December 31, 2021. Our effective tax rate for the three months ended December 31, 2022 was 4.5% due primarily to the valuation allowance recorded against substantially all of our deferred tax assets, and the tax effects of the partnership with Trigall Genetics entered into during the quarter. Due to the valuation allowance, we do not record the income tax expense or benefit related to substantially all of our current year operation results, with the exception of our operations in Australia. Our effective tax rate for the current quarter is primarily due to income tax expense related to our foreign operations and minor state taxes.

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**Six Months ended December 31, 2022 Compared to the Six Months Ended December 31, 2021**

The following table presents our results of operations for the periods indicated:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Six Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** |  |
|  | **2022** | **2021** | **2021**<br>**Change** | **Change** |
|  | **% of<br>Revenue(1)** | **% of<br>Revenue(1)** | **% of<br>Revenue(1)** | **% Change** |
| Revenue | 100.0% |  | 100.0% | 16.5% |
| Cost of revenue | 77.9% |  | 83.0% | 9.3% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit | 22.1% |  | 17.0% | 51.5% |
| Operating expenses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 34.4% |  | 44.9%) | (10.7)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Research and development expenses | 9.2% |  | 14.6%) | (26.5)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 7.9% |  | 9.6%) | (4.2)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 51.5% |  | 69.1%) | (13.1)% |
| Loss from operations) | (29.4)% |  | (52.1)% | (34.2)% |
| Other (income) expense |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign currency loss | 1.1% |  | 1.5%) | (12.7)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on disposal of intangible assets) | (5.5)% |  | —) | &nbsp;&nbsp;&nbsp;&nbsp;-- |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in contingent consideration obligation | —) |  | (1.9)% | (100.0)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense - amortization of debt discount | 2.6% |  | 1.5% | 108.5% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense, net | 5.7% |  | 4.1% | 64.5% |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of equity investment) | (0.1)% |  | —) | &nbsp;&nbsp;&nbsp;&nbsp;-- |
| &nbsp;&nbsp;&nbsp;&nbsp;Other income) | (0.1)% |  | (0.0)% | 275.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss before income taxes) | (33.2)% |  | (57.2)% | (32.4)% |
| &nbsp;&nbsp;&nbsp;&nbsp;(Benefit from) provision for income taxes | (1.2)% |  | 0.3%) | (517.5)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss) | (32.0)% |  | (57.5)% | (35.1)% |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amount in column may not foot due to rounding

The discussion and analysis presented below is concerned with material changes in our results of operations between the six months ended December 31, 2022 and the six months ended December 31, 2021. All comparisons presented are with respect to the prior-year period, unless stated otherwise. This discussion and analysis should be read in conjunction with the "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K for the year ended June 30, 2022, as filed with the SEC on September 28, 2022.

Revenue

The year-over-year increase in revenue for the six months ended December 31, 2022 was primarily due to the increase in product revenue from alfalfa sales to the MENA region of $6.6 million and increased alfalfa and sorghum sales to North America of $2.0 million. These revenue increases were partially offset by a decrease in sorghum sales to the MENA region of $1.7 million, a decrease in service revenue in the United States of $1.3 million, a decrease in pasture product sales to Australia of $0.5 million, a decrease in sorghum sales to Asia of $0.3 million, and a decrease in alfalfa sales to South America of $0.3 million.

Cost of Revenue and Gross Margin

Cost of revenue increased year-over-year due to increased sales in the six months ended December 31, 2022, but gross margin improved compared to the prior year period, primarily driven by increased sales of higher margin alfalfa seed in the MENA region and grain sorghum seed in North America, as well as decreased sales of lower margin sorghum products in the MENA region.

Cost of revenue for the six months ended December 31, 2022 and 2021 included inventory write-downs of $0.7 million and $0.7 million, respectively, related to certain inventory lots that had deteriorated in quality and germination rates.

Selling, General and Administrative Expenses

The decrease in selling, general and administrative expenses for the six months ended December 2022 compared to the prior year period is attributable to a $0.7 million decrease in stock-based compensation expense as a result of the accelerated vesting of equity awards of a former executive officer during the six months ended December 31, 2021, $0.6 million in reduced payroll and related expenses as a result of management's cost reduction efforts, and $0.2 million decrease in advertising and marketing, offset by a $0.1 million increase in consulting and professional fees.

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Research and Development Expenses

The year-over-year decrease in research and development expenses for the six months ended December 31, 2022 is attributable to a $0.4 million reduction in United States field trial related expenses, $0.4 million in reduced salaries, wages and related employment expenses as a result of management's cost reduction efforts, $0.2 million reduction of investment in our sunflower programs in Hungary and $0.1 million reduction in consulting and professional fees.

Depreciation and Amortization

The decrease in depreciation and amortization expenses for the six months ended December 2022 compared to the six months ended 2021 was attributable to decreased depreciation expense on assets held by S&W Australia.

Foreign Currency Loss

The decrease in foreign currency loss for the six months ended December 31, 2022 compared to the six months ended December 31, 2021 was attributable to fluctuations in foreign currency exchange rates between the Australian dollar and U.S. dollar.

Gain on Disposal of Intangible Assets

The $1.8 million gain on disposal of intangible assets in the second quarter of fiscal 2023 was recognized by S&W Australia as a result of its contribution of its Australia-based wheat breeding program and related assets to Trigall Australia in furtherance of the partnership with Trigall Australia, as discussed under the caption "Strategic Review," above.

Change in Contingent Consideration Obligation

The decrease in benefit to non-cash change in contingent consideration compared to the prior year period is due to the February 2022 final valuation of the contingent consideration obligation from the 2020 acquisition of Pasture Genetics Pty Ltd. The valuation resulted in no contingent consideration due, and a reversal of the remaining $0.5 million accrual.

Interest Expense - Amortization of Debt Discount

The increased debt amortization expense in the six months ended December 31, 2022 compared to the prior year period was due to the amortization of the financial commitment asset established in conjunction with the MFP Loan Agreement beginning in September 2022 (see "Capital Resources and Requirements—MFP Loan Agreement," below).

Interest Expense, Net

Interest expense for the six months ended December 31, 2022, and 2021 primarily consisted of interest incurred on the working capital credit facilities, the Rooster Note (as defined below), and equipment capital leases. The $0.7 million increase in interest expense for the six months ended December 31, 2022 was primarily driven by increases in average borrowings on the working capital credit facilities and increased interest rates on both our United States and Australian wholly owned subsidiaries.

Gain on Sale of Equity Investment

The gain on sale of equity investment was a result of the sale of the remainder of our investment in Bioceres.

(Benefit from) Provision for Income Tax Benefit

The income tax (benefit) totaled $(0.4) million for the six months ended December 31, 2022 compared to a $0.1 million income tax provision for the six months ended December 31, 2021. Our effective tax rate was 3.5% during the six months ended December 31, 2022 compared to -0.6% for the six months ended December 31, 2021. Our effective tax rate for the six months ended December 31, 2022 was 3.5% due primarily to the valuation allowance recorded against substantially all of our deferred tax assets, and the tax effects of the partnership with Trigall Genetics entered into during the second quarter. Due to the valuation allowance, we do not record the income tax expense or benefit related to substantially all of our current year operation results, with the exception of our operations in Australia. Our effective tax rate for the current quarter is primarily due to income tax expense related to our foreign operations and minor state taxes.

**Liquidity and Capital Resources**

Our working capital and working capital requirements fluctuate from quarter to quarter depending on the phase of the growing and sales cycle that falls during a particular quarter. Our need for cash has historically been highest in the second and third fiscal quarters (October through March) because we historically have paid our North American contracted growers progressively, starting in the second fiscal quarter. In fiscal year 2022, we paid our North American growers approximately 50% of amounts due in the fall of 2021 and the balance was paid in the spring of 2022. This payment cycle to our growers was similar in fiscal year 2021, and we expect it to be similar for fiscal year 2023. S&W Australia and Pasture Genetics, our Australia-based wholly owned subsidiaries, have production cycles that are

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counter-cyclical to North America; however, the timing of payments to Australian growers, which occurs in the second through fourth quarters, also puts a greater demand on our working capital and working capital requirements during these periods.

Historically, due to the concentration of sales to certain distributors, our month-to-month and quarter-to-quarter sales and associated cash receipts are highly dependent upon the timing of deliveries to and payments from these distributors, which varies significantly from year to year.

We continuously monitor and evaluate our credit policies with all of our customers based on historical collection experience, current economic and market conditions and a review of the current status of the respective trade accounts receivable balance. Our principal working capital components include cash and cash equivalents, accounts receivable, inventory, prepaid expenses and other current assets, accounts payable and our working capital lines of credit.

In addition to funding our business with cash from operations, we have historically relied upon occasional sales of our debt and equity securities and credit facilities from financial institutions, both in the United States and Australia.

**Capital Resources and Material Cash Requirements**

We are not profitable and have had negative cash flow from operations for the last several years. To help fund our operations, we have relied on equity and debt financings, and we will need to obtain additional funding to finance our operations in the future. Accordingly, we are actively evaluating financing and strategic alternatives, including debt and equity financings and potential sales of assets or certain lines of business.

We believe that cash flow from operations, cash payments from Shell pursuant to the Shell Partnership Agreement and undrawn availability under our existing debt facilities will be sufficient to meet our cash requirements over the next 12 months. We expect to meet our longer-term expected future cash requirements and obligations beyond the next 12 months through a combination of existing cash and cash equivalents, cash flow from operations, the undrawn availability under our debt facilities and issuances of equity securities or debt offerings, among other sources of capital. Our ability to fund longer-term operating needs will depend on our ability to generate sufficient cash flows through sales of our products, our ability to maintain compliance with, and secure additional from, our existing debt facilities, and our ability to access the capital markets, the impacts of adverse geopolitical and macroeconomic events, and other factors, including those discussed under the section titled "Risk Factors" in our Annual Report on Form 10-K for the year ended June 30, 2022, as filed with the SEC on September 28, 2022.

Below is a summary of material changes to our sources of capital during the six months ended December 31, 2022:

Trigall Australia Partnership

In connection with our partnership with Trigall Genetics (as discussed under "—Strategic Review"), we received $2.0 million in cash and a promissory note for $1.0 million due in December 2023. Under the partnership agreement we are obligated to make an aggregate of $560,000 of capital contributions to Trigall Australia through June 2025.

CIBC Loan Agreement

Our Loan and Security Agreement with CIBC Bank USA, or CIBC, as amended to date, or the CIBC Loan Agreement, provides for a $21.0 million credit facility. The following amendments to the CIBC Loan Agreement occurred during the six months ended December 31, 2022:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•on September 22, 2022, the CIBC Loan Agreement was amended to, among other things: (i) specify that the borrowing base eligible inventory sublimit cannot be reduced below the proceeds available to be drawn under the MFP Letter of Credit (as defined below), (ii) waive our non-compliance with certain financial covenants under the CIBC Loan Agreement and (iii) establish a minimum liquidity of no less than $1.0 million, tested weekly as of the last day of each week for the remainder of the term of the CIBC Loan Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•on October 28, 2022, the CIBC Loan Agreement was amended to, among other things, increase (i) the total revolving loan commitment to $21.0 million from $18.0 million and (ii) the borrowing base eligible inventory sublimit to $12.0 million from $9.0 million; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•on December 23, 2022, the CIBC Loan Agreement was further amended to extend the maturity date of all revolving loans, advances and other obligations outstanding under the CIBC Loan Agreement from December 23, 2022 to March 23, 2023. As of December 31, 2022, we were in compliance with all covenants contained in the CIBC Loan Agreement, and approximately $4.8 million remained available for use under this credit facility.

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NAB Finance Agreement

S&W Australia's debt facilities with National Australia Bank or NAB, as amended to date, or the NAB Finance Agreement, were amended and restated on October 24, 2022, and further amended on October 25, 2022. Pursuant to the amendments contained in the NAB Finance Agreement, among other things:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the borrowing base line credit limit under S&W Australia's seasonal credit facility was increased from AUD $32.0 million (USD $21.8 million as of December 31, 2022) to AUD $40.0 million (USD $27.2 million as of December 31, 2022), with a one-year maturity date extension to September 30, 2024;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the overdraft credit limit under S&W Australia's seasonal credit facility was increased from AUD $1.0 million (USD $0.7 million as of December 31, 2022) to AUD $2.0 million (USD $1.4 million as of December 31, 2022), with a one-year maturity date extension to September 29, 2023; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the maturity date of S&W Australia's master asset finance facility was extended by one year to September 29, 2023.

After the amendments, the consolidated debt facilities under the NAB Finance Agreement provide for up to an aggregate of AUD $49.0 (USD $33.3 million as of December 31, 2022) of credit. The NAB finance agreement is guaranteed by S&W Seed Company up to a maximum of AUD $15.0 million (USD $10.2 million as of December 31, 2022).

Following the October 2022 amendments, the NAB Finance Agreement contained an undertaking requiring us to maintain a net related entity position of not more than AUD $25.0 million, and our ability to comply with this undertaking was subject to fluctuations in foreign currency conversion rates outside of our control. Due to recent fluctuations in foreign currency conversion rates, we were not in compliance with this undertaking as of December 31, 2022, and we subsequently obtained a waiver from NAB with respect to such non-compliance as of December 31, 2022. On February 8, 2023, we further amended the NAB Finance Agreement to change the required net related entity position from AUD $25.0 million to USD $18.5 million (see "Amendment of NAB Finance Agreement," below). As of December 31, 2022, approximately AUD $4.3 million (USD $2.9 million) remained available for use under the NAB Finance Agreement.

Rooster Note

Our promissory note, dated November 30, 2017, originally issued to Conterra Agricultural Capital, LLC, and subsequently endorsed to Rooster, as amended to date, or the Rooster Note, originally bore interest of 7.75% per annum, and on July 1, 2022, we made the final semi-annual principal and interest payment of $454,185. On September 22, 2022, we entered into an amendment to extend the Rooster Note's maturity date to December 23, 2022. On December 23, 2022, we entered into an amendment to increase the interest rate on the Rooster Note from 7.75% to 9.25% per annum and extend the Rooster Note's maturity date to March 1, 2023. On February 6, 2023, the Rooster Note was paid off in full by Shell in connection with the Vision Bioenergy partnership (see "—Payoff of Rooster Note").

MFP Loan Agreement

On September 22, 2022, our largest stockholder, MFP Partners, L.P., or MFP, provided a letter of credit issued by JPMorgan Chase Bank, N.A. for the account of MFP, with an initial face amount of $9.0 million, or the MFP Letter of Credit, for the benefit of CIBC, as additional collateral to support our obligations under the CIBC Loan Agreement. The MFP Letter of Credit initially matured on January 23, 2023, one month after the maturity date of the existing CIBC Loan Agreement. Concurrently, on September 22, 2022, we entered into a Subordinate Loan and Security Agreement, or the MFP Loan Agreement, with MFP, pursuant to which any draw CIBC may make on the MFP Letter of Credit will be deemed to be a term loan advance made by MFP to us. The MFP Loan Agreement initially provided for up to $9.0 million of term loan advances.

Concurrent with the October 28, 2022 amendment to the CIBC Loan Agreement (as described above), MFP amended the MFP Letter of Credit to increase the face amount from $9.0 million to $12.0 million, and the MFP Loan Agreement was amended to increase the maximum amount of term loan advances available to us from $9.0 million to $12.0 million. In connection with the December 23, 2022 amendment to the CIBC Loan Agreement, MFP amended the MFP Letter of Credit, extending the maturity date from January 23, 2023 to April 30, 2023

The MFP Loan Agreement will mature on November 30, 2025. Pursuant to the MFP Loan Agreement, we will pay to MFP a cash fee through the maturity date of the MFP Letter of Credit equal to 3.50% per annum on all amounts remaining undrawn under the MFP Letter of Credit. In the event any term advances are deemed made under the MFP Loan Agreement, such advances will bear interest at a rate per annum equal to term SOFR (with a floor of 1.25%) plus 9.25%, half of which will be payable in cash on the last day of each fiscal quarter and half of which will accrue as payment in kind interest payable on the maturity date, unless, with respect to any quarterly payment date, we elect to pay such interest in cash.

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The MFP Loan Agreement includes customary affirmative and negative covenants and events of default. The MFP Loan Agreement is secured by substantially all of our assets and is subordinated to the CIBC Loan Agreement. Upon the occurrence and during the continuance of an event of default, MFP may declare all outstanding obligations under the MFP Loan Agreement immediately due and payable and take such other actions as set forth in the MFP Loan Agreement.

Below is a summary of material changes to our sources of capital during subsequent to the six months ended December 31, 2022:

Shell Partnership

On February 6, 2023, S&W and Shell entered into a joint venture for the development and production of sustainable biofuel feedstocks through Vision Bioenergy (see "—Strategic Review" above), and we received $7.0 million at the Shell JV Closing and will be eligible to receive an additional $6.0 million in February 2024.

Payoff of Rooster Note

On February 6, 2023, the principal and accrued interest on the Rooster Note was paid off in its entirety in connection with the Vision Bioenergy partnership.

Amendment of NAB Finance Agreement

On February 8, 2023, we further amended the NAB Finance Agreement to change the maximum permissble net related entity position from AUD $25.0 million to USD $18.5 million. We believe that this amendment to the NAB Finance Agreement will provide us with greater control over our compliance with this undertaking.

Summary

The CIBC Loan Agreement and our debt facilities with NAB contain various operating and financial covenants. Adverse geopolitical and macroeconomic events and uncertain market conditions have increased the risk of our inability to comply with these covenants, which could result in acceleration of our repayment obligations and foreclosure on our pledged assets. In addition, these loan agreements contain cross-default provisions, such that certain defaults or breaches under any of our loan agreements may entitle CIBC to invoke default remedies. We were not in compliance with certain covenants in the CIBC Loan Agreement as of June 30, 2021, December 31, 2021, March 31, 2022, June 15, 2022 and June 30, 2022, and were required to obtain waivers and/or amendments from CIBC. In particular, the CIBC Loan Agreement as presently in effect requires us to maintain minimum liquidity of no less than $1.0 million and the NAB Finance Agreement, as amended, includes an undertaking that requires us to maintain a net related entity position of not more than USD $18.5 million. We are actively pursuing refinancing of the CIBC Loan Agreement.

Our future liquidity and capital requirements will be influenced by numerous factors, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the maturity and repayment of our debt;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the extent and sustainability of future operating income;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•the level and timing of future sales and expenditures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•timing for when we are able to recognize revenue;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•working capital required to support our growth;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•our ability to timely pay our growers;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•investment capital for plant and equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•investment in our sales and marketing programs;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•investment capital for potential acquisitions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•our ability to renew and/or refinance our debt on acceptable terms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•our ability to raise equity financing, in order to secure refinancing as well as support our operations, among other things;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•competition;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•market developments; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•developments related to adverse geopolitical and macroeconomic events, including the COVID-19 pandemic, inflation and supply chain disruptions.

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We cannot assure you that we will be successful in renewing or refinancing our existing debt, raising additional capital, securing future waivers and/or amendments from CIBC, NAB or our other lenders, or securing new financing. If we are unsuccessful in doing so, we may need to reduce the scope of our operations, repay amounts owing to our lenders, finance our cash needs through a combination of equity and debt financings, enter into collaborations, strategic alliances and licensing arrangements, sell certain assets or divest certain operations.

If we are required or desire to raise additional capital in the future, whether as a condition to loan refinancing or separately, such additional financing may not be available on favorable terms, or available at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership interest would be diluted and the terms of these securities could include liquidation or other preferences that adversely affect your rights as a common stockholder. Debt financing may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends and may be secured by all or a portion of our assets, and may be on terms less favorable than our existing loans. If we fail to obtain additional capital as and when required, such failure could have a material impact on our business, results of operations and financial condition.

As a result of the COVID-19 pandemic and actions taken to slow its spread, the ongoing military conflict between Russia and Ukraine, and other geopolitical and macroeconomic factors beyond our control, the global credit and financial markets have experienced extreme volatility, including diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty about economic stability. It is possible that further deterioration in credit and financial markets and confidence in economic conditions will occur. If equity and credit markets deteriorate, it may affect our ability to raise equity capital, borrow on our existing facilities or make any additional necessary debt or equity financing more difficult to obtain, more costly and/or more dilutive. In addition, while we are currently in compliance with our loan agreements, our ability to comply with the terms of our loan agreements has been compromised and could result in an event of default. If an event of default were to occur, our lenders could accelerate our repayment obligations or enforce their other rights under our agreements with them. Any such default may also require us to seek additional or alternative financing, which may not be available on commercially reasonable terms or at all.

**Summary of Cash Flows**

The following table shows a summary of our cash flows for the six months ended December 31, 2022 and 2021:

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| | | |
|:---|:---|:---|
|  | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2022** | **2021** |
| Cash flows from operating activities | $(8399653) | $(8065824) |
| Cash flows from investing activities | 2248663 | (1206255) |
| Cash flows from financing activities | 5446944 | 8699613 |
| Effect of exchange rate changes on cash | (24290) | (233405) |
| Net decrease in cash and cash equivalents | (728336) | (805871) |
| Cash and cash equivalents, beginning of period | 2056508 | 3527937 |
| Cash and cash equivalents, end of period | $1328172 | $2722066 |

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Operating Activities

For the six months ended December 31, 2022, operating activities used $8.4 million in cash. Of this, the net loss excluding non-cash items as detailed on the statement of cash flows used $8.0 million in cash and changes in operating assets and liabilities as detailed on the statement of cash flows used $0.4 million in cash. The decrease in cash from changes in operating assets and liabilities was primarily driven by a $5.6 million increase in deferred revenue from prepayments for our fiscal 2023 United States domestic business and decreased inventories of $0.6 million, offset by a $4.0 million increase in accounts receivable, a decrease in accounts payable and accruals of $1.6 million, and a $0.7 million increase in other non-current assets.

For the six months ended December 31, 2021, operating activities used $8.1 million in cash. Of this, the net loss excluding non-cash items as detailed on the statement of cash flows used $11.0 million in cash, while changes in operating assets and liabilities as detailed on the statement of cash flows provided $3.0 million in cash. The increase in cash from changes in operating assets and liabilities was primarily driven by an increase in deferred revenue from prepayment on end of season revenue of $5.5 million, a decrease in accounts receivable of $2.5 million, and an increase in accounts payable of $1.1 million, partially offset by an increase in inventory of $5.7 million.

Investing Activities

Investing activities during the six months ended December 31, 2022 provided $2.2 million in cash, which resulted from $2.0 million in proceeds from the partnership transaction between Trigall Genetics and S&W Australia, $0.4 million in proceeds from the sale of our

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remaining shares of Bioceres stock, offset by $0.2 million in additions to property, plant and equipment for our United States and Australian facilities.

Investing activities during the six months ended December 31, 2021 used $1.2 million of cash, consisting of additions to property, plant and equipment.

Financing Activities

Financing activities during the six months ended December 31, 2022 provided $5.4 million in cash, consisting of $6.6 million in net borrowings on the working capital lines of credit and $0.3 million of borrowings of long-term debt, partially offset by repayments of long-term debt of $1.1 million and debt issuance costs of $0.4 million.

Financing activities during the six months ended December 31, 2021 provided $8.7 million in cash. During the six months ended December 31, 2021, we had net borrowings on the working capital lines of credit and borrowings of long-term debt of $4.8 million, net proceeds from sale of common stock of $4.9 million, partially offset by net repayments of long-term debt of $0.7 million.

**Inflation Risk** 

Inflationary pressures on labor and commodity price increases directly impacted our condensed consolidated results of operations during the six months ended December 31, 2022, and we expect this to continue throughout the remainder of fiscal year 2023. We attempt to manage any inflationary costs through selective price increases and changes in product mix, but rapidly changing inflationary pressures from global commodity prices and logistics could impact our costs of goods before pricing adjustments can be implemented. Delays in implementing such price increases, competitive pressures, and other factors may limit our ability to recover such cost increases in the future. Inherent volatility experienced in certain commodity markets could have a significant effect on our results of operations and may have an adverse effect on us in the future. The extent of any impact will depend on our ability to manage such volatility through the product mix that we sell and selective price increases.

**Critical Accounting Estimates**

This discussion of our financial condition and results of operations is based upon our unaudited condensed consolidated financial statements, which are prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and related disclosures. On an ongoing basis, we evaluate our estimates, judgments and assumptions. We base our estimates of the carrying value of certain assets and liabilities on historical experience and on various other assumptions that we believe to be reasonable. Our actual results may differ from these estimates under different assumptions or conditions.

A critical accounting estimate is one that involves a significant level of estimation uncertainty and has had or is reasonably likely to have a material impact on our financial condition or results of operations. Accordingly, we believe that our estimates for revenue recognition, internal-use software, and business combinations are the most critical to fully understand and evaluate our financial condition and results of operations.

During the six months ended December 31, 2022, there were no changes in our critical accounting estimates. For additional information regarding our critical accounting estimates, see the discussion under "Critical Accounting Policies" in "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K for the year ended June 30, 2022, as filed with the SEC on September 28, 2022.

**Item 3. Quantitative and Qualitative Disclosures About Market Risk.**

We are a smaller reporting company and, therefore, we are not required to provide information typically disclosed under this item.

**Item 4. Controls and Procedures.**

**Disclosure Controls and Procedures**

Our management, with the participation of our Principal Executive Officer and our Principal Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2022. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include,

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without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of December 31, 2022, our Principal Executive Officer and Principal Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

**Changes in Internal Control over Financial Reporting**

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) or in other factors that occurred during the period of our evaluation that have significantly affected, or are reasonably likely to significantly affect, our internal control over financial reporting.

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**Part II**

**OTHER INFORMATION**

**Item 1. Legal Proceedings.**

From time to time, we are involved in lawsuits, claims, investigations and proceedings, including pending opposition proceedings involving patents that arise in the ordinary course of business. There are no matters pending that we expect to have a material adverse impact on our business, results of operations, financial condition or cash flows.

**Item 1A. Risk Factors.**

We are a smaller reporting company, and, as such, we are not required to provide the information under this Item of Form 10-Q.

**Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.**

None.

**Item 3. Defaults Upon Senior Securities.**

None.

**Item 4. Mine Safety Disclosures.**

Not applicable.

**Item 5. Other Information.**

On February 8, 2023, S&W Australia, our wholly owned Australian subsidiary, entered into an amendment to the NAB Finance Agreement to revise the maximum permissible net related entity position from AUD $25.0 million to USD $18.5 million.

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**Item 6. Exhibits.** 

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| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 3.1(1) | [<u>Registrant's Articles of Incorporation, as amended</u>](https://www.sec.gov/Archives/edgar/data/0001477246/000156459021005404/sanw-ex31_230.htm). |
| 3.2(2) | [<u>Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock.</u>](https://www.sec.gov/Archives/edgar/data/0001477246/000156459022006273/sanw-ex31_6.htm) |
| 3.3(3) | [<u>Registrant's Second Amended and Restated Bylaws, together with Amendment One thereto.</u>](https://www.sec.gov/Archives/edgar/data/0001477246/000156459020025503/sanw-ex33_288.htm) |
| 4.1 | Reference is made to Exhibits [<u>3.1</u>](https://www.sec.gov/Archives/edgar/data/0001477246/000156459021005404/sanw-ex31_230.htm), [<u>3.2</u>](https://www.sec.gov/Archives/edgar/data/0001477246/000156459022006273/sanw-ex31_6.htm) and [<u>3.3</u>](https://www.sec.gov/Archives/edgar/data/0001477246/000156459020025503/sanw-ex33_288.htm). |
| 4.2(4) | [<u>Form of Common Stock Certificate.</u>](https://www.sec.gov/Archives/edgar/data/1477246/000113626117000168/exh4-3.htm) |
| 4.3(5) | [<u>Form of Warrant issued on February 18, 2022.</u>](https://www.sec.gov/Archives/edgar/data/0001477246/000156459022006273/sanw-ex41_7.htm) |
| 4.4(6) | [<u>Common Stock Purchase Warrant issued to MFP Partners, L.P. on September 22, 2022.</u>](https://www.sec.gov/Archives/edgar/data/1477246/000095017022025074/sanw-ex4_4.htm) |
| 4.5 | [<u>Common Stock Purchase Warrant issued to MFP Partners, L.P. on October 28, 2022.</u>](sanw-ex4_5.htm) |
| 4.6 | [<u>Common Stock Purchase Warrant issued to MFP Partners, L.P. on December 22, 2022.</u>](sanw-ex4_6.htm) |
| 10.1 | [<u>Amendment and Restatement Deed, dated October 18, 2022, by and between National Australia Bank Limited and S&W Seed Company Australia Pty Ltd</u>](sanw-ex10_1.htm).  |
| 10.2 | [<u>Amendment Deed, dated October 21, 2022, by and between National Australia Bank Limited and S&W Seed Company Australia Pty Ltd.</u>](sanw-ex10_2.htm) |
| 10.3 | [<u>Seventh Amendment to Loan and Security Agreement, dated October 28, 2022, by and among S&W Seed Company, Seed Holding, LLC, Stevia California, LLC and CIBC Bank USA.</u>](sanw-ex10_3.htm) |
| 10.4 | [<u>First Amendment to Subordinate Loan and Security Agreement, dated October 28, 2022, by and between S&W Seed Company and MFP Partners, L.P.</u>](sanw-ex10_4.htm) |
| 10.5 | [<u>Eighth Amendment to Loan and Security Agreement, dated December 23, 2022, by and among S&W Seed Company, Seed Holding, LLC, Stevia California, LLC and CIBC Bank USA.</u>](sanw-ex10_5.htm) |
| 10.6 | [<u>Second Amendment to Subordinate Loan and Security Agreement, dated December 22, 2022, by and between S&W Seed Company and MFP Partners, L.P.</u>](sanw-ex10_6.htm) |
| 10.7 | [<u>Third Amendment to Note, dated December 23, 2022, by and between S&W Seed Company and Rooster Capital LLC.</u>](sanw-ex10_7.htm) |
| 10.8+ | [<u>S&W Seed Company Non-Employee Director Compensation Policy</u>](sanw-ex10_8.htm) |
| 31.1 | [<u>Certification of Chief Executive Officer Pursuant to Rule 13-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.</u>](sanw-ex31_1.htm) |
| 31.2 | [<u>Certification of Chief Financial Officer Pursuant to Rule 13-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.</u>](sanw-ex31_2.htm) |
| 32.1\* | [<u>Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.</u>](sanw-ex32_1.htm) |
| 32.2\* | [<u>Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.</u>](sanw-ex32_2.htm) |
| 101.INS | Inline XBRL Instance Document |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document |

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104 Cover Page Interactive Data File (embedded within the Inline XBRL document) <br>

(1)Incorporated by reference to Exhibit 3.1 to the Registrant's Quarterly Report on Form 10-Q, filed on February 11, 2021 (File No. 001-34719).

(2)Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, filed on February 23, 2022 (File No. 001-34719).

(3)Incorporated by reference to Exhibit 3.3 to the Registrant's Quarterly Report on Form 10-Q, filed on May 14, 2020 (File No. 001-34719).

(4)Incorporated by reference to Exhibit 4.3 to the Registrant's Registration Statement on Form S-3, filed on August 4, 2017 (File No. 333-219726).

(5)Incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K, filed on February 23, 2022 (File No. 001-34719).

(6)Incorporated by reference to Exhibit 4.4 to the Registrant's Quarterly Report on Form 10-Q, filed on November 14, 2022 (File No. 001-34719).

\* This certification accompanies the Quarterly Report on Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Registrant under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.

+ Indicates management contract or compensatory plan.

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**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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| | | |
|:---|:---|:---|
|  | **S&W SEED COMPANY** | **S&W SEED COMPANY** |
| Date: February 13, 2023 | By: | /s/ Elizabeth Horton |
|  |  | Elizabeth Horton |
|  |  | Chief Financial Officer<br>(On behalf of the registrant in her capacity as<br>Principal Financial and Accounting Officer) |

---

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## Ex-4

NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT (I) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (II) PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL SELECTED BY THE HOLDER TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY OR (III) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

**COMMON STOCK PURCHASE WARRANT**

**S&W SEED COMPANY**

Warrant Shares: 166,700 Issuance Date: October 28, 2022

This Common Stock Purchase Warrant (this "<u>Warrant</u>") certifies that, for value received, the receipt and sufficiency of which is hereby acknowledged, MFP Partners, L.P. or its assigns (the "<u>Holder</u>"), is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the Issuance Date and on or prior to the close of business on the five-year anniversary of the Issuance Date (the "<u>Termination Date</u>") but not thereafter, to subscribe for and purchase from S&W Seed Company, a Nevada corporation (the "<u>Company</u>"), up to 166,700 fully paid, nonassessable shares (as subject to adjustment hereunder, the "<u>Warrant Shares</u>") of Common Stock of the Company ("<u>Common Stock</u>"). The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b) of this Warrant.

<u>Section 1.</u><u>Definitions</u>. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Subordinate Loan and Security Agreement, dated September 22, 2022, as amended by the First Amendment thereto dated October 28, 2022, by and between the Company and the Holder (the "<u>Agreement</u>"). As used in this Warrant, the following terms shall have the following meanings:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a."Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, such Person; provided that, for the purposes of this definition, "control" (including, with correlative meanings, the terms "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b."<u>Business Day</u>" means any day except any Saturday, any Sunday, any day that is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c."<u>Person</u>" means any entity, whether incorporated or not, organization or individual.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d."<u>Proceeding</u>" means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e."<u>Trading Day</u>" means any day on which the Trading Market is not closed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f."<u>Trading Market</u>" means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq

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Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, the OTCQB or the OTCCQX, (or any successors to any of the foregoing).

<u>Section 2.</u><u>Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Exercise of Warrant</u>. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Issuance Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly executed copy of the Notice of Exercise sent to the Company by facsimile or electronic mail in the form annexed hereto and, within three Trading Days of the date said Notice of Exercise, delivery to the Company of the aggregate Exercise Price for the shares thereby purchased by wire transfer or cashier's check drawn on a United States bank or, if available, pursuant to the cashless exercise procedure specified in Section 2(c) below. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case the Holder shall surrender this Warrant to the Company for cancellation as soon as practicable after such issuance without delaying the Company's obligation to deliver the Warrant Shares on the Warrant Share Delivery Date (as defined in Section 2(d)(i) of this Warrant) in order to effect an exercise hereunder. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver confirmation of, or any objection to, any Notice of Exercise within one Business Day of receipt of such notice. **The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.** The Company's obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the conditions hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Exercise Price</u>. The exercise price per share of the Common Stock under this Warrant shall be $1.60, subject to adjustment hereunder (the "<u>Exercise Price</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Cashless Exercise</u>. If at any time after the Issuance Date, there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares by the Holder, then this Warrant may also be exercised, in whole or in part, at such time by means of a "cashless exercise" in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) = the arithmetic average of the VWAP of the Common Stock for the five consecutive Trading Days ending on the date immediately preceding the date of the applicable Notice of Exercise;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) = the Exercise Price of this Warrant then in effect at the time of exercise, as adjusted hereunder; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(X) = the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

For purposes of Rule 144(d) promulgated under the Securities Act of 1933, as amended (the "<u>Securities Act</u>"), as in effect on the date hereof, it is intended that the Warrant Shares issued in a cashless exercise shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced, on the Issuance Date. Notwithstanding anything herein to the contrary, on the

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Termination Date, any unexercised portion of this Warrant shall be automatically exercised via cashless exercise pursuant to this Section 2(c).

"<u>VWAP</u>" means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:00 p.m. (New York City time)), (b) if the Common Stock is then listed or quoted on OTCQB or OTCQX, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX, as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported in the "Pink Sheets" published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Mechanics of Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Delivery of Warrant Shares Upon Exercise</u>. Warrant Shares purchased hereunder shall be transmitted by the Company's transfer agent, Transfer Online, Inc. (the "<u>Transfer Agent</u>") to the Holder by crediting the account of the Holder's or its designee's balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system ("<u>DWAC</u>") if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner of sale limitations pursuant to Rule 144, and otherwise by physical delivery of a certificate, registered in the Company's share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is three Trading Days after the delivery to the Company of the Notice of Exercise so long as the Holder delivers the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c)) on or prior to the second Trading Day following the date on which the Company has received the Notice of Exercise (such date, the "<u>Warrant Share Delivery Date</u>") (provided that if the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c) is delivered) has not been delivered by such date, the Warrant Share Delivery Date shall be one Trading Day after the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c)) is delivered. The Warrant Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise Price (or by cashless exercise, if permitted).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.<u>Delivery of New Warrants Upon Exercise</u>. If this Warrant shall have been exercised in part, the Company shall, at its own expense, promptly following the request of the Holder and upon surrender of this Warrant certificate to the Company and in no event later than three Trading Days thereafter, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii.<u>Rescission Rights</u>. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv.<u>Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise</u>. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder's brokerage firm otherwise purchases, shares of Common Stock to deliver in

3. ------

satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a "<u>Buy-In</u>"), then the Company shall, within three Trading Days after the Holder's request and in the Holder's discretion, either (A) pay in cash to the Holder an amount equal to the Holder's total purchase price (including brokerage commissions and other out of pocket expenses, if any) for the shares of Common Stock so purchased (the "<u>Buy-In Price</u>"), at which point the Company's obligation to deliver the number of Unavailable Warrant Shares equal to the number of shares of Common Stock purchased by or on behalf of the Holder in respect of such Buy-In shall terminate, or (B) pay in cash to the Holder the amount, if any, by which (x) the Buy-In Price exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) any trading price of the Common Stock selected by the Holder in writing as in effect at any time during the period beginning on the date of the applicable Notice of Exercise and ending on the applicable Warrant Share Delivery Date, and at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver in the manner required by Section 2(d)(i) to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder's right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company's failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v.<u>No Fractional Shares or Scrip</u>. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall round up the number of Warrant Shares so issued to the next whole share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi.<u>Charges, Taxes and Expenses</u>. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to The Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii.<u>Closing of Books</u>. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

<u>Section 3.</u><u>Certain Adjustments</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Stock Dividends and Splits</u>. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Pro Rata Distributions</u>. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "<u>Distribution</u>"), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Fundamental Transaction</u>. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, effects any merger or consolidation of the Company with or into another Person, or any stock sale to, or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, share exchange or scheme of arrangement) with or into another Person (other than such a transaction in which the Company is the surviving or continuing entity and its Common Stock is not exchanged for or converted into other securities, cash or property), (ii) the Company, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, effects any sale of all or substantially all of its assets in one transaction or a series of related transactions, (iii) any tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which more than 50% of the Common Stock not held by the Company or such Person is exchanged for or converted into other securities, cash or property, or (iv) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant (other than as a result of a dividend, subdivision or combination covered by Section 3(a) above) to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (each a "<u>Fundamental Transaction</u>"), then the Company shall use its commercially reasonable efforts to ensure that the Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then issuable upon exercise in full of this Warrant. If any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity does not agree to assume this Warrant in connection with a Fundamental Transaction, then the Holder may exercise this Warrant at any time prior to the consummation of such Fundamental Transaction (and such exercise may be made contingent upon the consummation of such Fundamental Transaction), and any portion of this Warrant that has not been exercised prior to the consummation of such Fundamental Transaction shall terminate and expire, and shall no longer be outstanding. The provisions of this Section 3(c) shall apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Calculations</u>. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Notice to Holder</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Adjustment to Exercise Price</u>. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder a notice by facsimile or electronic mail setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.<u>Notice to Allow Exercise by Holder</u>. If (A) the Company shall declare a dividend or distribution on or a redemption of the Common Stock, (B) the approval of any shareholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any

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compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or (C) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered via facsimile or electronic mail to the Holder at its last address as it shall appear upon the Warrant Register (as defined below), at least 10 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, or redemption are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii.<u>Other Events</u>. If any event occurs of the type contemplated by the provisions of this Section 3 but not expressly provided for by such provisions, then the Company's Board of Directors will make an appropriate adjustment in the Exercise Price and the number of Warrant Shares, as mutually determined by the Company's Board of Directors and the Holder, so as to protect the rights of the Holder; <u>provided</u> that no such adjustment pursuant to Section 3(i) will increase the Exercise Price or decrease the number of Warrant Shares as otherwise determined pursuant to this Section 3.

<u>Section 4.</u><u>Transfer of Warrant</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Transferability</u>. Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>New Warrants</u>. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Issuance Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Warrant Register</u>. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the "<u>Warrant Register</u>"), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Transfer Restrictions</u>. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the Holder or transferee of this Warrant, as the case may be, comply with the provisions of Section 5.6 of that certain Securities Purchase Agreement, dated February 18, 2022, by and among the Company and the purchasers signatory thereto (the "<u>Purchase Agreement</u>") that are applicable to Common Conversion Shares (as defined in the Purchase Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Representations by the Holder</u>. The Holder, by the acceptance hereof, represents and warrants that it is an accredited investor as that term is defined in Section 501 of Regulation D promulgated under the Securities Act, that it is acquiring this Warrant and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant to sales registered or exempted under the Securities Act; <u>provided,</u> <u>however</u>, that by making the representations herein, the Holder does not agree to hold any of the Warrants or the Warrant Shares for any minimum or other specific term.

<u>Section 5.</u><u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>No Rights as Shareholder Until Exercise</u>. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth herein, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person's capacity as the Holder of this Warrant, any of the rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section 6(a), the Company shall provide the Holder with copies of the same notices and other information given to the shareholders of the Company generally, contemporaneously with the giving thereof to the shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Loss, Theft, Destruction or Mutilation of Warrant</u>. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Saturdays, Sundays, Holidays, etc</u>. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Authorized Shares</u>. The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that all

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Noncircumvention</u>. Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its articles of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f.<u>Authorizations</u>. Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g.<u>Governing Law and Venue</u>. This Warrant will be governed by the laws of the State of New York without regard to conflicts of laws principles. The Company and Holder submit to the exclusive jurisdiction of the State and Federal courts in New York, New York. The Company and Holder expressly submit and consent in advance to such jurisdiction in any action or suit commenced in any such court, and the Company and Holder hereby waive any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consent to the granting of such legal or equitable relief as is deemed appropriate by such court.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h.<u>Restrictions</u>. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered and the Holder does not utilize cashless exercise, may have restrictions upon resale imposed by state and federal securities laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Nonwaiver and Expenses</u>. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder's rights, powers or remedies, notwithstanding the fact that all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys' fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;j.<u>Notices</u>. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Agreement. The foregoing notwithstanding, any notice of exercise intended to be delivered pursuant to this Warrant shall, in addition to the notice provisions of the Agreement, shall also be delivered by e-mail to the following e-mail address: notice@swseedco.com.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;k.<u>Limitation of Liability</u>. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Stock or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;l.<u>Disputes</u>. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail within two Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two Business Days submit via facsimile or electronic mail (a) the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of the Warrant Shares to the Company's independent, outside accountant. The Company shall cause at its expense the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than 10 Business Days from the time it receives the disputed determinations or calculations. Such investment bank's or accountant's determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;m.<u>Remedies</u>. The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant. The Company agrees that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach, including monetary damages, would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled, in addition to all other available remedies, to seek an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required, and the Company expressly agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;n.<u>Successors and Assigns</u>. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o.<u>Amendment</u>. Except as otherwise provided herein, this Warrant may only be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;p.<u>Severability</u>. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant so long as this Warrant as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;q.<u>Headings</u>. This Warrant shall be deemed to be jointly drafted by the Company and the initial Holder and shall not be construed against any Person as the drafter hereof. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;r.**<u>WAIVER OF JURY TRIAL</u>. IN ANY ACTION OR PROCEEDING IN ANY JURISDICTION BROUGHT BY OR ON BEHALF OF THE COMPANY AGAINST ANY OTHER PERSON IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTIONS** 

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**CONTEMPLATED HEREBY, THE COMPANY KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.**

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(Signature Page Follows)

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## Ex-4

NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT (I) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (II) PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL SELECTED BY THE HOLDER TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY OR (III) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

**COMMON STOCK PURCHASE WARRANT**

**S&W SEED COMPANY**

Warrant Shares: 666,700 Issuance Date: December 22, 2022

This Common Stock Purchase Warrant (this "<u>Warrant</u>") certifies that, for value received, the receipt and sufficiency of which is hereby acknowledged, MFP Partners, L.P. or its assigns (the "<u>Holder</u>"), is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the Issuance Date and on or prior to the close of business on the five-year anniversary of the Issuance Date (the "<u>Termination Date</u>") but not thereafter, to subscribe for and purchase from S&W Seed Company, a Nevada corporation (the "<u>Company</u>"), up to 666,700 fully paid, nonassessable shares (as subject to adjustment hereunder, the "<u>Warrant Shares</u>") of Common Stock of the Company ("<u>Common Stock</u>"). The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b) of this Warrant.

<u>Section 1</u>. <u>Definitions</u>. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Subordinate Loan and Security Agreement, dated September 22, 2022, as amended by the First Amendment thereto dated October 28, 2022, and the Second Amendment thereto dated December 22, 2022, by and between the Company and the Holder (the "<u>Agreement</u>"). As used in this Warrant, the following terms shall have the following meanings:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a."Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, such Person; provided that, for the purposes of this definition, "control" (including, with correlative meanings, the terms "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b."<u>Business Day</u>" means any day except any Saturday, any Sunday, any day that is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c."<u>Person</u>" means any entity, whether incorporated or not, organization or individual.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d."<u>Proceeding</u>" means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e."<u>Trading Day</u>" means any day on which the Trading Market is not closed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f."<u>Trading Market</u>" means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq

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Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, the OTCQB or the OTCCQX, (or any successors to any of the foregoing).

<u>Section 2</u>. <u>Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Exercise of Warrant</u>. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Issuance Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly executed copy of the Notice of Exercise sent to the Company by facsimile or electronic mail in the form annexed hereto and, within three Trading Days of the date said Notice of Exercise, delivery to the Company of the aggregate Exercise Price for the shares thereby purchased by wire transfer or cashier's check drawn on a United States bank or, if available, pursuant to the cashless exercise procedure specified in Section 2(c) below. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case the Holder shall surrender this Warrant to the Company for cancellation as soon as practicable after such issuance without delaying the Company's obligation to deliver the Warrant Shares on the Warrant Share Delivery Date (as defined in Section 2(d)(i) of this Warrant) in order to effect an exercise hereunder. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver confirmation of, or any objection to, any Notice of Exercise within one Business Day of receipt of such notice. **The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.** The Company's obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the conditions hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Exercise Price</u>. The exercise price per share of the Common Stock under this Warrant shall be $1.60, subject to adjustment hereunder (the "<u>Exercise Price</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Cashless Exercise</u>. If at any time after the Issuance Date, there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares by the Holder, then this Warrant may also be exercised, in whole or in part, at such time by means of a "cashless exercise" in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) = the arithmetic average of the VWAP of the Common Stock for the five consecutive Trading Days ending on the date immediately preceding the date of the applicable Notice of Exercise;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) = the Exercise Price of this Warrant then in effect at the time of exercise, as adjusted hereunder; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(X) = the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

For purposes of Rule 144(d) promulgated under the Securities Act of 1933, as amended (the "<u>Securities Act</u>"), as in effect on the date hereof, it is intended that the Warrant Shares issued in a cashless exercise shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall

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be deemed to have commenced, on the Issuance Date. Notwithstanding anything herein to the contrary, on the Termination Date, any unexercised portion of this Warrant shall be automatically exercised via cashless exercise pursuant to this Section 2(c).

"<u>VWAP</u>" means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:00 p.m. (New York City time)), (b) if the Common Stock is then listed or quoted on OTCQB or OTCQX, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX, as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported in the "Pink Sheets" published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Mechanics of Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Delivery of Warrant Shares Upon Exercise</u>. Warrant Shares purchased hereunder shall be transmitted by the Company's transfer agent, Transfer Online, Inc. (the "<u>Transfer Agent</u>") to the Holder by crediting the account of the Holder's or its designee's balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system ("<u>DWAC</u>") if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner of sale limitations pursuant to Rule 144, and otherwise by physical delivery of a certificate, registered in the Company's share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is three Trading Days after the delivery to the Company of the Notice of Exercise so long as the Holder delivers the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c)) on or prior to the second Trading Day following the date on which the Company has received the Notice of Exercise (such date, the "<u>Warrant Share Delivery Date</u>") (provided that if the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c) is delivered) has not been delivered by such date, the Warrant Share Delivery Date shall be one Trading Day after the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c)) is delivered. The Warrant Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise Price (or by cashless exercise, if permitted).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.<u>Delivery of New Warrants Upon Exercise</u>. If this Warrant shall have been exercised in part, the Company shall, at its own expense, promptly following the request of the Holder and upon surrender of this Warrant certificate to the Company and in no event later than three Trading Days thereafter, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii.<u>Rescission Rights</u>. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv.<u>Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise</u>. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to an exercise on or before the Warrant Share

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Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder's brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a "<u>Buy-In</u>"), then the Company shall, within three Trading Days after the Holder's request and in the Holder's discretion, either (A) pay in cash to the Holder an amount equal to the Holder's total purchase price (including brokerage commissions and other out of pocket expenses, if any) for the shares of Common Stock so purchased (the "<u>Buy-In Price</u>"), at which point the Company's obligation to deliver the number of Unavailable Warrant Shares equal to the number of shares of Common Stock purchased by or on behalf of the Holder in respect of such Buy-In shall terminate, or (B) pay in cash to the Holder the amount, if any, by which (x) the Buy-In Price exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) any trading price of the Common Stock selected by the Holder in writing as in effect at any time during the period beginning on the date of the applicable Notice of Exercise and ending on the applicable Warrant Share Delivery Date, and at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver in the manner required by Section 2(d)(i) to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder's right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company's failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v.<u>No Fractional Shares or Scrip</u>. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall round up the number of Warrant Shares so issued to the next whole share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi.<u>Charges, Taxes and Expenses</u>. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to The Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii.<u>Closing of Books</u>. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

<u>Section 3</u>. <u>Certain Adjustments</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Stock Dividends and Splits</u>. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately

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adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Pro Rata Distributions</u>. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "<u>Distribution</u>"), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Fundamental Transaction</u>. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, effects any merger or consolidation of the Company with or into another Person, or any stock sale to, or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, share exchange or scheme of arrangement) with or into another Person (other than such a transaction in which the Company is the surviving or continuing entity and its Common Stock is not exchanged for or converted into other securities, cash or property), (ii) the Company, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, effects any sale of all or substantially all of its assets in one transaction or a series of related transactions, (iii) any tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which more than 50% of the Common Stock not held by the Company or such Person is exchanged for or converted into other securities, cash or property, or (iv) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant (other than as a result of a dividend, subdivision or combination covered by Section 3(a) above) to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (each a "<u>Fundamental Transaction</u>"), then the Company shall use its commercially reasonable efforts to ensure that the Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then issuable upon exercise in full of this Warrant. If any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity does not agree to assume this Warrant in connection with a Fundamental Transaction, then the Holder may exercise this Warrant at any time prior to the consummation of such Fundamental Transaction (and such exercise may be made contingent upon the consummation of such Fundamental Transaction), and any portion of this Warrant that has not been exercised prior to the consummation of such Fundamental Transaction shall terminate and expire, and shall no longer be outstanding. The provisions of this Section 3(c) shall apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Calculations</u>. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Notice to Holder</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Adjustment to Exercise Price</u>. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder a notice by facsimile or electronic

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mail setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.<u>Notice to Allow Exercise by Holder</u>. If (A) the Company shall declare a dividend or distribution on or a redemption of the Common Stock, (B) the approval of any shareholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or (C) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered via facsimile or electronic mail to the Holder at its last address as it shall appear upon the Warrant Register (as defined below), at least 10 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, or redemption are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii.<u>Other Events</u>. If any event occurs of the type contemplated by the provisions of this Section 3 but not expressly provided for by such provisions, then the Company's Board of Directors will make an appropriate adjustment in the Exercise Price and the number of Warrant Shares, as mutually determined by the Company's Board of Directors and the Holder, so as to protect the rights of the Holder; <u>provided</u> that no such adjustment pursuant to Section 3(i) will increase the Exercise Price or decrease the number of Warrant Shares as otherwise determined pursuant to this Section 3.

<u>Section 4</u>. <u>Transfer of Warrant</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Transferability</u>. Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>New Warrants</u>. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on

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transfers or exchanges shall be dated the Issuance Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Warrant Register</u>. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the "<u>Warrant Register</u>"), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Transfer Restrictions</u>. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the Holder or transferee of this Warrant, as the case may be, comply with the provisions of Section 5.6 of that certain Securities Purchase Agreement, dated February 18, 2022, by and among the Company and the purchasers signatory thereto (the "<u>Purchase Agreement</u>") that are applicable to Common Conversion Shares (as defined in the Purchase Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Representations by the Holder</u>. The Holder, by the acceptance hereof, represents and warrants that it is an accredited investor as that term is defined in Section 501 of Regulation D promulgated under the Securities Act, that it is acquiring this Warrant and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant to sales registered or exempted under the Securities Act; <u>provided</u>, <u>however</u>, that by making the representations herein, the Holder does not agree to hold any of the Warrants or the Warrant Shares for any minimum or other specific term.

<u>Section 6</u>. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>No Rights as Shareholder Until Exercise</u>. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth herein, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person's capacity as the Holder of this Warrant, any of the rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section 6(a), the Company shall provide the Holder with copies of the same notices and other information given to the shareholders of the Company generally, contemporaneously with the giving thereof to the shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Loss, Theft, Destruction or Mutilation of Warrant</u>. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Saturdays, Sundays, Holidays, etc</u>. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business Day.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Noncircumvention</u>. Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its articles of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f.<u>Authorizations</u>. Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g.<u>Governing Law and Venue</u>. This Warrant will be governed by the laws of the State of New York without regard to conflicts of laws principles. The Company and Holder submit to the exclusive jurisdiction of the State and Federal courts in New York, New York. The Company and Holder expressly submit and consent in advance to such jurisdiction in any action or suit commenced in any such court, and the Company and Holder hereby waive any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consent to the granting of such legal or equitable relief as is deemed appropriate by such court.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h.<u>Restrictions</u>. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered and the Holder does not utilize cashless exercise, may have restrictions upon resale imposed by state and federal securities laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Nonwaiver and Expenses</u>. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder's rights, powers or remedies, notwithstanding the fact that all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys' fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;j.<u>Notices</u>. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Agreement. The foregoing notwithstanding, any notice of exercise intended to be delivered pursuant to this Warrant shall, in

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addition to the notice provisions of the Agreement, shall also be delivered by e-mail to the following e-mail address: notice@swseedco.com.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;k.<u>Limitation of Liability</u>. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Stock or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;l.<u>Disputes</u>. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail within two Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two Business Days submit via facsimile or electronic mail (a) the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of the Warrant Shares to the Company's independent, outside accountant. The Company shall cause at its expense the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than 10 Business Days from the time it receives the disputed determinations or calculations. Such investment bank's or accountant's determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;m.<u>Remedies</u>. The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant. The Company agrees that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach, including monetary damages, would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled, in addition to all other available remedies, to seek an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required, and the Company expressly agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;n.<u>Successors and Assigns</u>. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o.<u>Amendment</u>. Except as otherwise provided herein, this Warrant may only be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;p.<u>Severability</u>. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant so long as this Warrant as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;q.<u>Headings</u>. This Warrant shall be deemed to be jointly drafted by the Company and the initial Holder and shall not be construed against any Person as the drafter hereof. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;r.**<u>WAIVER OF JURY TRIAL</u>. IN ANY ACTION OR PROCEEDING IN ANY JURISDICTION BROUGHT BY OR ON BEHALF OF THE COMPANY AGAINST ANY OTHER PERSON IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTIONS CONTEMPLATED HEREBY, THE COMPANY KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.** 

\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*

(Signature Page Follows)

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

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| |
|:---|
| **S&W SEED COMPANY**<br>|
| By:<u>/s/ Betsy Horton</u> <br>Name: Betsy Horton<br>Title: Chief Financial Officer |

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11. 279448053

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**NOTICE OF EXERCISE**

To: S&W Seed Company

(1) The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

(2) Payment shall take the form of (check applicable box):

[ ] in lawful money of the United States; or

[ ] if permitted, the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).

(3) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

_______________________________

The Warrant Shares shall be delivered to the following DWAC Account Number:

_______________________________

_______________________________

_______________________________

(4) <u>Accredited Investor</u>. The undersigned is an "accredited investor" as defined in Regulation D promulgated under the Securities Act of 1933, as amended.

[SIGNATURE OF HOLDER]

(Name of Investing Entity)

(Signature of Authorized Signatory of Investing Entity)

(Name of Authorized Signatory)

(Title of Authorized Signatory)

(Date)

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ASSIGNMENT FORM

(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to

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| | |
|:---|:---|
| Name: | ___________________________________ |
|  | (Please Print) |
| Address: | ___________________________________ |
|  | (Please Print) |
| Dated: _______________ __, ______ |  |
| Holder's Signature: ______________________ |  |
| Holder's Address: _________________________<br>|  |

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13. 279448053

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## Ex-10

![img31847469_0.jpg](img31847469_0.jpg)

AMENDMENT AND

RESTATEMENT DEED

**National Australia Bank Limited**

**and** 

**S&W SEED COMPANY AUSTRALIA PTY LTD A.C.N. 061 114 814**

**DATED 18 October 2022**

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**Table of Contents**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** DEFINITIONS AND INTERPRETATION............................................................................ 2

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** CONDITIONS PRECEDENT. .............................................................................................. 3

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** AMENDMENT AND RESTATEMENT ................................................................................. 3

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** CONFIRMATION .................................................................................................................. 3

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** REPRESENTATIONS AND WARRANTIES........................................................................ 3

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** GENERAL ........................................................................................................................... 4© National Australia Bank Limited 1

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THIS DEED is dated the date shown on the front page and is made between:

**NATIONAL AUSTRALIA BANK LIMITED ABN 12 004 044 937** of 395 Bourke Street, Melbourne, Victoria

3000 **(NAB);**

Each person listed as a borrower in the Schedule **(Borrower** and together the **Borrowers);**

Each person (if any) listed as a cross-guarantor in the Schedule **(Cross-Guarantor** and together the

**Cross-Guarantors);** and

Each person (if any) listed as a security provider in the Schedule **(Security Provider** and together the

**Security Providers).**

This Deed remains available for acceptance until 11 January 2023 at which time it will lapse.

**BACKGROUND:**

**A** Some or all the parties are parties to the Original Agreement.

**B** The parties agree to amend and restate the Original Agreement on the terms and conditions set out in this document.

**C** With effect on and from the Effective Date, the Original Agreement is amended and restated in accordance with this document.

**IT IS AGREED** as follows:

**1. DEFINITIONS AND INTERPRETATION**

**1.1 Definitions**

Words which have a defined meaning in the Original Agreement have the same meaning in this document unless otherwise defined.

**Effective Date** means the date NAB gives the notice contemplated in clause 2.1 (Conditions precedent).

**Obligor** means each Borrower, Cross-Guarantor and Security Provider.

**Original Agreement** means the facility agreement between NAB and some or all the Obligors dated, or most recently amended or restated on, 15 December 2021.

**1.2 Interpretation**

Clause 1.4 (Interpretation) of the General Conditions of the Original Agreement applies to this document as set out in full in this document.

**1.3 Inconsistent law**

To the extent permitted by law, this document prevails to the extent it is inconsistent with any law.© National Australia Bank Limited 2

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**1.4 Consideration**

The parties enter into this document in consideration of, among other things, the mutual promises contained in this document.

**1.5 Finance Document**

This document is a Finance Document for the purposes of the Original Agreement.

**1.6 No undisclosed agency, partnership, scheme or trust**

No party enters into this document as agent for an undisclosed principal, as a partner of any partnership, trustee of any trust, responsible entity of any registered scheme or otherwise for the benefit of any other person except as expressly described in this document.

**2. CONDITIONS PRECEDENT**

**2.1 Conditions precedent**

The amendments proposed to the Original Agreement referred to in clause 3 (Amendment and restatement) are of no force and effect until NAB has notified the Borrowers in writing that each of the following has been received by NAB or otherwise complied with in form and substance satisfactory to NAB:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The results of NAB's enquiries and searches

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) An original of this document duly and fully executed by the Obligors.

**2.2 Certification of copies**

Unless otherwise required by NAB, each document specified in respect of an Obligor in clause 2.1 (Conditions precedent) must be an original. If NAB requires a certified copy of a document, the copy must be certified by a director or secretary of that Obligor as true and complete as at a date no earlier than 5 Business Days before the date of this document.

**3. AMENDMENT AND RESTATEMENT**

With effect on and from the Effective Date, the Original Agreement is amended and restated in the form set out in the annexure to this document.

**4. CONFIRMATION**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) With effect on and from the Effective Date, each party confirms and agrees that it is a party to, and bound by the terms of, the Original Agreement, as amended and restated by this document, in each capacity in which that party is named in the annexure to this document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Obligor agrees to any security documents and guarantees granted by it continuing to secure obligations under the Original Agreement, as amended and restated by this document.

 **5. REPRESENTATIONS AND WARRANTIES**

On the date of this document and on the Effective Date, each representation and warranty contained in the Original Agreement is deemed to be repeated by each Obligor for the benefit of NAB with reference to the facts and circumstances subsisting as at the date of this document and the Effective Date respectively.© National Australia Bank Limited 3

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**6. GENERAL**

&nbsp;&nbsp;&nbsp;&nbsp;6.1 **Communications and Notices**

Clause 31 (Communications and Notices) of the General Conditions of the Original Agreement applies to this document as if set out in full in this document.

&nbsp;&nbsp;&nbsp;&nbsp;6.2 **Counterparts**

This document may be executed in any number of counterparts and, if so, the counterparts taken together constitute one and the same instrument.

&nbsp;&nbsp;&nbsp;&nbsp;6.3 **Governing law and jurisdiction**

This document is governed by the laws that govern the Original Agreement. Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts exercising jurisdiction there.© National Australia Bank Limited 4

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**SCHEDULE 1**

**BORROWER(S)**

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814

**CROSS-GUARANTOR(S) (IF ANY)**

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 S&W HOLDINGS AUSTRALIA PTY LTD ACN 162 715 326

PASTURE GENETICS PTY LTD ACN 074 290 252

S&W WHEAT PTY LTD ACN 660 612 984

**SECURITY PROVIDER(S) (IF ANY)**

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 PASTURE GENETICS PTY LTD ACN 074 290 252

S&W HOLDINGS AUSTRALIA PTY LTD ACN 162 715 326

S&W WHEAT PTY LTD ACN 660 612 984© National Australia Bank Limited 5

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**EXECUTED AS A DEED**

**SIGNATURES**

&nbsp;&nbsp;Executed on behalf of **National Australia Bank Limited** by its Attorney who holds the position of Level 2 Attorney under Power of Attorney dated 1 March 2001 in the presence of:<br>

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| | |
|:---|:---|
| &nbsp;&nbsp;/s/Hugh Mincham Bailey | &nbsp;&nbsp;/s/Benjamin James Vanderkop |
| &nbsp;&nbsp;Signature of Witness | &nbsp;&nbsp;Signature of Attorney  |
| &nbsp;&nbsp;HUGH MINCHAM BAILEY | &nbsp;&nbsp;BENJAMIN JAMES VANDERKOP |
| &nbsp;&nbsp;Name of Witness (print) | &nbsp;&nbsp;Name of Attorney |

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| | |
|:---|:---|
| &nbsp;&nbsp;Executed by **S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114814** in accordance with Section 127 of the Corporations Act 2001 |  |
| &nbsp;&nbsp;/s/Cameron Victor Henley | &nbsp;&nbsp;/s/Andrew Ross Carthew |
| &nbsp;&nbsp;Signature of director | &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;CAMERON VICTOR HENLEY | &nbsp;&nbsp;ANDREW ROSS CARTHEW |
| &nbsp;&nbsp;Name of director (print)<br>| &nbsp;&nbsp;Name of director/company secretary (print) |

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| | |
|:---|:---|
| &nbsp;&nbsp;Executed by **S&W HOLDINGS COMPANY AUSTRALIA PTY LTD ACN 162 715326** in accordance with Section 127 of the Corporations Act 2001 |  |
| &nbsp;&nbsp;/s/Cameron Victor Henley | &nbsp;&nbsp;/s/Andrew Ross Carthew |
| &nbsp;&nbsp;Signature of director | &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;CAMERON VICTOR HENLEY | &nbsp;&nbsp;ANDREW ROSS CARTHEW |
| &nbsp;&nbsp;Name of director (print) | &nbsp;&nbsp;Name of director/company secretary (print) |

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| | |
|:---|:---|
| &nbsp;&nbsp;Executed by **PASTURE GENETICS PTY LTD ACN 074 290 252** in accordance with Section 127 of the Corporations Act 2001 |  |
| &nbsp;&nbsp;/s/Cameron Victor Henley | &nbsp;&nbsp;/s/Andrew Ross Carthew |
| &nbsp;&nbsp;Signature of director | &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;CAMERON VICTOR HENLEY | &nbsp;&nbsp;CAMERON VICTOR HENLEY |
| &nbsp;&nbsp;Name of director (print) | &nbsp;&nbsp;Name of director/company secretary (print) |

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© National Australia Bank Limited 6

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| | |
|:---|:---|
| &nbsp;&nbsp;Executed by **S&W WHEAT PTY LTD ACN 660 612 984** in accordance with Section 127 of the Corporations Act 2001 |  |
| &nbsp;&nbsp;/s/Cameron Victor Henley | &nbsp;&nbsp;/s/Andrew Ross Carthew |
| &nbsp;&nbsp;Signature of director | &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;CAMERON VICTOR HENLEY | &nbsp;&nbsp;CAMERON VICTOR HENLEY |
| &nbsp;&nbsp;Name of director (print) | &nbsp;&nbsp;Name of director/company secretary (print) |

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© National Australia Bank Limited 7

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**ANNEXTURE**

AMENDED AND RESTATED ORIGINAL AGREEMENT© National Australia Bank Limited 8

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![img31847469_1.jpg](img31847469_1.jpg)

FINANCE AGREEMENT

National Australia Bank Limited

**and** 

&nbsp;&nbsp;&nbsp;&nbsp;**S&W SEED COMPANY AUSTRALIA PTY LTD A.C.N. 061 114 814**

**DATED 18 October 2022**© National Australia Bank Limited 9

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This Finance Agreement is dated as shown on the front page and is made between

**NATIONAL AUSTRALIA BANK LIMITED ABN 12 004 044 937** of 395 Bourke Street, Melbourne, Victoria 3000 **(NAB)** and each person listed in the Key Information.

**FACILITIES IN THIS FINANCE AGREEMENT**

 NAB makes the following facilities available on the terms set out in this document:

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;Facility 1: | &nbsp;&nbsp;&nbsp;Bank Guarantee Facility | &nbsp;&nbsp;&nbsp;$105831 |
| &nbsp;&nbsp;&nbsp;Facility 2: | &nbsp;&nbsp;&nbsp;Trade Refinance Facility | &nbsp;&nbsp;$40000000 |
| &nbsp;&nbsp;&nbsp;Facility 3: | &nbsp;&nbsp;&nbsp;NAB Business Markets - Flexible Rate Loan | &nbsp;&nbsp;$4000000 |
| &nbsp;&nbsp;&nbsp;Facility 4: | &nbsp;&nbsp;&nbsp;Farm Management Account Overdraft Facility | &nbsp;&nbsp;$2000000 |
| &nbsp;&nbsp;&nbsp;Facility 5: | &nbsp;&nbsp;&nbsp;Farmer's Choice Package |  |
| &nbsp;&nbsp;&nbsp;Facility 6: | &nbsp;&nbsp;&nbsp;Revolving Lease Limit | &nbsp;&nbsp;$3000000 |
| &nbsp;&nbsp;&nbsp;Facility 7: | &nbsp;&nbsp;&nbsp;NAB Corporate and Purchasing Card | &nbsp;&nbsp;$200000 |

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 This document has the following sections:

o the Facility Details (see page 11);

o Key Information (see page 23);

o Specific Facility Terms (see page 30); and

o General Conditions - Finance Agreement (see page 62).

**SIGNATURES**

[Intentionally deleted]© National Australia Bank Limited 10

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**FACILITY DETAILS**

**FACILITY 1: BANK GUARANTEE FACILITY**

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| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;**FACILITY:** | &nbsp;&nbsp;&nbsp;&nbsp;**BANK GUARANTEE FACILITY**<br>Key aspects of this Facility include the following:<br>&nbsp;&nbsp;&nbsp;&nbsp;• NAB may unilaterally pay out a Bank Guarantee at any time whether or not it receives a demand from a Beneficiary.<br>&nbsp;&nbsp;&nbsp;&nbsp;• NAB may pay out a Bank Guarantee without making any enquiry and even if the Borrower disputes the validity of any demand.<br>&nbsp;&nbsp;&nbsp;&nbsp;• NAB may pay out a Bank Guarantee up to the Maximum Liability payable in one or more payments.<br>**These aspects are essential elements of the Facility and allow NAB to, among other things, manage the risk and cost of providing this Facility and to ensure NAB-issued Bank Guarantees continue to be accepted in the market.** |
| &nbsp;&nbsp; <br>Borrower: | &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 |
| &nbsp;&nbsp; <br>Facility Limit: | &nbsp;&nbsp; <br>$105831 |
| &nbsp;&nbsp; <br>Purpose: | &nbsp;&nbsp; <br>To enable the issuance of rental guarantees.<br>Financial accommodation provided under this Facility is, or must be, applied for business purposes. |
| &nbsp;&nbsp; <br>Expiry Date: | &nbsp;&nbsp; <br>30 September 2023 |
| &nbsp;&nbsp; <br>Review Date: | &nbsp;&nbsp; <br>NAB may review pricing in accordance with clause 14 (Review) of the General Terms. |
| &nbsp;&nbsp; <br>Review Fee: | &nbsp;&nbsp; <br>**$0** |
| &nbsp;&nbsp; <br>Issuing Fee: | &nbsp;&nbsp;&nbsp;&nbsp;**1.2%**<br>Calculated on the face value of each Bank Guarantee payable on issue, subject to a minimum fee of **$125** for each Bank Guarantee. |
| &nbsp;&nbsp; <br>Service Fee: | &nbsp;&nbsp; <br>**2.4%**<br>Calculated on the face value of each Bank Guarantee per year. Payable in arrears, on a pro-rata basis, half yearly from the date a Bank Guarantee is issued and on the cancellation of the Bank Guarantee and the Termination Date and subject to<br>a minimum fee **of$125per** Bank Guarantee for each payment. |
| &nbsp;&nbsp; <br>Nominated Account: | &nbsp;&nbsp; <br>To be advised.<br>For the purposes of debiting and crediting amounts in relation to this Facility under this document. |

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© National Australia Bank Limited 11

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<u> Other Conditions:</u> <u> The General Terms and Bank Guarantee Facility Specific Conditions apply to this Facility. </u>© National Australia Bank Limited 12

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**FACILITY 2: TRADE REFINANCE FACILITY**

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| | |
|:---|:---|
| &nbsp;&nbsp; <br>**FACILITY:** | &nbsp;&nbsp; <br>**TRADE REFINANCE FACILITY** |
| &nbsp;&nbsp; <br>Borrower: | &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 |
| &nbsp;&nbsp; <br>Facility Limit: | &nbsp;&nbsp; <br>$40000000 |
| &nbsp;&nbsp; <br>Purpose: | &nbsp;&nbsp; <br>To provide a revolving facility for trade refinance requirements in Australian dollars on fixed term periods of up to 30 days.<br>Credit or financial accommodation provided under this Facility is, or must be, applied for business purposes. |
| &nbsp;&nbsp; <br>Expiry Date: | &nbsp;&nbsp; <br>30 September 2024 |
| &nbsp;&nbsp; <br>Review Date: | &nbsp;&nbsp; <br>NAB may review pricing in accordance with clause 14 (Review) of the General Terms. |
| &nbsp;&nbsp; <br>Term of Drawing: | &nbsp;&nbsp; <br>The Borrower can determine the term of each Drawing which may be for a period of up to 180 days or any other period that NAB at its discretion may approve. |
| &nbsp;&nbsp; <br>Interest Rate (foreign currency): | &nbsp;&nbsp; <br>The interest rate for a Drawing denominated in a foreign currency is fixed at the time of that Drawing and will be:<br>Foreign Currency Fixed Lending Rate plus a customer margin of 1.65% p.a..<br>Foreign Currency Fixed Lending Rate means the Foreign Currency Fixed Lending Rate quoted by NAB at the time of that Drawing. |
| &nbsp;&nbsp; <br>Interest Rate (Dollar): | &nbsp;&nbsp; <br>The interest rate for a Drawing denominated in Dollars is fixed at the time of that Drawing and will be:<br>Floating Rate plus a customer margin of 1.65% p.a.. |
| &nbsp;&nbsp; <br>Floating Rate: | &nbsp;&nbsp; <br>NAB's Australian Trade Refinance (ATR) Rate<br>As quoted by NAB at the start of each Interest Period. |
| &nbsp;&nbsp; <br>Payment of interest: | &nbsp;&nbsp; <br>Interest is calculated daily. It is payable in arrears on the last day of the term of<br>a Drawing and if the last day of the term of a Drawing is not a Banking Day, on the last Banking Day of the term. Interest is also payable on the Termination Date. |
| &nbsp;&nbsp; <br>Facility Fee: | &nbsp;&nbsp; <br>1.500% per annum of the Facility Limit calculated on a 365 day basis payable in advance. The first such fee will be payable on a pro-rata basis, on the date of this agreement, with subsequent fees being payable in full on the last Business Day of each quarter and upon the cancellation of the facility. |
| &nbsp;&nbsp; <br>Other Fees and Charges: | &nbsp;&nbsp; <br>NAB's standard fees and charges from time to time will apply to all transactions under this Facility. Refer to the Fees Guide. |
| &nbsp;&nbsp; <br>Nominated Account: | &nbsp;&nbsp;&nbsp;&nbsp;To be advised.<br>For the purposes of debiting and crediting amounts in relation to this Facility under this document. |

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© National Australia Bank Limited 13

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| | |
|:---|:---|
| &nbsp;&nbsp; <br>Other Conditions: | &nbsp;&nbsp; <br>The General Terms, the Global Trade Finance Specific Conditions and the terms and conditions set out in any additional documents relating to Trade Finance required by NAB's normal practice apply to this Facility.<br>Borrowing Base Annexure to the Global Trade Finance Specific Conditions applies to this Facility. |
| &nbsp;&nbsp; <br>Default Interest Rate: | &nbsp;&nbsp; <br>Calculated at NAB's Base Indicator Rate plus a customer margin of 1.65% p.a. plus a default margin of 1% p.a.. |

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© National Australia Bank Limited 14

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**FACILITY 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN**

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp; <br>**FACILITY:** | &nbsp;&nbsp; <br>**NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN** | &nbsp;&nbsp; <br>**NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN** |
| &nbsp;&nbsp; <br>Borrower: | &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061114 814 | &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061114 814 |
| &nbsp;&nbsp; <br>Facility Limit: | &nbsp;&nbsp; <br>$4000000 | &nbsp;&nbsp; <br>$4000000 |
| &nbsp;&nbsp; <br>Loan Account: | &nbsp;&nbsp; <br>085005 733334200 | &nbsp;&nbsp; <br>085005 733334200 |
| &nbsp;&nbsp; <br>Purpose: | &nbsp;&nbsp; <br>To assist with the purchase of Pasture Genetics PL.<br>Credit provided under this Facility is, or must be, applied for approved business purposes or investment purposes. | &nbsp;&nbsp; <br>To assist with the purchase of Pasture Genetics PL.<br>Credit provided under this Facility is, or must be, applied for approved business purposes or investment purposes. |
| &nbsp;&nbsp; <br>Expiry Date: | &nbsp;&nbsp; <br>31 May 2026 | &nbsp;&nbsp; <br>31 May 2026 |
| &nbsp;&nbsp; <br>Review Date: | &nbsp;&nbsp; <br>NAB may review pricing in accordance with clause 14 (Review) of the General Terms. | &nbsp;&nbsp; <br>NAB may review pricing in accordance with clause 14 (Review) of the General Terms. |
| &nbsp;&nbsp; <br>Pricing Period: | &nbsp;&nbsp; <br>The Borrower can determine the Pricing Period which may be for a period of 30, 60, 90 or 180 days or any other period that NAB at its discretion may approve. | &nbsp;&nbsp; <br>The Borrower can determine the Pricing Period which may be for a period of 30, 60, 90 or 180 days or any other period that NAB at its discretion may approve. |
| &nbsp;&nbsp; <br>Interest Rate: | &nbsp;&nbsp; <br>The interest rate for each Pricing Period is the weighted average of the interest rates applicable to each of the Business Markets Facility components (being the Fixed Amount, the Flexible Maturity Fixed Amount, the Cap Amount and/or the Floating Amount) for that Pricing Period. For more information see the NAB Business Markets Facility Specific Conditions. | &nbsp;&nbsp; <br>The interest rate for each Pricing Period is the weighted average of the interest rates applicable to each of the Business Markets Facility components (being the Fixed Amount, the Flexible Maturity Fixed Amount, the Cap Amount and/or the Floating Amount) for that Pricing Period. For more information see the NAB Business Markets Facility Specific Conditions. |
| &nbsp;&nbsp; <br>Limit allocation: | &nbsp;&nbsp; <br>Floating Amount: | &nbsp;&nbsp; <br>$4000000 |
| &nbsp;&nbsp; <br>Limit allocation: | &nbsp;&nbsp; <br>Fixed Amount: | &nbsp;&nbsp; <br>To be advised |
| &nbsp;&nbsp; <br>Limit allocation: | &nbsp;&nbsp; <br>Cap Amount: | &nbsp;&nbsp; <br>To be advised |
| &nbsp;&nbsp; <br>Limit allocation: | &nbsp;&nbsp; <br>Flexible Maturity Fixed Amount: | &nbsp;&nbsp; <br>To be advised |
| &nbsp;&nbsp; <br>Floating Rate: | &nbsp;&nbsp; <br>The Floating Rate for a Pricing Period is the Business Lending Rate plus the Customer Margin. | &nbsp;&nbsp; <br>The Floating Rate for a Pricing Period is the Business Lending Rate plus the Customer Margin. |
| &nbsp;&nbsp; <br>Business Lending Rate: | &nbsp;&nbsp; <br>**1.98% p.a.** (indicative)<br>- see the NAB Business Markets Rate Facility Specific Conditions. | &nbsp;&nbsp; <br>**1.98% p.a.** (indicative)<br>- see the NAB Business Markets Rate Facility Specific Conditions. |
| &nbsp;&nbsp; <br>Customer Margin: | &nbsp;&nbsp; <br>**2.6% p.a.** | &nbsp;&nbsp; <br>**2.6% p.a.** |
| &nbsp;&nbsp; <br>Fixed Rate: | &nbsp;&nbsp; <br>**As advised by NAB in writing**<br>See the NAB Business Markets Facility Specific Conditions. | &nbsp;&nbsp; <br>**As advised by NAB in writing**<br>See the NAB Business Markets Facility Specific Conditions. |
| &nbsp;&nbsp; <br>Cap Rate: | &nbsp;&nbsp; <br>**As advised by NAB in writing**<br>See the NAB Business Markets Facility Specific Conditions. | &nbsp;&nbsp; <br>**As advised by NAB in writing**<br>See the NAB Business Markets Facility Specific Conditions. |

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© National Australia Bank Limited 15

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| | |
|:---|:---|
| &nbsp;&nbsp; <br>Flexible Maturity Fixed Rate: | &nbsp;&nbsp; <br>**As advised by NAB in writing**<br>See the NAB Business Markets Facility Specific Conditions. |
| &nbsp;&nbsp; <br>Cap Rate Premium: | &nbsp;&nbsp; <br>**$0** |
| &nbsp;&nbsp; <br>Review Fee: | &nbsp;&nbsp; <br>**$0** |
| &nbsp;&nbsp; <br>Service Fee: | &nbsp;&nbsp; <br>Not applicable |
| &nbsp;&nbsp; <br>Amortisation: | &nbsp;&nbsp; <br>The Facility Limit will automatically reduce by $500,000 per year, commencing 31 May 2023. |
| &nbsp;&nbsp; <br>Nominated Account: | &nbsp;&nbsp; <br>To be advised.<br>For the purposes of debiting and crediting amounts in relation to this Facility under this document. |
| &nbsp;&nbsp; <br>Other Conditions: | &nbsp;&nbsp; <br>The General Terms and NAB Business Markets Facility Specific Conditions apply to this Facility. |
| &nbsp;&nbsp; <br>Default Interest Rate: | &nbsp;&nbsp; <br>Calculated at NAB's Base Indicator Rate plus the Customer Margin plus a default margin of 1% p.a.. |

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© National Australia Bank Limited 16

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**FACILITY 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY**

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| | |
|:---|:---|
| &nbsp;&nbsp;**FACILITY:** | &nbsp;&nbsp;**FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY**<br>Key aspects of this Facility include the following:<br>• The Facility is fluctuating in nature and it is expected that the linked transaction account will regularly fluctuate between debit and credit balances. To help ensure this takes place, NAB may require that all, or an agreed part, of the Borrower's gross business income is credited to its linked transaction account.<br>• The Facility can be unilaterally terminated at any time on demand by NAB.<br>• NAB can unilaterally reduce the Facility Limit at any time.<br>**These aspects are essential elements of the Facility and allow NAB to, among other things, manage the risk and cost of providing this Facility.** |
| &nbsp;&nbsp; <br>Borrower: | &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 |
| &nbsp;&nbsp; <br>Facility Limit: | &nbsp;&nbsp; <br>$2,000,000<br>Drawings in excess of the Facility Limit may only be made with NAB's prior consent. |
| &nbsp;&nbsp; <br>Loan Account: | &nbsp;&nbsp; <br>085005 857726783 |
| &nbsp;&nbsp; <br>Purpose: | &nbsp;&nbsp;To cover financial requirements for the day to day operations of the Borrower. <br>Credit provided under this Facility is, or must be, applied for business purposes. |
| &nbsp;&nbsp; <br>Expiry Date: | &nbsp;&nbsp; <br>29 September 2023 |
| &nbsp;&nbsp; <br>Review Date: | &nbsp;&nbsp; <br>NAB may review pricing in accordance with clause 14 (Review) of the General Terms. |
| &nbsp;&nbsp; <br>Interest Rate: | &nbsp;&nbsp; <br>While part of the Farmer's Choice Package: **NAB's Farmer's Choice Prime Indicator Rate** <br>plus a customer margin of **0% p.a..**<br>While not part of the Farmer's Choice Package:<br>**NAB's Business Overdraft Prime Indicator Rate**<br>plus a customer margin of **0% p.a..** |
| &nbsp;&nbsp; <br>Service Fee: | &nbsp;&nbsp; <br>Not applicable ·  |
| &nbsp;&nbsp; <br>Facility Fee: | &nbsp;&nbsp;**$0**<br>Payable annually each year. |
| &nbsp;&nbsp; <br>Review Fee: | &nbsp;&nbsp;$0<br>Payable on each review of this Facility. |

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© National Australia Bank Limited 17

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| | |
|:---|:---|
| &nbsp;&nbsp; <br>Nominated Account: | &nbsp;&nbsp; <br>To be advised.<br>For the purposes of debiting and crediting amounts in relation to this Facility under this document. |
| &nbsp;&nbsp; <br>Other Conditions: | &nbsp;&nbsp;The General Terms and Overdraft Facility Specific Conditions apply to this Facility. <br>The Farmer's Choice Package Specific Conditions apply to this Facility. |
| &nbsp;&nbsp; <br>Default Interest Rate: | &nbsp;&nbsp; <br>Calculated at NAB's Base Indicator Rate plus a customer margin of 0% p.a. plus a default margin of 1% p.a.. |

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© National Australia Bank Limited 18

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**FACILITY 5: FARMER'S CHOICE PACKAGE**

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| | |
|:---|:---|
| &nbsp;&nbsp; <br>**FACILITY:** | &nbsp;&nbsp; <br>**FARMER'S CHOICE PACKAGE** |
| &nbsp;&nbsp; <br>Borrower: | &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061114 814 |
| &nbsp;&nbsp; <br>Transaction Account: | &nbsp;&nbsp; <br>085005 857726783 |
| &nbsp;&nbsp; <br>Maximum Aggregate Borrowing Limit<br>**(MABL):** | &nbsp;&nbsp; <br>$4000000 |
| &nbsp;&nbsp; <br>Farmer's Choice Facilities: | &nbsp;&nbsp; <br>The Farmer's Choice Package initially will include the following Facilities: |
| &nbsp;&nbsp; <br>Farmer's Choice Facilities: | &nbsp;&nbsp; <br>Facility3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN |
| &nbsp;&nbsp; <br>Farmer's Choice Facilities: | &nbsp;&nbsp; <br>Please refer to the Details for each Facility specified above. |
| &nbsp;&nbsp; <br>Expiry Date: | &nbsp;&nbsp; <br>29 September 2023 |
| &nbsp;&nbsp; <br>MABL Reduction Option: | &nbsp;&nbsp; <br>Option 4 - Long Term Repayment Option |
| &nbsp;&nbsp; <br>Repayment Details: | &nbsp;&nbsp; <br>Reducing limit: the Facility Limit will automatically reduce by $500,000 per year. |
| &nbsp;&nbsp; <br>Annual Package Fee: | &nbsp;&nbsp; <br>**$800**<br>See the Farmer's Choice Package Specific Conditions. |
| &nbsp;&nbsp; <br>Other Concession or Benefit: | &nbsp;&nbsp; <br>See the Farmer's Choice Package Specific Conditions. |
| &nbsp;&nbsp; <br>Negotiated Fee Structure: | &nbsp;&nbsp; <br>Not Applicable |
| &nbsp;&nbsp; <br>Other Conditions: | &nbsp;&nbsp; <br>The General Terms and the Farmer's Choice Package Specific Conditions apply to this Facility. |

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© National Australia Bank Limited 19

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**OTHER FACILITIES**

Following are details of some Other Facilities provided by NAB to a Borrower. The terms and conditions of each Other Facility are set out in the Transactions Specific Document, if any, for the Other Facility, each other document referred to in the "Other Conditions" section of the Details and, subject to clause 1.5 (Inconsistency), this document.

**FACILITY 6: REVOLVING LEASE LIMIT**

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| | |
|:---|:---|
| &nbsp;&nbsp; <br>**FACILITY:** | &nbsp;&nbsp; <br>**REVOLVING LEASE LIMIT** |
| &nbsp;&nbsp; <br>Borrower: | &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 |
| &nbsp;&nbsp; <br>Facility Limit: | &nbsp;&nbsp; <br>$3000000 |
| &nbsp;&nbsp; <br>Expiry Date: | &nbsp;&nbsp; <br>29 September 2023 |
| &nbsp;&nbsp; <br>Other Conditions: | &nbsp;&nbsp; <br>Master Asset Finance Agreement |

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**FACILITY 7: NAB CORPORATE AND PURCHASING CARD**

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| | |
|:---|:---|
| &nbsp;&nbsp; <br>**FACILITY:** | &nbsp;&nbsp; <br>**NAB CORPORATE AND PURCHASING CARD** |
| &nbsp;&nbsp; <br>Borrower: | &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 |
| &nbsp;&nbsp; <br>Facility Limit: | &nbsp;&nbsp; <br>$200000 |
| &nbsp;&nbsp; <br>Expiry Date: |  |
| &nbsp;&nbsp; <br>Other Conditions: | &nbsp;&nbsp;&nbsp;&nbsp;NAB Corporate and Purchasing Card Facility Terms and Conditions and NAB Corporate and Purchasing Card Facility - Letter of Offer |

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© National Australia Bank Limited 20

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**OPTION TO EXTEND CERTAIN FACILITIES**

The parties agree that if any of the following Facilities are specified in the Details, the Expiry Date for that Facility can be extended at the option of NAB:

o Bank Guarantee Facility;

o NAB Business Overdraft Facility;

o Documentary Letters of Credit;

o Documentary Letters of Credit and/ or Documents Surrendered;

o Farm Management Account Overdraft;

o Foreign Currency Overdraft Account;

o NAB Commercial Card Facilities;

o Overseas Bills Purchased;

o Set Off - Gross Debt Limit;

o Set Off - Net Debt Limit;

o Standby Letters of Credit;

o Trade Refinance Facility;

o Trade Refinance Facility (with Borrowing Base annexure);

o Revolving Lease Limit/ Master Asset Finance Facility;

o BPAY Batch Limit;

o Transaction Negotiation Facility;

o Direct Debit Facilities;

o NAB Connect;

o Merchant Facilities;

o NAB Invoice Finance;

o NAB Corporate Receivables Facility; and

o any other facility from time to time agreed to by NAB and the Borrower as a 12 Month Facility,

(each a **12 Month Facility).**

(a) On or before the Expiry Date for a 12 Month Facility, NAB may by written notice to the Borrower

cancel the Facility, in which case the Amount Owing will be repayable on a date being no less than 90 days after the Expiry Date (unless the Borrower is in Default, in which case the Amount Owing may be repayable on a date determined in accordance with this document).

(b) If NAB has not given a notice in accordance with paragraph (a) the Expiry Date for a 12 Month Facility

will be extended for a further 90 days for the purposes of an annual review of the Facility.© National Australia Bank Limited 21

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(c) After the period set out in paragraph (b), NAB will either:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) give notice to the Borrower that the Expiry Date will not be extended, in which case the Amount Owing will be repayable on a date being no less than 90 days after the date of such notice; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) give notice to the Borrower that the Expiry Date will be extended for a further period not exceeding 90 days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) with or without notice to the Borrower, extend the Expiry Date for a further 9-month period on the same terms and conditions as this document and any other terms and conditions applicable to a 12 Month Facility, and notified by NAB from time to time.

The option to extend a 12 Month Facility subject to the terms of this document will only be available for four consecutive annual periods from the initial Expiry Date, such that the final Expiry Date cannot be a date more than 5 years from the initial Expiry Date.

The Borrower repeats the representations and warranties that are made, or taken to be repeated, in accordance with this document (as varied from time to time) as at each Expiry Date (other than the final Expiry Date for a 12 Month Facility) and further represents and warrants to NAB that no Default subsists.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Expiry Date does not fall on a Business Day, it will be the next Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The above provisions prevail to the extent of any inconsistency.© National Australia Bank Limited 22

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**KEY INFORMATION**

**Item 1 (Obligors and Group)**

&nbsp;&nbsp;&nbsp;&nbsp;1.1 **Borrower(s)**

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814

&nbsp;&nbsp;&nbsp;&nbsp;1.2 **Cross-Guarantor(s**)

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814

S&W HOLDINGS AUSTRALIA PTY LTD ACN 162 715 326

PASTURE GENETICS PTY LTD ACN 074 290 252

S&W WHEAT PTY LTD ACN 660 612 984

&nbsp;&nbsp;&nbsp;&nbsp;1.3 **Security Provider(s)**

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814

PASTURE GENETICS PTY LTD ACN 074 290 252

S&W HOLDINGS AUSTRALIA PTY LTD ACN 162 715 326

S&W WHEAT PTY LTD ACN 660 612 984

&nbsp;&nbsp;&nbsp;&nbsp;1.4 **Groups**

Refer to definition of "Group" in clause 1.3 (Definitions)

**Item 2 (Security Documents)**

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; <br>**Name of Security Provider(s)** | &nbsp;&nbsp; <br>**Security Documents to be provided** | &nbsp;&nbsp; <br>**Facilities secured** |
| &nbsp;&nbsp;&nbsp;&nbsp;S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 | &nbsp;&nbsp;&nbsp;&nbsp;Term Deposit Letter of Set-Off over NAB Term Deposit Number 927408888 for an amount of $105,831 | &nbsp;&nbsp;&nbsp;&nbsp;Facility 1: BANK GUARANTEE FACILITY<br>Each Hedging Agreement |
| &nbsp;&nbsp;&nbsp;&nbsp;S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 | &nbsp;&nbsp;&nbsp;&nbsp;First registered mortgage over property situated at 4 & 5 Stirling Road, Keith SA 5267 more particularly described in Certificate of Title Volume 6186 Folios 122 and 123. | &nbsp;&nbsp;&nbsp;&nbsp;Facility 2: TRADE REFINANCE FACILITY<br>Facility 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN<br>Facility 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY<br>Each Hedging Agreement |

---

© National Australia Bank Limited 23

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---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 | &nbsp;&nbsp;&nbsp;&nbsp;Guarantee and Indemnity for $15,000,000 (Australian Dollars) from S&W Seed Company. | &nbsp;&nbsp;&nbsp;&nbsp;Facility 2: TRADE REFINANCE FACILITY<br>Facility 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN<br>Facility 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY<br>Each Hedging Agreement |
| &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 | &nbsp;&nbsp; <br>Right of Entry from Southaust Holdings Pty Ltd ACN 067 860 806 c/o Moore Stephens (SA) Pty Ltd of Level 2, 180 Flinders St Adelaide SA 5000 over 14-16 Hakkinen Road, WINGFIELD SA 5013 CT 5681/62 | &nbsp;&nbsp; <br>Facility 2: TRADE REFINANCE FACILITY<br>Facility 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN<br>Facility 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY<br>Each Hedging Agreement |
| &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 | &nbsp;&nbsp; <br>Right of Entry from Firstly Northland (SA) Pty Ltd ACN 080 423 365 of 14-16 Hakkinen Road Wingfield SA 5013 & Secondly from Robert Damin & Ann Elizabeth Damin all c/o 14-16 Hakkinen Road Wingfield CT 5976/648, 6020/269 & 6020/270 (Penfield) | &nbsp;&nbsp; <br>Facility 2: TRADE REFINANCE FACILITY<br>Facility 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN<br>Facility 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY<br>Each Hedging Agreement |
| &nbsp;&nbsp; <br>S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 | &nbsp;&nbsp; <br>First priority General Security Agreement over all present and after-acquired property | &nbsp;&nbsp; <br>Facility 2: TRADE REFINANCE FACILITY<br>Facility 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN<br>Facility 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY<br>Each Hedging Agreement |

---

© National Australia Bank Limited 24

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---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp; <br>PASTURE GENETICS PTY LTD ACN 074 290 252 | &nbsp;&nbsp; <br>First priority General Security Agreement over all present and after-acquired property | &nbsp;&nbsp; <br>Facility 2: TRADE REFINANCE FACILITY<br>Facility 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN<br>Facility 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY<br>Each Hedging Agreement |
| &nbsp;&nbsp; <br>S&W HOLDINGS AUSTRALIA PTY LTD ACN 162 715 326 | &nbsp;&nbsp; <br>First priority General Security Agreement over all present and after-acquired property | &nbsp;&nbsp; <br>Facility 2: TRADE REFINANCE FACILITY<br>Facility 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN<br>Facility 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY<br>Each Hedging Agreement |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>S&W WHEAT PTY LTD ACN 660 612 984 | &nbsp;&nbsp; <br>First priority General Security Agreement over all present and after-acquired property | &nbsp;&nbsp; <br>Facility 2: TRADE REFINANCE FACILITY<br>Facility 3: NAB BUSINESS MARKETS - FLEXIBLE RATE LOAN<br>Facility 4: FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY<br>Each Hedging Agreement |

---

**Item 3 (Material Documents)**

Not applicable

**Item 4 (Specified Documents and other conditions precedent) (clause 3.2(e)** (Conditions Precedent)}

**Specified Documents**

Not applicable

**Other Conditions Precedent**

Not applicable© National Australia Bank Limited 25

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**Item 5 (Mandatory Prepayment) (clause 5.2(b)** (Prepayment))

Not applicable

**Item 6 (Other Representations and Warranties) (clause 8.1(aa)** (Representations and Warranties))

Not applicable

**Item** 7 (Financial Statements and other documents) (clause 9(o) (Financial Statements and other documents to be delivered))

---

| | | | | |
|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;**Type of report** | &nbsp;&nbsp;&nbsp;&nbsp;**Entity** | &nbsp;&nbsp;&nbsp;&nbsp;**Audited/ Unaudited** | &nbsp;&nbsp;&nbsp;&nbsp;**Consolidated/ Unconsolidated** | &nbsp;&nbsp;&nbsp;&nbsp;**Due date for delivery to NAB** |
| &nbsp;&nbsp;&nbsp;&nbsp;**Annual Financial Statements** | &nbsp;&nbsp;&nbsp;&nbsp;S&W HOLDINGS AUSTRALIA PTY LTD ACN 162 715 326 | &nbsp;&nbsp;&nbsp;&nbsp;Unaudited | &nbsp;&nbsp;&nbsp;&nbsp;Consolidated | &nbsp;&nbsp;&nbsp;&nbsp;30 November 2022 and every 12 months thereafter |
| &nbsp;&nbsp;&nbsp;&nbsp;**Statutory payments certificate** (evidence satisfactory to NAB that all statutory payments have been met when due) | &nbsp;&nbsp;&nbsp;&nbsp;The Group |  |  | &nbsp;&nbsp;&nbsp;&nbsp;15 February 2023 and every 3 months thereafter |
| &nbsp;&nbsp;&nbsp;&nbsp;**Management accounts (including balance sheet, profit and loss statement and cash flow statement). Commentary to provided on variances greater than 15% to key line items.** | &nbsp;&nbsp;&nbsp;&nbsp;The Group |  |  | &nbsp;&nbsp;&nbsp;&nbsp;15 February 2023 and every 3 months thereafter |

---

**Item 8 (Other Undertakings) (clause 9(z) (other undertakings or conditions subsequent))**

(a) Net Related Entity Position:

The Group is to maintain a Net Related Entity Position at no less than $25,000,000.

"Net Related Entity Position" means current Related Entity assets plus non current Related Entity assets less current Related Entity liabilities less non current Related Entity liabilities.© National Australia Bank Limited 26

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**Item 9 (Financial Covenants) (clause 10.1** (Financial Covenants))

The Obligors must maintain the financial covenants set out below at all times.

The financial covenants will:

(a) be calculated by reference to GAAP; and

(b) be based on the then most recent Financial Statements and other financial information provided to NAB in accordance with this document.

NAB may test the financial covenants at any time.

**Financial Covenants**

The Interest Cover Ratio for the Group, for each period set out in the table below, must not be less than the ratio set out opposite that period in the table below.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Period** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Period** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**ICR** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Up to and including | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;30 June 2022 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2:1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1 July 2022 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;30 June 2023 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5:1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1 July 2023 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;30 June 2024 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.75:1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1 July 2024 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;onwards | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2:1 |

---

**Definitions**

For the purposes of these financial covenants, the following definitions and the definitions in the Property Conditions apply in addition to those set out in clause 1.3 (Definitions).

**Calculation Date** means the last day of each 12 month period until the Termination Date, commencing on the first Calculation Date of 30 June 2022.

**Calculation Period** means each period of twelve months ending on a Calculation Date, unless otherwise agreed in writing by NAB.

**EBITDA** means earnings before:

(a) interest;

(b) tax;

(c) depreciation;

(d) amortisation; and

(e) unrealised foreign exchange gains or losses.

**Interest Cover Ratio** or **ICR** means, for a Calculation Period, the ratio of EBITDA over that period to Interest Expense for that period.

**Interest Expense** means, in respect of a period, the aggregate amount of all interest and amounts in the nature of interest or of similar effect to interest paid or payable for that period, including:© National Australia Bank Limited 27

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(a) any dividend or distribution payable on any Marketable Security that constitutes Financial Indebtedness;

(b) payments under any finance or capital lease (except to the extent such payment constitutes a principal reduction of the amount financed);

(c) any discount on any bills, bonds, notes or other instruments drawn, accepted or endorsed;

(d) any commitment, line, facility, acceptance, letter of credit, discount, guarantee, insurance bond or other fees and other amounts of a regular or recurring nature payable during that period (but not establishment, arrangement, agency and other fees payable once only on the initial provision of Financial Indebtedness); and

(e) plus, or minus the net amount of any difference payments during that period under any interest rate hedging arrangement.

It includes interest on any shareholder loans unless capitalised or subordinated on terms acceptable to NAB.

**Item 10 (Hedging) (clause 10.3** (Hedging))

Not applicable

**Item 11 (Enforcement proceedings** - **Threshold Amount) (clause 11.1(g)** (Enforcement proceedings))

$250,000

**Item 12 (Other Events of Default) (clause 11.1(s)** (Other))

Not applicable

**Item 13 (Fees) (clause 17** (Fees))

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; <br>**Bank Fees** | &nbsp;&nbsp; <br>**Bank Fees** | &nbsp;&nbsp; <br>**Bank Fees** |
| &nbsp;&nbsp;&nbsp;&nbsp;Application/Establishment Fee: | &nbsp;&nbsp;&nbsp;&nbsp;payable on execution of this document | &nbsp;&nbsp;$8000.00 |
| &nbsp;&nbsp;&nbsp;&nbsp;Lodgment of Documents for Registration Fee  | &nbsp;&nbsp;&nbsp;&nbsp;payable on execution of this document | &nbsp;&nbsp;$115.00 |
| &nbsp;&nbsp;&nbsp;&nbsp;**Government Fees** | &nbsp;&nbsp;&nbsp;&nbsp;**Government Fees** | &nbsp;&nbsp;&nbsp;&nbsp;**Government Fees** |
| &nbsp;&nbsp;&nbsp;&nbsp;SA Title Search Fee (x2): | &nbsp;&nbsp;&nbsp;&nbsp;payable on execution of this document | &nbsp;&nbsp;$74.46 |
| &nbsp;&nbsp;&nbsp;&nbsp;**Total Estimated Fees $8,189.46** | &nbsp;&nbsp;&nbsp;&nbsp;**Total Estimated Fees $8,189.46** | &nbsp;&nbsp;&nbsp;&nbsp;**Total Estimated Fees $8,189.46** |

---

**Item 14 (Review Events) (clauses 14.4** (Review Event) **and 14.5** (Review Event Consequences))

Not applicable

**Item 15 (Communications) (clause 31** (Communications and Notices))

Details for service of communications to NAB:© National Australia Bank Limited 28

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---

| | |
|:---|:---|
| &nbsp;&nbsp;Name of Bank: | &nbsp;&nbsp;National Australia Bank Limited |
| &nbsp;&nbsp;Address: | &nbsp;&nbsp;L6, 22 King William Street, Adelaide SA 5000 |
| &nbsp;&nbsp;Attention: | &nbsp;&nbsp;Ben Vanderkop |
| &nbsp;&nbsp;Details for service of communications to the Obligor(s): | &nbsp;&nbsp;Details for service of communications to the Obligor(s): |
| &nbsp;&nbsp;Name of Obligor: | &nbsp;&nbsp;All Obligors |
| &nbsp;&nbsp;Address: | &nbsp;&nbsp;14-16 Hakkinen Road<br>|
|  | &nbsp;&nbsp;Wingfield SA 5013<br>|
| &nbsp;&nbsp;Attention: | &nbsp;&nbsp;The Secretary |
| &nbsp;&nbsp;Email: |  |

---

**Item 16 (Governing Law Jurisdiction) (clause** 37) (Governing Law & Jurisdiction))

South Australia

**Item 17 (Trust) and (Trust Documents)**

Not Applicable

**Item 18 (Partnership) and (Partnership Documents)**

Not applicable

**Item 19 (Scheme), (Custodian), (Custody Agreement) and (Scheme Documents)**

Not applicable

**Item 20 (Other)**

Not applicable© National Australia Bank Limited 29

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**SPECIFIC FACILITY TERMS**

**BANK GUARANTEE FACILITY SPECIFIC CONDITIONS**

**FOREIGN CURRENCY WARNING NOTICE**

This important notice should be read and understood before the Borrower decides to enter into a facility or transaction in a foreign currency.

This notice is intended to provide the Borrower with a general warning of the risks that can arise from adverse exchange rate movements when transacting in a foreign currency, and to advise the Borrower that other risks also exist.

The Borrower's liability in Dollars will increase, possibly very substantially, if there is a movement in either:

 the Dollar relative to the foreign currency facility or transaction; or

 the foreign currency relative to the Dollar.

Another risk that may also exist is the potential for adverse movements in the interest rate that applies to the foreign currency facility or transaction.

The Borrower should also be aware that in some circumstances mechanisms may be available for limiting these risks. Such mechanisms may include products ranging from forward FX contracts (FECs) and fixed rate loans to more complex options and derivatives. A solution can be tailored to the Borrower's specific business needs.

For more information about managing risks associated with international trade, go to the "Business" tab on our website www.nab.com.au and click on > International trade.

For more information regarding Foreign Exchange Risk please telephone a Specialist on 132265 (7am

- 7pm EST).

The Borrower should seek independent professional advice before entering into a facility or transaction in a foreign currency. In particular, advice should be sought as to the suitability of a foreign currency facility or transaction for your purposes and as to the risk management strategies available for such facilities or transactions.

**Important Information about Renminbi Settlement Services**

Renminbi ("RMB"), the lawful currency in the People's Republic of China, is not yet fully convertible and is subject to substantial exchange rate risk. For more information about the risks associated with RMB, please contact a Specialist on 132265 (7am - 7pm EST).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. ADDITIONAL CONDITIONS PRECEDENT**

The following additional conditions precedent apply in relation to the issue of any Bank Guarantee:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB receiving a Drawdown Notice in form and substance required by NAB from time to time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB being satisfied that:© National Australia Bank Limited 30

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the date the Bank Guarantee is to be issued is a Business Day on or before any Issue Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the currency of the Bank Guarantee is an Approved Currency; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Australian Dollar Equivalent of the Maximum Liability under all unexpired Bank Guarantees, on any day, after the Bank Guarantee is issued, does not exceed the Australian Dollar Equivalent of the Facility Limit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2. DRAWING**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB may reject an application for a Bank Guarantee at its discretion if NAB is unable to issue the Bank Guarantee due to operational reasons and will advise you of this as soon as possible.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Bank Guarantee will be in NAB's usual form, unless otherwise agreed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. REIMBURSEMENT**

The Borrower must pay NAB on demand from time to time amounts equal to each payment made by NAB under a Bank Guarantee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4. INDEMNITY**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower agrees to indemnify NAB in respect of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any amounts NAB pays to a Beneficiary under a Bank Guarantee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) an amount equal to any loss (including consequential or economic loss), damage and Costs which NAB incurs or suffers or for which NAB becomes liable, directly or indirectly as a result of or in connection with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) the issue or variation of a Bank Guarantee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) any payment or claim for payment under a Bank Guarantee; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) anything done by a Beneficiary or any other person in relation to or in reliance on a Bank Guarantee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any amount the Borrower must pay NAB under this clause 4 (Indemnity) is payable in Dollars (even if the payment made by NAB is in a different currency) and becomes due and payable upon the earlier of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB making payment under a Bank Guarantee; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) NAB incurring an obligation to make payment under a Bank Guarantee, or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) an Event of Default occurring.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5. PAYMENT OF BANK GUARANTEE WITHOUT DEMAND**

NAB may, at any time, and exercising its discretion in a reasonable manner when doing so, end its obligations under a Bank Guarantee by paying to the Beneficiary of that Bank Guarantee the Maximum Liability or such lesser amount as is required to discharge NAB's obligations under the Bank Guarantee, even though no demand is made on NAB by that Beneficiary.© National Australia Bank Limited 31

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6. NO OBLIGATION TO ENQUIRE**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower irrevocably authorises NAB to immediately pay any amount demanded at any time under a Bank Guarantee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower agrees that NAB:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) will make a payment referred to in clause 6(a) above without first referring to the Borrower;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) need not enquire into the correctness or validity of any demand made on NAB under a Bank Guarantee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) may meet any demand even though the Borrower disputes the validity of the demand.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7. PARTIAL PAYMENTS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower agrees that if a demand is made by a Beneficiary of a Bank Guarantee for a partial payment of the Maximum Liability of that Bank Guarantee, NAB may at its discretion and without further reference to the Borrower, pay the amount demanded and issue to the Beneficiary a replacement Bank Guarantee for the balance of the Maximum Liability.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The procedure set out in clause 7(a) may be repeated at NAB's discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Borrower agrees that this document applies to any replacement Bank Guarantee issued under this clause 7 (Partial payments).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8. PROCEEDINGS UNDER BANK GUARANTEE**

NAB is not obliged at any time to commence, pursue or defend any legal proceedings or other process in connection with any claim, demand or right arising under a Bank Guarantee issued under this Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9. RETURN OF BANK GUARANTEES**

The Borrower must promptly return to NAB an original Bank Guarantee if it is given to the Borrower by the relevant Beneficiary. If the Borrower fails to do so, fees and charges may continue to accrue.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10. ADDITIONAL CONSEQUENCES OF DEFAULT**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The following additional consequences of Default apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB may require the Borrower to provide cash cover on terms satisfactory to NAB for an amount not less than the Maximum Liability under each outstanding Bank Guarantee in the currency in which each such Bank Guarantee is denominated; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) NAB may require the Borrower to grant other Encumbrances acceptable to NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB may exercise any of its rights under this document even though one or more Bank Guarantees remain outstanding on that date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If, on a day when the Borrower makes a payment required under clause 1O(a), or under clause 11.2 (Consequences of Default) of the General Terns, there are any Bank Guarantees in respect of which payment of the whole or part of the Maximum Liability has not yet been demanded by the Beneficiary, and a portion of that payment represents the undemanded amount, then NAB will:© National Australia Bank Limited 32

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) deposit that portion in an interest-bearing deposit account on terms which NAB considers appropriate (which may include making the deposit with itself) and hold those funds until they are disbursed in accordance with clause 10(c)(ii) and/or (iii);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) use the deposited amount towards paying a Beneficiary of a Bank Guarantee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) pay to the Borrower the amount which NAB certifies is that part of the deposited amount and the interest earned on it (net of NAB's income tax liability in connection with those earnings) which remains after all of the Borrower's obligations (contingent or otherwise) under this document have been satisfied.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Where money will be held in a deposit account in accordance with clause 10(c), the Borrower must also provide NAB with an appropriate Deposit Letter in respect of all such moneys to be held by NAB in such a deposit account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Where the required deposit account is provided by NAB, it may charge the Borrower the usual fees and charges for the operation of such an account by NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11. TERMINATION OF THE FACILITY**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On the Termination Date for the Facility, the Borrower must pay to NAB:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) all of the Balance Owing; less

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the amount equal to the aggregate Maximum Liability under each outstanding Bank Guarantee in respect of which NAB has already been provided with cash cover on terms satisfactory to NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) When the Borrower makes a payment required under clause 11(a) NAB will, in respect of that portion of the receipts that remains to be allocated to any Bank Guarantees in respect of which payment of the whole or part of the Maximum Liability has not yet been demanded by the Beneficiary:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) deposit that portion in an interest-bearing deposit account on terms which NAB considers appropriate (which may include making the deposit with itself) and hold those funds until they are disbursed in accordance with clause 11(b)(ii) and/or (iii);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) apply the deposited amount towards paying a Beneficiary of a Bank Guarantee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) pay to the Borrower the amount which NAB certifies is that part of the deposited amount and the interest earned on it (net of NAB's income tax liability in connection with those earnings) which remains after all of the Borrower's obligations (contingent or otherwise) under this document have been satisfied.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) When the Borrower makes a payment required under clause 11(a), and where money will be held in a deposit account in accordance with 11(b), the Borrower must also provide NAB with an appropriate Deposit Letter in respect of all such moneys to be held by NAB in such a deposit account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Where the required deposit account is provided by NAB, it may charge the Borrower the usual fees and charges for the operation of such an account by NAB.© National Australia Bank Limited 33

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**12. FOREIGN CURRENCY FACILITIES OR TRANSACTIONS**

**12.1 Funding risk and non availability**

(a) NAB will use its best efforts to notify the Borrower as soon as practicable if the making, denomination or continuation of the Facility in the foreign currency is not reasonably practical or is impossible as a result of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any change in national or international financial, political or economic conditions, currency exchange rates, currency availability or exchange controls;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any event of contingency which materially and adversely affects the inter-bank markets generally; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any change in law.

(b) During the 30 days after that notice is given by NAB, NAB will negotiate in good faith with the Borrower to find an alternative basis to continue the Facility.

(c) If no agreement is reached within the 30 day period referred to in clause 12.1(b), NAB's obligation to provide the Facility will be automatically terminated and the Borrower must immediately provide cash cover on terms satisfactory to NAB for an amount not less than the Maximum Liability under each outstanding Bank Guarantee in the currency in which each such Bank Guarantee is denominated.

**12.2 No advice or management by NAB**

The Borrower acknowledges and agrees that NAB is not managing, supervising or advising in relation to the Borrower's foreign currency exposure.

**12.3 Foreign currency fluctuations**

If the Facility is made available or involves a foreign currency and there is a change in the exchange rate applicable between that foreign currency and Dollars which has the effect of causing the Australian Dollar Equivalent of the Balance Owing to exceed the Australian Dollar Equivalent of the Facility Limit, NAB may require the Borrower to either:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) cash cover on terms, and in currencies or currency, reasonably satisfactory to NAB for the amount of such excess so that the Australian Dollar Equivalent of the Balance Owing is equal to or less than Australian Dollar Equivalent of the Facility Limit; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) provide additional Encumbrances acceptable to NAB to the value reasonably determined by NAB, but not less than the amount of such excess.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13. PAYMENTS DUE ON A NON-BUSINESS DAY**

If a payment is due under the Facility on a day that is not a Business Day, that payment must be made on the previous Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14. DEFINITIONS**

For the purpose of these Bank Guarantee Facility Specific Conditions:

**Approved Currency** means the currency or currencies approved by NAB in writing from time to time.

**Australian Dollar Equivalent** means, in respect of:© National Australia Bank Limited 34

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Facility Limit for a Facility at any time which is expressed in a foreign currency, the equivalent amount in Australian Dollars (when notionally converted by NAB at the rate of exchange used by NAB for the purpose, and at the time, of approving the Facility); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Balance Owing for, or any other amount in respect of, a Facility which is expressed in a foreign currency, the equivalent amount of the Balance Owing or other amount in Australian Dollars (as notionally converted by NAB at its prevailing spot rate of exchange).

**Availability Period** means the period from the date of this document to the Termination Date.

**Beneficiary** means, in relation to a Bank Guarantee, the person to whom the Bank Guarantee is to be, or has already been, issued and any assignee of such person.

**Facility** means a bank guarantee facility.

**Issue Date** means the issue date for a Bank Guarantee specified in the Details.

**Maximum Liability** means, in respect of a Bank Guarantee, the amount specified in that Bank Guarantee as the maximum liability (exclusive of interest on that Maximum Liability) under that Bank Guarantee.© National Australia Bank Limited 35

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**FARMER'S CHOICE PACKAGE {"PACKAGE") SPECIFIC CONDITIONS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. THE TRANSACTION ACCOUNT**

The Borrower must ensure that the Transaction Account is opened and remains open at all times.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2. FACILITIES SUBJECT TO THE FARMER'S CHOICE PACKAGE**

The Borrower must comply with the specific terms and conditions applicable to each Farmer's Choice Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. MAXIMUM AGGREGATE BORROWING LIMIT (MABL)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The initial MABL is set out in the Details.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) There are 4 options for the reduction of the MABL as follows:

**Option 1 - Interest Only Option**

The MABL will not be reduced during the term of the Package. The MABL will be reduced to nil on the Expiry Date of the Package.

**Option 2 - Step down to Interest Only Option**

The MABL reduces on each Reduction Date to the amount set out beside that date in the Details. After the last Reduction Date, no further reductions to the MABL will be made until the Expiry Date of the Package. The MABL will be reduced to nil on the Expiry Date of the Package.

**Option 3** - **Milestone Option**

The MABL reduces on each Reduction Date to the amount set out beside that date in the Details. The MABL will be reduced to nil on the Expiry Date of the Package.

**Option 4 - Long Term Repayment Option**

The MABL reduces by the amounts and on the dates notified by NAB. The MABL will be reduced to nil on the Expiry Date of the Package.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The option applying to the Package is set out in the Details under the heading "MABL Reduction Option".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Borrower agrees that, regardless of the other terms and conditions applicable to the Farmer's Choice Facilities:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) unless otherwise agreed by NAB**,** the aggregate of the Balance Owing under each of the Farmer's Choice Facilities (excluding any Overdraft Facility) must not exceed the prevailing MABL; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) it will immediately make such repayments as are required to comply with clause 3(d)(i); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) NAB is not obliged to provide any Drawing under the Package or under any of the Farmer's Choice Facilities if to do so would cause the sum of the Balance Owing under each Farmer's Choice Facility (excluding any Overdraft Facility) to exceed the prevailing MABL.© National Australia Bank Limited 36

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) NAB may, after consultation with the Borrower, change the MABL Reduction Option that applies by giving the Borrower notice in accordance with the General Terms. The object of any such change would be to better reflect or address the Borrower's changed circumstances or requirements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4. PACKAGING FACILITIES**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB will confirm, in writing, the initial Farmer's Choice Facilities (if not set out in the Details).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower acknowledges that NAB may, at its discretion, determine which Facilities are eligible for inclusion in the Package, including by determining that a Facility is no longer eligible for inclusion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Borrower may apply to **NAB** to add other Facilities to the Package, to increase the Facility Limit of any Farmer's Choice Facility, to increase the MABL, or to extend the term of the Package.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) NAB may accept or reject any such request at its discretion and may impose such conditions on its acceptance as it sees fit. The Borrower may need to enter into a new Package.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) NAB will inform the Borrower if any Facilities are added to, or are to be removed from, the Package. Where a Facility is to be removed from the Package, NAB will inform the Borrower when it will be removed and will provide reasonable notice before its removal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Package must, at all times, include at least one Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) The Package is automatically cancelled if there are no longer any Facilities included in it.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) If the Package is cancelled or otherwise ends, the concessions and benefits available under the Package will immediately cease to apply.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5. CONCESSIONS AND BENEFITS**

The following concessions and benefits apply to Farmer's Choice Facilities, while they remain part of the Package (and subject to NAB's right to vary the terms of the Package):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) there will be no separate application fees for individual Farmer's Choice Facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any Farmer's Choice Facility that is a Term Loan Facility, Overdraft Facility, NAB Business Markets Facility or Market Rate Facility (and any other Facility notified in writing by NAB) will be free from any service fee that would otherwise apply; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) for any Farm Management Account Overdraft Facility that is part of the Package, a preferential variable interest rate will apply, as set out in the Details for that Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6. CANCELLATION OF THE PACKAGE**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If an Event of Default occurs and is continuing, NAB may (subject to the Specific Conditions of each Farmer's Choice Facility):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) immediately suspend the Borrower's ability to make further Drawings under a Farmer's Choice Facility until the Default is rectified to NAB's satisfaction; and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) give the Borrower notice stating that an Event of Default has occurred and give the Borrower a reasonable grace period of up to 7 days (or such longer period as required by law or that NAB elects to allow) to remedy the Event of Default. If the© National Australia Bank Limited 37

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Event of Default is not remedied within that period, NAB may immediately cancel the Package by written notice to the Borrower.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower may cancel the Package at any time by giving NAB at least 2 Business Days prior written notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Upon cancellation in accordance with clauses 6(a) or (b), NAB will make a pro rata refund of the remaining balance of the Annual Package Fee paid in advance, within a reasonable time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7. PACKAGE FEES**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower must pay the Annual Package Fee annually in advance on:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the date the Borrower enters into the Package or, at NAB's discretion, the last Business Day of the month in which the Borrower enters into the Package; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each anniversary of that date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower irrevocably authorises NAB to debit from the Transaction Account the Annual Package Fee and the Farmer's Choice Application Fee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8. JOINT PACKAGES**

If the Package is held jointly by the Borrower with one or more other people (each an **Other Package Holder):**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Borrower agrees that NAB may disclose to each Other Package Holder such information about any Farmer's Choice Facility (or associated account) as NAB believes is necessary to administer the Package, even if that Facility or account is in the Borrower's name alone, which information may include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) which of the Borrower's Facilities or accounts are included in the Package, and which are not;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Facility Limit of any of the Borrower's Facilities which are included in the calculation of the MABL; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any information about the repayment of the Borrower's Facilities which affects, or which may affect, the operation of the relevant MABL Reduction Option;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the obligation to pay the Annual Package Fee is a joint and several obligation of the Borrower and each Other Package Holder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) in addition to any other rights NAB has to cancel or suspend further Drawings under the Package, if any Other Package Holder commits an event of default (however described) in relation to any agreement NAB has with that Other Package Holder (whether or not that agreement relates to a Farmer's Choice Facility), NAB may (subject to the Specific Conditions of each Farmer's Choice Facility):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) immediately suspend the Borrower's ability to drawdown further financial accommodation under a Farmer's Choice Facility until the event of default is rectified to NAB's satisfaction; and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) cancel the Package by written notice to the Borrower and the Other Package Holder, provided that NAB has given the Borrower and the Other Package Holder a notice stating that an event of default has occurred under an agreement between NAB© National Australia Bank Limited 38

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and the Other Package Holder and after giving that Other Package Holder a reasonable grace period of up to 7 days (or such longer period as required by law or that NAB elects to allow) to remedy the event of default; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) notwithstanding clause 6 (Cancellation of the Package), the Borrower can only cancel the Package if the notice referred to in clause 6 (Cancellation of the Package) is given by the Borrower and each Other Package Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9. DEFINITIONS**

For the purposes of these Farmer's Choice Package Specific Conditions:

**Annual Package Fee** means the Annual Package Fee specified in the Details.

**Farm Management Account Overdraft Facility** means any Facility titled "Farm Management Account Overdraft Facility" in the Details.

**Farmer's Choice Facility** means each Facility set out in the Details under the heading "Farmer's Choice Package" or as otherwise advised to the Borrower in accordance with this document.

**MABL** means the Maximum Aggregate Borrowing Limit specified in the Details.

**Overdraft Facility** means a Facility in respect of which the Overdraft Facility Specific Conditions apply, as stated in the Details.

**Reduction Date** means each reduction date in respect of the Facility specified in the Details.

**Repayment Details** means the repayment details in respect of the Facility specified in the Details.

**Term Loan Facility** means any Facility to which the Term Loan Facility Specific Conditions apply, as stated in the Details.

**Transaction Account** means the transaction account in respect of the Facility specified in the Details or as otherwise agreed.© National Australia Bank Limited 39

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**GLOBAL TRADE FINANCE SPECIFIC CONDITIONS**

**FOREIGN CURRENCY WARNING NOTICE**

This important notice should be read and understood before the Borrower decides to enter into a Facility or transaction in a foreign currency.

This notice is intended to provide the Borrower with a general warning of the risks that can arise from adverse exchange rate movements when transacting in a foreign currency, and to advise the Borrower that other risks also exist.

The Borrower's liability in Dollars will increase, possibly very substantially, if there is an adverse movement in either:

the Dollar relative to the currency of the foreign currency facility or transaction; or the foreign currency relative to the Dollar.

Another risk that may also exist is the potential for adverse movements in the interest rate that applies to the foreign currency Facility or transaction.

The Borrower should also be aware that in some circumstances mechanisms may be available for limiting these risks. Such mechanisms may include products ranging from forward FX contracts (FECs) and fixed rate loans to more complex options and derivatives. A solution can be tailored to the Borrower's specific business needs.

For more information about managing risks associated with international trade, go to the "Business" tab on our website www.nab.com.au and click on > International trade.

For more information regarding Foreign Exchange Risk please telephone a Specialist on 132265 (7am

- 7pm EST).

The Borrower should seek independent professional advice before entering into a Facility or transaction in a foreign currency. In particular, advice should be sought as to the suitability of a foreign currency Facility or transaction for the Borrower's purposes and as to risk management strategies available for such Facilities or transactions.

**Important Information about Renminbi Settlement Services**

Renminbi ("RMB"), the lawful currency in the People's Republic of China, is not yet fully convertible and is subject to substantial exchange rate risk. For more information about the risks associated with RMB, please contact a Specialist on 132265 (7am - 7pm EST).

**1. FOREIGN CURRENCY OVERDRAFT FACILITIES**

**1.1 Application of this clause**

This clause 1 (Foreign Currency Overdraft Facilities) applies to any Foreign Currency Overdraft Facility.

**1.2 Additional Conditions Precedent**

The following additional conditions precedent apply in relation to any Drawing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Drawdown Date is a Banking Day within the Availability Period;© National Australia Bank Limited 40

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) subject to contrary agreement, the currency of the Drawing is the same as the currency of the Loan Account; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Australian Dollar Equivalent of the Drawing does not exceed the Available Facility at that time unless NAB has given its prior written consent for an amount greater than the Available Facility to be drawn.

**1.3 Drawing**

Any amount paid or repaid to the credit of the Facility may be redrawn subject to the terms of this document.

**1.4 Repayment**

NAB may require the Borrower to repay all or part of the Balance Owing at any time. The Borrower must repay all of the Balance Owing on demand.

**1.5 Prepayment**

The Borrower may prepay the whole or any part of the Balance Owing at any time.

**1.6 Interest**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Interest on debt balances is calculated daily by applying the Daily Interest Rate to the Value Balance (excluding any amount to which a Default Interest Rate applies) at the end of each day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Value Balance is generally the same as the Balance Owing, except that interest charges for an Interest Period (including any interest adjustment) do not form part of the Value Balance until the first day of the next Interest Period (even though they may be included in the Balance Owing from the date they are debited).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Interest for:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) an Interest Period is debited from the Loan Account on the last Business Day of that Interest Period or such other reasonable times as NAB may notify; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the last Interest Period is debited from the Loan Account on the Termination Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Where a transaction for a particular day is processed by NAB after that day, for whatever reason, NAB may, acting reasonably, elect to back-date that transaction and, if NAB does this, an appropriate interest adjustment will be made to the Loan Account on the last Banking Day of the next Interest Period.

**1.7 What currency applies**

&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower must ensure that all payments to the Facility are in the currency of the Loan Account.

&nbsp;&nbsp;&nbsp;&nbsp;(b) Fees and charges are calculated in Dollars and may be debited by NAB from the Loan Account with any necessary currency conversions made in accordance with the provisions of the **'**NAB Foreign Currency Account - Onshore Terms and Conditions' as amended or replaced from time to time in accordance with any notice given under any Finance Document.© National Australia Bank Limited 41

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**2. LETTERS OF CREDIT**

**2.1 Application of this clause**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Drawing under a Documentary Letter of Credit or Standby Letter of Credit Facility must, and a Drawing under a Documentary Letter of Credit &/or Documents Surrendered Facility may, take the form of a Utilisation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This clause 2 (Letters of Credit) applies in relation to any Utilisation.

**2.2 Additional Conditions Precedent**

The following additional conditions precedent apply in relation to any Utilisation (including the initial Utilisation):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB receiving a Letter of Credit application in the form and substance satisfactory to NAB together with such information and documentation relating to the Utilisation as NAB may reasonably require before the relevant Cut-Off Time (which NAB will notify on request); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB being satisfied that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Issue Date is a Business Day within the Availability Period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the currency of the Letter of Credit is an Approved Currency; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Australian Dollar Equivalent of the Letter of Credit does not exceed the Available Facility at that time unless NAB has given its prior written consent for an amount greater than the Available Facility to be drawn.

**2.3 Utilisation**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Letter of Credit application is irrevocable once given.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Notwithstanding any other provision, NAB can decline any Letter of Credit application at its discretion and will advise the Borrower promptly if it does this.

**2.4 The form of the Letter of Credit**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Letter of Credit will be in NAB's usual form, unless otherwise agreed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In certain circumstances specific to a Letter of Credit issued or to be issued at the Borrower's request, NAB may request the Borrower to execute such additional documentation or forms as reasonably required by NAB's normal practice to manage its risks in connection with the Letter of Credit. Not providing NAB with such documentation or forms may impact on NAB's ability to carry out the Borrower's request in connection with the Letter of Credit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All Letters of Credit established under the Facility will be subject to the terms and conditions of the prevailing Uniform Customs and Practice for Documentary Credits or International Standby Practices, each published by the International Chamber of Commerce or such other terms as agreed in writing with NAB. The Borrower must ensure that it is aware of those terms and conditions and accepts them, including any indemnities contained within such terms it may be required to provide a party.© National Australia Bank Limited 42

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**2.5 Authority to make payments and payment of Standby Letter of Credit without demand**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower irrevocably authorises NAB to pay any amount for which a demand or request is made at any time under a Letter of Credit without reference to, or further authority from, the Borrower.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB need not investigate or enquire whether a claim or demand on it has been properly made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) NAB may meet any claim or demand on it notwithstanding that the Borrower may dispute the validity of the claim or demand.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) NAB may if consistent with the terms of the Standby Letter of Credit, at any time and exercising its reasonable discretion in doing so, end its obligations under a Standby Letter of Credit by paying to the Beneficiary of that Standby Letter of Credit the Maximum Liability or such lesser amount as is required to discharge NAB's obligations under the Standby Letter of Credit, even though no demand is made on NAB by the Beneficiary.

**2.6 The Borrower's undertaking to pay**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower agrees to pay to NAB on demand and in the currency in which the Letter of Credit is denominated an amount equal to each amount demanded from or paid by NAB under any Letter of Credit together with any incidental Costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower indemnifies NAB against all actions, proceedings, claims and demands brought or made against NAB and against all losses (including consequential losses and loss of profits), damages and Costs which NAB incurs or suffers or for which NAB reasonably becomes liable, directly or indirectly, in connection with any Letter of Credit requested by the Borrower to be issued by NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) When NAB makes a payment under a Letter of Credit or Bill drawn on and accepted by NAB in connection with a Letter of Credit and the Borrower does not promptly reimburse NAB, the Borrower authorises NAB to debit the amount of the payment together with any incidental Costs (less any reimbursements in relation to that payment) to any account of the Borrower's NAB chooses without first having to make demand for payment or otherwise giving the Borrower prior notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each payment obligation of the Borrower under this clause 2.6 (The Borrower's undertaking to pay) is independent of each other payment obligation of the Borrower under this clause 2.6 (The Borrower's undertaking to pay).

**2.7 Bills drawn on NAB in connection with a Letter of Credit**

Where any Bills are drawn on NAB in connection with a Letter of Credit, NAB will accept such Bills on presentation and make payments in accordance with the terms of the Bill. The Borrower must pay and indemnify NAB for doing so in accordance with clause 2.6 (The Borrower's undertaking to pay) of these Global Trade Finance Specific Conditions.

**2.8 Insurance**

The Borrower must:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) insure all goods relating to each Letter of Credit drawn under the Facility to NAB's satisfaction (unless NAB has previously agreed in writing to waive this condition);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) deliver to NAB a copy of any insurance policy or certificate relating to those goods when received or at such time as is agreed with NAB; and© National Australia Bank Limited 43

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) hold proceeds of any claim under an insurance policy on trust for NAB if required to do so under clause 2.12(d) of these Global Trade Finance Specific Conditions.

**2.9 Use of correspondent banks**

NAB may, at its reasonable discretion, direct a Letter of Credit established under a Facility to its correspondent bank for negotiation or other action. If NAB does this, such correspondent bank may pay NAB a commission for each Letter of Credit directed to them.

**2.10 Pledge**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless the Borrower has granted NAB a General Security Agreement, the Borrower authorises, as security for its obligations to NAB in connection with a Utilisation, NAB to retain by way of pledge the documents and goods relating to the Letter of Credit that is the subject of the Utilisation, all proceeds of sale and insurances relating to such documents and goods and all the Borrower's rights as unpaid seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If requested by NAB, the Borrower agrees to execute any other documents that NAB may reasonably require to grant NAB an Encumbrance over the documents and goods relating to a Letter of Credit (the "Pledge Agreement").

**2.11 Additional consequences of default**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If an Event of Default occurs and is continuing, the following additional consequences of default apply, in addition to any other rights and obligations under the General Terms:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB may require the Borrower to provide cash cover on terms satisfactory to NAB for an amount not more than the Maximum Liability under each outstanding Letter of Credit in the currency in which the outstanding Letter of Credit is denominated;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) NAB may, where the Amount Owing has become due and payable, sell, dispose of or otherwise deal with any documents or goods pledged under this document or a Pledge Agreement as NAB thinks fit and apply the proceeds towards satisfaction of the Borrower's obligations to NAB in connection with the relevant Utilisation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) NAB may collect any amount due under any policy of insurance in relation to any goods; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) NAB may require the Borrower to grant other Encumbrances acceptable to NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB may exercise any of its rights under this document even though one or more Letters of Credit remain outstanding on that date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If, on a day when the Borrower makes a payment required under clause 2.11(a) or under clause 11.2 (Consequences of Default) of the General Terms, there are any Letters of Credit in respect of which payment has not yet been demanded by the Beneficiary and a portion of that payment represents those undemanded amounts, then NAB will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) deposit that portion in an interest-bearing term deposit account (which may include making the deposit with NAB) on terms NAB considers appropriate and hold those funds until they are disbursed in accordance with clause 2.11(c)(ii) and/or (iii);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) use the deposited amount towards paying a Beneficiary of a Letter of Credit; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) pay to the Borrower the amount which NAB certifies is that part of the deposited amount and the interest earned on it (net of NAB's income tax liability in connection© National Australia Bank Limited 44

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with those earnings) which remains after all of the Borrower's obligations (contingent or otherwise) under this document have been satisfied.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) When the Borrower makes a payment required under clause 2.11(a) or under clause 11.2 (Consequences of Default) of the General Terms and where money will be held in a deposit account in accordance with clause 2.11(c), the Borrower must also provide NAB with an appropriate Deposit Letter in respect of all such moneys to be held by NAB in such a deposit account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Where the required deposit account is provided by NAB, it may charge the Borrower the usual fees and charges for the operation of such an account by NAB.

**2.12 Delivery of documents or goods**

If any documents or any goods in relation to a Letter of Credit are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) delivered by NAB to the Borrower or to any person authorised by the Borrower to receive those documents or goods on the Borrower's behalf; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) received by the Borrower (or by any such person on the Borrower's behalf),

before the Borrower has fully paid and discharged its obligations to NAB or its correspondent banks in relation to the Letter of Credit, the Borrower agrees that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) if directed by NAB acting reasonably, the Borrower must receive those goods or documents for NAB and must hold them and any proceeds of sale for NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the Borrower must hold the proceeds of any claim on any policy of insurance on trust for NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) if directed by NAB acting reasonably, the Borrower must keep the goods and any proceeds separate from others; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) NAB may at any time take possession of and receive the goods or any proceeds of the sale or disposal of the goods.

**2.13 Termination of Facility**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On the Termination Date for the Facility, the Borrower must pay to NAB:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) all of the Balance Owing for the Facility; less

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the amount equal to the cash cover then available to NAB, in respect of the aggregate of the Maximum Liability under each unexpired Letter of Credit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) When the Borrower makes a payment required under clause 2.13(a), it must do so on terms satisfactory to NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) When the Borrower makes a payment required under clause 2.13(a), NAB will, in respect of that portion of the receipts that remains to be allocated to any Letters of Credit in respect of which payment of the whole or part of the Maximum Liability has not yet been demanded by the Beneficiary:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) deposit that portion in an interest-bearing term deposit account (which may include making the deposit with itself) on terms which NAB considers appropriate and hold those funds until they are disbursed in accordance with clause 2.11(c)(ii) and/or (iii);© National Australia Bank Limited 45

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) use the deposited amount towards paying a Beneficiary of a Letter of Credit; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) pay to the Borrower the amount which NAB certifies is that part of the deposited amount and the interest earned on it (net of NAB's income tax liability in connection with those earnings) which remains after all of the Borrower's obligations (contingent or otherwise) under this document have been satisfied.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Where money will be held in a deposit account in accordance with clause 2.13(b), the Borrower must also provide NAB with an appropriate Deposit Letter in respect of all such moneys to be held by NAB in such a deposit account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Where the required term deposit account is provided by NAB, it may charge the Borrower the usual fees and charges for the operation of such an account by NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Borrower's obligations under the Facility continue to apply to any Letters of Credit in respect of which payment of the whole or part of the Maximum Liability has not yet been demanded by the Beneficiary.

**2.14 Interest**

The Borrower does not pay interest charges on any Utilisation that is an issue of a Letter of Credit, provided that it is repaid in accordance with this document. Interest charges will apply where that Letter of Credit is refinanced under your Facility.

**3. OTHER DRAWINGS**

**3.1 Application of the clause**

This clause 3 (Other Drawings) applies to all Drawings under a Facility which is not covered by clause 1 (Foreign Currency Overdraft Facilities) or clause 2 (Letters of Credit), including a Drawing under a Trade Refinance Facility, Overseas Bills Purchased Facility or Overseas Currency Loan Facility.

**3.2 Additional Conditions Precedent**

The following additional conditions precedent apply in relation to any Drawing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB receiving a Drawdown Notice in the form and substance satisfactory to NAB together with such information and documentation relating to the Drawing as NAB may require before the relevant Cut-Off Time (which NAB will notify to the Borrower upon request); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB being satisfied that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the proposed Drawdown Date is a Banking Day within the Availability Period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the term of the proposed Drawing does not extend beyond the Expiry Date for the Facility;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the currency of the proposed Drawing is an Approved Currency;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the Australian Dollar Equivalent of the Drawing does not exceed the Available Facility on the proposed Drawdown Date unless NAB has given its prior written consent for an amount greater than the Available Facility to be drawn;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) the number of Drawings outstanding would not exceed the Maximum Number of Drawings (if any) for the Facility as a result of the proposed Drawing;© National Australia Bank Limited 46

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the amount of the proposed Drawing complies with any requirements of NAB from time to time as regards to minimum amount (and, if required, integral multiples); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) disbursement instructions for the proceeds of the Drawing have been provided in form and substance satisfactory to NAB.

**3.3 Drawing**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Drawdown Notice is irrevocable once given.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Notwithstanding any other provision, NAB can decline any request to draw on a Facility at its discretion and will advise the Borrower promptly if it does this.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any amount repaid or prepaid is available for redraw subject to the terms of this document.

**3.4 Repayment**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Drawing made under a Facility is for an agreed term and the Balance Owing for each Drawing must be repaid in full at the end of the term of that Drawing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower must make such repayments as required for it to comply with the Amortisation Schedule (if any).

**3.5 Prepayment**

The Borrower may prepay all or part of the Balance Owing in respect of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) an Overseas Currency Loan Facility:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) on the last day of an Interest Period provided that the Borrower gives NAB at least 5 Banking Days prior written notice of its request and pays to NAB any applicable fees; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) at any other time, if NAB agrees in writing that the Borrower may make such prepayment and provided that it pays NAB all Economic Costs (if any) and any other applicable fees; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any Facility other than an Overseas Currency Loan Facility, if NAB agrees in writing that the Borrower may make a prepayment (NAB's agreement of which shall not to be unreasonably withheld). No Economic Costs will be applicable.

**3.6 Interest**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Interest is calculated daily on the Balance Owing in respect of a Drawing (excluding any amount to which a Default Interest Rate applies) at the end of that day using the Daily Interest Rate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If the Details provide that interest is payable in arrears:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) all accrued interest is payable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) in respect of a Drawing under an Overseas Currency Loan Facility, on the last day of each Interest Period for that Drawing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) in respect of a Drawing under any other Facility, on the last day of the term of that Drawing,© National Australia Bank Limited 47

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and if the last day of that Interest Period or term of that Drawing (as the case may be) is not a Banking Day, accrued interest is payable on the last Banking Day of that Interest Period or term; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) all accrued but unpaid interest is payable on the Termination Date.

(c) If the Details provide that interest is payable in advance, interest for each Drawing is payable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) in respect of a Drawing under an Overseas Currency Loan Facility, on the first day of each Interest Period for that Drawing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) in respect of a Drawing under any other Facility, for the term of the Drawing on the first Banking Day of that term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) In respect of each Drawing under an Overseas Currency Loan Facility:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the first Interest Period is to be a period of 3, 6 or 12 months (or such other period as agreed by the Borrower and NAB) as set out in the Drawdown Notice; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each subsequent Interest Period will be for the same duration as the existing Interest Period unless the Borrower requests a different period (being a period of a period of 3, 6 or 12 months (or such other period as agreed by the Borrower and NAB)), by giving written notice to NAB in the form approved by NAB (a "Selection Notice") at least 5 Banking Days prior to the commencement of that subsequent Interest Period,

in each case adjusted where necessary so that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the first Interest Period commences on the Drawdown Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) a subsequent Interest Period commences on the day after the last day of the preceding Interest Period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) each Interest Period commences on a Banking Day (and if an Interest Period ends on a day that is not followed by a Banking Day, NAB may extend the Interest Period accordingly (except where this would be contrary to (vi) below, in which case NAB may shorten the Interest Period); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) an Interest Period must not end after the Expiry Date.

**3.7 Payments**

All payments of principal and interest in respect of any Drawing must be made:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in the Approved Currency in which the Drawing is denominated at the time of the making of such payment or payments;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to an account nominated by NAB from time to time; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) in same day value dated funds,

and, upon payment, the Borrower must notify NAB that such payment has been made.© National Australia Bank Limited 48

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**4. CANCELLATION AND REDUCTION OF THE FACILITY LIMIT**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower can cancel the Facility at any time by giving NAB at least 2 Business Days prior written notice (and if so, the Balance Owing for the Facility will be payable in accordance with clause 4(b) of the General Terms).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except in respect of a Foreign Currency Overdraft Facility, NAB can cancel any part of the unused Facility Limit at any time upon providing the Borrower with no less than 30 days' written notice, even if the Facility has an Expiry Date and even if this means the new Facility Limit is lower than the Balance Owing. NAB's rights under this clause are in addition to any rights NAB has under the General Terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) A Foreign Currency Overdraft Facility is available at all times at NAB's reasonable discretion and NAB can cancel any part of the Facility Limit at any time upon providing the Borrower with no less than 30 days' written notice, even if the Facility has an Expiry Date and even if this means the new Facility Limit is lower than the Balance Owing. NAB's rights under this clause are in addition to any rights NAB has under the General Terms. Repayment will be required in accordance with clause 1.4 (Repayment) of these Global Trade Finance Specific Conditions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Facility Limit automatically reduces by the amount of any cancellation or reduction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Facility Limit automatically reduces on the dates and by the amounts specified in the Amortisation Schedule (if any), unless otherwise agreed.

**5. WHICH ACCOUNTS NAB CAN DEBIT**

Unless otherwise agreed:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) for Foreign Currency Overdraft Facilities, the Borrower authorises NAB to debit to the Loan Account any amounts payable by the Borrower in relation to the Facility, including interest, fees and charges, taxes, enforcement expenses and any amount payable under an indemnity (any necessary currency conversions for a debit will be in accordance with the 'NAB Foreign Currency Account - Onshore Terms and Conditions' applicable to the Loan Account); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) for any other Facility, the Borrower authorises NAB to debit to the Nominated Account any amounts payable by the Borrower in relation to the Facility, including interest, fees and charges, taxes, enforcement expenses and any amount payable under an indemnity. Where the currency of the Nominated Account **(Account Currency)** is not in the currency of the amount payable by the Borrower **(Other Currency),** NAB may notionally convert the Other Currency at its prevailing spot rate of exchange against the Account Currency for the debit.

**6. FOREIGN CURRENCY FACILITIES OR TRANSACTIONS**

**6.1 Application of this clause**

This clause 6 (Foreign Currency Facilities or Transactions) applies to any Facility made available in or which involves foreign currencies.

**6.2 Funding risk and non-availability**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB will use its best efforts to notify the Borrower as soon as practicable if the making, denomination or continuation of the Facility in the foreign currency is not reasonably practicable or is impossible as a result of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any change in national or international financial, political or economic conditions, currency exchange rates, currency availability or exchange controls;© National Australia Bank Limited 49

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any event of contingency which materially and adversely affects the inter-bank markets generally; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any change in law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) During the 30 days after that notice is given by NAB, NAB will negotiate with the Borrower in good faith to find an alternative basis to continue the affected Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If no agreement is reached within the 30 day period referred to in clause 6.2(b), the affected Facility terminates automatically and the Borrower must immediately repay in full the Amount Owing in respect of that Facility (including providing cash cover on terms satisfactory to NAB for an amount not less than the Maximum Liability under each outstanding Letter of Credit in the currency in which such Letter of Credit is denominated).

**6.3 Currency Indemnity**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Clause 6.3(b) applies if a judgment or order is given by any court or tribunal for the payment of any amount owing by the Borrower under the Facility, or for the payment of damages by the Borrower in respect of any breach of the terms of the Facility, where that judgment or order is expressed in a currency **(Judgment Currency)** which is different from the currency expressed to be payable under this document in relation to the Facility **(Relevant Foreign Currency).**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower indemnifies NAB against any deficiency in the amounts received by NAB arising or resulting from any variation between:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the rate of exchange at which the Relevant Foreign Currency is converted into the Judgment Currency for the purpose of the judgment or order; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the rate of exchange at which NAB is able to purchase the Relevant Foreign Currency with the Judgment Currency at the time of its receipt by NAB.

**6.4 No advice or management by NAB**

The Borrower acknowledges and agrees that NAB does not, and the Borrower must not rely on NAB to, manage, supervise or advise the Borrower in relation to the Borrower's foreign currency exposure.

**6.5 Foreign currency fluctuations**

If a Facility is made available or involves a foreign currency and there is a change in the exchange rate applicable between that foreign currency and Dollars which has the effect of causing the Australian Dollar Equivalent of the Balance Owing to exceed the Australian Dollar Equivalent of the Facility Limit, NAB may require the Borrower to either:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) repay a sufficient amount to NAB so that the Australian Dollar Equivalent of the Balance Owing under the Facility is equal to or less than the Australian Dollar Equivalent of the Facility Limit; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) provide additional Encumbrances acceptable to NAB to the value determined by NAB, but not less than the amount payable under clause 6.5(a).

**7. GENERAL PAYMENT OBLIGATIONS**

To the extent not otherwise payable, the Borrower must repay to NAB all of the Amount Owing on the Termination Date.© National Australia Bank Limited 50

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**8. DEFINITIONS**

For the purposes of these Global Trade Finance Specific Conditions:

**Approved Currency** means the currency or currencies approved by NAB in writing from time to time.

**Australian Dollar Equivalent** means, in respect of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Facility Limit for a Facility at any time which is expressed in a foreign currency, the equivalent amount in Australian Dollars (when notionally converted by NAB at the rate of exchange used by NAB for the purpose, and at the time, of approving the Facility); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Balance Owing for, or any other amount in respect of, a Facility which is expressed in a foreign currency, the equivalent amount of the Balance Owing or other amount in Australian Dollars (as notionally converted by NAB at its prevailing spot rate of exchange).

**Available Facility** means, in respect of a Facility at any time, the Australian Dollar Equivalent of the Facility Limit minus the Australian Dollar Equivalent of the Balance Owing at that time.

**Availability Period** means, in respect of a Facility, the period from the date of this document to the Expiry Date.

**Banking Day** means a day other than:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a Saturday or Sunday;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a public holiday in Sydney and/or the capital city of the Governing Law Jurisdiction; and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) for any currency other than Australian Dollars, a public holiday in the principal financial centre of the currency involved in the transaction or in the principal financial centre for US currency.

**BBSY** means the rate determined by NAB which is equal to the higher of zero and the "bid rate" administered by ASX Benchmarks displayed on page BBSY of the Thomson Reuters Screen on the first day of that Pricing Period for a period equal to that Pricing Period (or where the Pricing Period is less than 1 month, a period of 1 month) and which starts on that day. If such rate is not available or if, in NAB's reasonable opinion, the rate becomes inappropriate, the Floating Rate will be the rate reasonably determined by NAB to be the appropriate equivalent rate, having regard to the prevailing market.

**Beneficiary** means, in relation to a Standby Letter of Credit, the person to whom the Standby Letter of Credit is to be, or has already been, issued and any assignee of such person.

**Cut-Off Time** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in respect of a Drawdown under an Overseas Currency Loan Facility, 2 Banking Days prior to the proposed Drawdown Date; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in respect of a Drawing under any other Facility, the period prior to the proposed Drawdown Date as determined by NAB from time to time which is subject to change without notice and which can be notified to the Borrower upon request.

**Facility** means a facility in respect of which these Global Trade Finance Specific Conditions apply, as stated in the Details.

**Issue Date** means the date on which a Letter of Credit is issued or to be issued.© National Australia Bank Limited 51

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**Letter of Credit** means a documentary letter of credit or a standby letter of credit issued by NAB pursuant to a Facility.

**LIBOR** means the higher of zero and the following rate determined as of 11.00am London time at the time of the Drawing and for a period equal in length to the Term of Drawing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the London interbank offered rate administered by the Intercontinental Exchange Group (ICE) Benchmark Administration (or any other person which takes over the administration of that rate) for the relevant currency and period displayed on pages LIBOR01 or LIBOR02 of the Reuters screen (or any replacement Reuters page which displays that rate); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if the above rate is not available for the currency or relevant period, then the rate for that period will be the rate reasonably determined by NAB to be the appropriate equivalent rate, having regard to the prevailing market.

**Maximum Liability** means, in respect of a Letter of Credit, the amount specified in that Letter of Credit as the maximum liability (exclusive of interest on that maximum liability) under that Letter of Credit.

**Utilisation** means the issue of a Letter of Credit by NAB at the Borrower's request.

**Value Balance** has the meaning given to it under the "NAB Foreign Currency Account - Onshore Terms and Conditions".© National Australia Bank Limited 52

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**NAB BUSINESS MARKETS FACILITY SPECIFIC CONDITIONS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. ADDITIONAL CONDITIONS PRECEDENT**

The following additional conditions precedent apply in relation to any Drawing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The proposed Drawing is allocated to a Business Markets Facility Component by either:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Borrower giving NAB at least 1 Business Day's prior notice of the allocation, in a form acceptable to NAB, before the proposed Drawdown Date (which notice will be irrevocable once given); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) NAB by doing so in accordance with clause 2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The allocation of Drawings to each Business Markets Facility Component must be such that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the initial Drawing does not occur before the Commencement Date (if any) or after the Last Date for Initial Drawdown (if any);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Maturity Date for each Drawing always falls on the last day of a Pricing Period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) each of the Maturity Date and the last day of a Pricing Period for any Drawing are not later than the Expiry Date for the Facility;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the total of all outstanding Drawings does not exceed the Facility Limit;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) the total of all outstanding Drawings allocated to the Floating Amount or the Cap Amount does not exceed the corresponding Business Markets Facility Component Limit;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the total of all outstanding Drawings allocated to the Fixed Amount or the Flexible Maturity Fixed Amount is at all times equal to the corresponding Business Markets Facility Component Limit; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the terms of any agreed Drawdown Schedule are met.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2. DRAWING**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Where the total of all Drawings allocated by the Borrower to the Business Markets Facility Components pursuant to clause 1(a)(i) is less than the Facility Limit, NAB will allocate the remaining balance of Drawings which have not been allocated by the Borrower to the Floating Amount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Unless NAB receives notice from the Borrower in accordance with clause 1(a)(i), any Drawing that has been allocated by the Borrower to the Fixed Amount, Cap Amount or Flexible Maturity Fixed Amount will automatically be assigned by NAB to the Floating Amount on the day after the Maturity Date for that relevant Drawing and the Business Markets Facility Component Limit for the Floating Amount will automatically increase by the amount (if any) necessary to accommodate that Drawing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Subject to clause 7 (Redraw), any amount repaid or prepaid may not be redrawn.© National Australia Bank Limited 53

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**3. REPAYMENT, PREPAYMENT AND CANCELLATION**

**3.1 Repayment**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower must make such repayments as are required for it to comply with the Amortisation Schedule (if any).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower must repay to NAB the Amount Owing in respect of the Facility in full on the Termination Date.

**3.2 Prepayment**

The Borrower may prepay all or any part of the Balance Owing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to the extent it is subject to a Floating Rate or a Cap Rate provided that the Borrower gives NAB at least 1 Business Day notice in a form acceptable to NAB, subject to payment of any applicable Premium; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) otherwise, if NAB agrees that the Borrower may make a prepayment provided that the Borrower:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) gives NAB at least 7 days notice in a form acceptable to NAB; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) pays all Economic Costs (if any) and other applicable fees specified in the Details.

**WARNING:** Economic Costs can be high and may increase the amount owed. The Borrower can ask NAB at any time for an estimate of Economic Costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4. CANCELLATION AND REDUCTION OF LIMITS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB may cancel the Available Facility on the Last Date for Initial Drawdown (if any).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower may cancel all or any part of the Available Facility (including any undrawn Business Markets Facility Component Limit) at any time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Facility Limit and relevant Business Markets Facility Component Limit(s) automatically reduce:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) by the amount of any cancellation or reduction; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) on the dates and by the amounts specified in the Amortisation Schedule (if any).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If a Facility Limit or any other limit applicable to the Facility is scheduled to change on a day that is not a Banking Day, that change will not take effect until the following Banking Day unless otherwise stated in these Specific Conditions or unless otherwise agreed, and interest, fees and charges will be payable accordingly.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5. INTEREST**

**5.1 Pricing Period**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Facility will have one Pricing Period at a time, which will apply to all Business Markets Facility Components at the same time. Subject to clauses 5.1(c) and (d), each Pricing Period will be of the same length, unless otherwise agreed by NAB.

&nbsp;&nbsp;&nbsp;&nbsp;(b) The Interest Rate applicable to each Drawing made during a Pricing Period will be determined as of the first day of that Pricing Period.© National Australia Bank Limited 54

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) NAB can adjust a Pricing Period where necessary so that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the first Pricing Period commences on the First Drawdown Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a subsequent Pricing Period commences on the day after the expiry of the preceding Pricing Period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) a Pricing Period must start on a Business Day;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) a Pricing Period must not end after the Expiry Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) all Drawings under the Facility will have the same Pricing Period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) when a Pricing Period ends it does not result in the Facility Limit or any Business Markets Facility Component Limit being exceeded at any time; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the terms of any agreed Drawdown Schedule are met.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) For the avoidance of doubt, if a Pricing Period ends on a day that is not followed by a Business Day, NAB may extend that Pricing Period accordingly (except where this would be contrary to paragraph 5.1(c)(iv)above, in which case NAB may shorten the Pricing Period).

**5.2 Interest Rate**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For each Business Markets Facility Component that is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) part of the Fixed Amount or Flexible Maturity Fixed Amount, the Interest Rate for a Pricing Period is the relevant Fixed Rate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Floating Amount, the Interest Rate for a Pricing Period is the Floating Rate; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) part of the Cap Amount, the Interest Rate for a Pricing Period is the lower of the Cap Rate and the Floating Rate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Interest Rate used to calculate the interest payable for a Facility in relation to a Pricing Period:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) will be the weighted average of the Interest Rates applicable to each Business Markets Facility Component for that Pricing Period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) unless otherwise stated, will be confirmed by NAB in writing generally within 7 Business Days after the start of the Pricing Period; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) will be recalculated by NAB and may change for the remainder of a Pricing Period if repayments or further Drawings are made during that Pricing Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Generally, the Interest Rates, as a percentage rate, applicable to a Facility will be set out in the Drawdown Schedule. Where a percentage rate is not set out in the Drawdown Schedule for an applicable Interest Rate or where the percentage rate is stated to be 'indicative only', the Interest Rate will be the rate NAB advises as determined by NAB on or before the day the first Drawing is made under the Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) On the date the first Drawing is made under the Facility, the Borrower can contact NAB before the first Drawing is made to ascertain the rate that will apply to the first Pricing Period.© National Australia Bank Limited 55

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The rate quoted by NAB is only valid for, and only applies to, the Drawing if the Borrower makes its first Drawing by 3.30 p.m. Sydney time that day and will lapse if the Drawing is not made by 3.30 p.m. Sydney time that day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Borrower can contact NAB to confirm the Interest Rate applying to a Pricing Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Provided no Default is continuing, the Interest Rate that applies to a Business Markets Facility Component for a Pricing Period remains constant during the term of that Pricing Period, whether or not further Drawings or repayments are made.

**5.3 Payment of Interest**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Interest for each day is calculated by applying the Daily Interest Rate to the Balance Owing at the end of that day (excluding any amount to which a Default Interest Rate applies).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower must pay accrued interest in respect of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) each Pricing Period, on the first or second Banking Day (as advised by NAB) after the expiry of that Pricing Period; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the last Pricing Period, for the period up to and including the Termination Date, on the Termination Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6. ECONOMIC COSTS AND ECONOMIC BENEFITS**

**WARNING:** Economic Costs can be high and may increase the amount owed. You can ask NAB at any time for an estimate of Economic Costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If an Economic Event occurs, Economic Costs or Economic Benefits may arise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB determines the amount of Economic Benefits by determining the net amount of returns and gains obtained by it in connection with the Economic Event including any amount determined by it to have been gained by reason of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) changes in the rates applicable to the Facility (all other things being equal); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the liquidation of deposits or other funds, or the termination or reversing of any swap or option agreement or other agreement or arrangement entered into by NAB (either generally in the course of its business or specifically in connection with this document) to fund or maintain the Facility or to hedge, fix or limit its effective cost of funding in relation to the Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) NAB will notify the Borrower of the amount of any Economic Benefits that arise, as determined by it in accordance with this clause 5 (Economic Costs and Economic Benefits), and will pay the Borrower that amount within 7 Business Days of such notification.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Economic Costs are calculated and are payable in accordance with the General Terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7. OPTION TO EXTEND: NAB BUSINESS MARKETS-FLEXIBLE MATURITY FIXED RATE LOAN**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower may extend the Maturity Date for any Drawing that has been allocated to the Flexible Maturity Fixed Amount so that it ends on the Extended Maturity Date by giving NAB written notice at least 2 Banking Days before the expiry of the Initial Maturity Date for that Drawing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any Extended Maturity Date for a Drawing under clause 7(a) must:© National Australia Bank Limited 56

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) always occur on the last day of a Pricing Period; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) not exceed the Expiry Date for the Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8. REDRAW**

**WARNING:** Before redrawing, the Borrower should consider the financial and taxation consequences<br> of redrawing and, if unsure, should consider obtaining independent financial and/or taxation advice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower may redraw up to the amount by which the Floating Amount or the Cap Amount is less than the relevant Business Markets Facility Component Limit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower must not redraw or request to redraw if anything has occurred that cold materially affect its ability to repay the Amount Owing, as it will exist after the redrawing, in accordance with the terms of this document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9. PREMIUM PAYABLE ON TERMINATION**

If the Facility terminates before all instalments are paid, then the Borrower must pay NAB the full amount of the Premium (if any) less any instalments paid before such termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10. DEFINITIONS**

For the purposes of these NAB Business Markets Facility Specific Conditions:

**Available Facility** means, in respect of the Facility at any time, the Facility Limit less the Balance Owing at that time.

**Availability Period** means, in respect of the Facility, the period from the date of this document to the Termination Date.

**Banking Day** means a day other than a Saturday or Sunday, or a day gazetted as a public holiday in Sydney or every state and territory of Australia.

**Business Lending Rate** for a Pricing Period means NAB's Business Lending Rate for Drawings with a tenor which is equal to the Pricing Period, as determined by NAB in its absolute discretion on the first day of the Pricing Period. NAB's Business Lending Rate is linked to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the rate determined by NAB which is equal to the higher of zero and the "bid rate" administered by ASX Benchmarks displayed on page BBSY of the Thomson Reuters Screen on the first day of that Pricing Period for a period equal to that Pricing Period (or where the Pricing Period is less than 1 month, a period of 1 month) and which starts on that day;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if the rate for a Pricing Period cannot be determined in accordance with the paragraph above or if, in NAB's reasonable opinion, the rate becomes inappropriate, the rate reasonably determined by NAB to be the appropriate equivalent rate having regard to the prevailing market; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the minimum return margin NAB requires from time to time.

NAB will periodically publish one or more indicative Business Lending Rates on nab.com.au and the Borrower can contact NAB for information about current rates.

**Business Markets Facility Component** means the Floating Amount and each separate component (if any) of the Fixed Amount, the Flexible Maturity Fixed Amount, the Floating Amount and the Cap Amount.© National Australia Bank Limited 57

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**Business Markets Facility Component Limit** means, in respect of the:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Floating Amount, the maximum aggregate sum that may be drawn down under the Floating Rate Business Markets Facility Component;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Fixed Amount, the maximum aggregate sum that may be drawn down under one or more Fixed Rate Business Markets Facility Components;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Flexible Maturity Fixed Amount, the maximum aggregate sum that may be drawn down under one or more Flexible Maturity Fixed Rate Business Markets Facility Components; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Cap Amount, the maximum aggregate sum that may be drawn down under one or more Cap Rate Business Markets Facility Component,

as set out in the Details and subsequently set out in the Drawdown Schedule for the Business Markets Facility Component, as amended from time to time.

**Cap Amount** means that part of the Facility that can be subject to any of the Cap Rate or Floating Rate, depending on their value, as determined in accordance with this document.

**Cap Rate** means, in respect of each Cap Rate Business Markets Facility Component, the cap rate specified in the Drawdown Schedule or as otherwise determined in accordance with this document.

**Commencement Date** means, in respect of the Facility, the commencement date (if any) specified in the Details.

**Economic Benefit** means the amount determined in accordance with clause 6(b).

**Extended Maturity Date** means, in respect of the Facility, the extended maturity date as set out in the Drawdown Schedule.

**Facility** means a NAB Business Markets Facility - Flexible Rate Loan.

**First Drawdown Date** means, in respect to the Facility, the first Drawdown Date.

**Fixed Amount** means that part of the Facility that is subject to a Fixed Rate.

**Fixed Rate** means, in respect of each Fixed Rate Business Markets Facility Component, the fixed rate specified in the relevant Drawdown Schedule or as otherwise determined in accordance with this document.

**Flexible Maturity Fixed Amount** means the part of the Facility that is subject to a Fixed Rate and to which clause 6 (Option to Extend: NAB Business Markets - Flexible Maturity Fixed Rate Loan) applies.

**Floating Amount** means that part of the Facility that is subject to a Floating Rate only.

**Floating Rate** means, in respect of the Facility, the rate specified in the Details.

**Initial Maturity Date** means, in respect to the Facility, the initial maturity date specified in the Drawdown Schedule.

**Last Date for Initial Drawdown** means, in respect of the Facility, the last date for initial drawdown specified in the Details.

**Maturity Date** means the date on which a Fixed Rate Period is due to expire.© National Australia Bank Limited 58

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**Premium** means the "Cap Rate Premium" specified in the Details.

**Pricing Period** means a period determined in accordance with the Details and clause 5.1, as adjusted in accordance with clauses 5.1(c) and (d).© National Australia Bank Limited 59

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**OVERDRAFT FACILITY SPECIFIC CONDITIONS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. ADDITIONAL CONDITIONS PRECEDENT**

The Facility must, at all times, be linked to an approved transaction account held with NAB solely in the Borrower's name (or if there are two or more Borrowers, held jointly by each Borrower) and not with any other person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2. DRAWING**

Any amount paid or repaid to the credit of the Facility is available for redraw in accordance with the terms of this document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. REPAYMENT AND CANCELLATION**

**3.1 Repayment**

The Borrower must repay all or part of the Balance Owing on demand by NAB.

**3.2 Cancellation**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Facility can be cancelled or the Facility Limit reduced by NAB or the Borrower at any time, even if it has an Expiry Date and even if this means the new Facility Limit is lower than the Balance Owing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Facility Limit automatically reduces by the amount of any cancellation or reduction.

**4. INTEREST**

**4.1 Payment of Interest**

The Borrower must pay:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all accrued interest on the last Business Day of each month (excluding interest for that day, which is included in the amount payable in the following month); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) all accrued but unpaid interest on the Termination Date.

**4.2 Calculation of Interest**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless otherwise provided, interest for each day is calculated by applying the Daily Interest Rate to the Balance Owing at the end of that day (excluding any amount to which a Default Interest Rate applies).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Where tiered interest rates apply (see Details), clause 4.2(a) does not apply and the interest for each day is the aggregate of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Daily Interest Rate for Tier One, multiplied by that part of the Balance Owing at the end of that day that falls within Tier One; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Daily Interest Rate for Tier Two, multiplied by that part of the Balance Owing at the end of that day that falls within Tier Two,

in each case excluding any amounts to which the Default Interest Rate applies.© National Australia Bank Limited 60

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5. FARM MANAGEMENT ACCOUNT OVERDRAFT FACILITY**

If a Facility is a Farm Management Account Overdraft Facility, NAB may require that all, or an agreed part, of the Borrower's gross business income is credited to the Loan Account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6. DEFINITIONS**

For the purposes of these Overdraft Facility Specific Conditions:

**Available Facility** means, in respect of a Facility at any time, the Facility Limit less the Balance Owing at that time.

**Availability Period** means, in respect of a Facility, the period from the date of this document to the Termination Date.

**Facility** means a facility in respect of which these Overdraft Facility Specific Conditions apply, as stated in the Details.

**Farm Management Account Overdraft Facility** means any Facility titled "Farm Management Account Overdraft Facility" in the Details.

**Tier One** means the tier one amounts in respect of a Facility specified in the Details.

**Tier Two** means tier two amounts in respect of a Facility specified in the Details.© National Australia Bank Limited 61

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![img31847469_2.jpg](img31847469_2.jpg)

**GENERAL CONDITIONS** -

**FINANCE AGREEMENT**© National Australia Bank Limited 62

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**General Conditions – Table of Contents**

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. | ABOUT THIS DOCUMENT | 64 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. | Facilities | 82 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. | Conditions Precedent | 82 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. | Repayment | 83 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. | Cancellation and Prepayment | 84 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. | Interest | 84 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. | Partners, responsible entities and trustees | 85 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. | Representations and Warranties | 86 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. | Undertakings | 89 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. | Financial Covenants and Hedging | 94 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. | Events of Default | 94 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. | Appointment of Consultants | 96 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. | Change of Control | 97 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. | Review | 97 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. | Open Treasury Transactions | 98 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. | Costs and Taxes | 99 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. | Fees | 99 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18. | Payments | 100 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19. | GST | 100 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20. | Increased Costs | 101 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21. | Economic Costs | 101 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22. | Currency indemnity | 103 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23. | Other Indemnities | 103 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24. | Set-Off | 103 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25. | Liability for Regulatory Events | 104 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26. | ANTI-MONEY LAUNDERING | 104 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27. | GUARANTEE AND INDEMNITY | 105 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28. | Power of Attorney | 107 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29. | Assignment and Changes to the Obligors | 108 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;30. | Confidentiality | 110 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;31. | Communications and Notices | 110 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32. | Accounts and Certificates | 111 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;33. | Accounting for Transactions | 112 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;34. | Statements of Account | 112 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;35. | Banking Code of Practice | 112 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36. | General provisions | 113 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;37. | Governing Law and Jurisdiction | 115 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;38. | Acknowledgement | 116 |
| &nbsp;&nbsp;&nbsp;&nbsp;Annexures | &nbsp;&nbsp;&nbsp;&nbsp;Annexures | 117 |

---

© National Australia Bank Limited 63

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**General Terms**

**1. ABOUT THIS DOCUMENT**

**1.1 Interpretation rules and inconsistency**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Interpretation rules are set out in clause 1.4 (Interpretation).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Rules to govern any inconsistency between provisions of this document or between this document and other documents are set out in clause 1.5 (Inconsistency).

**1.2 This document**

This document is comprised of the following parts:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Details;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Schedule;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Property Conditions (if applicable);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Specific Conditions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) General Conditions - Finance Agreement (including the Annexures).

**1.3 Definitions**

In this document, capitalised terms have the following meanings:

**Accession Letter** means a document substantially in the form set out in Annexure 4 (Form of Accession Letter).

**Additional Borrower** means a company which becomes an Additional Borrower in accordance with clause 29 (Assignment and Changes to the Obligors).

**Additional Cross-Guarantor** means a company which becomes an Additional Cross-Guarantor in accordance with clause 29 (Assignment and Changes to the Obligors).

**Additional Security Provider** means a person who becomes an Additional Security Provider in accordance with clause 29 (Assignment and Changes to the Obligors).

**Affiliates** means, in respect of an entity, each Related Body Corporate and each Related Entity of that entity and each Subsidiary of that entity (if not also a Related Body Corporate or a Related Entity of that entity).

**Agency** means any government or any governmental, semi-governmental or judicial entity or other authority. It also includes any self-regulatory organisation established under law.

**Amortisation Schedule** means, at any time, in respect of a Facility, the amortisation details specified in the Details (if any), as may be amended or replaced.

**Amount Owing** means all money which a Borrower (whether alone or not) is, or at any time may be, liable to pay NAB for any reason whatsoever under or in connection with the Finance Documents including the aggregate face value of any unmatured bills, the maximum amount payable by NAB under

any Bank Guarantees or Letters of Credit and money by way of principal, interest, fees, Costs, indemnity, charges, duties or expenses irrespective of whether the liability is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) present or future;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) actual, prospective, contingent or otherwise;© National Australia Bank Limited 64

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) ascertained or unascertained;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) in existence before or comes into existence on or after the date of this document; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) a combination of any or all of the above.

**Asset Finance Facility** means any Facility titled "Asset Finance Facility" in the Details.

**ASIC** means the Australian Securities and Investments Commission.

**ASX** means the Australian Securities Exchange.

**Authorisation** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any authorisation, consent, approval, resolution, licence, exemption, filing, lodgement or registration required by any Agency or any law; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in relation to anything which is prohibited or restricted by law if an Agency takes certain actions within a specified period, the expiry of that period without the Agency taking that action.

**Authorised Officer** means, in respect of an Obligor:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a director; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a person appointed by that Obligor to act as such for that Obligor under a Finance Document to which it is expressed to be a party,

and whose specimen signature in that appointed capacity has been provided to NAB and who has satisfied any required Client Identification Checks.

**Availability Period** in respect of a Facility, has the meaning given to it in the Specific Conditions for that Facility.

**Available Facility** in respect of a Facility, has the meaning given to it in the Specific Conditions for that Facility.

**Balance Owing**:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in respect of a Facility, other than a Facility listed in paragraph (b) or (c) below, means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) for a Loan Account, at any time, the difference between all amounts credited and all amounts debited to that Loan Account at that time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) for a Drawing, at any time, the amount of the Drawing less any amounts of principal repaid in relation to the Drawing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) for a Facility with multiple Loan Accounts or Drawings, the sum of the amounts calculated by reference to paragraph (a) or (b) as appropriate for each such Loan Account or Drawing,

to the extent that such amount is a debit balance. Where this amount is to be calculated for the end of a day, it includes all debits and credits assigned to that day;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in respect of a Credit Card Facility, at any time, means the unpaid balance (including fees and charges) on each "account" (as defined in the separate terms and conditions for the relevant Credit Card Facility) at that time; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) in respect of an Asset Finance Facility, at any time, means the aggregate of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the "loan balance" under each "loan agreement" at that time; and© National Australia Bank Limited 65

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the amount calculated by NAB under each "lease agreement" and "hire purchase agreement" as representing the aggregate at that time of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) the total "rental instalments" payable over the remaining part of the "term"; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) the "residual value" (if any); plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) any other amount due and payable but not paid at that time; less

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) the amount of interest attributed to the "rental instalments" falling due and payable after that time,

where each term within inverted commas has the meaning given to it in the Master Asset Finance Agreement.

**Bank Guarantee** means a bank guarantee, if any, issued by NAB under or in connection with this document.

**Beneficiary** means any beneficiary under a Trust.

**Bill Facility** means any Facility with the words "Bill Facility" in its title as stated in the Details.

**Borrower** means an Original Borrower or an Additional Borrower.

**Business Day** means a day other than a Saturday, Sunday or public holiday in every state and territory of Australia.

**Change of Control** has the meaning described in clause 13 (Change of Control).

**Client Identification Checks** means, at any time, any client identification or similar checks or procedures required in connection with any law or NAB's policies and procedures from time to time.

**Commercial Consignment** has the meaning given in the PPSA.

**Compliance Certificate** means a certificate in substantially the form of Annexure 2 setting out (in reasonable detail) computations as to compliance with clause 10.1 (Financial Covenants) as at the applicable date or for the applicable period and confirming that no Default or Review Event (if any) is continuing, signed by two Authorised Officers of the Obligor and otherwise in form and substance satisfactory to NAB.

**Compliance Committee** means, in respect of a Scheme, the compliance committee of the Scheme established in accordance with Part 5C.5 of the Corporations Act.

**Compliance Plan** means, in respect of a Scheme, the plan complying with Part 5C.4 of the Corporations Act and lodged with ASIC under section 601EA of the Corporations Act.

**Constitution** means, in respect of a Scheme, the constitution of the Scheme made by the Responsible Entity from time to time and, at the date of this document, having the details set out in the Schedule.

**Contested Tax** means a Tax payable by an Obligor where the Obligor:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) is contesting the liability in good faith and in accordance with proper procedures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) is not required by applicable law to pay the Tax prior to contesting its liability; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) has satisfied NAB that it has set aside sufficient reserves of liquid assets to pay the Tax and any fine, penalty or interest payable if the contest is unsuccessful.

**Controller** has the meaning given to the term in the Corporations Act.

**Corporations Act** means the Corporations Act 2001 (Cth).© National Australia Bank Limited 66

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**Costs** means costs, charges, fees and expenses, including those incurred in connection with NAB's internal and external legal advisers (on a full indemnity basis) and professional consultants.

**Credit Card Facility** means any Facility titled "NAB Qantas Business Signature Card Facility" or "NAB Business Card Facility" in the Details.

**Cross-Guarantor** means an Original Cross-Guarantor or an Additional Cross-Guarantor, unless it has ceased to be a Cross-Guarantor in accordance with clause 29 (Assignment and Changes to the Obligors).

**Custodian** means, at any time, the custodian of the Scheme Property from time to time and, at the date of this document, is the person identified as such in the Schedule, if any.

**Custody Agreement** means, in relation to a Scheme, the agreement between the Responsible Entity and the Custodian from time to time and, as at the date of this document, the agreement described as such in the Schedule, if any.

**Customer Margin** means, in respect of a Facility, the customer margin specified in the Details for that Facility or as otherwise agreed.

**Daily Interest Rate** means, for any day:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in relation to a Global Trade Finance Facility, the Interest Rate applying to the Facility or Drawing (as the case may be) on that day divided by 360 or, in the case of Dollars or any other currency for which the relevant interbank market practice differs, 365; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in relation to any other Facility (or any part of such a Facility), the Interest Rate applying to the Facility (or that part of the Facility) on that day divided by 365.

**Deed of Cross Guarantee** means a deed substantially in the form of a pro forma deed issued or otherwise approved by ASIC in order to satisfy ASIC class order eligibility requirements for relief from certain Corporations Act financial reporting obligations.

**Default** means an Event of Default or a Potential Event of Default.

**Default Interest Rate** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in respect of a Facility, the default interest rate as formulated in accordance with the Details for that Facility or, if no such rate is described in the Details for that Facility or if the amount is not referable to a particular Facility, the total of NAB's Base Indicator Rate plus a margin of 1% per annum or such lesser margin as NAB elects to apply; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in respect of any amount payable under a Finance Document that is not in respect of a particular Facility, such as a fee incurred in connection with engaging a professional consultant, the default interest rate under any Facility NAB may select,

or as otherwise agreed or amended as contemplated in this document

**Deposit Letter** means a security agreement in the form required by NAB from time to time which grants NAB an Encumbrance over a deposit account.

**Details** means, at any time, the details set out in the Facility Details section of this document, as may be amended from time to time as contemplated in this document.

**Dollars, Australian Dollars** or **$** means the lawful currency of Australia, unless otherwise stated in this document.

**Drawdown Date** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) for a Facility other than a Bill Facility, the date on which a Drawing is made; and© National Australia Bank Limited 67

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) for a Bill Facility, the date on which a bill is accepted, discounted or endorsed under a Facility.

**Drawdown Notice** means a notice or other communication requesting a Drawing or otherwise giving instructions in relation to a Drawing, in a form and substance acceptable to NAB (including a notice substantially in the form of Annexure 3).

**Drawdown Schedule** means, in respect of a Facility, the drawdown schedule specified in the Details for that Facility (if any) or any drawdown schedule provided to the relevant Borrower by NAB.

**Drawing** means, in respect of a Facility, a provision of financial accommodation (including, if applicable, the acceptance, discounting and endorsement of bills and the issue of Bank Guarantees and Letters of Credit) under that Facility.

**Economic Costs** has the meaning described in clause 21.

**Economic Event** has the meaning described in clause 21.

**Encumbered Property** means any asset, property or right the subject of an Encumbrance under a Security Document.

**Encumbrance** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a security agreement, bill of sale, mortgage, charge, pledge, lien, trust or other security interest securing any obligation of any person and includes a security interest within the meaning of section 12 of the PPSA;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any title retention arrangement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any right, interest, agreement, notice or arrangement which has the effect of giving another person a preference, priority or advantage over creditors including any arrangement under which money or the benefit of a bank or other account may be applied, set-off or made subject to a combination of accounts or not repayable in certain circumstances;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any third party right or interest or any right arising as a consequence of the enforcement of a judgment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any right that a person (other than the owner) has to remove something from land (known as a profit á prendre), easement, public right of way, restrictive covenant, positive covenant, lease or licence to use or occupy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any right of set-off, assignment of income, garnishee order or monetary claim;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) equity, interest or writ of execution;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) any security deposit;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any option; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) any other agreement, notice or arrangement having a similar effect as any of the items set out in paragraphs (a) to (i) (inclusive) above,

or any agreement or arrangement to create any of them or allow them to exist.

**Event of Default** means any event or circumstance specified as such in this document or under any other Finance Document.

**Expiry Date** means, in respect of a Facility, the expiry date (if any) specified in the Details for that Facility.

**Facility** means each facility referred to in the Details, including each Other Facility.© National Australia Bank Limited 68

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**Facility Component** means a Bill Facility Component, NAB Business Markets Facility Component or a Corporate Markets Loan Component, as the case may be, as each of those terms as defined in the relevant Specific Conditions.

**Facility Limit**, at any time:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in respect of a Facility (other than a Facility to which paragraph (b) below applies), means the facility limit specified in the Details for that Facility, as reduced, cancelled or varied from time to time in accordance with this document; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in respect of a Facility with scheduled repayments or scheduled reductions of its facility limit, means the sum of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the facility limit specified in the Details for that Facility, as reduced, cancelled or varied from time to time in accordance with the document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) capitalised interest at that time; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) capitalised scheduled fees (which, for the avoidance of doubt, do not include contingent fees).

**Fees Guide** means NAB's "Business Banking Fees – A guide to fees and charges" as amended or replaced from time to time.

**Finance Document** means each of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) this document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) each Compliance Certificate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) each Hedging Agreement (if applicable);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) each Drawdown Notice, drawdown schedule and amortisation schedule (however described);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) each Transactional Specific Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) each Security Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) each Accession Letter;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) each Deposit Letter;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) each other document referred to in the "Other Conditions" section of the Details;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) any other document or agreement NAB and a Borrower agree in writing is a Finance Document,

and each document, agreement or notice entered into, or given, under or for the purpose of amending, novating or acceding to, any of the above.

**Financial Indebtedness** means any indebtedness for or in respect of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) moneys borrowed;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any amount raised under any acceptance credit, or bill acceptance, discount or endorsement facility;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the amount of any liability in respect of any lease or hire purchase contract which would, in accordance with GAAP, be treated as a finance or capital lease;© National Australia Bank Limited 69

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any redeemable shares where the holder has the right, or the right in certain conditions, to require redemption;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) any amount raised under any other transaction (including any forward sale or purchase agreement) having the commercial effect of a borrowing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) consideration for the acquisition of assets or services payable more than 90 days after acquisition;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price (and, when calculating the value of any derivative transaction, only the marked to market value will be taken into account);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) any counter-indemnity obligation in respect of a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) the amount of any liability in respect of any guarantee or indemnity for any of the items referred to in paragraphs (a) to (j) above,

irrespective of whether the indebtedness is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) present or future;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) actual, prospective, contingent or otherwise;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) at any time ascertained or unascertained;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) owed or incurred alone or severally or jointly or both with any other person; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) a combination of any of the above.

**Financial Statements** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a statement of comprehensive income (otherwise known as a statement of financial performance or profit and loss statement);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a statement of financial position;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) a statement of cash flow; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) a statement of changes in equity,

together with any notes to those documents and any accompanying reports, statements, declarations and other documents or information.

**Fixed Rate Period** means, in respect of a Facility or a Drawing, the period during which a specific interest rate or yield rate will apply and will not change.

**Foreign Currency Overdraft Facility** means any Facility titled "Foreign Currency Overdraft Facility" in the Details.

**GAAP** means accounting standards, principles and practices applying by law or otherwise which are generally accepted and consistently applied in Australia.

**General Conditions** means the provisions set out in the General Conditions – Finance Agreement section of this document.

**General Terms** means the conditions set out in this General Terms section of the General Conditions – Finance Agreement.© National Australia Bank Limited 70

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**Global Trade Finance Facility** means any Facility to which the Global Trade Finance Specific Conditions apply, as stated in the Details.

**Goods** has the meaning given in the PPSA.

**Governing Law Jurisdiction** means the jurisdiction specified as such in the Schedule.

**Group** means each Borrower and each of its Related Bodies Corporate and Subsidiaries (if not also a Related Body Corporate) or the group or groups of entities (if any) listed as such in the Schedule.

**GST** means Goods and Services Tax as imposed under the GST Act.

**GST Act** means A New Tax System (Goods and Services Tax) Act 1999 (Cth).

**Guarantee** means (other than in clause ‎27 (Guarantee and Indemnity)) any guarantee, letter of credit, bond, indemnity or similar assurance against loss, or any obligation, direct or indirect, actual or contingent, to purchase or assume any indebtedness of any person or to make an investment in or loan to any person or to purchase assets of any person where, in each case, such obligation is assumed in order to maintain or assist the ability of such person to meet its indebtedness or to assure any creditor against loss.

**Head Company** means the head company (as defined in the Tax Act) of a Tax Consolidated Group.

**Hedging Agreement** means each derivative transaction protecting against or benefiting from fluctuations in any rate or price, which is entered into or to be entered into by an Obligor with NAB, including any novation agreement, master agreement and transaction or confirmation under or relating to them.

**Increased Costs** has the meaning given to it under clause 20(b).

**Indicator Rate** means, for any day, in respect of a Facility, the relevant type of indicator rate specified in the Details for that Facility where the amount is as:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) advised in writing by NAB to the relevant Borrowers;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) published or otherwise advised by NAB from time to time on NAB's website; and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) advertised by NAB in the local or national press.

**Insolvency Event** means, in respect of a person, any of the following events:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) it is (or states it is) an insolvent under administration or insolvent (each as defined in the Corporations Act);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) it has an administrator, liquidator, provisional liquidator, Controller or any other kind of insolvency administrator appointed to it or to any part of its property, or they are or any part of its property is placed under any other formal or informal kind of insolvency administration;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) an application is made to a court for an order, or an order is made, that it be wound up;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) it resolves or take any action to wind up itself up, or otherwise dissolve itself, or it is otherwise wound up or dissolved, except to reconstruct or amalgamate while solvent on terms pre-approved by NAB in writing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) execution or distress or any other process is levied or attempted or imposed against or over any of its undertaking, property or assets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) a compromise, arrangement, assignment, moratorium or composition is proposed with, or becomes effective in relation to, its creditors or any class of its creditors (in each case, other than to carry out a reconstruction or amalgamation while solvent on terms approved by NAB in writing);© National Australia Bank Limited 71

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) an application or order has been made (and, in the case of an application, it is not stayed, withdrawn or dismissed within 5 Business Days), a resolution is passed, a proposal is put forward, a meeting is convened, or any other action is taken, in each case in connection with it, which is preparatory to or could result in any of the things referred to in paragraphs (a) to (f) (inclusive) above;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) it is taken (under section 459F of the Corporations Act) to have failed to comply with a statutory demand;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) it is the subject of an event described in section 459C(2)(b) or section 585 of the Corporations Act (or they make a statement from which NAB reasonably deduces it is so subject);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) it takes any step to obtain protection, or are granted protection, from creditors, under any applicable law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) it is deregistered for whatever reason;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) it commits an act of bankruptcy within the meaning of Bankruptcy Act 1966 (Cth);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) it becomes a bankrupt as defined in Bankruptcy Act 1966 (Cth) or action is taken which could result in that event;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) it is otherwise unable to pay its debts when they fall due; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) something having a substantially similar effect to any of the things referred to in paragraphs (a) to (n) (inclusive) happens in connection with it under any law.

**Intellectual Property** means all trade secrets, confidential information, know-how, patents, trade marks, designs (whether registered or unregistered), copyright, and computer programs.

**Interest Period** means, in respect of a Facility, the period for which interest is calculated and charged as stated, or selected if provided for, in this document or as otherwise agreed.

**Interest Rate** means, at any time in respect of a Facility, the per annum rate of interest applicable to that Facility or part of that Facility as formulated in accordance with the Details for that Facility or as otherwise agreed or amended as contemplated in this document.

**Interested Person** has the meaning given to that term for the purposes of section 275 of the PPSA, and includes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any person granting an Encumbrance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a person with another Encumbrance in the same property in which NAB has an Encumbrance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) if a person granting an Encumbrance is a body corporate, an auditor of that person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) an execution creditor with an interest in the property in which NAB has an Encumbrance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) an authorised representative of any of the above.

**Ipso Facto Event** means a Borrower is the subject of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) an announcement, application, compromise, arrangement, managing controller, or administration as described in section 415D(1), 434J(1) or 451E(1) of the Corporations Act; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any process which under any law with a similar purpose may give rise to a stay on, or prevention of, the exercise of contractual rights.

**Letter of Credit** means a documentary letter of credit or a standby letter of credit issued by NAB pursuant to a Facility.© National Australia Bank Limited 72

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**Loan Account** means an account with NAB for the purposes of recording transactions in connection with a Facility and includes, in relation to an overdraft (including a Foreign Currency Overdraft Facility), the associated transaction account.

**Mandatory Prepayment Period** means, in respect of a Review Event, the period specified as such in the Schedule which begins on the date on which NAB gives notice to the Borrowers under clause 14.5(c).

**Market Rate Facility** means any Facility titled "Market Rate Facility" in the Details.

**Marketable Security** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a "marketable security" as defined in the Corporations Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a negotiable instrument;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) a unit or other interest in a trust, partnership or Registered Scheme; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) a right or an option in respect of any of paragraphs (a), (b) or (c), whether issued or unissued.

**Master Asset Finance Agreement** means a master asset finance agreement in NAB's standard form.

**Material Adverse Effect** means any material adverse effect (in the opinion of NAB) on:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the assets, business, operations, affairs, property, condition (financial or otherwise) or prospects of any Obligor or of the Obligors taken as a whole;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the ability of an Obligor to perform its obligations under any Finance Document to which it is expressed to be a party; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the validity, enforceability or priority of any Finance Document or an Encumbrance provided for by any Finance Document, or the rights or remedies of NAB under any Finance Document.

**Material Authorisation** means, for an Obligor, any Authorisation required:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to enable it to lawfully enter into and exercise its rights and comply with its obligations under each Finance Document to which it is expressed to be a party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to enable it to own its assets and to carry on its business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) to make each Finance Document to which it is expressed to be a party admissible in evidence in its jurisdiction of incorporation.

**Material Documents** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) each of the documents (if any) identified as such in the Schedule;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the constitution of each Obligor that is a corporation or an incorporated association;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) each Trust Deed (if any);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) each Partnership Document (if any);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) each Scheme Document (if any); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) each other document NAB and a Borrower agree in writing is a Material Document.

**NAB Business Markets Facility** means any Facility titled "NAB Business Markets - Flexible Rate Loan" in the Details.

**NAB Corporate Markets Loan** means any Facility titled "NAB Corporate Markets Loan" in the Details.© National Australia Bank Limited 73

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**Negotiation Period** means, in respect of a Review Event, the period specified as such in the Schedule which begins on the date on which NAB becomes aware of the occurrence of the Review Event.

**Nominated Account** means, in respect of a Facility, the NAB account described in the Details as being the nominated account for that Facility, or such other bank account nominated from time to time by the relevant Borrower and acceptable to NAB and, on the date of this document, is the bank account described as such in the Details for that Facility.

**Obligor** means a Borrower, Cross-Guarantor or Security Provider.

**Original Borrower** means each person listed as a borrower in Item 1 (Obligors and Group) of the Schedule.

**Original Cross-Guarantor** means each person listed as a cross-guarantor in Item 1 (Obligors and Group) of the Schedule.

**Original Obligor** means an Original Borrower, Original Cross-Guarantor or Original Security Provider.

**Original Security Provider** means each person listed as a security provider in Item 1 (Obligors and Group) of the Schedule.

**Other Facility** means any facility referred to in the Details under the heading "Other Facilities".

**Package** means any product with the words "Package" or "Multi-Option" in its name.

**Partner** means, in respect of a Partnership, the relevant Obligor which is a partner in the Partnership.

**Partnership** means, at any time, a partnership in respect of which an Obligor is a partner at that time and includes each partnership specified in the Schedule.

**Partnership Agreement** means, in respect of a Partnership, the instrument establishing, or setting out the terms of, the Partnership and any other constituent documents relating to the Partnership.

**Partnership Documents** means, in respect of a Partnership:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Partnership Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any other documents described as such in the Schedule; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) each other document which an Obligor and NAB agree in writing is a Partnership Document.

**Partnership Property** means, in respect of a Partnership, all assets, rights, property and undertaking which are the subject of the Partnership:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) of whatever kind and wherever situated; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) whether present or future.

**Partnership Provisions** means the provisions set out in the Partnership Provisions section of these General Conditions – Finance Agreement (if applicable).

**Permitted Disposal** means any sale, lease, transfer or other disposal on arm's length terms and for market consideration:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) made with NAB's prior written consent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) made in the ordinary course of the disposing entity's business and for the purpose of carrying on the disposing entity's ordinary business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) of assets in exchange for other assets comparable or superior as to type, value and quality and for a similar purpose;© National Australia Bank Limited 74

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) of obsolete or redundant vehicles, plant and equipment for cash; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) under a Permitted Encumbrance.

**Permitted Encumbrance** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any of the following entered into by an Obligor in the ordinary course of its business (as conducted on the date of the agreement):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a Commercial Consignment of Goods under which that Obligor is the consignee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a bailment, hiring arrangement or lease under which that Obligor is the bailee, hirer or lessee, that does not secure payment or performance of an obligation, but which is a PPS Lease;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) retention of title terms in a contract for the supply of Goods to that Obligor,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any Encumbrance created under a Finance Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any Encumbrance created or subsisting with NAB's prior written consent (as long as any conditions stipulated for that consent are complied with); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any lien arising by operation of law (other than the PPSA) and securing obligations which are not overdue.

**Permitted Financial Indebtedness** means any Financial Indebtedness:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) incurred or subsisting under a Finance Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) incurred by an incorporated Obligor in compliance with clause 9(l)(i) (providing Financial Indebtedness); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) incurred or subsisting with NAB's prior written consent (unless the consent was conditional and any of the conditions are not complied with to the satisfaction of NAB).

**Potential Event of Default** means any event or circumstance which would, with the lapse of time, the giving of notice, the making of any determination under any Finance Document, the fulfilment of any condition or any combination of any of the foregoing, be an Event of Default.

**PPS Lease** has the meaning given in the PPSA.

**PPSA** means the Personal Property Securities Act 2009 (Cth).

**Pricing Period** means, in respect of a Facility, the period set out in the Specific Conditions for that Facility (if applicable).

**Pricing Review** has the meaning given to it in clause 14.1 (Pricing Review Events).

**Privacy Statement** means the statement as contained in Annexure 7.

**Property Conditions** means the conditions set out in the Property Conditions section of this document (if applicable).

**Range Amount** has the meaning, if any, set out in the Specific Conditions for a Facility.

**Receiver** means a receiver, receiver and manager or controller as defined in the Corporations Act.

**Recipient** has the meaning as given to it in the GST Act.

**Registered Scheme** means a registered scheme as defined by the Corporations Act.© National Australia Bank Limited 75

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**Regulatory Event** means any:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) change in, or introduction of a new, law or other form of regulation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) change in, or introduction of a new, practice or policy of an Agency;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) investigation into an Obligor or any Related Entity of an Obligor by an Agency;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) application for or grant of an injunction or order in respect of any Encumbrance, Facility or account held with NAB made by an Agency, or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) change in, or introduction of a new, code of practice or custom relating to the provision of any Service which a reasonable and prudent banker would comply with,

whether in Australia or elsewhere, that, in NAB's good faith opinion, or that of another financial institution, applies in any way to an Obligor, or Service.

**Related Body Corporate** means, in respect of an entity, each related body corporate (as defined in the Corporations Act) of that entity.

**Related Entity** means, in respect of an entity, each related entity (as defined in the Corporations Act) of that entity.

**Repricing Date**, in respect of a Facility, has the meaning given to it in the Specific Conditions for that Facility (if any).

**Resignation Letter** means a letter substantially in the form set out in Annexure 5 (Form of Resignation Letter).

**Responsible Entity** means, in respect of a Scheme, the relevant Obligor which is a responsible entity of the Scheme.

**Responsible Entity Provisions** means the provisions set out in the Responsible Entity section of these General Conditions – Finance Agreement (if applicable).

**Review Event** means each event specified as such in the Schedule.

**Schedule** means the Key Information section of this document.

**Scheme** means, at any time, a Registered Scheme in respect of which an Obligor is a responsible entity and includes each Registered Scheme specified in the Schedule.

**Scheme Documents** means, in respect of a Scheme:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Constitution;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Compliance Plan;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any other documents described as such in the Schedule; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) each other document which an Obligor or the Responsible Entity and NAB agree in writing is a Scheme Document.

**Scheme Property** means, in respect of a Scheme, the scheme property (as defined by the Corporations Act) of the Scheme.

**Security Documents** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) each document, if any, specified as such in the Schedule or specified as such in an Accession Letter;© National Australia Bank Limited 76

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) each other document which creates an Encumbrance to secure the Amount Owing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) each Guarantee or Encumbrance granted in connection with this document.

**Security Provider** means an Original Security Provider or an Additional Security Provider unless that person has ceased to be a Security Provider in accordance with 29 (Assignment and Changes to the Obligors).

**Service** means any service NAB provides to the Borrower under or in relation to a Facility including making or processing any payment or issuing any document.

**Specific Conditions** means, at any time, the conditions set out in the Specific Facility Terms section of this document which apply to each Facility (as stated in the Details of that Facility), as may be amended from time to time in accordance with this document.

**Subsidiary** has the meaning given to it in the Corporations Act, but as if body corporate includes any entity. It also includes any entity required by GAAP to be included in the consolidated annual financial report of an entity or which would be required if that entity were a corporation. A trust or Registered Scheme may be a Subsidiary (and a unit or other beneficial interest in the trust or Registered Scheme is to be treated as a share accordingly) and an entity is to be treated as a Subsidiary of a trust or Registered Scheme as if that trust or Registered Scheme were a corporation.

**Superannuation Laws** means the Superannuation Industry (Supervision) Act 1993 (Cth), regulations made under that Act and any other instrument made under that Act or those regulations.

**Supply** has the meaning given to it in the GST Act.

**Tax** means any tax, levy, impost, duty or other charge or withholding of a similar nature including any penalty, interest, fine or expense payable in connection with any failure to pay, or any delay in paying, any of the same.

**Tax Act** means the Income Tax Assessment Act 1936 (Cth) or the Income Tax Assessment Act 1997 (Cth), as the context requires.

**Tax Consolidated Group** means a "Consolidated Group" or a "MEC Group" (each having the meaning given to it in the Tax Act).

**Tax Invoice** has the meaning given to it in the GST Act.

**Taxable Supply** has the meaning given to it in the GST Act.

**Tenancy Schedule** means a schedule of leases detailing the following information in relation to each of the leases:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) name of each tenant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) area let by each tenant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) current passing rent paid by each tenant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) outgoings and outgoing recoveries;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) rental incentives within the next 12 months;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) lease start date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) lease term;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) lease maturity date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) option term (if any);© National Australia Bank Limited 77

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) rent review details;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) any other material or special clauses or conditions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) any other information reasonably requested by NAB.

**Termination Date** means, in respect of a Facility, the date being the earlier of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Expiry Date, if any, or the last day of a facility term specified for that Facility in the Details;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the date on which the Facility is cancelled in accordance with the terms of this document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the date on which the Amount Owing in respect of that Facility is due and repayable; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the date the Facility is terminated under the relevant Transactional Specific Document.

**TFA** means a tax funding agreement between the members of a Tax Consolidated Group which includes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) reasonably appropriate arrangements for the funding of tax payments by the Head Company having regard to the position of each member of the Tax Consolidated Group; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) an undertaking from each member of the Tax Consolidated Group to compensate each other member of the Tax Consolidated Group adequately for loss of tax attributes (including tax losses and tax offsets) as a result of being a member of the Tax Consolidated Group; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) an undertaking from the Head Company to pay all group liabilities (as described in section 721-10 of the Tax Act) of the Tax Consolidated Group.

**Threshold Amount** means the amount specified as such in the Schedule.

**Transaction Document** means a Finance Document or a Material Document.

**Transactional Specific Documents** means, in respect of a Facility, the standard form documents in connection with that Facility which NAB requires an Obligor to execute or accept under or to establish that Facility.

**Trust** means, at any time, a trust or settlement in respect of which an Obligor is a trustee at that time and includes each trust specified in the Schedule.

**Trust Deed** means, in respect of a Trust, the document establishing the Trust and any other constituent document relating to the Trust.

**Trust Documents** means, in respect of a Trust:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Trust Deed;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) all agreements or deeds between unitholders of the Trust;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any other documents described as such in the Schedule; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) each other document which an Obligor and NAB agree in writing is a Trust Document.

**Trust Property** means, in respect of a Trust, all the rights, property and undertaking which are the subject of the Trust:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) of whatever kind and wherever situated; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) whether present or future.

**Trustee** means, in respect of a Trust, the relevant Obligor which is a trustee of the Trust.© National Australia Bank Limited 78

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**Trustee Provisions** means the provisions set out in the Trustee Provisions section of these General Conditions – Finance Agreement (if applicable).

**TSA** means an agreement between the members of a Tax Consolidated Group which takes effect as a tax sharing agreement under section 721-25 of the Tax Act and complies with the Tax Act and any law in connection with the Tax Act.

**Verification Certificate** means a certificate substantially in the form of, and with the attachments referred to in, Annexure 1, signed by two directors or a director and company secretary of the Obligor (if the Obligor has more than one director) or by the director of the Obligor (if the Obligor has only one director) and otherwise in form and substance satisfactory to NAB.

**1.4 Interpretation**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless the contrary intention appears, in this document:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a reference to an **Annexure** is a reference to an annexure to these General Conditions – Finance Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) **assets** includes present and future properties, revenues, benefits and rights of every description and a reference to an asset includes any real or personal, present or future, tangible or intangible property or asset (including intellectual property) and any right, interest, revenue or benefit in, under or derived from the property or asset;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) unless the context otherwise requires, a reference to a **clause** in:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) any Specific Conditions is a reference to a clause in those Specific Conditions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) the Property Conditions (if applicable) is a reference to a clause in those Property Conditions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) any other part of this document is a reference to a clause in these General Terms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) a Default (other than an Event of Default) is **continuing** if it has not been remedied to NAB's satisfaction or waived by NAB in writing and an Event of Default is **continuing** if it has not been waived by NAB in writing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) a reference to a **Finance Document**, a **Transaction Document** or any other document is a reference to that Finance Document, Transaction Document or other document as amended, novated, supplemented, extended, replaced or restated;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the meaning of a term is not limited by specific examples introduced by **including, for example, such as** or any other similar term;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the word **law** includes common law, principles of equity, and laws made by parliament, listing rules or business rules of a financial market, any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any Agency and if not having the force of law, with which responsible entities in the position of the relevant party would normally comply;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) a provision of **law** is a reference to that provision as consolidated, amended, re-enacted, replaced or varied;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) **NAB** includes its successors in title, permitted assigns and permitted transferees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) the word **person** includes an individual, a company, a corporation, a firm, a partnership, a joint venture, a body corporate, an unincorporated association, an authority and any combination of the foregoing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) a reference to a particular person includes the person's executors, administrators, successors and permitted substitutes (including persons taking by novation) and assigns;© National Australia Bank Limited 79

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii) a reference to a group of persons is a reference to any two or more of them jointly and to each of them individually;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) an agreement, representation or warranty in favour of two or more persons is for the benefit of them jointly and each of them individually;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv) an agreement, representation or warranty, undertaking, obligation, covenant, indemnity or liability of or by two or more persons binds them jointly and each of them individually but an agreement, representation or warranty, undertaking, obligation, covenant, indemnity or liability of or by NAB binds NAB individually only;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xv) a reference to any thing (including an amount) is a reference to the whole and each part of it, but nothing in this clause 1.4 (Interpretation) implies that the performance of part of an obligation constitutes performance of the obligation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvi) a reference to a time of day is a reference to the time in the Governing Law Jusrisdiction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvii) a reference to a month means a calendar month and a reference to a quarter means a calendar quarter; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xviii) nothing in this document is to be interpreted against a party on the ground that the party put it forward.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Words importing the singular include the plural and vice versa.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Words importing a gender include any gender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Headings (including those in brackets at the beginning of paragraphs) are for convenience only and do not affect the interpretation of this document.

**1.5 Inconsistency**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For the avoidance of doubt, this clause 1.5 (Inconsistency) takes precedence over all Finance Documents in relation to resolving any inconsistencies provided for in the sub-clauses below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Unless expressly stated otherwise, any inconsistency as between the terms of a Facility will be resolved, to the extent of the inconsistency, in the following order of priority:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Details (and where a Facility comprises part of a Package, the Details relating to the Package prevails over the Details relating to that Facility);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Property Conditions (if any);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Specific Conditions (and where a Facility comprises part of a Package, the Specific Conditions relating to the Package prevail over the Specific Conditions relating to that Facility);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any additional documents referred to in the "Other Conditions" section of the Details;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) the Schedule;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the General Terms; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the relevant Fees Guide.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Unless expressly stated otherwise, any inconsistency as between a provision in this document and a provision in any other Finance Document will be resolved, to the extent of the inconsistency, in the following order of priority:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) this document;© National Australia Bank Limited 80

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each Hedging Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) each Security Document; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) each other Finance Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Unless expressly stated otherwise, if there is any inconsistency between a provision in the separate terms and conditions applying to an Asset Finance Facility, Credit Card Facility or Other Facility and the terms of this document, the separate terms and conditions for the Asset Finance Facility, Credit Card Facility or Other Facility (as the case may be) prevail to the extent of the inconsistency except that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Facility Limit for the Asset Finance Facility or Credit Card Facility (as the case may be) may be changed in accordance with the Specific Conditions for a Multi-Option Facility; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the provisions in this document relating to set-off will prevail.

**1.6 Personal Property Securities (PPS) law**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a PPS Law applies, or will at a future date apply to any of the Finance Documents or any of the transactions contemplated by them, or NAB determines that a PPS Law applies, or will at a future date apply, to any of the Finance Documents or any of the transactions contemplated by them; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) in the opinion of NAB (acting reasonably), the PPS Law:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) adversely affects or would adversely affect NAB's security position or the rights or obligations of NAB under or in connection with the Finance Documents; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) enables or would enable NAB's security position to be improved without adversely affecting the Obligors in a material respect,

NAB may give notice to the Obligors requiring the Obligors to do anything (including amending any Finance Document or executing any new Finance Document) that in NAB's opinion is reasonably necessary to ensure that, to the maximum possible extent, NAB's security position, and rights and obligations, are not adversely affected as contemplated by clause 1.6(a)(ii)(A) (or that any such adverse effect is overcome), or that NAB's security position is improved as contemplated in clause 1.6(a)(ii)(B) and the Borrowers must comply with the requirements of that notice within the time stipulated in the notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In this clause 1.6 (Personal Property Securities (PPS) law), **PPS Law** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Personal Property Securities Act 2009 (Cth) (**PPS Act**);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any regulations made at any time under the PPS Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any provision of the PPS Act or regulations referred to in clause (ii);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any amendment to any of the above, made at any time; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) any amendment made at any time to any other legislation as a consequence of a PPS Law referred to in clauses (i) to (iv).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Obligors waive, to the extent permitted under the PPS Law, their right to receive any notices NAB is required to give under the PPS Law (including a notice of a verification statement).© National Australia Bank Limited 81

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**2. Facilities**

**2.1 The Facilities**

Each Facility is made available during its Availability Period on the terms set out in this document.

**2.2 Purpose and monitoring**

The Borrower must apply all Drawings under a Facility for the purpose specified for that Facility in the relevant Details or for any other purpose that NAB approves in writing. NAB is not bound to monitor or verify the application of any Drawings.

**3. Conditions Precedent**

**3.1 Initial conditions precedent**

NAB's obligation to provide the first Drawing under any Facility to any Borrower is subject to NAB first receiving the following documents, each in form and substance satisfactory to NAB:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) (**verification certificate**) a Verification Certificate in relation to each Original Obligor and dated not earlier than 5 Business Days before the first Drawdown Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) (**Finance Documents**) each Finance Document duly executed by each party to that document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) (**Material Documents**) (except for the constitution of each Obligor that is a corporation) a copy of each Material Document duly executed by each party to that document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) (**Taxes and registration**) evidence that each Finance Document and each Material Document:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) which is registrable is in registrable form and is accompanied by all executed documents necessary to register them in each relevant jurisdiction; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) has had all Taxes paid on it or, if not already paid, evidence that sufficient immediately available and transferable funds have been provided to NAB to enable the payment of any Taxes chargeable on it, together with all executed documents (including, where relevant, a statutory declaration regarding the location and value of assets) necessary to effect due payment of those Taxes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) (**Client Identification Checks**) all documents and other information that NAB requires to enable NAB to complete any Client Identification Checks;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) (**structure chart**) a diagram showing the structure and ownership arrangements of each Group and the Obligors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) (**valuations**) any valuation required by NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) (**insurances**) a certified copy of any insurance policy required by NAB and evidence that all insurances meet the requirements of the Finance Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) (**process agent appointment**) evidence of the acceptance of appointment of a process agent located in Australia for each Obligor incorporated or located outside Australia; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) (**enquiries and searches**) the results of NAB's enquiries and searches.

**3.2 Further conditions precedent**

NAB will only be required to provide a Drawing under a Facility if the following conditions are met:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) if a Drawdown Notice (however described) is required to be delivered in accordance with the Specific Conditions (or separate terms and conditions) for that Facility, NAB has received a© National Australia Bank Limited 82

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Drawdown Notice completed and signed or submitted in accordance with clause 31(b) (Communications and Notices) by the relevant Borrower;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the proposed Drawdown Date is a date during the Availability Period for that Facility and the provision of the Drawing will not cause the Balance Owing for that Facility (when aggregated with the amount of the proposed Drawing) to exceed the Facility Limit for that Facility;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) on the date of any Drawdown Notice and on the proposed Drawdown Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) no Default, Change of Control or Review Event is, in NAB's opinion, continuing or would result from the proposed Drawing being provided; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each representation and warranty set out in clause 8.1 (Representations and Warranties) is correct and not misleading by reference to the then current facts and circumstances subsisting on each of those dates;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) all Costs due and payable to NAB as at the Drawdown Date under any Finance Document have been paid or will be paid out of the Drawing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) each document listed as a "Specified Document" in the Schedule or any other conditions precedent specified in, or required under, any Finance Document have been satisfied or delivered (as the case may be) to NAB, each in form and substance satisfactory to NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any other document, opinion or assurance which NAB requires in connection with the entry into, delivery (if applicable) .and performance of the transactions contemplated by, or for the validity and enforceability of, any Finance Document has been delivered to NAB, each in form and substance satisfactory to NAB; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) NAB has received, in form and substance satisfactory to it, all other documents, opinions or information requested by NAB in accordance with each Finance Document or which NAB otherwise requires in connection with any Finance Document.

**3.3 Certification of copies**

Unless otherwise required by NAB, each document specified in respect of an Obligor in clause 3.1 (Initial conditions precedent) or clause 3.2 (Further conditions precedent) must be an original. If NAB requires a certified copy of a document, the copy must be certified by a director or secretary of that Obligor as true and complete as at a date no earlier than 5 Business Days before the first Drawdown Date.

**4. Repayment**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Borrower of a Facility must, in respect of that Facility, repay:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) each Drawing in the manner set out in the Specific Conditions or, if no Specific Conditions apply, the separate terms and conditions applying to that Facility; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) on demand, any amount by which the Balance Owing exceeds the Facility Limit,

together with accrued interest calculated in accordance with the applicable Specific Conditions or, if no Specific Conditions apply, in accordance with the separate terms and conditions applying to that Facility on the amount referred to in clauses (i) or (ii) (as the case may be).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower of a Facility must repay the Amount Owing in respect of the Facility on its Termination Date.© National Australia Bank Limited 83

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**5. Cancellation and Prepayment**

**5.1 Cancellation**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Borrower of a Facility may, in respect of that Facility, cancel the whole or any part of a Facility in accordance with the Specific Conditions or, if no Specific Conditions apply, the separate terms and conditions applying to that Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB may cancel, without notice to the Borrower, each Available Facility on the last day of the relevant Availability Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) NAB may otherwise cancel a Facility in accordance with the Specific Conditions or, if no Specific Conditions apply, the separate terms and conditions applying to that Facility.

**5.2 Prepayment**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Borrower of a Facility may, in respect of that Facility, prepay the whole or any part of the Balance Owing under that Facility in accordance with the Specific Conditions or, if no Specific Conditions apply, the separate terms and conditions applying to that Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) A Borrower of a Facility must, in respect of that Facility, prepay the Balance Owing under that Facility in the amounts and at the times specified under the heading "Mandatory Prepayment" in the Schedule.

**5.3 Illegality**

If NAB reasonably determines that it is or will become unlawful (or impossible in practice as a result of a change in law) in any jurisdiction for NAB to perform any of its obligations under this document or to fund or maintain any Drawing or part of a Facility:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB will promptly notify the relevant Borrower upon becoming aware of that event;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Facility will be immediately cancelled; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the relevant Borrower must prepay the Amount Owing on the date specified by NAB in its notice.

**5.4 Restrictions**

Unless otherwise specified in this document:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) no amount cancelled may be subsequently reinstated;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any prepayment under this document must be made together with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) accrued interest on the amount prepaid calculated in accordance with the applicable Specific Conditions or, if no Specific Conditions apply, the separate terms and conditions applying to that Facility; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Economic Costs and fees incurred in relation to the prepayment (if any); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) no Borrower may reborrow any part of a Facility that is prepaid.

**6. Interest**

**6.1 Interest**

Each Borrower of a Facility must, in respect of that Facility, pay interest on the Balance Owing in accordance with the Specific Conditions or, if no Specific Conditions apply, the separate terms and conditions applying to that Facility.© National Australia Bank Limited 84

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**6.2 Default Interest**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If a Borrower fails to pay any amount payable by it under a Finance Document on its due date, interest will accrue on the overdue amount from the due date up to and including the date of actual payment (both before and after judgment) at the Default Interest Rate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If a Borrower exceeds a Facility Limit (even where NAB has approved the excess), NAB may charge, and the Borrower must pay, interest on the excess at the Default Interest Rate at the end of each day that an excess exists.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Default interest is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) for a Facility where interest is ordinarily debited from an account or accounts under that Facility, added to the Balance Owing for that Facility on each date on which interest is debited for that Facility;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) for any other Facility, at NAB's discretion, added to the overdue amount monthly and when the overdue amount is paid, or debited from the Nominated Account for that Facility (or, if permitted by this document, any other account held by the Borrower) on each date on which interest is debited for that Facility, unless NAB otherwise specifies; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) for any other amount payable under a Finance Document that is not in respect of a particular Facility, payable at such time as NAB selects.

**7. Partners, responsible entities and trustees**

**7.1 Partners**

If, at any time, there is a Partnership, the terms and conditions set out in the Partnership Provisions apply to the relevant Obligor which is a Partner of that Partnership.

**7.2 Responsible Entities**

If, at any time, there is a Scheme, the terms and conditions set out in the Responsible Entity Provisions apply to the relevant Obligor which is the Responsible Entity of that Scheme.

**7.3 Trustees**

If, at any time, there is a Trust, the terms and conditions set out in the Trustee Provisions apply to the relevant Obligor which is a Trustee of that Trust.

**7.4 Self-managed superannuation funds**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If a Borrower is a trustee of a self-managed superannuation fund which is regulated by the Superannuation Laws (**SMSF Borrower**), it will need to comply with those laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If an SMSF Borrower wishes to use a Facility to buy an asset, it will need to sign and comply with the terms of a Superannuation Acquisition Financing Deed or Superannuation Financing Deed, in a form acceptable to NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) NAB's recourse to an SMSF Borrower's fund will be limited in accordance with the terms of the Superannuation Acquisition Financing Deed or Superannuation Financing Deed. The terms of the Superannuation Acquisition Financing Deed or Superannuation Financing Deed prevail over any inconsistent term in another Transaction Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Due to the requirements of the Superannuation Laws, despite any other term in a Transaction Document, no SMSF Borrower can redraw any amount it repays under a Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) If an SMSF Borrower used a Facility to buy an asset, it agrees not to overdraw its accounts and to pay, or direct its security trustee to pay, NAB any proceeds received:© National Australia Bank Limited 85

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) from any insurance claim relating to the asset, before repaying the Amount Owing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) if the asset is compulsorily acquired, sold or otherwise disposed of, immediately following receipt.

**8. Representations and Warranties**

**8.1 Representations and Warranties**

Each Obligor makes the following representations and warranties on the date of this document:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) (**incorporation**) each Obligor (other than an Obligor who is a natural person) is a corporation, duly incorporated and validly existing under the laws of its jurisdiction of incorporation and is capable of suing and being sued;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) (**power**) each Obligor has full power, authority and legal right to own its assets and carry on its current and contemplated business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) (**binding obligations**) subject to any necessary stamping and registration requirements, equitable principles and laws generally affecting creditors' rights, the obligations expressed to be assumed by each Obligor in each Transaction Document to which it is expressed to be a party are legal, valid, binding and enforceable obligations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) (**no conflict**) the execution, delivery (if applicable) and performance by each Obligor of each Transaction Document to which it is expressed to be a party and the transactions contemplated by those Transaction Documents do not and will not conflict with or violate:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any law applicable to it;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any Material Document; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any agreement or instrument binding upon it or any of its assets in any material respect,

and, excluding the Finance Documents, in each case, do not and will not:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) create or impose any Encumbrance; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) entitle a person to accelerate or cancel an obligation relating to Financial Indebtedness or constitute a default, cancellation event, prepayment event or similar event (however described) under any agreement relating to Financial Indebtedness whether immediately or after notice or lapse of time or both;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) (**power and authority**) each Obligor has full power to enter into, perform and deliver, and has taken all necessary action to authorise its entry into, delivery (if applicable) and performance of, each Transaction Document to which it is expressed to be a party and the transactions contemplated by those Transaction Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) (**Authorisations**) all Material Authorisations have been obtained and are in full force and effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) (**benefit**) each Obligor benefits by entering into and performing its obligations under each Transaction Document to which it is expressed to be a party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) (**Information, projections and disclosure**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) all Financial Statements, accounts, reports and any other information in connection with each Transaction Document to which it is expressed to be a party and the transactions contemplated by those Transaction Documents which have been furnished to NAB are true and accurate and not misleading (whether by its inclusion or by omission of other information);© National Australia Bank Limited 86

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any financial projections provided by, or on behalf of, it, a Group or the Obligors, have been prepared by appropriately qualified persons and in good faith on the basis of recent historical information and on the basis of reasonable assumptions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) each Obligor has disclosed all information and documents relating to it, its assets, each Transaction Document to which it is expressed to be a party and the transactions contemplated by each of them, which are material to NAB's decision to enter into the Finance Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) (**no default**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) no Event of Default is continuing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) no other event or circumstance is outstanding which constitutes a default under any other agreement or instrument which is binding on any Obligor, or to which its assets are subject, which could have a Material Adverse Effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) (**solvency**) no Insolvency Event has occurred in respect of any Obligor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) (**undisclosed relationships**) except as disclosed to and agreed by NAB in writing, it has not entered into any other Transaction Document, and no Obligor holds any property:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) as a trustee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) as a partner of a partnership;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) as a responsible entity of any Registered Scheme;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) as an agent of an undisclosed principal; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) in any other capacity for the benefit of any person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) (**Authorised Officers**) any person specified as an Authorised Officer of an Obligor is authorised to sign or (in the case of an unsigned notice) submit any requests and other notices on its behalf and do all other things contemplated by the Transaction Documents to which it is expressed to be a party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) (**no litigation**) except as disclosed to and agreed by NAB in writing, no litigation, arbitration, other dispute resolution process or civil, criminal or administrative proceedings are current, pending or (to the best of its knowledge and belief, having made due enquiry) threatened before any court, arbitral body or Agency affecting any Obligor or its assets which, if adversely determined, could have a Material Adverse Effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) (**investigation by Agency**) no investigation by any Agency into all or part of the affairs of any Obligor is current in circumstances material to its business or financial condition;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) (**no immunity**) no Obligor has, and no assets of any Obligor have immunity from the jurisdiction of a court or from legal process;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) (**Financial Statements**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the most recent Financial Statements (consolidated as required under applicable law) provided to NAB under, or in contemplation of, this document were prepared in accordance with GAAP consistently applied unless expressly disclosed to the contrary in those Financial Statements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the most recent Financial Statements (consolidated as required under applicable law) provided to NAB under, or in contemplation of, this document give a true and fair view of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) the financial position (including actual and contingent liabilities) of the relevant entities on a consolidated basis as at the date to which the Financial Statements relate; and© National Australia Bank Limited 87

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) the performance of those entities during the accounting period to which the Financial Statements relate; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) there has been no material adverse change in the business or financial condition of any of the relevant entities since the last day of that accounting period to which the Financial Statements referred to in clauses (i) and (ii) relate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) (**tax consolidation**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) except as disclosed to, and agreed by, NAB in writing, no Obligor is a member of a Tax Consolidated Group; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) if an Obligor is a member of a Tax Consolidated Group (which has been disclosed to, and agreed by, NAB in writing), each member of the Tax Consolidated Group is a party to a TSA and a TFA;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) (**cross-guarantee**) no Obligor has executed, and no Obligor is currently seeking approval from ASIC to execute, a Deed of Cross Guarantee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) (**Taxes**) each Obligor has complied with all laws in relation to Tax in all jurisdictions in which it is subject to Taxes and has paid all Taxes due and payable by it except those which are Contested Taxes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) (**insurances**) all insurances required under the Finance Documents are in effect and current and meet the requirements of the Finance Documents, no Obligor has made any material misrepresentation or omission to its insurers and no Obligor is aware of any reason why any of the insurance policies may be terminated or why any insurers may refuse to pay a claim when made;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) (**ownership**) except where it has entered into a Finance Document or a Material Document in its capacity as Trustee or as Responsible Entity, each Obligor is the legal and beneficial owner of, and has good right and title to, all of its assets free from any Encumbrance other than a Permitted Encumbrance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) (**Security Documents**) each Security Document is in full force and effect and the Encumbrance created under it has the priority contemplated in the Security Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w) (**Financial Indebtedness**) no Financial Indebtedness subsists other than Permitted Financial Indebtedness;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) (**no benefit to related party**) the execution and delivery by each Obligor of the Transaction Documents to which it is expressed to be a party, and the participation by it in any transaction in connection with the Transaction Documents to which it is expressed to be a party, will not violate or contravene Chapter 2E of the Corporations Act or any analogous provision;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y) (**Intellectual Property**) each Obligor owns, or has the right and license to use, all Intellectual Property necessary for the conduct of its business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z) (**Marketable Securities**) except as disclosed to and approved in writing by NAB, all Marketable Securities which are Encumbered Property are fully paid and there is no agreement, arrangement or understanding under which further Marketable Securities with rights of conversion to shares in any Obligor may be issued to any person; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(aa) (**other**) each other representation or warranty (if any):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) set out, or as amended by any other provision, in this document; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) set out in each other Transaction Document to which it is expressed to be a party,

is true and correct.© National Australia Bank Limited 88

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**8.2 Reliance and Repetition**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB has entered into each Finance Document to which it is expressed to be a party in reliance on the representations and warranties in this document and the other Finance Documents. The representations and warranties survive execution and delivery of the Finance Documents and the provision of financial accommodation under them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each representation and warranty contained in a Finance Document is deemed to be repeated by each Obligor on:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the date of each request for financial accommodation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each Drawdown Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the last day of each Interest Period and Pricing Period (if applicable);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the date of each Compliance Certificate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) the date on which any Amount Owing is paid to NAB; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) in the case of an Additional Obligor, the date on which the entity becomes (or it is proposed that the entity becomes) an Additional Obligor,

by reference to the current facts and circumstances subsisting on that date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) An Obligor must advise NAB immediately if, at any time, anything happens which prevents it from truthfully repeating the representations and warranties contained in clause 8.1 on the dates specified in clause 8.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) With respect to clause 8.1, each Obligor must make all necessary enquiries (including where necessary seeking independent external advice) to satisfy itself that the representations and warranties made are true and accurate at the date of this document. If an Obligor is unable to make any of these representations and warranties, it must immediately advise NAB in writing.

**9. Undertakings**

Each Obligor undertakes to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) (**notification**) notify NAB immediately on becoming aware of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any event which constitutes a Default (and the steps, if any, being taken to remedy it);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any breach of, or default under, any Material Document to which it is expressed to be a party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any intention by it to exercise any right, power or remedy under any Material Document to which it is expressed to be a party as a consequence of any default under the Material Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any change in the Authorised Officers of any Obligor accompanied by the names, titles and specimen signatures of any new Authorised Officers;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) any Obligor changing its contact details for communications;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the details of any litigation, arbitration, other dispute resolution process or civil, criminal or administrative proceedings which are current, threatened or pending against any Obligor before any court, arbitral body or Agency affecting it or its assets which, if adversely determined, could have a Material Adverse Effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) any change (actual or proposed) to the structure or ownership arrangements of any Obligor;© National Australia Bank Limited 89

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) any Obligor:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) seeking the approval of ASIC in respect of, or executing, any Deed of Cross Guarantee; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) amending or terminating a Deed of Cross Guarantee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) any proposal by any Agency to revoke or materially amend any Material Authorisation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) the occurrence of any event or circumstance which has or is likely to have a Material Adverse Effect; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) any Obligor creating or acquiring or intending to create or acquire a Subsidiary;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) (**information**) provide NAB immediately with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) all documents (including reports, accounts, notices and circulars) despatched by an Obligor to its shareholders (or any class of them) or its creditors generally (or any class of them) at the same time as they are despatched;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) such further information regarding the financial condition, business and operations of any Obligor as NAB may reasonably request; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) all material notices received by any Obligor from any Agency and, if listed on any securities exchange, all notices issued by, or given to, the relevant securities exchange, regarding matters which could have a Material Adverse Effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) (**Authorisations**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) obtain, renew on time, comply with and do all that is necessary to maintain in full force and effect any Material Authorisation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) not do anything which would prevent the prompt renewal of any Authorisation or cause it to be renewed on less favourable terms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) (**comply with laws**) comply with all laws to which it or its assets are subject;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) (**change of business**) ensure, and procure that, no significant change is made to the general nature of the business of any Obligor from that carried on at the date of this document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) (**negative pledge**) not create or permit to subsist any Encumbrance over any of its assets other than a Permitted Encumbrance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) (**acquisition subject to Encumbrance**) except with the prior written consent of NAB, not acquire any asset which is subject to an Encumbrance or which becomes the subject of an Encumbrance on its acquisition;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) (**disposals**) not enter into a single transaction or a series of transactions (whether related or not and whether voluntary or involuntary) to sell, lease, license, transfer, grant an interest over, part with possession of or otherwise dispose of any asset or any interest in any asset other than a Permitted Disposal;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) (**mergers**) not enter into any amalgamation, demerger, merger or corporate reconstruction except a solvent amalgamation or a reconstruction on terms pre-approved by NAB in writing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) (**insurances**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) take out and maintain insurances with an independent and reputable insurer in the manner and to the extent stipulated by NAB or, if not stipulated by NAB, for the amounts and against risks which are in accordance with prudent business practice having regard to the nature of© National Australia Bank Limited 90

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the business, assets and operations of the Obligors (including all insurances required by applicable law);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) take out and maintain any further insurances as NAB may reasonably request;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) disclose to each insurer all facts which are material to the insurer's risk and comply with its obligations of utmost good faith to the insurer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) ensure that no material alteration is made to any policy, except with NAB's prior written consent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) ensure that each policy expressly notes NAB's interests and, if required by NAB, names NAB as the sole loss payee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) as soon as practicable notify NAB if an event occurs which permits an insurance claim to be made or if an insurance claim is made or refused; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) promptly produce evidence satisfactory to NAB of current insurance cover (including a certified copy of each policy and schedule, certificate of currency or any variation made) or other details whenever NAB asks;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) (**incurring Financial Indebtedness**) not incur or permit to subsist any Financial Indebtedness other than Permitted Financial Indebtedness;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) (**providing Financial Indebtedness**) not be a creditor in respect of any Financial Indebtedness, other than Financial Indebtedness:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) provided to an incorporated Obligor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) provided with the prior written consent of NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) provided to allow its customers to acquire goods or services on extended terms in the ordinary course of trading; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) which (when aggregated with any other such Financial Indebtedness of any other Obligor, other than any Financial Indebtedness permitted under the preceding paragraphs) does not exceed $0.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) (**Taxes**) pay all Taxes due and payable by it (other than Contested Taxes) and Taxes which are due and payable by it after final determination or settlement of a Contested Tax;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) (**valuations**) for Encumbered Property which is land, pay for any valuation which NAB may obtain at any time from a valuer approved and instructed by NAB, unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB has obtained a valuation for that property at an Obligor's cost within the previous two year period or such longer period as NAB may agree in its absolute discretion; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) no Default is subsisting and the valuation does not reveal that a Default is subsisting.

Nothing in this clause prevents NAB from obtaining (at its own cost) any valuation of the Encumbered Property at any time that NAB requires;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) (**Financial Statements and other documents to be delivered**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) deliver to NAB within the period stipulated in the Schedule, a copy of the Financial Statements and other documents stipulated in Item 7 of the Schedule;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) ensure the Financial Statements provided to NAB under this document:© National Australia Bank Limited 91

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) are certified by a director of the relevant Obligor as giving a true and fair view of the financial position and performance of the relevant Obligor or Group (as the case may be), in the case of financial position, as at the date stated in the Financial Statements, and, in the case of financial performance, for the period specified in the Schedule to which those Financial Statements relate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) are prepared using GAAP consistently applied;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) give a true and fair view of the financial position and performance of the relevant entities on a consolidated basis, in the case of financial position, as at the date stated in the Financial Statements, and, in the case of financial performance, for the period to which those Financial Statements relate; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) comply with any other requirement specified in the Schedule; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) not change its financial year;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) (**tax consolidation**) in respect of any Obligor that is a member of a Tax Consolidated Group (which has been disclosed to, and agreed to by, NAB in writing), ensure and procure that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a TSA and a TFA are maintained in full force and effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each member of the Tax Consolidated Group complies with the TSA and the TFA; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Head Company gives the Australian Taxation Office a copy of the TSA within the period required by section 721-25(3)(b) of the Tax Act if the Australian Taxation Office gives it a notice requiring it to do so;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) (**reduction of capital and financial assistance**) except with the prior written consent of NAB, not do any of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) redeem, buy-back, defease, retire or repay any of its share capital or resolve to do so;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) provide any financial assistance in connection with the acquisition of shares in itself or in any of its holding companies or resolve to do so; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) do anything analogous to clause (i) or (ii) above;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) (**no partnership or joint venture**) unless otherwise specified in a Finance Document, not enter into:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any profit sharing arrangement in relation to any Encumbered Property; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any partnership or joint venture with any other person,

without NAB's prior written consent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) (**arm's length transactions**) not enter into any transaction other than on arm's length terms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) (**Related Entity debt**) not release or waive any Financial Indebtedness owed by a Related Entity;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) (**constituent documents**) not change its constituent documents without the prior written consent of NAB (such consent not to be unreasonably withheld unless the change could have a Material Adverse Effect);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) (**Compliance and enforcement of Material Documents**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) comply with its obligations under each Material Document to which it is expressed to be a party in all material respects;© National Australia Bank Limited 92

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) enforce each Material Document to which it is expressed to be a party and exercise its rights, authorities and discretions under those documents prudently and, while a Default is continuing, in accordance with the directions (if any) of NAB; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) use its best endeavours to keep the Material Documents valid and enforceable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w) (**Variation of Material Documents**) not:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) vary in any material respect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) avoid, discharge, rescind, release, surrender, terminate (other than by performance) or accept the repudiation of;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) allow to expire (other than by effluxion of time);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) do or permit anything which would entitle another party to do anything referred to in clause (ii) in relation to; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) expressly or impliedly grant any material waiver, consent, time or indulgence under or in respect of,

a Material Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) (**Subsidiaries**) except with the prior written consent of NAB, not acquire or permit to exist, a Subsidiary (other than a Subsidiary in existence as the date of this document disclosed to, and approved by NAB);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y) (**further assurances**) promptly:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) do all such acts and execute all such documents as NAB may reasonably specify (and in such form as NAB may reasonably require) to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) enable NAB to exercise its rights under or in connection with each Finance Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) bind each Obligor and any other person intended to be bound under a Finance Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) enable NAB to register any power of attorney or any similar power;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) perfect each Encumbrance created or intended to be created under the Security Documents or for the exercise of rights or remedies of NAB by or pursuant to any Finance Document or law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) confer on NAB an Encumbrance over any right, property and asset of the Obligors intended to be conferred by or pursuant to the Security Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(F) facilitate the realisation of assets, which are, or are intended to be subject of an Encumbrance; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(G) demonstrate whether the Obligors are complying with each Finance Document to which they are expressed to be a party; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) take all action available to it as may be necessary for the purpose of creation, perfection, protection or maintenance of any Encumbrance conferred or intended to be conferred on NAB by or pursuant to any Finance Document; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z) (**other undertakings or conditions subsequent**) comply with each other undertaking or condition subsequent set out, or as amended by any other provision, in this document.© National Australia Bank Limited 93

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**10. Financial Covenants and Hedging**

**10.1 Financial Covenants**

Each Borrower must comply with the financial covenants set out in the Schedule (if any) and in any other part of this document (if any).

**10.2 Accounting Policy**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If, in the reasonable opinion of a Borrower or NAB, any changes to GAAP materially alter the effect of financial covenants referred to in clause 10.1 (Financial Covenants) or the related definitions, NAB will review the relevant covenants and definitions in consultation with the Borrower to determine whether any amendment is required to this document to take into account the change in GAAP so they have an effect comparable to that at the date of this document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrower acknowledges that, notwithstanding clause (a), NAB may determine, in its discretion, that no amendment to this document is required despite the change in GAAP.

**10.3 Hedging**

Each Obligor must comply with the hedging requirements set out in the Schedule (if any) and in any other part of this document (if any).

**11. Events of Default**

**11.1 Events and circumstances**

Each of the following events or circumstances is an Event of Default:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) (**payment default**) an Obligor fails to pay any Amount Owing when due and payable to NAB at the place and in the currency in which it is expressed to be payable unless NAB is satisfied that the sole reason for such failure to pay is caused by administrative or technical error in the banking system generally which is beyond the control of that Obligor and payment is made within 2 Business Days after its due date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) (**financial covenants and hedging**) an Obligor breaches any of the requirements referred to in clause 10.1 (Financial Covenants) or clause 10.3 (Hedging);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) (**other defaults**) an Obligor fails to perform and observe any obligation under, or any condition of any waiver or consent by NAB in connection with, any Finance Document to which it is expressed to be a party (other than those referred to in any other paragraph of clause ‎11.1 (Events and circumstances));

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) (**representations and warranties**) a representation or warranty made or deemed to be repeated by an Obligor to NAB in a Finance Document to which it is expressed to be a party or any other document or information delivered by or on behalf of any Obligor under or in connection with any Finance Document to which it is expressed to be a party is incorrect or misleading when made or deemed to be repeated;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) (**cross default**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any Financial Indebtedness of an Obligor is not paid when due or within any applicable grace period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any Financial Indebtedness of an Obligor or any member of a Group becomes due and payable or is capable of being declared due and payable prior to its specified maturity (where such indebtedness in NAB's reasonable opinion is likely to have a material adverse impact on the ability of the Obligor or the member of the Group to meet its obligations to NAB); or© National Australia Bank Limited 94

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any commitment for any Financial Indebtedness of an Obligor is cancelled or suspended by a creditor of an Obligor as a result of an event of default or change of control (however described);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) (**Insolvency Event**) an Insolvency Event occurs in relation to an Obligor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) (**enforcement proceedings**) any expropriation, attachment, sequestration, distress or execution (or any analogous process in any jurisdiction) affects any asset of an Obligor having an aggregate value of at least the Threshold Amount and is not stayed or withdrawn within 5 Business Days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) (**vitiation**) it becomes impossible for an Obligor to perform a material obligation under a Finance Document to which it is expressed to be a party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) (**material adverse change**) an event or series of events (whether or not related) occurs which, in NAB's reasonable opinion, could have a Material Adverse Effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) (**unlawfulness and invalidity**) it is or becomes unlawful for an Obligor to perform any of its obligations under any Finance Document to which it is expressed to be a party, or any Finance Document ceases to be in full force and effect or is alleged to be ineffective;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) (**repudiation**) an Obligor repudiates any Finance Document to which it is expressed to be a party or evidences an intention to repudiate a Finance Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) (**litigation**) any litigation, arbitration, other dispute resolution process or civil, criminal or administrative proceedings are current, pending or threatened before any court, arbitral body or Agency in respect of any Obligor or the assets of any Obligor which, if adversely determined, could have a Material Adverse Effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) (**cessation of business**) any Obligor ceases or threatens to cease conducting its business, or a material part of it, or substantially changes the nature of its business, without NAB's prior written consent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) (**investigation**) a person is appointed under any law to investigate any part of the affairs of an Obligor or a Related Entity and that investigation could have a Material Adverse Effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) (**delisting, termination or suspension of listing**) if any class of Marketable Securities of, or issued by, an Obligor is listed or quoted on any securities exchange (including the ASX), the listing or quotation of those Marketable Securities is removed from the official list of that securities exchange, is terminated or is suspended and remains suspended for a continuous period of 10 or more trading days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) (**fraud**) NAB reasonably believes any Obligor has acted fraudulently;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) (**status of Encumbrance**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any Encumbrance over an asset of an Obligor is enforced or becomes capable of being enforced;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) NAB loses the priority accorded to it under any Encumbrance created or intended to be created under a Security Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the value of any Encumbered Property materially decreases (as assessed by NAB);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any Agency compulsorily acquires all or a material part of any Encumbered Property, orders the sale or divesture of the Encumbered Property or takes any step for the purposes of doing, or proposes to do, any of those things; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) any native title claim is made or is proposed to be made in respect of any Encumbered Property;© National Australia Bank Limited 95

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) (**death or incapacity**) in respect of any Obligor that is a natural person, the Obligor dies or is declared by a competent authority to be insane or mentally incapacitated; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) (**other**) any other event of default (however described) set out, or as amended by any provision, in this document or in any other Finance Document occurs.

**11.2 Consequences of an Event of Default**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If an Event of Default occurs and:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Event of Default is under clause 11.1(f) (Insolvency Event) or is otherwise not capable of remedy by the Obligor, the Amount Owing is due and payable immediately without the need to give any prior notice other than that required by law; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Event of Default is other than referred to in clause (a)(i), NAB will give the Borrower notice stating that an Event of Default has occurred and a reasonable grace period of up to 7 days (or such longer period as required by law or that NAB elects to allow) to remedy the Event of Default within that period. Where that Event of Default is not remedied within that period, the Amount Owing is due and payable immediately without the need to give any prior notice. An Event of Default will not be remedied if at the end of that period, the Event of Default in the notice or an Event of Default of the same type continues to exist.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Upon the Amount Owing being due and payable under clause 11.2(a)(i) or (ii), subject to any applicable law and in addition to any other rights, powers and remedies NAB may have (including under a Security Document or this document), NAB may without the need to give any prior notice, immediately or at any later time:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) cancel the whole or any part of any remaining Facility or cancel all or any part of any remaining Facility Limit in which case the cancellation will take effect immediately;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) enforce any Security Document; and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) sue the Obligors for the Amount Owing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If NAB gives notice to the Borrowers that it has done anything under clause (a), each Borrower must comply with that notice but otherwise must continue to perform its obligations under each Finance Document to which it is expressed to be a party as if the notice had not been given, subject to any contrary directions from NAB.

**12. Appointment of Consultants**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If NAB reasonably believes that a Default has occurred or that circumstances exist which could lead to a Default occurring, NAB may, and at NAB's request an Obligor must, engage such accountancy, financial management and other consultants as NAB may nominate to investigate and report to NAB on the financial condition and business affairs of any Obligor and whether each Obligor has complied with each Finance Document to which it is expressed to be a party and to make recommendations to NAB relating to the manner in which the Obligors carry on their business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any engagement referred to in clause (a) (whether by NAB or an Obligor) will be at the Obligors' cost, and NAB may exercise its sole discretion to debit those costs from any account of an Obligor. The Obligor must pay to NAB immediately on demand any amount so debited.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Obligor agrees to provide all assistance and information required by the consultants (including making all financial records available and giving access to all premises and records) to enable the consultants to conduct their examination promptly, completely and accurately.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) No Obligor is obliged to accept the recommendations of any consultant, and NAB will assume no liability with respect to any actions an Obligor takes, or does not take, as a result of those recommendations.© National Australia Bank Limited 96

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**13. Change of Control**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If the person or persons who control an Obligor (whether directly or indirectly) at the date of this document cease to control that Obligor (a **Change of Control**), the Borrowers must promptly notify NAB upon becoming aware of that event and NAB may (acting reasonably):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) review pricing in respect of any Facility in accordance with clause 14 (Review); and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) by giving written notice to the Borrowers:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) cancel the whole or any part of a Facility whereupon it will be immediately cancelled; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) declare that all or any part of the Amount Owing is due and payable on the date specified in NAB's written notice whereupon it will be due and payable on the specified date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) For the purposes of this clause 13 (Change of Control), "control" of a corporation includes the power to directly or indirectly:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) direct the management or policies of the corporation either generally or, if that corporation acts as trustee of a trust or responsible entity of a Registered Scheme, the trust or Registered Scheme (as the case may be); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) control the membership of the board of directors,

whether or not the power has statutory, legal or equitable force or is based on statutory, legal or equitable rights and whether or not it arises by means of trusts, agreements, arrangements, understandings, practices, the ownership of any interest in shares or stock of the corporation or interests in any trust or Registered Scheme or otherwise.

**14. Review**

**14.1 Pricing Review Events**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB has the right to review the pricing applicable to a Facility (**Pricing Review**):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) on or about each anniversary of the date of this document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) at any time if NAB reasonably believes that there is a Default;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) as permitted under clause 13 (Change of Control); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) at any time to the extent necessary (NAB acting reasonably) to reflect the then prevailing market conditions or changes to NAB's general pricing for facilities of that type at that time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB may request a Borrower to provide information in connection with a Pricing Review and the Borrower must provide such information as soon as possible following receipt of the request.

**14.2 Consequences of a Pricing Review**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Following a Pricing Review, NAB may, by giving written notice (including by way of revised terms and conditions for any Facility or by way of a revised Fees Guide) to the Borrowers and/or by way of publication on NAB's website and/or advertisement in the local or national press:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) introduce a new fee, charge or premium or change an existing fee, charge or premium (including its amount, the way in which it is calculated and when it is charged); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) change the interest rate or yield rate applicable to a Facility including by changing or introducing a margin (including by making the margin positive or negative), or substituting a different indicator rate for the relevant indicator rate (except where the rate is a fixed rate).© National Australia Bank Limited 97

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Where NAB gives the Borrowers notice under clause (a) by way of advertisement in the local or national press or by way of publication on NAB's website, NAB will also endeavour to directly notify the Borrowers of the change although NAB will not be precluded from charging the new or adjusted pricing if it does not directly notify the Borrowers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) An introduction or change of a matter specified in clause (a) takes effect on:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the date specified in the relevant notice to the Borrowers; and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) on the date specified in the relevant advertisement in the local or national press or in the publication on NAB's website.

**14.3 Pricing Review Fee**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A review fee may be payable to NAB in respect of each Pricing Review in the amount set out in the relevant Details.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB may debit the review fee from any account of a Borrower. The Borrower must pay to NAB immediately on demand any amount so debited.

**14.4 Review Event**

Each Borrower must promptly notify NAB after it becomes aware that a Review Event has occurred.

**14.5 Review Event Consequences**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Following the occurrence of a Review Event, the Obligors and NAB must enter into negotiations for a period of not less than the Negotiation Period, with a view to agreeing terms on which NAB would be prepared to offer to provide, fund or maintain all or any of the Facilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If agreement is reached, the Obligors must do all acts and execute all documents as NAB requires to document, or to protect, preserve or secure NAB's rights and interests under, such agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If agreement is not reached within the Negotiation Period or if (in the opinion of NAB) any of the Obligors does not do all acts and execute all documents as NAB requires to document, or to protect, preserve or secure for NAB's rights and interests under, any agreement, NAB may by giving written notice to the Borrowers:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) cancel the whole or any part of a Facility whereupon it will be immediately cancelled; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) declare that all or any part of the Amount Owing is due and payable whereupon it will be due and payable within the Mandatory Prepayment Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If the Borrowers fail to prepay all amounts payable under clause (c) within the Mandatory Prepayment Period, that failure will constitute an Event of Default and NAB may exercise any of its rights set out in clause 11.2 (Consequences of an Event of Default)

**15. Open Treasury Transactions**

If any Facility is terminated or cancelled in full or in part or if any part of the Balance Owing in respect of any Facility is permanently prepaid or repaid or if any part of the Balance Owing in respect of any Facility becomes repayable before its stated maturity date for any reason and if at that time there are any treasury related transactions in existence between NAB and any Borrower (**Open Positions**) then:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB may close out the Open Positions, by entering into opposite positions for the balance of the unexpired term, or by such other means as may be usual in the relevant market, and any such close out must be at market rates prevailing at the time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any Costs incurred by NAB in closing out Open Positions under clause (a) must be paid by the relevant Borrower to NAB immediately upon demand by NAB;© National Australia Bank Limited 98

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any gain derived by NAB in closing out Open Positions under clause (a) will be credited to the relevant Borrower and set off against the Amount Owing by the relevant Borrower; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) NAB will give the relevant Borrower reasonable particulars of the manner of close out of the Open Positions and the basis of calculation of any amounts payable by or to the relevant Borrower arising from that close out.

**16. Costs and Taxes**

**16.1 Bank's Costs**

Each Borrower must pay to NAB immediately upon demand all Taxes and reasonable Costs paid or payable by NAB of any nature incurred by NAB in connection with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the negotiation, preparation, execution, delivery, stamping, registration, completion, amendment, release and discharge of each Finance Document or the provision of any Drawing (whether payable directly or otherwise paid by NAB and regardless of the date on which it is due, payable and/or paid);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) preparing, registering and maintaining any financing statement or financing change statement (each as defined in the PPSA) in relation to a Security Document, or taking any other action that in NAB's reasonable opinion is necessary under clause 1.6;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the consideration and grant of any request for consent, approval or waiver by NAB under any Finance Document regardless of whether or not NAB gives the consent, approval or waiver sought;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the preservation, exercise, enforcement or waiver of any power, right or remedy under any Finance Document, taking (or reasonably considering, preparing or attempting to take) any action in connection with any Finance Document or in connection with anything referred to in clause 23(d); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any enquiry from an Agency involving an Obligor,

including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) all Costs and Taxes of any nature incurred in connection with the remuneration of any administrator or Controller or similar persons appointed by NAB or anything done by any such persons appointed; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) any administration costs of NAB in relation to the matters described in clause (c).

**16.2 Obligors' Costs**

Without prejudice to clauses 12(b) and 14.3(b), each Obligor will be responsible for all of its own costs and expenses in connection with the Finance Documents and the transactions contemplated by those documents.

**17. Fees**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrowers must pay to NAB the fees specified in the Schedule, at the times specified in the Schedule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In addition to the fees set out in the Schedule, the Borrowers must pay to NAB the other fees specified in the Details, the Specific Conditions (or, if none, the separate terms and conditions applying to a Facility) and the Fees Guide, in the manner and at the times specified in those documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If a Balance Owing exceeds the relevant Facility Limit for any reason (even where NAB has approved the excess), fees may apply as detailed in the relevant Fees Guide.© National Australia Bank Limited 99

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Unless otherwise agreed, fees are not charged on a pro-rata basis and, once incurred, charged or paid (as the case may be) are non-refundable in whole or in part.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Fees that are payable when an event occurs may be debited when, or after, that event occurs and periodic fees (such as Service Fees) may be debited at any time during, or after, the period to which they relate.

**18. Payments**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject to the Specific Conditions or, if no Specific Conditions apply, the separate terms and conditions applying to a Facility, all payments due by a Borrower to NAB must be made on the due date (or if no due date is specified, then on demand by NAB) unless such payment is due on a day that is not a Business Day in which case payment must be made on the next Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All payments must be made in immediately available cleared funds and without set-off or counter-claim, and be free and clear of any deduction or withholding, unless required by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If a deduction or withholding is required by law, the relevant Borrower must:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) make that deduction and/or withholding, pay such amount in full to the appropriate Agency and deliver to NAB a copy of the receipt for the payment; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) increase its payment to NAB to an amount which will result in NAB receiving (after the deduction or withholding) the full amount which it would have received if no deduction or withholding had been required.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) All payments are payable in Dollars unless otherwise stated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) If NAB receives or recovers an amount in a currency other than that in which it is due:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB may convert the amount received or recovered into the due currency (and if necessary convert through other currencies) on such day and at such rates as NAB considers appropriate. NAB may deduct from the amount it receives or recovers its usual costs in connection with the conversion; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Borrower satisfies its obligation to pay only to the extent of the amount of the due currency obtained from the conversion after deducting conversion costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) If NAB is debiting an amount from an account held by a Borrower, and that amount is in a currency other than that of the account, NAB may:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) convert the amount to be debited into the currency of the relevant account (and if necessary convert through other currencies) on such day and at such rates as NAB considers appropriate; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) debit from that account the amount so converted, plus the costs of conversion.

The Borrower satisfies its obligation to pay only to the extent of the amount of the due currency obtained from the conversion after deducting conversion costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) For the purposes of making payments under this document, a day ends at 4 p.m. in the Governing Law Jurisdiction.

**19. GST**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless otherwise specified, all amounts referred to in a Finance Document are exclusive of GST.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If GST is or will be imposed on any Supply made by NAB under or in connection with a Finance Document to a Recipient, where any amount or consideration (**consideration**) payable or to be provided by the Recipient under the Finance Document in relation to that Supply is exclusive of GST (**GST-exclusive consideration**), NAB may:© National Australia Bank Limited 100

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) increase the consideration payable by an additional amount on account of GST; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) otherwise recover from the Recipient an additional amount on account of GST.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The additional amount on account of GST is to be calculated by multiplying the GST-exclusive consideration for the relevant Taxable Supply by the GST rate prevailing at the time of the Taxable Supply.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) NAB will issue the Recipient with a Tax Invoice prior to seeking payment for the relevant Supply.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Each Recipient must pay NAB the amount of any loss or Costs incurred by NAB as a result of or in connection with NAB not receiving any additional amount on account of GST.

**20. Increased Costs**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject to clause (c), each Borrower must, immediately upon demand, pay the amount of any Increased Costs reasonably determined by NAB as required to compensate NAB or any of its Affiliates as a result of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the introduction of or any change in (or in the interpretation or application of) any law; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) compliance with any law,

made after the date of this document including any law with regard to capital adequacy, prudential limits, liquidity, reserve assets, banking or monetary controls or Tax.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In this document, **Increased Costs** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a reduction in the rate of return from any Facility or on the overall capital (including as a result of any reduction in the rate of return on capital as more capital is required to be allocated) of NAB or any of its Affiliates;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) an additional or increased cost to NAB or any of its Affiliates of providing, funding or maintaining a Facility; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) a reduction of any amount due and payable under any Finance Document,

which is incurred or suffered by NAB or any of its Affiliates to the extent attributable to NAB or any of its Affiliates funding or performing its obligations under any Finance Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Clause (a) does not apply to the extent any Increased Costs are compensated by the relevant Borrower under clause 18(c).

**21. Economic Costs**

**21.1 When Economic Costs are payable**

**WARNING:** Economic Costs can be high and may increase the amount owed. Borrowers can ask NAB at any time for an estimate of Economic Costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Economic Costs are potentially payable by the Borrowers for a Facility whenever an Economic Event occurs in relation to that Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB will determine the amount of any Economic Costs payable in respect of the occurrence of an Economic Event and will notify the relevant Borrowers of the amount (if any) that is payable by them in accordance with NAB's calculation under clause 21.3. Borrowers must pay NAB the amount of any Economic Costs notified to them by NAB as payable by them under this clause 21. Borrowers must pay those notified Economic Costs immediately following their receipt of the notification of the Economic Costs payable.© National Australia Bank Limited 101

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**21.2 Economic Events**

An Economic Event is taken to have occurred if, at any time while a Yield Rate or an Interest Rate (other than a variable Interest Rate) applies to a Facility, a Facility Component, a Loan Account or a Drawing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all or part of that Facility, Facility Component, Loan Account or Drawing is repaid early (even if NAB agrees to the early repayment being made);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) that Facility, Facility Component, Loan Account or Drawing is re-priced by agreement from one fixed rate to another fixed rate or to another type of rate (such as a variable rate);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) that Facility or a relevant Facility Limit or Component Limit is cancelled, reduced or not fully drawn for any reason at any time before the Expiry Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) NAB is for any reason no longer obliged to accept, discount or endorse Bills under the Facility or a Bill is cancelled before its Maturity Date; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) if the Amount Owing becomes immediately due and payable following an Event of Default, or the Balance Owing otherwise becomes repayable, and NAB elects to treat it as an Economic Event;

except to the extent that this occurs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) for a Facility other than a Bill Facility, NAB Business Markets Facility or NAB Corporate Markets Loan – on the Repricing Date applicable to the Facility or Loan Account (as the case may be), or if that day is not a Business Day, on the next Business Day;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) for a Bill Facility, NAB Business Markets Facility or NAB Corporate Markets Loan, in relation to the Floating Amount;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) on the Expiry Date; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) in order to comply with the Amortisation Schedule (if any).

**21.3 How NAB calculates Economic Costs**

NAB will determine Economic Costs by calculating a reasonable estimate of the Costs and losses incurred, or expected to be incurred, by NAB (including fees, charges and premiums) in connection with an Economic Event. The calculation of Economic Costs may incorporate the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in relation to a Facility other than a Bill Facility, NAB Business Markets Facility or NAB Corporate Markets Loan, Costs, representing the difference between NAB's cost of funds at the start of the relevant Fixed Rate Period or Pricing Period and NAB's cost of funds at the date of the Economic Event over the remainder of that period. This is then discounted back to the net present value at the rate equivalent to NAB's cost of funds at that date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in relation to a Bill Facility, NAB Business Markets Facility or NAB Corporate Markets Loan, Costs and losses calculated by reference to the difference between:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the interest rate used or applied by NAB when setting the Yield Rate or interest rate for the Facility or the relevant Facility Component; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the most applicable interest rate available to NAB at the date of the Economic Event, after having regard to the remaining term to maturity of the Facility.

The calculated Costs and losses are then discounted back to the net present value at the rate determined by NAB at that date; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the liquidation of deposits or other funds, or the termination or reversing of any swap or option agreement or other agreement or arrangement entered into by NAB (either generally in the course© National Australia Bank Limited 102

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of NAB's business or specifically in connection with this document) to fund or maintain the Facility or to hedge, fix or limit NAB's effective cost of funding in relation to the Facility.

**22. Currency indemnity**

**22.1 Payments**

Each Borrower indemnifies NAB against any Costs reasonably incurred by NAB as a result of a failure by an Obligor to pay any amount due under a Finance Document on its due date in accordance with the terms of that Finance Document or in the relevant currency.

**22.2 Judgments and orders**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Clause (b) applies if a judgment or order is given by any court or tribunal for the payment of any Amount Owing to NAB under a Facility, or for the payment of damages to NAB in respect of any breach of the terms of a Facility, where that judgment or order is expressed in a currency (the **Judgment Currency**) which is different from the currency expressed to be payable under this document in relation to the Facility (the **Relevant Foreign Currency**).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower indemnifies NAB against any deficiency in the amounts received by NAB arising or resulting from any variation between:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the rate of exchange at which the Relevant Foreign Currency is converted into the Judgment Currency (whether through other currencies or not) for the purpose of the judgment or order; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the rate of exchange at which NAB is able to purchase the Relevant Foreign Currency with the Judgment Currency (whether through other currencies or not) at the time of its receipt by NAB.

**23. Other Indemnities**

Each Borrower indemnifies NAB against, and must pay NAB on demand, any Costs and Taxes reasonably incurred or suffered by NAB as a result of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB investigating any event or circumstance which it reasonably believes is a Default, a Review Event or a Change of Control;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the occurrence of any Default, Review Event or Change of Control;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) information produced or approved by or on behalf of an Obligor or any other member of a Group under or in connection with any Finance Document or the transactions contemplated by any Finance Document being or being alleged to be misleading or deceptive in any respect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any enquiry, investigation, subpoena (or similar order) or litigation with respect to any Obligor or with respect to the transactions contemplated under any Finance Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) NAB acting or relying on any notice, request or instruction (whether in electronic form or otherwise) which it reasonably believes to be genuine, correct and appropriately authorised;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any indemnity NAB gives a Controller or administrator of any Obligor; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) NAB terminating, reversing or varying any agreement, arrangement or transaction entered into to hedge, fix or limit its effective cost of providing, funding or maintaining a Facility.

**24. Set-Off**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB may, at any time without any demand or notice, combine, consolidate or merge all or any accounts of a Borrower or a Cross-Guarantor and may also set off any amounts payable by that person under this document against any credit balance in those accounts.© National Australia Bank Limited 103

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower and each Cross-Guarantor irrevocably authorises NAB to do anything necessary for the purpose set out in clause (a) including redeeming and/or appropriating all or any part of any account, deposit or other arrangement between NAB and that Borrower or Cross-Guarantor under which NAB may be indebted to that Borrower or Cross-Guarantor, even if the balance on any such account and the amounts payable under this document are not expressed in the same currencies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) NAB may make any currency conversion it considers necessary or desirable for the purpose set out in clause (a) and clauses 18(e) and 18(f) will apply in relation to any such conversion.

**25. Liability for Regulatory Events**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) From time to time, the Services may be interrupted, prevented, delayed or otherwise adversely affected by a Regulatory Event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) To the extent permitted by law:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB is not liable for any loss or expense suffered or incurred by an Obligor or any other person if an event described in clause (a) occurs, irrespective of the nature or cause of that loss, and NAB has no obligation to contest any Regulatory Event or to mitigate its impact on an Obligor or NAB; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each Obligor releases NAB from all liability in connection with any loss incurred by an Obligor or any other person if an event described in clause (a) occurs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) To the extent that NAB's liability cannot be excluded, NAB's liability is limited to the cost of having the Service supplied again.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) NAB may use and disclose to any other financial institution or Agency, any information about any Obligor, or any Affiliate of any Obligor, or the Facilities or the Services, for any purpose which NAB, or any other financial institution, considers appropriate or necessary in connection with any Regulatory Event or the Facilities or the Services and this may result in information being transmitted overseas.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Each Obligor agrees to provide information to NAB about it, the Facilities, the Services or any person connected with it or the Facilities or the Services on request, and to promptly procure any consents NAB requires to give effect to clause (d).

**26. ANTI-MONEY LAUNDERING**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB may delay, block or refuse to process any payment or other transaction without incurring any liability if NAB knows or reasonably suspects that the transaction or the application of its proceeds will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) breach, or cause NAB to breach, any applicable laws or regulations of any jurisdiction (including any sanctions); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) allow the imposition of any penalty on NAB or its Affiliates under any such law or regulation,

including where the transaction or the application of its proceeds involves any entity or activity the subject of any applicable sanctions of any jurisdiction binding on NAB or its Affiliate, or the direct or indirect proceeds of unlawful activity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Obligor must provide all information to NAB promptly which NAB reasonably requires in order to manage its money laundering, terrorism financing or economic and trade sanctions risk or to comply with any laws or regulations in Australia or any other country. Each Obligor agrees that NAB may disclose any information concerning the Obligor to any Agency where required by any such law or regulation in Australia or elsewhere.© National Australia Bank Limited 104

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Obligor undertakes to exercise its rights and perform its obligations under the Finance Documents in accordance with all applicable laws or regulations relating to anti-money laundering, counter-terrorism financing or sanctions.

**27. GUARANTEE AND INDEMNITY**

**27.1 Guarantee and indemnity**

Each Cross-Guarantor irrevocably and unconditionally jointly and severally:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) guarantees to NAB punctual performance by each Obligor of all that Obligor's obligations under the Finance Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) undertakes with NAB that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) whenever an Obligor does not pay any amount when due under or in connection with any Finance Document (or anything which would have been due if the Finance Document or the amount was enforceable, valid and not illegal), immediately on demand by NAB that Cross-Guarantor shall pay that amount as if it was the principal obligor; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) if an Ipso Facto Event has occurred then that Cross-Guarantor shall immediately on demand by NAB pay all Drawings, accrued interest and Amount Owing as if it was the principal obligor; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) indemnifies NAB immediately on demand against any cost, loss or liability suffered by NAB if any obligation guaranteed by it (or anything which would have been an obligation guaranteed by it if not unenforceable, invalid or illegal) is or becomes unenforceable, invalid or illegal. The amount of the cost, loss or liability shall be equal to the amount which NAB would otherwise have been entitled to recover.

Each of paragraphs (a), (b)(i), (b)(ii) and (c) is a separate obligation. None is limited by reference to the other.

**27.2 Continuing guarantee**

This guarantee, undertaking and indemnity is a continuing guarantee, undertaking and indemnity and will extend to the ultimate balance of sums payable by any Obligor under the Finance Documents, regardless of any intermediate payment or discharge in whole or in part.

**27.3 Reinstatement**

If any payment to or any discharge, release or arrangement given or entered into by NAB (whether in respect of the obligations of any Obligor or any security for those obligations or otherwise) is avoided or reduced for any reason (including as a result of insolvency, breach of fiduciary or statutory duties or any similar event):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the liability of each Obligor shall continue and any such security shall be reinstated as if the payment, discharge, avoidance or reduction had not occurred; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB is entitled to recover the value or amount of that security or payment from each Obligor as if the payment, discharge, avoidance or reduction had not occurred.

**27.4 Waiver of defences**

The obligations of each Cross-Guarantor under this clause will not be affected by an act, omission, matter or thing which, but for this clause, would reduce, release or prejudice any of its obligations under this clause (without limitation and whether or not known to it or NAB) including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any time, waiver or other concession or consent granted to, or composition with, any Obligor or other person;© National Australia Bank Limited 105

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the release or resignation of any other Obligor or any other person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any composition or arrangement with any creditor of any Obligor or other person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect, execute, take up or enforce, any rights against, or security over assets of, any Obligor or other person or any non-presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of an Obligor or any other person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any amendment, novation, supplement, extension, reinstatement or replacement of a Finance Document or any other document or security (however fundamental and whether or not more onerous) including any change in the purpose of, any extension of or any increase in any facility or the addition of any new facility under any Finance Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) any unenforceability, illegality or invalidity of any obligation of any person under any Finance Document or any other document or security;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) any set off, combination of accounts or counterclaim;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any insolvency or similar proceedings; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) this document or any other Finance Document not being executed by or binding against any other Obligor or any other party.

References in clause 27.1 to obligations of an Obligor or amounts due will include what would have been obligations or amounts due but for any of the above, as well as obligations and amounts due which result from any of the above.

**27.5 Immediate recourse**

Each Cross-Guarantor waives any right it may have of first requiring NAB to proceed against or enforce any other rights or security or claim payment from any person before claiming from that Cross-Guarantor under this clause. This waiver applies irrespective of any law or any provision of a Finance Document to the contrary.

**27.6 Appropriations**

Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full, NAB may:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) refrain from applying or enforcing any other moneys, security or rights held or received or recovered (by set-off or otherwise) by NAB (or any trustee or agent on its behalf) in respect of those amounts, or appropriate apply and enforce the same in such manner and order as it sees fit (whether against those amounts or otherwise) and no Cross-Guarantor shall be entitled to the benefit of the same; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) without limiting paragraph (a), refrain from applying any moneys received or recovered (by set-off or otherwise) from any Cross-Guarantor on account of any Cross-Guarantor's liability under this clause in discharge of that liability or any other liability of an Obligor, and claim or prove against anyone in respect of the full amount owing by the Obligors.

**27.7 Deferral of Cross-Guarantors' rights**

Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full and unless NAB otherwise directs, no Cross-Guarantor will:© National Australia Bank Limited 106

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) exercise any rights which it may have by reason of performance by it of its obligations under the Finance Documents:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) to be indemnified by an Obligor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) to claim any contribution from any other guarantor of or provider of security for any Obligor's obligations under the Finance Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of NAB under the Finance Documents or of any other guarantee or security taken pursuant to, or in connection with, the Finance Documents by NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) to bring legal or other proceedings for an order requiring any Obligor to make any payment, or perform any obligation, in respect of which any Cross-Guarantor has given a guarantee, undertaking or indemnity under clause 27.1; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) to exercise any right of set off against any Obligor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in any form of administration of an Obligor (including liquidation, winding up, bankruptcy, voluntary administration, dissolution or receivership or any analogous process) prove for or claim, or exercise any vote or other rights in respect of, any indebtedness of any nature owed to it by the Obligor.

**27.8 Trust**

If, in any form of administration of an Obligor (including liquidation, winding up, bankruptcy, voluntary administration, dissolution or receivership or any analogous process), a Cross-Guarantor receives any sum in respect of any indebtedness of any nature owed to it by the Obligor, it will hold on trust for NAB so much of that sum as does not exceed the amount which may be or become payable to NAB under or in connection with the Finance Documents. It will promptly pay it to NAB.

**27.9 Additional security**

This guarantee, undertaking and indemnity is in addition to and is not in any way prejudiced by any other guarantee, undertaking and indemnity or security now or subsequently held by NAB.

**28. Power of Attorney**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Obligor (for consideration received) irrevocably appoints NAB and each authorised officer or Controller appointed by NAB (each an **Attorney**) severally as its attorney for the purposes set out in clause (b).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In addition to doing anything which in the reasonable opinion of an Attorney is necessary or expedient for securing or perfecting this document and any Encumbrance created under a Security Document at any time, the Attorney may, after the occurrence of an Event of Default, do any of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) execute and deliver all documents: and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) do all things,

which are necessary or desirable to give effect to each Finance Document or a transaction contemplated by a Finance Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Attorney may for the purposes of clause (b), appoint or remove any substitute or delegate or sub-attorney.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Obligor agrees to ratify anything done by its Attorney for the purposes of clause (b).© National Australia Bank Limited 107

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**29. Assignment and Changes to the Obligors**

**29.1 Assignments and transfers by NAB**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) NAB may assign any of its rights or novate, sub-participate, sell-down or transfer by whatever form or otherwise deal with any or all of its rights and obligations under any Finance Document without the consent of, or notice to, any Obligor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In order to facilitate any such dealing, NAB may (but is not obliged to), from time to time, separate and sever any of its rights (or any part of any of its rights) described in a notice given by NAB to the Obligors from its other rights and obligations under any Finance Document. Any such notice is effective from the time of delivery so that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the rights and obligations described in the notice are independent from, and may be assigned (including at law), novated, sub-participated, sold-down, transferred or otherwise dealt with separately from, any other rights and obligations of NAB under that Finance Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the rights and obligations described in the notice may be exercised differently from any other rights and obligations of NAB under that Finance Document; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Amount Owing in respect of those rights may be calculated separately from the other Amount Owing.

**29.2 Assignments and transfers by Obligors**

No Obligor may assign its rights or novate its obligations or otherwise deal with its rights and obligations under any Finance Document without NAB's prior written consent.

**29.3 Additional Borrowers**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Borrower may request that any of its wholly-owned Subsidiaries becomes an Additional Borrower. That Subsidiary may become an Additional Borrower only if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB approves the addition of that Subsidiary;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Borrower delivers to NAB an Accession Letter, duly completed and executed by the Borrower and the Subsidiary, whereby the Subsidiary accedes as both an Additional Borrower and (unless the Subsidiary is already a Cross-Guarantor) an Additional Cross-Guarantor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Borrower confirms that no Default is continuing or would occur as a result of that Subsidiary becoming an Additional Borrower; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) NAB has received all of the documents and other evidence listed in Annexure 6 (Conditions precedent required to be delivered by an Additional Obligor) in relation to that Additional Borrower, each in form and substance satisfactory to NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If NAB accepts and executes the Accession Letter and notifies the Borrower, the Subsidiary becomes an Additional Borrower with effect on and from the date specified in the Accession Letter and is bound by the terms of this document.

**29.4 Additional Cross-Guarantors**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Borrower may request that any of its wholly-owned Subsidiaries becomes an Additional Cross-Guarantor. That Subsidiary may become an Additional Cross-Guarantor only if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB approves the addition of that Subsidiary;© National Australia Bank Limited 108

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Borrower delivers to NAB a duly completed and executed Accession Letter executed as a deed by the Borrower and the Subsidiary whereby the Subsidiary accedes as an Additional Cross-Guarantor; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) NAB has received all of the documents and other evidence listed in Annexure 6 (Conditions precedent required to be delivered by an Additional Obligor) in relation to that Additional Cross-Guarantor, each in form and substance satisfactory to NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If NAB accepts and executes the Accession Letter and notifies the Borrower, the Subsidiary becomes an Additional Cross-Guarantor with effect on and from the date specified in the Accession Letter and is bound by the terms of this document.

**29.5 Additional Security Providers**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Borrower may request that a person becomes an Additional Security Provider. That person shall become an Additional Security Provider if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) NAB approves the addition of that person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Borrower delivers to NAB a duly completed and executed Accession Letter executed as a deed by the Borrower and the person whereby the person accedes as an Additional Security Provider; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) NAB has received all of the documents and other evidence listed Annexure 6 (Conditions precedent required to be delivered by an Additional Obligor) in relation to that Additional Security Provider, each in form and substance satisfactory to NAB.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If NAB accepts and executes the Accession Letter and notifies the Borrower, the person becomes an Additional Security Provider with effect on and from the date specified in the Accession Letter and is bound by the terms of this document.

**29.6 Resignation of a Cross-Guarantor**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Borrower may request that a Cross-Guarantor ceases to be a Cross-Guarantor by delivering to NAB a duly completed and executed Resignation Letter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If NAB (acting reasonably having regard to its legitimate commercial interests) accepts and executes the Resignation Letter and notifies the Borrower of its acceptance of the Resignation Letter, the Cross-Guarantor shall cease to be a Cross-Guarantor with effect on and from the date specified in the Resignation Letter and shall have no further rights or obligations as a Cross-Guarantor under the Finance Documents.

**29.7 Resignation of a Security Provider**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A Borrower may request that a Security Provider ceases to be a Security Provider by delivering to NAB a duly completed and executed Resignation Letter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If NAB (in its absolute discretion) accepts and executes the Resignation Letter and notifies the Borrower of its acceptance of the Resignation Letter, the Security Provider shall cease to be a Security Provider with effect on and from the date specified in the Resignation Letter and shall have no further rights or obligations as a Security Provider under the Finance Documents.

**29.8 Repetition of representations**

Delivery of an Accession Letter constitutes confirmation by the proposed Additional Obligor that the representations and warranties in this document are true and correct in relation to it as at the date of delivery as if made by reference to the facts and circumstances then existing.© National Australia Bank Limited 109

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**29.9 Accession Letters and Resignation Letters**

For each Accession Letter or Resignation Letter, each Obligor for valuable consideration irrevocably appoints each Borrower to execute the Accession Letter or Resignation Letter on its behalf.

**30. Confidentiality**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each party agrees that no party will disclose to an Interested Person, or any other person at the request of an Interested Person, any information of the kind described in section 275(1) of the PPSA unless allowed or required by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Obligor agrees that it will not authorise the disclosure of any information of the kind described in section 275(1) of the PPSA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each party agrees not to disclose information provided by the other party (including the existence or contents of this document) except:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) to officers, employees, legal and other advisers and auditors of an Obligor, NAB or a Receiver;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) with the consent of the other party (who must not unreasonably withhold their consent);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) if required by any stock exchange or if allowed or required by law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) by NAB under clause 25 (Liability for Regulatory Events) or in relation the exercise of its rights under clause 29.1(a) (Assignments and transfers by NAB);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) by NAB to any Related Entity of NAB or an Obligor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) by NAB to any assignee of NAB's rights under this document or any other arrangement (including a request, bill of exchange, agreement, guarantee or an Encumbrance) under which obligations are or could in the future be owed to NAB provided the receiving party is bound by an obligation of confidentiality;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) by NAB to any person in connection with NAB exercising rights or dealing with rights or obligations including preparatory steps such as negotiating with any potential assignee of NAB's rights or other person who is considering contracting (directly or indirectly) with NAB or a Receiver in connection with this document, or anyone who invests in or otherwise finances or administers such a transaction, provided the receiving party is bound by an obligation of confidentiality;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) by NAB for the purpose of registering and maintaining any financing statement or financing change statement (each as defined in the PPSA) relating to NAB's Security Documents; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) by NAB to any Obligor or person NAB believes may become an Obligor, provided that the prohibition under clause (a) or (b) is absolute and therefore none of the exceptions in this clause (c) apply to a disclosure under clause (a) or (b).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) NAB agrees that each Borrower is providing its signed copy of this document on the condition that NAB complies with its obligations of confidentiality under clauses (a) and (c) above.

**31. Communications and Notices**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any communication or notice made under or in connection with any Finance Document must be made in legible writing in English and, unless otherwise stated, may be delivered by post or email.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any communication or notices (including a Drawdown Notice) under this document may be submitted by an Authorised Officer of an Obligor (or other person authorised by or on behalf of the Obligor for the purpose) by any electronic method approved by NAB for a specific purpose from time to time.© National Australia Bank Limited 110

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any communication or notice from NAB to an Obligor, may be:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) given by making it available at NAB's website and notifying the Obligor that the information is available electronically (including by SMS or email); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) given by other electronic method or by making it available on a service provided by NAB.

Obligors may withdraw their agreement to receive notices by electronic means by giving NAB notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The address, email address, mobile telephone number and the department or officer for whose attention the communication is to be marked is that identified in the Schedule or any substitute address, electronic address, email address or department or officer as an Obligor may notify to NAB (or NAB may notify to the Obligors, if a change is made by NAB) by not less than 5 Business Days' prior written notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Unless a later time is specified in the communication, a communication will take effect from the earlier of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the time it is actually received; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) except in the case of a communication to NAB, the time it is deemed to be received under clause (f).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Subject to clause (g), any communication or notification will be deemed to be received:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) if left at the recipient's address, at the time left at the relevant address;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) if sent electronically to a Borrower to an email address or if made available at NAB's website and notified to an Obligor under sub-clause (c) or if sent by another electronic method, at the time it was sent or when it was posted on a service provided by NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) if by way of post, 3 Business Days (or 7 Business Days if sent overseas) after being posted; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) if a notice is given by publishing it, at the time the notice is first published,

unless delivery or receipt is on a day which is not a Business Day or is after 4:00 p.m. (addressee's time) in which case it will be deemed to be received at 9:00 a.m. on the following Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Except in respect of a communication submitted under sub-clause (b), each communication to NAB:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) must be addressed to the department or officer of NAB specified in accordance with (d); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) where the Obligor is a company must be signed (either directly or with a digital image of their signature) by an Authorised Officer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) NAB may rely on any notice or communication from an Obligor, an Authorised Officer of an Obligor or any other authorised person referred to in sub-clause (b), or on any notice or communication that NAB believes in good faith is from any of those persons.

**32. Accounts and Certificates**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In any litigation, arbitration proceedings or other dispute resolution process arising out of or in connection with a Finance Document, the entries made in the accounts maintained by NAB are sufficient evidence of the matters to which they relate unless the contrary is proved.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any certification or determination by NAB of an exchange rate, a rate of interest or any amount under any Finance Document is sufficient evidence of the matters to which it relates and any© National Australia Bank Limited 111

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certification or determination by NAB of any other matter is sufficient evidence of the matters to which it relates unless and until it is established to be incorrect.

**33. Accounting for Transactions**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Borrower irrevocably authorises NAB to open such accounts as NAB reasonably determines to be necessary in connection with a Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower of a Facility irrevocably authorises NAB to debit from the Loan Account or Nominated Account for that Facility (if any) any amounts payable by the Borrower in relation to that Facility or account, including interest, Costs, Taxes, enforcement expenses and any amount payable under an indemnity, unless otherwise stated or agreed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If a Borrower authorises NAB to debit any amount from an account or one of two or more accounts, NAB can debit that amount from that account (or if more than one account, from any account it chooses) even if it causes the account to become overdrawn. Alternatively, if there are insufficient cleared funds in that account, the Borrower authorises NAB to debit that amount from any account of the Borrower NAB decides, including an account NAB opens in the Borrower's name.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If this document does not state to which account an amount may be debited or credited, NAB may debit or credit that amount from any account (including, for the avoidance of doubt, any Loan Account or Nominated Account) of the Borrower NAB decides, including an account NAB opens in the Borrower's name.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Where NAB debits an account in the name of a Borrower, opened by:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Borrower, the Borrower must pay NAB interest (including default interest if applicable) on any debit balance in accordance with the terms of that account;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) NAB, the Borrower must pay NAB interest on the overdrawn balance of that account (other than an overdraft account where the balance does not exceed the applicable Facility Limit) at the Default Interest Rate applying to the relevant Facility or, if there is none, in accordance with the terms normally applied by NAB to accounts of that type; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) either the Borrower or NAB, and the amount debited is not otherwise payable in accordance with this document, the overdrawn balance of the account (taking into account any limit applicable to that account) is immediately payable by the Borrower when NAB asks. It is to the Borrower's benefit to pay this amount as soon as possible to minimise fees and interest (including default interest).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Unless otherwise provided, NAB may apply any payment under or in connection with this document towards satisfying obligations under this document as NAB reasonably sees fit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Where NAB is authorised to debit an amount from an account under this document, it can do so without prior notice.

**34. Statements of Account**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject to clause (b), NAB will provide the Borrower with a statement of account at least every 3 months for each Facility that is a revolving facility (such as an overdraft facility) and at least every 6 months for other credit facilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If NAB is not required by law to provide the Borrower with a statement, it may choose not to do so.

**35. Banking Code of Practice**

Each Borrower represents and warrants to NAB that either:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) it (or where it is a member of a corporate group, the group) had an annual turnover of greater than $10 million in the previous financial year; or© National Australia Bank Limited 112

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) it (or where it is a member of a corporate group, the group) has more than 100 full time equivalent employees; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) it has more than $5 million total debt to all credit providers including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any undrawn amounts under existing loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any loans provided under this agreement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the debt of all its related entities that are businesses; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) it is a company listed on the ASX or it is a government entity or it holds an Australian Financial Services Licence to be a responsible entity or to provide custodial or depository services,

and accordingly each Borrower acknowledges that the Banking Code of Practice does not apply to this agreement or the facilities being provided under it.

**36. General provisions**

**36.1 Partial invalidity**

If, at any time, any provision of a Finance Document is or becomes illegal, invalid or unenforceable in any respect under any law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions nor the legality, validity or enforceability of such provision under the law of that or any other jurisdiction will in any way be affected or impaired.

**36.2 No waiver**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No failure to exercise, nor any delay in exercising, on the part of NAB, any right or remedy under a Finance Document will operate as a waiver, nor will any single or partial exercise of any right or remedy prevent any further exercise or the exercise of any other right or remedy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The rights and remedies provided in each Finance Document are cumulative and not exclusive of any rights or remedies provided by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) NAB need not resort to a right, power or Encumbrance under a Security Document before resorting to any other of them.

**36.3 Amendments and waivers**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as set out in clause (b), any term of a Finance Document may be amended or waived only in writing with the consent of NAB and the relevant Obligors and any such amendment or waiver will be binding on all parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) NAB may, acting reasonably, vary the terms of this document unilaterally by giving written notice to the relevant Borrower, by way of publication on NAB's website and/or advertisement in the local or national press or by giving notice in accordance with any provision of this document that expressly contemplates or permits the terms of this document to be varied unilaterally, at any time:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) to the extent NAB reasonably considers necessary to ensure compliance with relevant laws or to reflect NAB's systems capabilities, provided such variation does not, in the reasonable opinion of NAB, result in a material change to the nature of the Facilities; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) to the extent that this document expressly contemplates or permits the terms of this document to be varied unilaterally.

**36.4 Counterparts**

Each Finance Document may be executed in any number of counterparts, and if so, the counterparts taken together constitute one and the same instrument.© National Australia Bank Limited 113

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**36.5 Continuing indemnities**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All indemnities and reimbursement obligations in each Finance Document are continuing and survive termination of the Finance Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each such indemnity is an additional, separate and independent obligation of each Obligor and no one indemnity limits the general nature of any other indemnity.

**36.6 Consents and waivers**

Each Obligor will comply with all conditions in any consent or waiver NAB gives under or in connection with a Finance Document. NAB will act reasonably in all the circumstances and in its legitimate business interests in determining such conditions and requirements.

**36.7 Discretion in exercising rights**

NAB may exercise a right or remedy or give or refuse its consent under or in connection with a Finance Document reasonably after having regard to its legitimate business requirements.

**36.8 No liability for loss**

NAB is not liable to any Obligor for any loss, liability or Costs caused by the exercise or attempted exercise of, or failure to exercise, or delay in exercising, a right or remedy under or in connection with a Finance Document, where:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) there is no breach of a legal duty of care owed by NAB or by any of NAB's employees or agents; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) such loss or damage is not a reasonably foreseeable result of any such breach.

**36.9 Rights and obligations are unaffected**

Rights given to NAB, and an Obligor's obligations, under or in connection with a Finance Document, are not affected by any act or omission or any other thing which might otherwise affect them under law or otherwise.

**36.10 Inconsistent law**

The Obligors may have statutory rights and protections available to them under Australian laws, including laws to protect small businesses from unfair contract terms. However, to the extent permitted by law, each Finance Document prevails to the extent it is inconsistent with any law.

**36.11 Entire agreement** 

This document constitutes the entire agreement of the parties about its subject matter and supersedes all previous agreements, understandings and negotiations on the subject matter.

**36.12 Telephone recording**

Each Obligor consents to NAB recording any telephone conversations between it and NAB in relation to any Facility that are customarily recorded in the finance industry or where the Obligor is notified prior to the commencement of the telephone conversation and such recordings being used for training and quality purposes and in any arbitral or legal proceedings.

**36.13 Reinstating avoided transaction**

Each Obligor agrees that if a payment or other transaction relating to the Amount Owing is void, voidable, unenforceable or defective for any reason or a related claim is upheld, conceded or settled (each an **Avoidance**), then even though NAB knew or should have known of the Avoidance:© National Australia Bank Limited 114

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) each right, power and remedy of NAB, and each Obligor's liability under each Finance Document will be what it would have been, and will continue, as if the payment or transaction the subject of the Avoidance had not occurred; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) it will immediately execute and do anything necessary or reasonably required by NAB to restore NAB to its position immediately before the Avoidance (including reinstating any Finance Document) and procure that each relevant Obligor does so.

This clause 36.13 survives any termination or full or partial discharge or release of any Finance Document.

**36.14 Reading down and severance**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If any law making unfair contract terms void could apply to a term in this document, the following rules apply to interpreting that term:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If the law would make the term void because the term permits NAB to exercise a right or discretion in a way or to an extent that would cause detriment to an Obligor, the term shall be read down and construed so as not to permit NAB to exercise the right or discretion in such a way or to such an extent but otherwise the term shall be construed as permitting NAB to exercise the right or discretion in all ways and to any extent consistent with the term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If the law would make the term void because the term imposed a particular amount for a fee or charge, the term shall be read down and construed as authorising the maximum amount for that fee or charge which would not cause the term to be void.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If the law would make the term void because it authorised NAB to recover costs or losses or damages to be calculated by NAB in a specified way or in a way NAB chooses, the term shall be read down and construed as authorising NAB to recover the maximum reasonable costs, losses and damages to be calculated in a reasonable way that did not cause the term to be void.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) If, despite the application of rules (i), (ii) and (iii) to the term, the law would make the term void, the term is to be read down and construed as if it were varied, to the minimum extent necessary, so that the term is not void.

These reading-down rules apply before the following additional reading-down and severance provision:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If a provision of this document is void or voidable or unenforceable by NAB, but would not be void or voidable or unenforceable if it were read down, it shall be read down accordingly.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If, despite paragraph (b), a provision of this document is still void or voidable or unenforceable by NAB:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) if the provision would not be void or voidable or unenforceable if a word or words were omitted therefrom, that word or those words (as the case may be) are severed; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) in any other case, the whole provision is severed, and the remainder of this document has full force and effect.

**37. Governing Law and Jurisdiction**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This document is governed by the laws of the Governing Law Jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts of the Governing Law Jurisdiction (and any court of appeal) and waives any right to object to an action being bought in those courts, including on the basis of inconvenient forum or those courts not having jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) This clause 37 (Governing Law and Jurisdiction) is for the benefit of NAB only. As a result, NAB will not be prevented from taking proceedings in any other court with jurisdiction.© National Australia Bank Limited 115

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) To the extent permitted by law, NAB may take concurrent proceedings in any number of jurisdictions.

**38. Acknowledgement**

Each Obligor acknowledges that, except as expressly set out in a Finance Document:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) none of NAB or any of its advisers has given any representation or warranty or other assurance to it in relation to any Finance Document or the transactions contemplated by any Finance Document, including as to Tax or other effects;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) it has not relied on NAB or any of its advisers or on any conduct (including any recommendation) by NAB or any of its advisers;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) it has had the opportunity to obtain its own independent financial, Tax and legal advice and has done so or has elected not to do so;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) where an Obligor has granted a Security Document (including any Guarantee) in favour of NAB, each Security Document (including any Guarantee) is, and remains, in full force and effect and continues and extends to secure all present and future obligations of that Obligor to NAB in respect of the Facilities; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) if it gives NAB personal information about someone else, or directs someone else to give their personal information to NAB, it must show that person a copy of the Privacy Statement so that they understand the manner in which their personal information may be used or disclosed.© National Australia Bank Limited 116

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**Annexures**

**Annexure 1: Verification Certificate**

**VERIFICATION CERTIFICATE**

To: National Australia Bank Limited (NAB)

From: [insert name and ACN] (the Company)

Dated: [insert date]

We, being [directors][a director and company secretary] of the Company [I, being the sole director of the Company] hereby certify as follows:

Except where otherwise defined, capitalised terms used in the Finance Agreement dated on or about the date of this certificate between the Company and NAB have the same meaning when used in this certificate.

1. SPECIMEN SIGNATURES

The following are the signatures of the persons appointed as Authorised Officers and attorneys of the Company for the purposes of the Finance Documents or who are otherwise authorised to sign a Finance Document on behalf of the Company.

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| | |
|:---|:---|
| &nbsp;&nbsp;**Authorised Officers**<br>|  |
| &nbsp;&nbsp;Signature of Authorised Officer | &nbsp;&nbsp;Signature of Authorised Officer |
| &nbsp;&nbsp;Name: | &nbsp;&nbsp;Name: |
| &nbsp;&nbsp;Title: |  |

---

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| | |
|:---|:---|
| &nbsp;&nbsp;**Attorneys**<br>|  |
| &nbsp;&nbsp;Signature of Attorney | &nbsp;&nbsp;Signature of Attorney |
| &nbsp;&nbsp;Name: | &nbsp;&nbsp;Name: |
| &nbsp;&nbsp;Title: | &nbsp;&nbsp;Title: |

---

2. AUTHORISATIONS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Attached to this certificate marked "**A**" are true, complete and current copies of each [list Material Authorisations].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Other than the documents listed above, no other Authorisations are necessary for the Company to enter into, observe its obligations under, and perform the transactions contemplated by, each Finance Document to which it is expressed to be a party.

3. SOLVENCY DECLARATION

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) As at the date of execution of each Finance Document the Company is solvent (as defined in section 95A(1) of the Corporations Act) and will not become insolvent (as defined in section 95A(2) of the Corporations Act) by entering into and complying with its obligations under each Finance Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Company has at all times complied with its obligations under section 286 of the Corporations Act.© National Australia Bank Limited 117

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) To the best of our knowledge, no application or order has been made, no proceedings have been commenced, no resolutions have been passed or proposed in a notice of meeting and no other steps have been taken for:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the winding up, dissolution or administration of the Company or of any Trust or Registered Scheme of which the Company acts as trustee or responsible entity, as the case may be; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Company entering into an arrangement, compromise or composition with or assignment of the benefit of its creditors or a class of them.

4. POWER OF ATTORNEY

Attached to this certificate marked "**B**" is [an original] [a true, complete and current copy] of a power of attorney which the Company is to use or has used to execute a Finance Document.

5. FINANCIAL STATEMENTS

Attached to this certificate marked "**C**" is [a true, complete and current copy] of the most recent [insert details of Finance Statements] of the Company [and the Group].

6. MATERIAL DOCUMENTS

Attached to this certificate marked "**D**" are [true, complete and correct copies] of the following Material Documents:

[insert list]

To the extent that any of these Material Documents has been provided to NAB prior to the date of this certificate, we certify that the copies provided are true, up-to-date and complete.

MULTIPLE DIRECTORS

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| | |
|:---|:---|
| &nbsp;&nbsp;Signature of director<br>| &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;Name of director (print)<br>| &nbsp;&nbsp;Name of director/company secretary (print) |
| &nbsp;&nbsp;Date | &nbsp;&nbsp;Date |

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SINGLE DIRECTOR

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| |
|:---|
| &nbsp;&nbsp;Signature of sole director and sole company secretary<br>|
| &nbsp;&nbsp;Name of sole director and sole company secretary (print)<br>|
| &nbsp;&nbsp;Date |

---

© National Australia Bank Limited 118

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**Annexure 2: Compliance Certificate**

**COMPLIANCE CERTIFICATE**

To: National Australia Bank Limited (NAB)

From: [insert name and ACN] (the Company)

Dated: [insert date]

Finance Agreement dated [insert date] (the Agreement)

1. We refer to the Agreement. This is a Compliance Certificate. Terms used in the Agreement shall have the same meaning in this Compliance Certificate unless given a different meaning in this Compliance Certificate.

2. We confirm that: [Insert details of covenants to be certified]

3. [We confirm that no Default [or Review Event] is continuing.]\*

\* If this statement cannot be made, the certificate should identify any Event of Default, Potential Event of Default or Review Event that is continuing and the steps, if any, being taken to remedy it<sup>.</sup>

MULTIPLE AUTHORISED OFFICERS

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| | |
|:---|:---|
| &nbsp;&nbsp;Signature of Authorised Officer<br>| &nbsp;&nbsp;Signature of Authorised Officer |
| &nbsp;&nbsp;Name (print)<br>| &nbsp;&nbsp;Name (print) |
| &nbsp;&nbsp;Date<br>| &nbsp;&nbsp;Date |

---

© National Australia Bank Limited 119

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**Annexure 3: Drawdown Notice**

**DRAWDOWN NOTICE**

To: National Australia Bank Limited (NAB)

From: [insert name and ACN] (the Company)

Dated: [insert date]

Finance Agreement dated [insert date] (the Agreement)

1. We refer to the Agreement. This is a Drawdown Notice. Terms defined in the Agreement shall have the same meaning in this Drawdown Notice unless given a different meaning in this Drawdown Notice.

2. [For facilities other than Bank Guarantee Facilities] We wish to make a Drawing on the following terms:

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| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proposed Drawdown Date: | &nbsp;&nbsp;[ ] (or, if that is not a Business Day, the next Business Day) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Facility for Drawing:  | &nbsp;&nbsp;[Insert details of Facility] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Currency:] | &nbsp;&nbsp;[ ] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount: | &nbsp;&nbsp;[ ] or, if less, the Available Facility |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest Period: | &nbsp;&nbsp;[ ] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds to be credited to: | &nbsp;&nbsp;[Account] |

---

3. [For Bank Guarantee Facilities] We request that the following Bank Guarantee(s) be prepared by NAB and made available for collection by [ourselves/the Beneficiary]:

---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Beneficiary: | &nbsp;&nbsp;[Name, ABN/ACN and address] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agreement: | &nbsp;&nbsp;[ ] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount: | &nbsp;&nbsp;$[ ] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Termination Date: | &nbsp;&nbsp;[ ] |

---

We acknowledge that the Bank Guarantee(s) above will be issued under, and will be subject to the terms of, the Bank Guarantee Facility under the Agreement. NAB will continue to be indemnified in accordance with the terms of that Bank Guarantee Facility in respect of any amount it pays to a Beneficiary under the Bank Guarantee(s) requested.

4. We confirm that each condition specified in Clause [\*] is satisfied on the date of this Drawdown Notice. [except as described in the notice dated [\*] given to you, a copy of which is attached]

5. The proceeds of this Drawing should be credited to [account].© National Australia Bank Limited 120

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6. This Drawdown Notice is irrevocable.

Yours faithfully

Authorised Officer

[Company on behalf of] [name of relevant Borrower]© National Australia Bank Limited 121

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**Annexure 4: Form of Accession Letter**

To: National Australia Bank Limited (NAB)

From: [Additional Obligor] and [Borrower] for itself and on behalf of each other person who is an Obligor at the date of this letter

Date: [insert date]

**Finance Agreement dated [insert date] (the Agreement)**

We refer to the Finance Agreement. This is an Accession Letter. Terms used in the Finance Agreement shall have the same meaning in this Accession Letter unless given a different meaning in this Accession Letter.

[[Additional Obligor] agrees to become an Additional Borrower in respect of [all Facilities]/[specify relevant Facilities] and to be bound by the terms of the Finance Agreement as an Additional Borrower pursuant to Clause 29.3 (Additional Borrowers) of the Finance Agreement.]

[[Additional Obligor] agree s to become an Additional [Cross-Guarantor]/[Security Provider] and to be bound by the terms of the Finance Agreement as an Additional [Cross-Guarantor]/[Security Provider] pursuant to [Clause 29.4 (Additional Cross-Guarantors)]/[Clause 29.5 (Additional Security Providers)] of the Finance Agreement.]

[Additional Obligor] agrees to do all things that are required under the Finance Agreement to be done in connection with becoming an Additional [Borrower]/ [Cross-Guarantor]/ [Additional Security Providers].

[Each of the following is specified as a Security Document for purposes of the Finance Agreement:

[Insert details of new Security Documents including Facilities to be secured]

The details for service of communications to [Additional Obligor] are as follows:

Address:

Email:

Attention:

This Accession Letter is governed by the laws of Victoria. This Accession Letter may be executed in any number of counterparts and, if so, the counterparts taken together constitute one and the same instrument.

This Accession Letter is entered into as a deed.

[Borrower] [Additional Obligor]

This Accession Letter is accepted by NAB and the accession date is confirmed as [\*].© National Australia Bank Limited 122

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| | |
|:---|:---|
| Executed on behalf of National Australia Bank Limited by its Attorney who holds the position of Level ____ Attorney under Power of Attorney dated 1 March 2007 in the presence of: |  |
| Signature of Witness | Signature of Attorney |
| Name of Witness (print) | Name of Attorney |

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© National Australia Bank Limited 123

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**Annexure 5: Form of Resignation Letter**

To: National Australia Bank Limited (NAB)

From: [Resigning Obligor] and [Borrower] for itself and on behalf of each other person who is an Obligor at the date of this letter

Dated: [insert date]

**Finance Agreement dated [insert date] (the Agreement)**

1. We refer to the Finance Agreement. This is a Resignation Letter. Terms used in the Finance Agreement shall have the same meaning in this Resignation Letter unless given a different meaning in this Resignation Letter.

2. Pursuant to [Clause 29.6 (Resignation of a Cross-Guarantor)]/ [Clause 29.7 (Resignation of a Security Provider)], we request that [resigning Obligor] be released from its obligations as a [Cross-Guarantor]/[Security Provider] under the Finance Agreement.

3. This Resignation Letter is governed by the laws of Victoria. This Resignation Letter may be executed in any number of counterparts and, if so, the counterparts taken together constitute one and the same instrument.

[resigning Obligor] [Borrower] <br> By:

This Resignation Letter is accepted by NAB and the resignation date is confirmed as [\*].

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| | |
|:---|:---|
| Executed on behalf of National Australia Bank Limited by its Attorney who holds the position of Level ____ Attorney under Power of Attorney dated 1 March 2007 in the presence of: |  |
| Signature of Witness | Signature of Attorney |
| Name of Witness (print) | Name of Attorney |

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© National Australia Bank Limited 124

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**Annexure 6: Conditions Precedent Required to be Delivered by an Additional Obligor**

(a) (**Accession Letter**) An Accession Letter, duly executed by the Additional Obligor and the relevant Borrower.

(b) (**Security Documents**) Any Security Document required by NAB, duly executed by the Additional Obligor.

(c) (**verification certificate**) Where the Additional Obligor is a company, a Verification Certificate in relation to the Additional Obligor dated not earlier than 5 Business Days before the date of the Accession Letter.

(d) (**Client Identification Checks**) All documents and other information that NAB requires to enable NAB to complete any Client Identification Checks.

(e) (**structure chart**) An updated diagram showing the structure and ownership arrangements of each Group and the Obligors.

(f) (**process agent appointment**) Evidence of the acceptance of appointment of a process agent located in Australia for the Additional Obligor, if the Additional Obligor is incorporated or located outside Australia.

(g) (**enquiries and searches**) The results of NAB's enquiries and searches.

(h) (**other information**) Any other information or document which NAB reasonably requests from time to time.© National Australia Bank Limited 125

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**Annexure 7: Privacy Statement**

This statement outlines the manner in which any Personal Information that will be or has been collected from and/or about you in connection with the Agreement (and any transactions contemplated under it) may be used and disclosed by the parties described in this statement.

In this statement:

**Affiliate** means a related body corporate of NAB.

**Agreement** means this document.

**Personal Information** means information or an opinion about an identified individual or an individual who is reasonably identifiable.

**You** includes any person who is an employee of or holds office in an Obligor.

1. **Purpose of collection of Personal Information**

NAB may collect and use your Personal Information:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to provide and manage facilities offered to any Obligor under the Agreement including entering into a transfer, assignment, participation or other agreement in connection with the Facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to identify you or any Obligor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) to comply with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) or substantially similar laws and regulations in any jurisdiction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) to establish an Obligor's tax status under any Australian or foreign legislation, regulation or treaty or pursuant to an agreement with any tax authority;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) to identify, prevent or investigate any actual or suspected fraud, unlawful activity or misconduct;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) to consider any concerns or complaints raised by an Obligor against NAB and/or to manage any legal action involving NAB; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) as required by relevant laws, regulations, codes of practice and external payment systems in any jurisdiction.

NAB may collect your Personal Information not only directly from you but also from third parties such as any Obligor.

2. **Disclosure of Personal Information**

NAB may disclose Personal Information to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any Affiliate of NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) regulatory bodies, government agencies, law enforcement bodies and courts;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) participants in payments systems (including payment organisations and merchants) and other financial institutions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) an Obligor's legal representatives or anyone else acting for an Obligor in connection with the Facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any provider of a guarantee or other credit support for the Obligors' obligations to NAB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) parties to whom NAB is authorised or required by law or court/tribunal order to disclose information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) any professional advisors or service providers of NAB who are under a duty of confidentiality to keep such information confidential;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) any person with whom NAB may enter into a transfer, assignment, participation or other agreement in connection with the Facilities.

3. **Consequence of failure to provide Personal Information**

If an Obligor does not provide NAB with some or all of the Personal Information requested, NAB may be unable to provide the Obligors with any product or service.

4. **Disclosure of Personal Information to overseas recipients**

In collecting and using your Personal Information and making the disclosures described in clauses 1 and 2, NAB may disclose information to recipients located outside Australia, including recipients who are not established in or not carrying on business in Australia. This may include (but is not limited to) recipients in countries named in NAB's privacy policy.

5. **Privacy policies**

The privacy policy of NAB is available on its website. Each privacy policy contains information about the way you may access and seek correction of your Personal Information and how to make a privacy related complaint.© National Australia Bank Limited 126

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## Ex-10

![img32770990_0.jpg](img32770990_0.jpg)

AMENDMENT DEED

**National Australia Bank Limited**

**and S&W SEED COMPANY AUSTRALIA PTY LTD A.C.N. 061 114 814**

**DATED 21 October 2022**

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**Table of Contents**

1DEFINITIONS AND INTERPRETATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2CONDITIONS PRECEDENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

3AMENDMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

4CONFIRMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

5REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

6REMAINING PROVISIONS UNAFFECTED. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

7GENERAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

SCHEDULE 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

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THIS DEED is dated as shown on the front page and is made between:

**NATIONAL AUSTRALIA BANK LIMITED ABN 12 004 044 937** of 395 Bourke Street, Melbourne, Victoria

3000 (**NAB**);

Each person listed as a borrower in Schedule 1 (**Borrower** and together the **Borrowers**); Each person (if any) listed as a guarantor in Schedule 1 (**Cross-Guarantor** and together the

**Cross-Guarantors**); and

Each person (if any) listed as a security provider in Schedule 1 (**Security Provider** and together the **Security Providers**).

This Deed remains available for acceptance until 19 January 2023, at which time it will lapse.

**BACKGROUND:**

ASome or all of the parties are parties to the Finance Agreement.

BThe parties agree to amend the Finance Agreement on the terms and conditions set out in this document.

CWith effect on and from the Effective Date, the Finance Agreement is amended in accordance with this document.

**IT IS AGREED** as follows:

**1** **DEFINITIONS AND INTERPRETATION**

&nbsp;&nbsp;&nbsp;&nbsp;**1.1** **Definitions**

Words which have a defined meaning in the Finance Agreement have the same meaning in this document unless otherwise defined.

**Effective Date** means the date NAB gives the notice contemplated in clause 2.1 (Conditions precedent).

**Finance Agreement** means the facility agreement between NAB and some or all of the Obligors dated or most recently amended or restated on 18 October 2022, as amended from time to time.

**Obligor** means each Borrower, Cross-Guarantor and Security Provider.

&nbsp;&nbsp;&nbsp;&nbsp;**1.2** **Interpretation**

Clause 1.4 (Interpretation) of the Finance Agreement applies to this document as if set out in full in this document.

&nbsp;&nbsp;&nbsp;&nbsp;**1.3** **Inconsistent law**

To the extent permitted by law, this document prevails to the extent it is inconsistent with any law.

&nbsp;&nbsp;&nbsp;&nbsp;**1.4** **Consideration**

The parties enter into this document in consideration of, among other things, the mutual promises

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contained in this document.

&nbsp;&nbsp;&nbsp;&nbsp;**1.5** **Finance Document**

This document is a Finance Document for the purposes of the Finance Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;**1.6** **No undisclosed agency, partnership, scheme or trust**

No party enters into this document as agent for an undisclosed principal, as a partner of any partnership, trustee of any trust, responsible entity of any registered scheme or otherwise for the benefit of any other person except as expressly described in this document.

**2** **CONDITIONS PRECEDENT**

&nbsp;&nbsp;&nbsp;&nbsp;**2.1** **Conditions precedent**

The amendments proposed to the Finance Agreement referred to in clause 3 (Amendment) are of no force and effect until NAB has notified the Borrowers in writing that each of the following has been received by NAB or otherwise complied with in form and substance satisfactory to NAB:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)The results of NAB's enquiries and searches

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)An original of this document duly and fully executed by the Obligors.

&nbsp;&nbsp;&nbsp;&nbsp;**2.2** **Certification of copies**

Unless otherwise required by NAB, each document specified in respect of an Obligor in clause 2.1 (Conditions precedent) must be an original. If NAB requires a certified copy of a document, the copy must be certified by a director or secretary of that Obligor as true and complete as at a date no earlier than 5 Business Days before the date of this document.

**3** **AMENDMENT**

With effect on and from the Effective Date, the Finance Agreement is amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)The Details are amended by inserting the following provisions after the Details for each Facility and Other Facility (if applicable):

**OPTION TO EXTEND CERTAIN FACILITIES**

The parties agree that if any of the following Facilities are specified in the Details, the Expiry Date for that Facility can be extended at the option of NAB:

oBank Guarantee Facility;

oNAB Business Overdraft Facility;

oDocumentary Letters of Credit;

oDocumentary Letters of Credit and / or Documents Surrendered;

oFarm Management Account Overdraft;

oForeign Currency Overdraft Account;

oNAB Commercial Card Facilities;

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oOverseas Bills Purchased;

oSet Off – Gross Debt Limit;

oSet Off – Net Debt Limit;

oStandby Letters of Credit;

oTrade Refinance Facility;

oTrade Refinance Facility (with Borrowing Base annexure);

oRevolving Lease Limit / Master Asset Finance Facility;

oBPAY Batch Limit;

oTransaction Negotiation Facility;

oDirect Debit Facilities;

oNAB Connect;

oMerchant Facilities;

oNAB Invoice Finance;

oNAB Corporate Receivables Facility; and

oany other facility from time to time agreed to by NAB and the Borrower as a 12 Month Facility,

(each a **12 Month Facility**).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)On or before the Expiry Date for a 12 Month Facility, NAB may by written notice to the Borrower cancel the Facility, in which case the Amount Owing will be repayable on a date being no less than 90 days after the Expiry Date (unless the Borrower is in Default, in which case the Amount Owing may be repayable on a date determined in accordance with this document).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)If NAB has not given a notice in accordance with paragraph (a) the Expiry Date for a 12 Month Facility will be extended for a further 90 days for the purposes of an annual review of the Facility.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)After the period set out in paragraph (b), NAB will either:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)give notice to the Borrower that the Expiry Date will not be extended, in which case the Amount Owing will be repayable on a date being no less than 90 days after the date of such notice; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)give notice to the Borrower that the Expiry Date will be extended for a further period not exceeding 90 days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)with or without notice to the Borrower, extend the Expiry Date for a further 9 month period on the same terms and conditions as this document and any other terms and conditions applicable to a 12 Month Facility, and notified by NAB from time to time.

The option to extend a 12 Month Facility subject to the terms of this document will only be available for four consecutive annual periods from the initial Expiry Date, such that the final

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Expiry Date cannot be a date more than 5 years from the initial Expiry Date.

The Borrower repeats the representations and warranties that are made, or taken to be repeated, in accordance with this document (as varied from time to time) as at each Expiry Date (other than the final Expiry Date for a 12 Month Facility) and further represents and warrants to NAB that no Default subsists.

If the Expiry Date does not fall on a Business Day, it will be the next Business Day. The above provisions prevail to the extent of any inconsistency.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Item 8 (Other Undertakings or Conditions Subsequent) of the Schedule is amended by inserting the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Net Related Entity Position:

The Group is to maintain a Net Entity Position of no more than $25,000,000.

"Net Related Entity Position" means current Related Entity assets plus non current Related Entity assets less current Related Entity liabilities less non current Related Entity liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Item 8 (Other Undertakings or Conditions Subsequent) of the Schedule is amended by deleting the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Net Related Entity Position

The Group is to maintain a Net Entity Position of no less than $25,000,000.

"Net Related Entity Position" mean current Related Entity assets plus non current Related Entity assets less current Related Entity liabilities less non current Related Entity liabilities.

**4** **CONFIRMATION**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)With effect on and from the Effective Date, each party confirms and agrees that it is a party to, and bound by the terms of, the Finance Agreement, as amended by this document, in each capacity in which that party is named in Schedule 1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Each Obligor agrees to any security documents and guarantees granted by it continuing to secure obligations under the Finance Agreement, as amended by this document.

**5** **REPRESENTATIONS AND WARRANTIES**

On the date of this document and on the Effective Date, each representation and warranty contained in the Finance Agreement is deemed to be repeated by each Obligor for the benefit of NAB with reference to the facts and circumstances subsisting as at the date of this document and the Effective Date respectively.

**6** **REMAINING PROVISIONS UNAFFECTED**

Except as specifically amended by this document, the provisions of the Finance Agreement remain in full force and effect.

**7** **GENERAL**

&nbsp;&nbsp;&nbsp;&nbsp;**7.1** **Communications and notices**

Clause 31 (Communications and Notices) of the Finance Agreement applies to this document as if

------

set out in full in this document.

&nbsp;&nbsp;&nbsp;&nbsp;**7.2** **Counterparts**

This document may be executed in any number of counterparts and, if so, the counterparts taken together constitute one and the same instrument.

&nbsp;&nbsp;&nbsp;&nbsp;**7.3** **Governing law and jurisdiction**

This document is governed by the laws of the Governing Law Jurisdiction. Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts exercising jurisdiction there.

------

**SCHEDULE 1**

**BORROWER(S)**

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814

**CROSS-GUARANTOR(S) (IF ANY)**

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 S&W HOLDINGS AUSTRALIA PTY LTD ACN 162 715 326

PASTURE GENETICS PTY LTD ACN 074 290 252

S&W WHEAT PTY LTD ACN 660 612 984

**SECURITY PROVIDER(S) (IF ANY)**

S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114 814 S&W HOLDINGS AUSTRALIA PTY LTD ACN 162 715 326

PASTURE GENETICS PTY LTD ACN 074 290 252

S&W WHEAT PTY LTD ACN 660 612 984

------

**EXECUTED AS A DEED**

**SIGNATURES**

&nbsp;&nbsp;Executed on behalf of **National Australia Bank Limited** by its Attorney who holds the position of Level 2 Attorney under Power of Attorney dated 1 March 2001 in the presence of:<br>

---

| | |
|:---|:---|
| &nbsp;&nbsp;/s/Hugh Mincaam Bailey | &nbsp;&nbsp;/s/Benjamin James Vanderkop |
| &nbsp;&nbsp;Signature of Witness | &nbsp;&nbsp;Signature of Attorney  |
| &nbsp;&nbsp;HUGH MINCAAM BAILEY | &nbsp;&nbsp;BENJAMIN JAMES VANDERKOP |
| &nbsp;&nbsp;Name of Witness (print) | &nbsp;&nbsp;Name of Attorney |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;Executed by **S&W SEED COMPANY AUSTRALIA PTY LTD ACN 061 114814** in accordance with Section 127 of the Corporations Act 2001 |  |
| &nbsp;&nbsp;/s/Cameron Victor Henley | &nbsp;&nbsp;/s/Andrew Ross Carthew |
| &nbsp;&nbsp;Signature of director | &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;CAMERON VICTOR HENLEY | &nbsp;&nbsp;ANDREW ROSS CARTHEW |
| &nbsp;&nbsp;Name of director (print)<br>| &nbsp;&nbsp;Name of director/company secretary (print) |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;Executed by **S&W HOLDINGS COMPANY AUSTRALIA PTY LTD ACN 162 715326** in accordance with Section 127 of the Corporations Act 2001 |  |
| &nbsp;&nbsp;/s/Cameron Victor Henley | &nbsp;&nbsp;/s/Andrew Ross Carthew |
| &nbsp;&nbsp;Signature of director | &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;CAMERON VICTOR HENLEY | &nbsp;&nbsp;ANDREW ROSS CARTHEW |
| &nbsp;&nbsp;Name of director (print) | &nbsp;&nbsp;Name of director/company secretary (print) |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;Executed by **PASTURE GENETICS PTY LTD ACN 074 290 252** in accordance with Section 127 of the Corporations Act 2001 |  |
| &nbsp;&nbsp;/s/Cameron Victor Henley | &nbsp;&nbsp;/s/Andrew Ross Carthew |
| &nbsp;&nbsp;Signature of director | &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;CAMERON VICTOR HENLEY | &nbsp;&nbsp;CAMERON VICTOR HENLEY |
| &nbsp;&nbsp;Name of director (print) | &nbsp;&nbsp;Name of director/company secretary (print) |

---

------

---

| | |
|:---|:---|
| &nbsp;&nbsp;Executed by **S&W WHEAT PTY LTD ACN 660 612 984** in accordance with Section 127 of the Corporations Act 2001 |  |
| &nbsp;&nbsp;/s/Cameron Victor Henley | &nbsp;&nbsp;/s/Andrew Ross Carthew |
| &nbsp;&nbsp;Signature of director | &nbsp;&nbsp;Signature of director/company secretary |
| &nbsp;&nbsp;CAMERON VICTOR HENLEY | &nbsp;&nbsp;CAMERON VICTOR HENLEY |
| &nbsp;&nbsp;Name of director (print) | &nbsp;&nbsp;Name of director/company secretary (print) |

---

------

## Ex-10

**<u>SEVENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT</u>**

This Seventh Amendment to Loan and Security Agreement (this "**<u>Seventh Amendment</u>**") made and entered into as of the 28<sup>th</sup> day of October, 2022, is by and among S&W Seed Company, a Nevada corporation ("**<u>S&W Seed</u>**"), Seed Holding, LLC, a Nevada limited liability company ("**<u>Seed Holding</u>**"), and Stevia California, LLC, a California limited liability company ("**<u>Stevia CA</u>**"; S&W Seed, Seed Holding and Stevia CA are each individually a "**<u>Borrower</u>**" and collectively referred to as "**<u>Borrowers</u>**"), the other Loan Parties hereto, the financial institutions that are or may from time to time become parties hereto (together with their respective successors and assigns, the "**<u>Lenders</u>**"), and CIBC BANK USA (in its individual capacity, "**<u>CIBC</u>**"), as administrative agent for the Lenders ("**<u>Administrative Agent</u>**").

**<u>W I T N E S S E T H:</u>**

**WHEREAS,** prior hereto, Lenders provided loans, extensions of credit and other financial accommodations to Borrowers pursuant to (a) that certain Loan and Security Agreement dated as of December 26, 2019, as amended by that certain First Amendment to Loan and Security Agreement dated as of September 22, 2020, that certain Second Amendment to Loan and Security Agreement dated as of December 30, 2020, that certain Third Amendment to Loan and Security Agreement dated as of May 13, 2021, that certain Fourth Amendment to Loan and Security Agreement dated as of September 24, 2021, that certain Fifth Amendment to Loan and Security Agreement dated as of May 13, 2022, and that certain Sixth Amendment to Loan and Security Agreement dated as of September 22, 2022, each by and among Lenders, Borrowers, the other Loan Parties thereto and Administrative Agent (collectively, the "**<u>Loan Agreement</u>**"), and (b) the other documents, agreements and instruments referenced in the Loan Agreement or executed and delivered pursuant thereto;

**WHEREAS,** Borrowers desire Administrative Agent and Lenders to, (a) among other things, increase the Total Revolving Loan Commitment from $18,000,000 to $21,000,000, and (b) modify the Eligible Inventory Sublimit (collectively, the "**<u>Additional Financial Accommodations</u>**"); and

**WHEREAS,** Administrative Agent and Lenders are willing to provide the Additional Financial Accommodations, but solely on the terms and subject to the provisions set forth in this Seventh Amendment and the other agreements, documents and instruments referenced herein or executed and delivered pursuant hereto.

**NOW, THEREFORE,** in consideration of the foregoing, the mutual promises and understandings of the parties hereto set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Administrative Agent, Lenders, Borrowers and the other Loan Parties hereto hereby agree as set forth in this Seventh Amendment.

I.**<u>Definitions</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A.**<u>Use of Defined Terms</u>**. Except as expressly set forth in this Seventh Amendment, all terms which have an initial capital letter where not required by the rules of grammar are used herein as defined in the Loan Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B.**<u>Amended Definitions</u>**. Effective as of the Seventh Amendment Effective Date, Section 1.1 of the Loan Agreement is hereby amended by substituting the definitions set forth below for the corresponding definitions set forth in the Loan Agreement, respectively:

<u>Eligible Inventory Sublimit</u> shall mean, as of the Seventh Amendment Effective Date, $12,000,000.00, or such higher or lower number as may be determined by Administrative Agent in its sole and absolute discretion; <u>provided</u> that (a) the Eligible Inventory Sublimit shall automatically decrease by the amount of the proceeds of the Specified Letter of Credit received by Administrative Agent and applied to the Revolving Loans in accordance with Section 2.3.3(c) effective upon Administrative Agent's receipt of such proceeds, and (b) for so long as the Specified Letter of Credit

------

is outstanding, Administrative Agent shall not decrease the Eligible Inventory Sublimit to an amount that is less than the proceeds available to be drawn under the Specified Letter of Credit.

<u>Maximum Loan Amount</u> shall mean Twenty-One Million and No/100 Dollars ($21,000,000.00).

<u>MFP Loan Agreement</u> shall mean that certain Subordinate Loan and Security Agreement, dated as of September 22, 2022, by and between MFP and S&W Seed, as amended by that First Amendment to Subordinate Loan and Security Agreement, dated as of the Seventh Amendment Effective Date, as further amended, restated, amended and restated, supplemented or otherwise modified from time to time, in each case in form and substance satisfactory to Administrative Agent in its sole discretion.

<u>Specified Letter of Credit</u> shall mean that certain Letter of Credit No. NUSCG044349 issued by JPMorgan Chase Bank, N.A., for the account of MFP, in the original face amount of $9,000,000, as amended on or before the Seventh Amendment Effective Date increasing the face amount to $12,000,000, as further amended, restated, amended and restated, supplemented or otherwise modified from time to time, in each case in form and substance satisfactory to Administrative Agent in its sole discretion.

<u>Total Revolving Loan Commitment</u> shall mean an amount equal to Twenty-One Million and No/100 Dollars ($21,000,000.00) except as such amount may be increased or, upon the occurrence and at all times during the continuance of an Event of Default, decreased by Required Lenders in their sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C.**<u>New Definitions</u>**. Effective as of the Seventh Amendment Effective Date, Section 1.1 of the Loan Agreement is hereby amended by adding the following new definition thereto in the appropriate alphabetical order:

<u>Seventh Amendment Effective Date</u> shall mean October 28, 2022.

II.**<u>Amendments to Loan Agreement</u>**. Effective as of the Seventh Amendment Effective Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A.Annex 1 to the Loan Agreement is hereby deleted and replaced with Annex 1 attached to this Seventh Amendment.

III.**<u>Conditions Precedent</u>**. Administrative Agent's and Lenders' obligations to provide the Additional Financial Accommodations to Borrowers are subject to the full and timely performance of the following covenants prior to or contemporaneously with the execution and delivery of this Seventh Amendment:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A.Borrowers executing and delivering, or causing to be executed and delivered to the Administrative Agent and the Lenders, the following documents, each of which shall be in form and substance acceptable to the Administrative Agent and the Lenders:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)a Note of even date herewith, payable by Borrowers to the order of CIBC in the original principal amount of $21,000,000.00;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)an amendment to the Specified Letter of Credit increasing the face amount thereof to $12,000,000.00;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)a consent to this Seventh Amendment from Rooster; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)such other agreements, documents and instruments as Administrative Agent or Lenders may reasonably request.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B.No Default or Event of Default exists under the Loan Agreement, as amended by this Seventh Amendment, or any of the other Loan Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C.No claims, litigation, arbitration proceedings or governmental proceedings not disclosed in writing to Administrative Agent and the Lenders prior to the date hereof shall be pending or known to be threatened against Borrowers or any other Loan Party and no known material development not so disclosed shall have occurred in any claims, litigation, arbitration proceedings or governmental proceedings so disclosed which in the opinion of Administrative Agent is likely to materially or adversely affect the financial position or business of Borrowers or any other Loan Party or the capability of Borrowers to pay their obligations and liabilities to Lenders; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D.There shall have been no Material Adverse Effect since the date of each Borrower's most recent financial statements delivered to Administrative Agent.

IV.**<u>Organizational Information</u>**. Each Loan Party hereby represents and warrants to Administrative Agent and Lenders that as of the Seventh Amendment Effective Date, (a) the formation and organizational documents of each such Loan Party attached to the Company General Certificates dated as of December 26, 2019, executed and delivered by each such Loan Party to Administrative Agent and Lenders (the "**<u>Certificates</u>**"), have not been modified or altered in any way, (b) the officers, members or managers, as applicable, for each Loan Party set forth in each such Certificate, that are authorized to execute documents on behalf of such Loan Party remain duly authorized officers, members or managers of such Loan Party, except that Matthew K. Szot has been replaced each time he appears in any such Certificate by Betsy Horton, (c) the resolutions attached to each of such Certificate have not been modified, rescinded or altered in any way and are sufficient to authorize the execution and delivery of this Seventh Amendment and the other agreements, documents and instruments executed and delivered in connection herewith, and (d) each Loan Party is and continues to be in good standing in the state of its formation and in all other states where it is qualified or licensed to do business in which the laws thereof require such Loan Party to be so qualified or licensed except where the failure to qualify would not have a material adverse effect.

V.**<u>Conflict</u>**. If, and to the extent, the terms and provisions of this Seventh Amendment contradict or conflict with the terms and provisions of the Loan Agreement, the terms and provisions of this Seventh Amendment shall govern and control; provided, however, to the extent the terms and provisions of this Seventh Amendment do not contradict or conflict with the terms and provisions of the Loan Agreement, the Loan Agreement, as amended by this Seventh Amendment, shall remain in and have its intended full force and effect, and Lenders, Administrative Agent and Borrowers hereby affirm, confirm and ratify the same.

VI.**<u>Severability</u>.** Wherever possible, each provision of this Seventh Amendment shall be interpreted in such manner as to be valid and enforceable under applicable law, but if any provision of this Seventh Amendment is held to be invalid or unenforceable by a court of competent jurisdiction, such provision shall be severed herefrom and such invalidity or unenforceability shall not affect any other provision of this Seventh Amendment, the balance of which shall remain in and have its intended full force and effect. Provided, however, if such provision may be modified so as to be valid and enforceable as a matter of law, such provision shall be deemed to be modified so as to be valid and enforceable to the maximum extent permitted by law.

VII.**<u>Reaffirmation</u>**. Each Loan Party hereby reaffirms and remakes all of its respective representations, warranties, covenants, duties, obligations and liabilities contained in the Loan Agreement, as amended hereby, and the other Loan Documents.

VIII.**<u>Fees, Costs and Expenses</u>**. Borrowers agree to pay, upon demand, all fees, costs and expenses of Administrative Agent and Lenders, including, but not limited to, reasonable attorneys' fees, in connection with the preparation, execution, delivery and administration of this Seventh Amendment and the other agreements, documents and instruments executed and delivered in connection herewith or pursuant hereto.

------

IX.**<u>Reservation of Rights</u>**. ADMINISTRATIVE AGENT AND LENDERS RESERVE ALL OF THEIR RIGHTS AND REMEDIES, INCLUDING ALL SECURITY INTERESTS, ASSIGNMENTS AND LIENS PURSUANT TO THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS WELL AS ANY RIGHTS AND REMEDIES AT LAW, IN EQUITY OR OTHERWISE. NOTHING CONTAINED IN THIS SEVENTH AMENDMENT SHALL BE OR BE DEEMED A WAIVER OF ANY PRESENTLY EXISTING OR ANY HEREAFTER ARISING OR OCCURRING BREACH, DEFAULT OR EVENT OF DEFAULT, NOR SHALL PRECLUDE THE SUBSEQUENT EXERCISE OF ANY OF ADMINISTRATIVE AGENT'S OR LENDERS' RIGHTS OR REMEDIES.

X.**<u>Choice of Law</u>**. This Seventh Amendment has been delivered and accepted in Chicago, Illinois, and shall be governed by and construed in accordance with the laws of the State of Illinois, regardless of the laws that might otherwise govern under applicable principles of conflicts of law as to all matters, including matters of validity, construction, effect, performance and remedies.

XI.**<u>Counterparts</u>**. This Seventh Amendment may be executed in two or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument. A facsimile or email transmitted executed counterpart to this Seventh Amendment and the other agreements, documents and instruments executed in connection herewith will be deemed an acceptable original for purposes of consummating this Seventh Amendment and such other agreements, documents and instruments; provided, however, each Borrower and each other Loan Party shall be required to deliver to the Administrative Agent original executed signature pages in substitution for said facsimile or email transmitted signature pages upon the Administrative Agent's request therefor.

XII.**<u>Waiver of Jury Trial.</u>** EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THE LOAN AGREEMENT, AS AMENDED FROM TIME TO TIME, ANY NOTE, ANY OTHER LOAN DOCUMENT AND ANY OTHER AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ARISING FROM ANY LENDING RELATIONSHIP EXISTING IN CONNECTION WITH ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

XIII.**<u>WAIVER AND RELEASE OF CLAIMS</u>**. IN CONSIDERATION OF ADMINISTRATIVE AGENT'S AND EACH LENDER'S EXECUTION AND DELIVERY OF THIS SEVENTH AMENDMENT, EACH BORROWER AND EACH OTHER LOAN PARTY HEREBY, INDIVIDUALLY AND COLLECTIVELY, WAIVES, RELEASES AND FOREVER DISCHARGES ADMINISTRATIVE AGENT, EACH LENDER, THEIR PREDECESSORS, PARENTS, SUBSIDIARIES, AFFILIATES, AGENTS, EMPLOYEES, OFFICERS, DIRECTORS, SHAREHOLDERS, ATTORNEYS, LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS, AND EACH OF THEM (EACH A "RELEASED PARTY"), OF AND FROM ANY AND ALL CLAIMS, DEMANDS, COUNTERCLAIMS, SET-OFFS, DEFENSES, DEBTS, OBLIGATIONS, COSTS, EXPENSES, ACTIONS, CAUSES OF ACTION AND DAMAGES OF EVERY KIND, NATURE AND DESCRIPTION WHATSOEVER, KNOWN OR UNKNOWN, FORESEEABLE OR UNFORESEEABLE, LIQUIDATED OR UNLIQUIDATED, AND INSURED OR UNINSURED, WHICH ANY BORROWER OR ANY OTHER LOAN PARTY HERETOFORE, NOW OR FROM TIME TO TIME HEREAFTER OWNS, HOLDS OR HAS BY REASON OF ANY MATTER, CAUSE OR THING WHATSOEVER, ARISING ON OR BEFORE THE DATE OF THIS SEVENTH AMENDMENT FROM, RELATING TO OR IN CONNECTION WITH THE LOAN DOCUMENTS, THE OBLIGATIONS, THIS SEVENTH AMENDMENT, BORROWERS' OR ANY OTHER LOAN PARTY'S BANKING OR CASH MANAGEMENT RELATIONSHIP WITH ADMINISTRATIVE AGENT, ANY LENDER OR ANY OTHER RELEASED PARTY OR ANY MATTERS RELATING TO ANY OF THE FOREGOING

[signature pages follow]

------

**In Witness Whereof**, Administrative Agent, Lenders, Borrowers and each other Loan Party have caused this Seventh Amendment to be executed and delivered by their duly authorized officers as of the date first set forth above.

---

| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;**BORROWERS:** | &nbsp;&nbsp;**BORROWERS:** |  |  |
| &nbsp;&nbsp;**S&W SEED COMPANY,** <br>a Nevada corporation | &nbsp;&nbsp;**S&W SEED COMPANY,** <br>a Nevada corporation | &nbsp;&nbsp;**SEED HOLDING, LLC**<br>a Nevada limited liability company | &nbsp;&nbsp;**SEED HOLDING, LLC**<br>a Nevada limited liability company |
| &nbsp;&nbsp;By: | &nbsp;&nbsp;/s/ Betsy Horton | &nbsp;&nbsp;By: | &nbsp;&nbsp;/s/ Betsy Horton |
|  | &nbsp;&nbsp;Betsy Horton, Chief Financial Officer |  | &nbsp;&nbsp;Betsy Horton, Manager |
| &nbsp;&nbsp;**STEVIA CALIFORNIA, LLC**, <br>a California limited liability company | &nbsp;&nbsp;**STEVIA CALIFORNIA, LLC**, <br>a California limited liability company |  |  |
| &nbsp;&nbsp;By: | &nbsp;&nbsp;/s/ Betsy Horton |  |  |
|  | &nbsp;&nbsp;Betsy Horton, Manager |  |  |

---

[Signature page to Seventh Amendment to Loan and Security Agreement]

------

**CIBC BANK USA,**<br> as Administrative Agent and as a Lender

By: <u>/s/ Jennifer Kempton</u> <br> Name: Jennifer Kempton<br>Title: Managing Director

[Signature page to Seventh Amendment to Loan and Security Agreement]

------

**ANNEX 1 – COMMITMENTS**

---

| | | |
|:---|:---|:---|
| Lender | Revolving Loan Commitment | Percentage |
| CIBC BANK USA | $21000000.00 | 100.000000000 |
| Total | $21000000.00 | 100.000000000 |

---

------

## Ex-10

**Execution Version**

**FIRST AMENDMENT TO**

**SUBORDINATE LOAN AND SECURITY AGREEMENT**

This FIRST AMENDMENT TO SUBORDINATE LOAN AND SECURITY AGREEMENT, dated as of October 28, 2022 (this "**Amendment**"), is entered into by and between S&W SEED COMPANY, a Nevada corporation (the "**Borrowe**r"), and MFP PARTNERS, L.P., a Delaware limited partnership the "**Lender**").

WHEREAS, the Borrower and the Lender are parties to that certain Subordinate Loan and Security Agreement, dated as of September 22, 2022 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the "**Loan Agreement**"); and

WHEREAS, pursuant to Section 12.7 of the Loan Agreement, the parties hereto have agreed to amend certain terms of the Loan Agreement as hereinafter provided in <u>Section 2</u> to, among other items, establish and give effect to the First Amendment Available Amount and the incurrence of Term Advances equal to the First Amendment Available Amount, subject to the satisfaction of the conditions precedent to effectiveness set forth in <u>Section 3</u> hereof.

NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto agree as follows:

Section 1. <u>Definitions</u>. Except as otherwise defined in this Amendment, terms defined in the Loan Agreement are used herein as defined therein.

Section 2. <u>Amendment</u>. Subject to the satisfaction of the conditions precedent set forth in Section 3 of this Amendment, but effective as of the date hereof:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Loan Agreement is hereby amended as set forth in <u>Annex A</u> hereto (stricken text shall be deleted from the Loan Agreement (indicated textually in the same manner as the following example: stricken text) and double-underlined text shall be added to the Loan Agreement (indicated textually in the same manner as the following examples: <u>double-underlined text</u> or <u>double-underlined text</u>)).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Annex</u> B hereto is hereby appended to the Loan Agreement as Exhibit B-3 thereof.

Section 3. <u>Conditions Precedent</u>. The amendments set forth in <u>Section 2</u> shall become effective upon receipt by the Lender of counterparts of this Amendment executed by the Borrower and Lender (such date of receipt, the "**First Amendment Effective Date**").

Section 4. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) References in the Loan Agreement (including references to the Loan Agreement as amended hereby) to "this Agreement" (and indirect references such as "hereunder", "hereby", "herein" and "hereof") shall be deemed to be references to the Loan Agreement as amended by this Amendment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Amendment shall constitute a Loan Document for purposes of the Loan Agreement and the other Loan Documents, and except as specifically modified by this Amendment, the Loan Agreement, and the other Loan Documents shall remain unchanged and shall remain in full force and effect and are hereby ratified and confirmed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The execution, delivery and performance of this Amendment shall not constitute a forbearance, waiver, consent or amendment of any other provision of, or operate as a forbearance or waiver of any right, power or remedy of the Lender under the Loan Agreement or any of the other Loan Documents, all of which are ratified and reaffirmed in all respects and shall continue in full force and effect. This Amendment does not constitute a novation of rights, obligations and liabilities of the respective parties existing under the Loan Documents.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) This Amendment shall be governed by, and construed in accordance with, the law of the State of New York.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) This Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Amendment in electronic (i.e., "pdf" or "tif") format shall be effective as delivery of a manually executed counterpart of this Amendment. Each party hereto agrees and acknowledges that (i) the transaction consisting of this Amendment may be conducted by electronic means, (ii) it is such party's intent that, if such party signs this Amendment using an electronic signature, it is signing, adopting and accepting this Amendment and that signing this Amendment using an electronic signature is the legal equivalent of having placed its handwritten signature on this Amendment on paper and (iii) it is being provided with an electronic or paper copy of this Amendment in a usable format.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) This Amendment, the Loan Agreement and the other Loan Documents represent the final agreement between the parties hereto and thereto and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties.

[Signature Pages Follow]

2. ------

**Execution Version**

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

<u>BORROWER:</u><br>S&W SEED COMPANY

By: <u>/s/ Betsy Horton</u> <br>Name: Betsy Horton<br>Title: Chief Financial Officer

[Signature Page to First Amendment to Subordinate Loan and Security Agreement]

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<u>LENDER</u>:<br>

MFP PARTNERS, L.P.<br>By: MFP Investors LLC, its General Partner

By: <u>/s/ Alexander C. Matina</u> <br>Name: Alexander C. Matina<br>Title: Portfolio Manager, Vice President

[Signature Page to First Amendment to Subordinate Loan and Security Agreement]

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**Execution Version**

**<u>ANNEX A</u>**

Amended Loan Agreement<br>[see attached]

[Signature Page to First Amendment to Subordinate Loan and Security Agreement]

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Execution Version**<u>As amended by the First Amendment, dated as of October 28, 2022.</u>**

**THE OBLIGATIONS EVIDENCED BY THIS SUBORDINATE LOAN AND SECURITY AGREEMENT ARE SUBORDINATED TO THE PRIOR PAYMENT IN FULL OF THE "SENIOR DEBT" AND THE TERMINATION OF THE "SENIOR COMMITMENT" (AS SUCH TERMS ARE DEFINED IN THE SUBORDINATION AGREEMENT HEREINAFTER REFERRED TO) PURSUANT TO, AND TO THE EXTENT PROVIDED IN, THE SUBORDINATION AGREEMENT DATED AS OF SEPTEMBER 22, 2022, BY AND AMONG CIBC BANK USA, AS ADMINISTRATIVE AGENT FOR THE SENIOR CREDITOR, THE SENIOR LENDER PARTY THERETO, AND MFP PARTNERS, L.P., A DELAWARE LIMITED PARTNERSHIP (THE "CIBC SUBORDINATION AGREEMENT").**

**SUBORDINATE LOAN AND SECURITY AGREEMENT**

**THIS SUBORDINATE LOAN AND SECURITY AGREEMENT** (this "**Agreement**") dated as of September 22, 2022 (the "**Effective Date**") between **MFP PARTNERS, L.P.**, a Delaware limited partnership ("**Lender**"), and **S&W SEED COMPANY**, a Nevada corporation ("**Borrower**"), provides the terms on which Lender shall lend to Borrower and Borrower shall repay Lender. The parties agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **<u>ACCOUNTING AND OTHER TERMS</u>**

Accounting terms not defined in this Agreement shall be construed following GAAP. Calculations and determinations must be made following GAAP. Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in <u>Section 13</u>. All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **<u>LOAN AND TERMS OF PAYMENT</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.1** **Promise to Pay**. Borrower hereby unconditionally promises to pay Lender the outstanding principal amount of all Credit Extensions and all accrued and unpaid interest thereon as and when due in accordance with this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.2** **Specified Letter of Credit; Term Advances.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Specified Letter of Credit</u>. Subject to the terms and conditions of this Agreement, on the Effective Date, Lender shall provide the Specified Letter of Credit to CIBC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Availability</u>. Subject to the terms and conditions of this Agreement, Lender shall make advances (each a "**Term Advance**", and collectively, the "**Term Advances**") to Borrower in an aggregate amount not to exceed the Available Amount. Each Term Advance shall bear interest from the Funding Date thereof for so long as any part of such Term Advance remains outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Repayment</u>. Borrower shall not be required to make any principal payments prior to the Maturity Date. The entire unpaid principal balance of the Term Advances, and all accrued but unpaid interest thereon, shall be due and payable on the Maturity Date, or such earlier date as the same may become due and payable in accordance with the terms of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Prepayment</u>. Borrower may prepay all or any portion of the Term Advances at any time without penalty or premium, provided that Borrower may not reborrow any amount so prepaid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.3** **Payment of Interest on the Credit Extensions.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Interest Rate; Payment</u>. Subject to <u>Sections 2.3(b)</u> and <u>2.3(d)</u>, the principal amount outstanding for each Term Advance shall accrue interest at a per annum rate equal to the Term SOFR-based Rate. Accrued interest on the Term Advances, if any, shall be payable in arrears on each Payment Date in cash, and upon the payment or prepayment of the Term Advances (on the principal amount being so paid or prepaid); <u>provided</u> that

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interest payable at the Default Rate shall also be payable in cash from time to time on demand by the Lender. Notwithstanding the foregoing, 50% of the interest payable for each applicable period shall be payable in kind by capitalizing and adding such interest to the outstanding principal amount of the Term Advances on such Payment Date ("**PIK Interest**"); <u>provided</u>, that the Borrower may, at its option, irrevocably elect, by written notice to the Lender prior to any Payment Date, to decrease the rate of interest per annum capitalized as PIK Interest for such Payment Date by paying such amount in cash, or that no PIK Interest will be capitalized for such Payment Date, and, in each case, Borrower will pay such amount of interest that is owing and not capitalized as PIK Interest in cash as regular interest on such Payment Date. For purposes of this Agreement and the other Loan Documents, PIK Interest capitalized pursuant to this <u>Section 2.3(a)</u> shall constitute a portion of the principal amount outstanding of the Term Advances hereunder and shall bear interest in accordance with this <u>Section 2.3</u> and all references herein or in any other Loan Document to the principal amount of the Loans<u>loans</u> shall include all interest accrued and capitalized as a result of any payment of PIK Interest. Any PIK Interest shall automatically be capitalized on the applicable Payment Date in accordance with the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Default Rate</u>. Immediately upon the occurrence and during the continuance of an Event of Default, Obligations shall bear interest at a rate per annum which is two percentage points (2.0%) above the rate that is otherwise applicable thereto (the "**Default Rate**"). Fees and expenses which are required to be paid by Borrower pursuant to the Loan Documents (including, without limitation, Lender Expenses) but are not paid when due shall bear interest until paid at a rate equal to the highest rate applicable to the Obligations. Payment or acceptance of the increased interest rate provided in this <u>Section 2.3(b)</u> is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Lender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Interest Computation</u>. Interest shall be computed on the basis of a 360-day year for the actual number of days elapsed. In computing interest, (i) all payments received after 12:00 p.m. Pacific time on any day shall be deemed received at the opening of business on the next Business Day, and (ii) the date of the making of any Credit Extension shall be included and the date of payment shall be excluded; <u>provided</u>, however, that if any Credit Extension is repaid on the same day on which it is made, such day shall be included in computing interest on such Credit Extension.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Additional Provisions Regarding Term SOFR-based Advances</u>. If Lender shall have determined that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the Term SOFR Rate for any Interest Period, Lender shall give written notice thereof to Borrower. If such notice is given (x) any Term SOFR-based Advances made thereafter shall be made as Prime-based Advances, and (y) any outstanding Term SOFR-based Advances shall be converted, on the last day of the then-current Interest Period, to Prime-based Advances, in each case until Lender withdraws such notice. Notwithstanding the foregoing or anything herein or in any other Loan Document to the contrary, in the event that (i) the Index is permanently or indefinitely unavailable or unascertainable, (ii) the Index can no longer be lawfully relied upon in contracts of this nature by any or all of the parties, or (iii) the Index does not accurately and fairly reflect the cost of making or maintaining the type of loans or advances under this Agreement and in any such case, such circumstances are unlikely to be temporary, then all references to the interest rate herein will instead be to Daily Simple SOFR, and if Lender is unable to determine or ascertain Daily Simple SOFR (which determination shall be conclusive and binding absent manifest error), then to a replacement rate selected by mutual agreement of the Lender and the Borrower, each including any adjustment to the replacement rate to reflect a different credit spread, term or other mathematical adjustment agreed by Lender and Borrower. Lender and Borrower shall negotiate in good faith to determine such replacement rate as applicable pursuant to the preceding sentence, which will be effective on the date of the earliest event set forth in clauses (i)-(iii) of this paragraph. Lender and Borrower may also from time to time, in their mutual discretion, make any technical, administrative or operational changes (including changes to the timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length or applicability of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) ("**Conforming Changes**") that Lender and Borrower collectively decide may be appropriate to reflect the adoption and implementation of such replacement rate and to permit the administration of the loans in an administratively and operationally practicable manner.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.4** **Fees; Warrants; Lender Expenses.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Specified Letter of Credit Fee.</u> Borrower shall pay Lender, through the Specified Letter of Credit Maturity Date, a cash fee equal to 3.50% per annum on all amounts remaining undrawn under the Specified Letter of Credit, such fee to be paid quarterly in arrears.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Warrants.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>i.</u> On the Effective Date, Borrower shall issue the Initial Warrant to Lender, to purchase 500,000 shares of the Borrower's common stock (subject to adjustment as set forth in the Initial Warrant).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>ii. On the First Amendment Effective Date, Borrower shall issue the First Amendment Warrant to Lender, to purchase 166,700 shares of the Borrower's common stock.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>iii.</u> ii. Within five business days of each Bank Draw, the Borrower shall issue Lender an Additional Warrant to purchase shares of the Borrower's common stock, for such number of shares of the Borrower's common stock as is equal to (A) the product of: (x) the amount of such Bank Draw multiplied by (y) 40%, divided by (B) $1.60. Upon the issuance of each Additional Warrant, the Initial Warrant shall become exercisable for a lesser number of shares as provided in the Initial Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Lender Expenses.</u> Borrower shall pay to Lender all Lender Expenses (including reasonable and documented (x) attorneys' fees and expenses for documentation, negotiation and enforcement of this Agreement incurred through and after the Effective Date<u>;</u> and (y) all fees charged by JPMorgan Chase Bank, N.A. in connection with issuing and/or maintaining the Specified Letter of Credit), when due (or, if no stated due date, upon demand by Lender). Unless otherwise provided in this Agreement or in a separate writing by Lender, Borrower shall not be entitled to any credit, rebate, or repayment of any Lender Expenses owed by Borrower pursuant to this Agreement notwithstanding any termination of this Agreement or the suspension or termination of Lender's obligation to make loans and advances hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.5** **Payments; Application of Payments; Debit of Accounts.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All payments to be made by Borrower under any Loan Document shall be made in immediately available funds in Dollars to Lender at Lender's office in immediately available funds on the date due, without setoff or counterclaim, before 3:00 p.m. Pacific time. Payments of principal and/or interest received after 3:00 p.m. Pacific time are considered received at the opening of business on the next Business Day. When a payment is due on a day that is not a Business Day, the payment shall be due the next Business Day, and additional fees or interest, as applicable, shall continue to accrue until paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Lender has the exclusive right to determine the order and manner in which all payments with respect to the Obligations may be applied. Borrower shall have no right to specify the order or the accounts to which Lender shall allocate or apply any payments required to be made by Borrower to Lender or otherwise received by Lender under this Agreement when any such allocation or application is not specified elsewhere in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.6** **Withholding.** Payments received by Lender from Borrower under this Agreement will be made free and clear of and without deduction for any and all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority (including any interest, additions to tax or penalties applicable thereto). Specifically, however, if at any time any Governmental Authority, applicable law, regulation or international agreement requires Borrower to make any withholding or deduction from any such payment or other sum payable hereunder to Lender, Borrower hereby covenants and agrees that the amount due from Borrower with respect to such payment or other sum payable hereunder will be increased to the extent necessary to ensure that, after the making of such required withholding or deduction, Lender receives a net sum equal to the sum which it would have received had no withholding or deduction been required, and Borrower shall pay the full amount withheld or deducted to the relevant Governmental Authority. Borrower will, upon request, furnish Lender

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with proof reasonably satisfactory to Lender indicating that Borrower has made such withholding payment; <u>provided</u>, however, that Borrower need not make any withholding payment if the amount or validity of such withholding payment is contested in good faith by appropriate and timely proceedings and as to which payment in full is bonded against by Borrower. The agreements and obligations of Borrower contained in this <u>Section 2.6</u> shall survive the termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **<u>CONDITIONS OF LOANS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.1** **Conditions Precedent to Effectiveness**. This Agreement shall become effective upon Lender's receipt of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)duly executed signatures to the Loan Documents, the Specified Letter of Credit and the Initial Warrant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)the Operating Documents and long-form good standing certificates of Borrower certified by the Secretary of State (or equivalent agency) of Borrower's jurisdiction of organization or formation and each jurisdiction in which Borrower is qualified to conduct business, each as of a date no earlier than thirty (30) days prior to the Effective Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)duly executed signatures to the completed Borrowing Resolutions for Borrower;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)a subordination agreement by and between CIBC and Lender, together with the duly executed signatures thereto (the "**Subordination Agreement**");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)certified copies, dated as of a recent date, of financing statement searches, as Lender may request, accompanied by written evidence (including any UCC termination statements) that the Liens indicated in any such financing statements either constitute Permitted Liens or have been terminated or released; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)payment of the fees and Lender Expenses then due as specified in <u>Section 2.4</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.2** **Making of Term Advances**. Immediately upon the occurrence of any Bank Draw, Lender shall be deemed to have made a Term Advance in an aggregate principal amount equal to the amount of such Bank Draw. Lender shall notify Borrower in writing of the making of any Term Advance <u>pursuant to this Section 3.2</u> and the principal amount thereof in accordance with <u>Section 10</u> of this Agreement by 12:00 p.m. Pacific time on the first (1st) Business Day following the later of (i) the applicable Funding Date, or (ii) the date on which JPMorgan Chase Bank, N.A., the issuer under the Specified Letter of Credit, notifies Lender that a Term Advance<u>Bank Draw</u> has been made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **<u>CREATION OF SECURITY INTEREST</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.1** **Grant of Security Interest**. Borrower hereby grants Lender, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Lender, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof.

If this Agreement is terminated, Lender's Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations, but, for the avoidance of doubt, including indemnity obligations owing from Borrower on the date of such termination pursuant to <u>Section 12.3</u>) are repaid in full in cash. Upon payment in full in cash of the Obligations and at such time as Lender's obligation to make Credit Extensions has terminated, Lender shall, at Borrower's sole cost and expense, release its Liens in the Collateral and all rights therein shall revert to Borrower.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.2** **Priority of Security Interest**. Borrower represents, warrants, and covenants that the security interest granted herein is and shall at all times continue to be (a) subject and subordinate to the prior security interest granted to CIBC, as set forth in the CIBC Loan Documents, and (b) otherwise a first priority perfected security interest in the Collateral (subject only to Permitted Liens that may have superior priority to Lender's Lien under this Agreement).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.3** **Authorization to File Financing Statements**. Borrower hereby authorizes Lender to file financing statements, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Lender's interest or rights hereunder, including a notice that any disposition of the Collateral, by either Borrower or any other Person, shall be deemed to violate the rights of Lender under the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **<u>REPRESENTATIONS AND WARRANTIES</u>**

Borrower represents and warrants as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.1** **Due Organization, Authorization; Power and Authority**. Borrower is duly existing and in good standing in the State of Nevada, being its jurisdiction of formation, and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property requires that it be qualified except where the failure to do so could not reasonably be expected to have a Material Adverse Change. If Borrower is not now a Registered Organization but later becomes one, Borrower shall promptly notify Lender of such occurrence and provide Lender with Borrower's organizational identification number.

The execution, delivery and performance by Borrower of the Loan Documents and Specified Letter of Credit to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower's organizational documents, (ii) contravene, conflict with, constitute a default under or violate any material Requirement of Law, (iii) contravene, conflict or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any of its Subsidiaries or any of their property or assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and effect or (v) conflict with, contravene, constitute a default or breach under, or result in or permit the termination or acceleration of, any material agreement by which Borrower is bound. Borrower is not in default under any agreement to which it is a party or by which it is bound in which the default could reasonably be expected to have a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.2** **Collateral**. Borrower has good title to, rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted Liens. **<u>Schedule 5.2</u>** to the Disclosure Letter sets forth a list of all Liens existing on the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.3** **Litigation**. There are no actions or proceedings pending or, to the knowledge of any Responsible Officer, threatened in writing by or against Borrower or any of its Subsidiaries, which would reasonably be expected to cause a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.4** **Solvency**. Borrower is able to pay its debts (including trade debts) as they mature.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.5** **Regulatory Compliance**. Borrower is not an "investment company" or a company "controlled" by an "investment company" under the Investment Company Act of 1940, as amended. Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Borrower (a) has complied in all material respects with all Requirements of Law, and (b) has not violated any Requirements of Law the violation of which could reasonably be expected to have a Material Adverse Change. None of Borrower's or any of its Subsidiaries' properties or assets has been used by Borrower or any Subsidiary or, to the best of Borrower's knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than legally. Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Government Authorities that are necessary to continue their respective businesses as currently conducted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.6** **Subsidiaries; Investments**. Borrower does not own any stock, partnership, or other ownership interest or other equity securities except for Permitted Investments. **<u>Schedule 5.6</u>** to the Disclosure Letter sets forth a list of all Investments (including, without limitation, Subsidiaries), existing on the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.7** **Tax Returns and Payments; Pension Contributions**. Borrower has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and

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contributions owed by Borrower except (a) to the extent such taxes are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted, so long as such reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor, or (b) if such taxes, assessments, deposits and contributions, individually or in the aggregate, would not reasonably be expected to cause a Material Adverse Change.

To the extent Borrower defers payment of any contested taxes, Borrower shall (i) notify Lender in writing of the commencement of, and any material development in, the proceedings, and (ii) post bonds or take any other steps required to prevent the governmental authority levying such contested taxes from obtaining a Lien upon any of the Collateral that is other than a "Permitted Lien." Borrower is unaware of any claims or adjustments proposed for any of Borrower's prior tax years which could result in additional taxes becoming due and payable by Borrower, which would reasonably be expected to have a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.8** **Use of Proceeds**. Term Advances shall be made available to Borrower for the sole purpose of covering the principal amount of any Bank Draw as set forth in <u>Section 3.2</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.9** **Full Disclosure**. No written representation, warranty or other statement of Borrower in any certificate or written statement given to Lender, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Lender, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized by Lender that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.10** **Definition of "Knowledge**.**"** For purposes of the Loan Documents, whenever a representation or warranty is made to Borrower's knowledge or awareness, to the "best of" Borrower's knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable investigation, of any Responsible Officer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **<u>AFFIRMATIVE COVENANTS</u>**

Borrower shall do all of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.1** **Government Compliance.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Maintain its and all its Subsidiaries' legal existence and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would reasonably be expected to have a Material Adverse Change. Borrower shall comply, and have each Subsidiary comply, in all material respects, with all laws, ordinances and regulations to which it is subject.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Obtain all of the Governmental Approvals necessary for the performance by Borrower of its obligations under the Loan Documents to which it is a party and the grant of a security interest to Lender in the Collateral. Borrower shall promptly provide copies of any such obtained Governmental Approvals to Lender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.2** **Notices and Financial Information**. Provide Lender with the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Legal Action Notice</u>. A prompt report of any legal actions pending or threatened in writing against Borrower or any of its Subsidiaries that is reasonably likely to result in a Material Adverse Change; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Financial Information</u>. Financial information reasonably requested by Lender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.3** **Taxes; Pensions**. Timely file, and require each of its Subsidiaries to timely file, all required tax returns and reports and timely pay, and require each of its Subsidiaries to timely pay, all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries, except for deferred payment of any taxes contested pursuant to the terms of <u>Section 5.7</u> hereof, and shall deliver to Lender, on demand,

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appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.4** **Insurance.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Keep its business and the Collateral insured for risks and in amounts standard for companies in Borrower's industry and location and as Lender may reasonably request. Insurance policies shall be in a form, with financially sound and reputable insurance companies that are not Affiliates of Borrower, and in amounts that are satisfactory to Lender. Upon Lender's request, Borrower shall cause all property policies to have a lender's loss payable endorsement showing Lender as an additional loss payee. Upon Lender's request, Borrower shall cause all liability policies to show, or have endorsements showing, Lender as an additional insured. Upon Lender's request, Borrower shall cause Lender to be named as lender loss payee and/or additional insured with respect to any such insurance providing coverage in respect of any Collateral.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)At Lender's request, Borrower shall deliver certified copies of insurance policies and evidence of all premium payments. Upon Lender's request, Borrower shall cause each provider of any such insurance to agree, by endorsement upon the policy or policies issued by it or by independent instruments furnished to Lender, that it will give Lender thirty (30) days prior written notice before any such policy or policies shall be materially altered or canceled. If Borrower fails to obtain insurance as required under this <u>Section 6.4</u> or to pay any amount or furnish any required proof of payment to third persons and Lender, Lender may make all or part of such payment or obtain such insurance policies required in this <u>Section 6.4</u>, and take any action under the policies Lender deems prudent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.5** **Litigation Cooperation**. From the date hereof and continuing through the termination of this Agreement, make available to Lender, without expense to Lender, Borrower and its officers, employees and agents and Borrower's books and records, to the extent that Lender may deem them reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or against Lender with respect to any Collateral or relating to Borrower.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.6** **Access to Collateral; Books and Records**. Allow Lender, or its agents, at reasonable times, on two (2) Business Days' notice (provided no notice is required if an Event of Default has occurred and is continuing), to inspect the Collateral and audit and copy Borrower's Books. Such inspections or audits shall be conducted no more often than twice during the term of this Agreement unless an Event of Default has occurred and is continuing in which case such inspections and audits shall occur as often as Lender shall determine is necessary. The foregoing inspections and audits shall be at Borrower's expense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.7** **Further Assurances**. Execute any further instruments and take further action as Lender reasonably requests to perfect or continue Lender's Lien in the Collateral or to effect the purposes of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **<u>NEGATIVE COVENANTS</u>**

Borrower shall not do any of the following without Lender's prior written consent, which consent may be withheld in Lender's sole and absolute discretion:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.1** **Dispositions**. Convey, sell, lease, transfer, assign, or otherwise dispose of (collectively, "**Transfer**") all or any part of the Collateral, except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn-out or obsolete equipment that is, in the reasonable judgment of Borrower, no longer economically practicable to maintain or useful in the ordinary course of business of Borrower; (c) consisting of Permitted Liens and Permitted Investments; (d) consisting of the sale or issuance of any stock of Borrower permitted under <u>Section 7.2</u> of this Agreement; (e) consisting of Borrower's use or transfer of money or Cash Equivalents in the ordinary course of its business for the payment of ordinary course business expenses in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents; (f) of non-exclusive licenses for the use of the property of Borrower or its Subsidiaries in the ordinary course of business and licenses that could not result in a legal transfer of title of the licensed property but that may be exclusive in respects other than territory and that may be exclusive as to territory

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only as to discreet geographical areas outside of the United States and (g) any other Transfers permitted under the CIBC Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.2** **Changes in Business, Management, Control, or Business Locations**. (a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower and such Subsidiary, as applicable, or reasonably related thereto; (b) liquidate or dissolve; or (c) (i) fail to provide notice to Lender of any Key Person departing from or ceasing to be employed by Borrower within ten (10) Business Days after their departure from Borrower; or (ii) permit or suffer any Change of Control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.3** **Mergers or Acquisitions**. Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person (including, without limitation, by the formation of any Subsidiary) except to the extent permitted under the CIBC Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.4** **Indebtedness**. Create, incur, assume, or be liable for any Indebtedness other than Permitted Indebtedness. **<u>Schedule 7.4</u>** to the Disclosure Letter sets forth a list of all Indebtedness existing on the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.5** **Encumbrance**. Create, incur, allow, or suffer any Lien on any of the Collateral except for Permitted Liens or permit any Collateral not to be subject to the security interest granted herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.6** **Distributions; Investments**. (a) Pay any dividends or make any distribution or payment or redeem, retire or purchase any capital stock except to the extent permitted under the CIBC Loan Documents; or (b) directly or indirectly make any Investment (including, without limitation, by the formation of any Subsidiary) other than Permitted Investments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.7** **Transactions with Affiliates**. Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for this Agreement and transactions that are in the ordinary course of Borrower's business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm's length transaction with a non-affiliated Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.8** **Subordinated Debt**. (a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor, or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to the Subordinated Debt which would increase the amount thereof, provide for earlier or greater principal, interest, or other payments thereon, or adversely affect the subordination thereof to Obligations owed to Lender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.9** **Compliance**. Become an "investment company" or a company controlled by an "investment company", under the Investment Company Act of 1940, as amended, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit Extension for that purpose; fail to (a) meet the minimum funding requirements of ERISA, (b) prevent a Reportable Event or Prohibited Transaction, as defined in ERISA, from occurring, or (c) comply with the Federal Fair Labor Standards Act, the failure of any of the conditions described in clauses (a) through (c) which could reasonably be expected to have a Material Adverse Change; or violate any other law or regulation, if the violation could reasonably be expected to have a Material Adverse Change, or permit any of its Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from participation in, permit partial or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **<u>EVENTS OF DEFAULT</u>**

Any one of the following shall constitute an event of default (an "**Event of Default**") under this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.1** **Payment Default**. Borrower fails to (a) make any payment of principal or interest on any Credit Extension when due, or (b) pay any other Obligations within three (3) Business Days after such Obligations are due

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and payable (which three (3) Business Day cure period shall not apply to payments due on the Maturity Date). During the cure period, the failure to make or pay any payment specified under clause (b) hereunder is not an Event of Default (but no Credit Extension will be made during the cure period);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.2** **Covenant Default.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Borrower fails or neglects to perform any obligation in <u>Sections 6.2</u>, <u>6.3</u>, <u>6.4</u>, or <u>6.5</u> or violates any covenant in <u>Section 7</u>; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in <u>Section 8.2(a)</u> and <u>Sections 8.3</u> through <u>8.9</u>) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within ten (10) days after the occurrence thereof; <u>provided</u>, however, that if the default cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed ten (10) days) to attempt to cure such default, and within such reasonable time period the failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.3** **Material Adverse Change**. A Material Adverse Change occurs;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.4** **Insolvency**. (a) Borrower or any of its Subsidiaries is unable to pay its debts (including trade debts) as they become due or otherwise becomes insolvent; (b) Borrower or any of its Subsidiaries begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower or any of its Subsidiaries and is not dismissed or stayed within thirty (30) days (but no Credit Extensions shall be made while any of the conditions described in clause (a) exist and/or until any Insolvency Proceeding is dismissed);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.5** **Other Agreements**. There is under any agreement to which Borrower is a party with a third party or parties (including the CIBC Loan Documents), any default resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount individually or in the aggregate in excess of One Million Dollars ($1,000,000); <u>provided</u>, however, that any failure to comply with this <u>Section 8.5</u> shall not be deemed an Event of Default if such breach or default under such other agreement shall be cured or waived within ten (10) days of Borrower's receipt of written notice thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.6** **Judgments; Penalties**. One or more fines, penalties or final judgments, orders or decrees for the payment of money in an amount, individually or in the aggregate, of at least Five Hundred Thousand Dollars ($500,000) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower by any Governmental Authority, and the same are not, within ten (10) days after the entry, assessment or issuance thereof, discharged, satisfied or paid, or after execution thereof, stayed or bonded pending appeal, or such judgments are not discharged prior to the expiration of any such stay (provided that no Credit Extensions will be made prior to the satisfaction, payment, discharge, stay, or bonding of such fine, penalty, judgment, order or decree);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.7** **Misrepresentations**. Borrower or any Person acting for Borrower makes any representation, warranty, or other statement now or later in this Agreement, any Loan Document or in any writing delivered to Lender or to induce Lender to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.8** **Subordinated Debt**. The Obligations shall for any reason not have the priority contemplated by this Agreement or the Subordination Agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.9** **Governmental Approvals.** Any Governmental Approval shall have been (a) revoked, rescinded, suspended, modified in an adverse manner or not renewed in the ordinary course for a full term or (b) subject to any decision by a Governmental Authority that designates a hearing with respect to any applications for renewal of any of such Governmental Approval or that could result in the Governmental Authority taking any of the actions described

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in clause (a) above, and such decision or such revocation, rescission, suspension, modification or non-renewal (i) cause, or could reasonably be expected to cause, a Material Adverse Change, or (ii) adversely affects the legal qualifications of Borrower or any of its Subsidiaries to hold such Governmental Approval in any applicable jurisdiction and such revocation, rescission, suspension, modification or non-renewal could reasonably be expected to affect the status of or legal qualifications of Borrower or any of its Subsidiaries to hold any Governmental Approval in any other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **<u>LENDER'S RIGHTS AND REMEDIES</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.1** **Rights and Remedies**. Upon the occurrence and during the continuance of an Event of Default, Lender may, without notice or demand, do any or all of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)declare all Obligations immediately due and payable (but if an Event of Default described in <u>Section 8.4</u> occurs all Obligations are immediately due and payable without any action by Lender);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)stop advancing money or extending credit for Borrower's benefit under this Agreement or under any other agreement between Borrower and Lender;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)verify the amount of, demand payment of and performance under, and collect any Accounts and General Intangibles, settle or adjust disputes and claims directly with Account Debtors for amounts on terms and in any order that Lender considers advisable, and notify any Person owing Borrower money of Lender's security interest in such funds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the Collateral. Borrower shall assemble the Collateral if Lender requests and make it available as Lender designates. Lender may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be prior or superior to its security interest and pay all expenses incurred. Borrower grants Lender a license to enter and occupy any of its premises, without charge, to exercise any of Lender's rights or remedies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)apply to the Obligations any (i) balances and deposits of Borrower it holds or controls, or (ii) any amount held or controlled by Lender owing to or for the credit or the account of Borrower;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)place a "hold" on any account maintained with Lender and/or deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any Control Agreement or similar agreements providing control of any Collateral;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)demand and receive possession of Borrower's Books; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)exercise all rights and remedies available to Lender under the Loan Documents or at law or equity, including all remedies provided under the Code (including disposal of the Collateral pursuant to the terms thereof).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.2** **Power of Attorney**. Borrower hereby irrevocably appoints Lender as its lawful attorney-in-fact, exercisable upon the occurrence and during the continuance of an Event of Default, to: (a) endorse Borrower's name on any checks or other forms of payment or security; (b) sign Borrower's name on any invoice or bill of lading for any Account or drafts against Account Debtors; (c) settle and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and on terms Lender determines reasonable; (d) make, settle, and adjust all claims under Borrower's insurance policies; (e) pay, contest or settle any Lien, charge, encumbrance, security interest, and adverse claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and (f) transfer the Collateral into the name of Lender or a third party as the Code permits. Borrower hereby appoints Lender as its lawful attorney-in-fact to sign Borrower's name on any documents necessary to perfect or continue the perfection of Lender's security interest in the Collateral regardless of whether an Event of Default has occurred until all Obligations have been satisfied in full and Lender is under no further obligation to make Credit Extensions hereunder. Lender's foregoing appointment as Borrower's attorney in fact, and all of Lender's rights

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and powers, coupled with an interest, are irrevocable until all Obligations have been fully repaid and performed and Lender's obligation to provide Credit Extensions terminates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.3** **Protective Payments**. If Borrower fails to obtain the insurance called for by <u>Section 6.4</u> or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under this Agreement or any other Loan Document or which may be required to preserve the Collateral, Lender may obtain such insurance or make such payment, and all amounts so paid by Lender are Lender Expenses and immediately due and payable, bearing interest at the then highest rate applicable to the Obligations, and secured by the Collateral. Lender will make reasonable efforts to provide Borrower with notice of Lender obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Lender are deemed an agreement to make similar payments in the future or Lender's waiver of any Event of Default.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.4** **Application of Payments and Proceeds Upon Default**. If an Event of Default has occurred and is continuing, Lender shall have the right to apply in any order any funds in its possession, whether from Borrower payments, proceeds realized as the result of any collection of Accounts or other disposition of the Collateral, or otherwise, to the Obligations. Lender shall pay any surplus to Borrower by credit to an account designated by Borrower or to other Persons legally entitled thereto; Borrower shall remain liable to Lender for any deficiency. If Lender, directly or indirectly, enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Lender shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price or deferring the reduction of the Obligations until the actual receipt by Lender of cash therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.5** **Lender's Liability for Collateral**. If Lender takes possession or control of the Collateral pursuant to the terms of this Agreement after an Event of Default, so long as Lender complies with reasonable banking practices regarding the safekeeping of the Collateral in the possession or under the control of Lender (for the avoidance of doubt, the reference to "control" in this sentence shall not mean constructive control solely as a result of entering into this Agreement), Lender shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or (d) any act or default of any carrier, warehouseman, bailee, or other Person. Borrower bears all risk of loss, damage or destruction of the Collateral.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.6** **No Waiver; Remedies Cumulative**. Lender's failure, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan Document shall not waive, affect, or diminish any right of Lender thereafter to demand strict performance and compliance herewith or therewith. No waiver hereunder shall be effective unless signed by the party granting the waiver and then is only effective for the specific instance and purpose for which it is given. Lender's rights and remedies under this Agreement and the other Loan Documents are cumulative. Lender has all rights and remedies provided under the Code, by law, or in equity. Lender's exercise of one right or remedy is not an election and shall not preclude Lender from exercising any other remedy under this Agreement or other remedy available at law or in equity, and Lender's waiver of any Event of Default is not a continuing waiver. Lender's delay in exercising any remedy is not a waiver, election, or acquiescence.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.7** **Demand Waiver**. Borrower waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Lender on which Borrower is liable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **<u>NOTICES</u>**

All notices, consents, requests, approvals, demands, or other communication by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S. mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address or email address indicated below. Lender or Borrower may change its mailing or electronic mail address by giving the other party written notice thereof in accordance with the terms of this <u>Section 10</u>.

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If to Borrower: S&W Seed Company<br>2101 Ken Pratt Blvd, Suite 201<br>Longmont, CO 80501<br>Attn: Betsy Horton, Chief Financial Officer<br>Email: BetsyHorton@swseedco.com

If to Lender: MFP Partners, L.P.<br>909 Third Ave., 33<sup>rd</sup> Floor <br>New York, NY 10022 <br>Attn: Timothy E. Ladin, General Counsel and VP<br>Email: notices@mfpllc.com

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **<u>CHOICE OF LAW, VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE</u>**

This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of New York. The parties hereby submit to the non-exclusive jurisdiction of the state and federal courts located in New York, New York. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH PARTY RECOGNIZES AND AGREES THAT THE FOREGOING WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO ENTER INTO THIS AGREEMENT. EACH PARTY REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.

This <u>Section 11</u> shall survive the termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.** **<u>GENERAL PROVISIONS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.1** **Termination Prior to Maturity Date; Survival**. All covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations have been satisfied. So long as Borrower has satisfied the Obligations (other than inchoate indemnity obligations, and any other obligations which, by their terms, are to survive the termination of this Agreement), this Agreement may be terminated prior to the Maturity Date by Borrower, effective three (3) Business Days after written notice of termination is given to Lender. Those obligations that are expressly specified in this Agreement as surviving this Agreement's termination shall continue to survive notwithstanding this Agreement's termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.2** **Successors and Assigns**. This Agreement binds and is for the benefit of the successors and permitted assigns of each party. Borrower may not assign this Agreement or any rights or obligations under it without Lender's prior written consent (which may be granted or withheld in Lender's discretion). Lender has the right, without the consent of or notice to Borrower, to sell, transfer, assign, negotiate, or grant participation in all or any part of, or any interest in, Lender's obligations, rights, and benefits under this Agreement and the other Loan Documents. For the avoidance of doubt, any assignee of all or any part of Lender's interest in and of Lender's obligations, rights, and benefits under this Agreement and the other Loan Documents will be deemed a "Lender" under this Agreement and the other Loan Documents; <u>provided</u> that in such case, determinations of "Lender" under this Agreement and the other Loan Documents shall be based on the decision of the Lender or Lenders holding a majority in interest of the Obligations; and, <u>provided further</u> that in the event that Lender sells a participation to any Person (each, a "**Participant**") in all or any part of Lender's rights and/or obligations under this Agreement or the other Loan Documents, (i) such Participant shall not be deemed a "Lender" under this Agreement or the other Loan Documents, (ii) Lender's obligations under this Agreement and the other Loan Documents shall remain unchanged, (iii) Lender shall remain solely responsible to Borrower for the performance of such obligations, and (iv) Borrower shall continue to deal solely and directly with Lender in connection with Lender's rights and obligations under this Agreement and the other Loan Documents.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.3** **Indemnification**. Borrower agrees to indemnify, defend and hold Lender (and, for the avoidance of doubt, Lender's assignees) and its (and any such assignee's) directors, officers, employees, agents, attorneys, or any other Person affiliated with or representing Lender (or its assignee) (each, an "**Indemnified Person**") harmless against: (i) all obligations, demands, claims, and liabilities (collectively, "**Claims**") claimed or asserted by any other party in connection with the transactions contemplated by the Loan Documents; and (ii) all losses or expenses (including Lender Expenses) in any way suffered, incurred, or paid by such Indemnified Person as a result of, following from, consequential to, or arising from transactions between Lender and Borrower (including reasonable attorneys' fees and expenses), except for Claims and/or losses directly caused by such Indemnified Person's gross negligence or willful misconduct.

This <u>Section 12.3</u> shall survive until all statutes of limitation with respect to the Claims, losses, and expenses for which indemnity is given shall have run.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.4** **Time of Essence**. Time is of the essence for the performance of all Obligations in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.5** **Severability of Provisions**. Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.6** **Correction of Loan Documents**. Lender may correct patent errors and fill in any blanks in the Loan Documents consistent with the agreement of the parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.7** **Amendments in Writing; Waiver; Integration**. No purported amendment or modification of any Loan Document, or waiver, discharge or termination of any obligation under any Loan Document, shall be enforceable or admissible unless, and only to the extent, expressly set forth in a writing signed by the party against which enforcement or admission is sought. Without limiting the generality of the foregoing, no oral promise or statement, nor any action, inaction, delay, failure to require performance or course of conduct shall operate as, or evidence, an amendment, supplement or waiver or have any other effect on any Loan Document. Any waiver granted shall be limited to the specific circumstance expressly described in it, and shall not apply to any subsequent or other circumstance, whether similar or dissimilar, or give rise to, or evidence, any obligation or commitment to grant any further waiver. The Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of the Loan Documents merge into the Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.8** **Counterparts**. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, is an original, and all taken together, constitute one Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.9** **Confidentiality**. In handling any confidential information, Lender shall exercise the same degree of care that it exercises for its own proprietary information, but disclosure of information may be made: (a) to Lender's Subsidiaries or Affiliates (such Subsidiaries and Affiliates, together with Lender, collectively, "**Lender Entities**"); (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided, however, Lender shall use commercially reasonable efforts to obtain any prospective transferee's or purchaser's agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to Lender's regulators or as otherwise required in connection with Lender's examination or audit; (e) as Lender considers appropriate in exercising remedies under the Loan Documents; and (f) to third-party service providers of Lender so long as such service providers have executed a confidentiality agreement with Lender or are otherwise subject to a duty of confidentiality, with terms no less restrictive than those contained herein. Confidential information does not include information that is either: (i) in the public domain or in Lender's possession when disclosed to Lender, or becomes part of the public domain (other than as a result of its disclosure by Lender in violation of this Agreement) after disclosure to Lender; or (ii) disclosed to Lender by a third party, if Lender does not know that the third party is prohibited from disclosing the information.

Lender Entities may use anonymous forms of confidential information for aggregate datasets, for analyses or reporting, and for any other uses not expressly prohibited in writing by Borrower. The provisions of the immediately preceding sentence shall survive termination of this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.10** **Attorneys' Fees, Costs and Expenses**. In any action or proceeding between Borrower and Lender arising out of or relating to the Loan Documents, the prevailing party shall be entitled to recover its reasonable attorneys' fees and other costs and expenses incurred, in addition to any other relief to which it may be entitled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.11** **Electronic Execution of Documents**. The words "execution," "signed," "signature" and words of like import in any Loan Document shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity and enforceability as a manually executed signature or the use of a paper-based recordkeeping systems, as the case may be, to the extent and as provided for in any applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.12** **Captions**. The headings used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.13** **Construction of Agreement**. The parties mutually acknowledge that they and their attorneys have participated in the preparation and negotiation of this Agreement. In cases of uncertainty this Agreement shall be construed without regard to which of the parties caused the uncertainty to exist.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.14** **Relationship**. The relationship of the parties to this Agreement is determined solely by the provisions of this Agreement. The parties do not intend to create any agency, partnership, joint venture, trust, fiduciary or other relationship with duties or incidents different from those of parties to an arm's-length contract.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.15** **Third Parties**. Nothing in this Agreement, whether express or implied, is intended to: (a) confer any benefits, rights or remedies under or by reason of this Agreement on any persons other than the express parties to it, Indemnified Persons and their respective permitted successors and assigns; (b) relieve or discharge the obligation or liability of any person not an express party to this Agreement; or (c) give any person not an express party to this Agreement any right of subrogation or action against any party to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.** **<u>DEFINITIONS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.1** **Definitions**. As used in the Loan Documents, the word "shall" is mandatory, the word "may" is permissive, the word "or" is not exclusive, the words "includes" and "including" are not limiting, the singular includes the plural, and numbers denoting amounts that are set off in brackets are negative. As used in this Agreement, the following capitalized terms have the following meanings:

"**Account**" is any "account" as defined in the Code with such additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to Borrower.

"**Account Debtor**" is any "account debtor" as defined in the Code with such additions to such term as may hereafter be made.

"**Additional Warrant**" is a warrant delivered pursuant to this Agreement, evidenced by an instrument substantially the form of <u>Exhibit B-2</u>, as amended, replaced or otherwise modified pursuant to the terms thereof.

"**Affiliate**" is, with respect to any Person, each other Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person's senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person's managers and members.

"**Agreement**" is defined in the preamble hereof.

"**Available Amount**" is Nine<u>Twelve</u> Million Dollars ($9,000,000<u>12,000,000</u>).

"**Bank Draw**" is any draw down by CIBC under the terms of the Specified Letter of Credit.

"**Borrower**" is defined in the preamble hereof.

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"**Borrower's Books**" are all Borrower's books and records including ledgers, federal and state tax returns, records regarding Borrower's assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.

"**Borrowing Resolutions**" are, with respect to any Person, those resolutions substantially in the form attached hereto as <u>Exhibit A</u>.

"**Business Day**" is any day that is not a Saturday, Sunday or a day on which Lender is closed.

"**Cash Equivalents**" means (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after its creation and having the highest rating from either Standard & Poor's Ratings Group or Moody's Investors Service, Inc.; and (c) money market funds at least ninety-five percent (95%) of the assets of which constitute Cash Equivalents of the kinds described in clauses (a) and (b) of this definition.

"**Change of Control**" means any event, transaction, or occurrence as a result of which any "person" (as such term is defined in Sections 3(a)(9) and 13(d)(3) of the Exchange Act), other than MFP Partners, L.P. or a trustee or other fiduciary holding securities under an employee benefit plan of Borrower, is or becomes a beneficial owner (within the meaning Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of Borrower, representing more than forty percent (40%) or more of the combined voting power of Borrower's then outstanding securities; <u>provided</u> that if Borrower and CIBC amend the definition of Change of Control in the CIBC Loan Documents with the purpose or effect of waiving a Change of Control with respect to a particular investor, event, transaction, or occurrence, upon the written request of Lender, the definition of Change of Control in this Agreement shall be waived or amended in a similar manner.

"**CIBC**" is CIBC Bank USA.

"**CIBC Loan Documents**" are that certain Loan and Security Agreement, dated as of December 26, 2019, among the Borrower and certain of its Subsidiaries, as borrowers, the other loan parties party thereto, the various financial institutions party thereto as lenders, and CIBC, as administrative agent for the lenders, together with all other documents, instruments and other agreements entered into in connection therewith, all as amended, restated, amended and restated, supplemented or otherwise modified from time to time.

"**Claims**" is defined in <u>Section 12.3</u>.

"**Code**" is the New York Uniform Commercial Code.

"**Collateral**" is all of Borrower's right, title and interest in and to the Collateral (as defined in the CIBC Loan Documents).

"**Conforming Changes**" is defined in <u>Section 2.3</u>.

"**Contingent Obligation**" is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation, in each case, directly or indirectly guaranteed, endorsed, co-made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but "Contingent Obligation" does not include endorsements in the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.

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"**Copyrights**" are any and all copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret.

"**Credit Extension**" is any Term Advance or any other extension of credit by Lender for Borrower's benefit.

"**Daily Simple SOFR**" is the Daily Secured Overnight Financing Rate for any day (i) if such day is a U.S. Government Securities Business Day, published on such day or (ii) if such day is not a U.S. Government Securities Business Day, published on the U.S. Government Securities Business Day immediately preceding such day, in each case, as published by the Federal Reserve Bank of New York (or successor administrator) and displayed by Bloomberg LP (or any successor thereto, or replacement thereof, as approved by Lender) and as determined by Lender.

"**Default Rate**" is defined in <u>Section 2.3(b)</u>.

"**Determination Date**" is, with respect to a Term SOFR-based Advance, the day such Term SOFR-based Advance is made or the last day of the Interest Period of a Term SOFR-based Advance, as applicable; <u>provided</u> that if any Determination Date is not a U.S. Government Securities Business Day, the rate applicable on such Determination Date shall be the rate for the immediately preceding U.S. Government Securities Business Day.

"**Disclosure Letter**" is that certain Disclosure Letter of even date herewith, delivered to Lender by Borrower on the date hereof.

"**Dollars**," "**dollars**" or use of the sign "**$**" are only lawful money of the United States and not any other currency, regardless of whether that currency uses the "$" sign to denote its currency or may be readily converted into lawful money of the United States.

"**Effective Date**" is defined in the preamble hereof.

"**ERISA**" is the Employee Retirement Income Security Act of 1974, and its regulations.

"**Event of Default**" is defined in <u>Section 8</u>.

"**Exchange Act**" is the Securities Exchange Act of 1934, as amended.

<u>"</u>**<u>First Amendment</u>**<u>" means that certain First Amendment to Subordinate Loan and Security Agreement, dated as of the First Amendment Effective Date, by and between the Borrower and the Lender.</u>

<u>"</u>**<u>First Amendment Effective Date</u>**<u>" is October 28, 2022.</u>

<u>"</u>**<u>First Amendment Warrant</u>**<u>" is a warrant delivered pursuant to this Agreement, evidenced by an instrument substantially the form of Exhibit B-3, as amended, replaced or otherwise modified pursuant to the terms thereof.</u>

"**Funding Date**" is any date on which a Credit Extension is made to or for the account of Borrower.

"**GAAP**" is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination; <u>provided</u>, that with respect to the accounting for leases as either operating leases or capital leases and the impact of such accounting in accordance with FASB ASC 840 on the definitions and covenants herein, GAAP as in effect on December 31, 2018 shall be applied.

"**General Intangibles**" is all "general intangibles" as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all Intellectual Property, claims, income and other tax refunds, security and other deposits, payment intangibles, contract rights, options to purchase

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or sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of insurance and rights to payment of any kind.

"**Governmental Approval**" is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority.

"**Governmental Authority**" is any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory organization.

"**Indebtedness**" is (a) indebtedness for borrowed money or the deferred price of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, and (d) Contingent Obligations.

"**Indemnified Person**" is defined in <u>Section 12.3</u>.

"**Index**" is defined in the definition of "Term SOFR Rate."

"**Initial Warrant**" is a warrant delivered pursuant to this Agreement, evidenced by an instrument substantially the form of <u>Exhibit B-1</u>, as amended, replaced or otherwise modified pursuant to the terms thereof.

"**Insolvency Proceeding**" is any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief.

"**Intellectual Property**" is, with respect to any Person, means all of such Person's right, title, and interest in and to the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) its Copyrights, Trademarks and Patents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any and all trade secrets and trade secret rights, including, without limitation, any rights to unpatented inventions, know-how, operating manuals;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any and all source code;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any and all design rights which may be available to such Person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the Intellectual Property rights identified above; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents.

"**Interest Period**" is, for each Term SOFR-based Advance, a period of three (3) months; <u>provided</u> that Borrower may at any time elect any other Interest Period then available in the SOFR market (e.g., a period of one (1) month) by written notice to Lender, which election shall take effect commencing with the immediately following Interest Period; <u>provided</u>, <u>further</u>, that the last day of each Interest Period shall be determined in accordance with the practices of the SOFR market as from time to time in effect. Any Term SOFR-based Advances shall automatically continue for the same Interest Period upon the last day of the applicable Interest Period, unless the Borrower otherwise elects in accordance with the first proviso of the preceding sentence.

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"**Inventory**" is all "inventory" as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products, including without limitation such inventory as is temporarily out of Borrower's custody or possession or in transit and including any returned goods and any documents of title representing any of the above.

"**Investment**" is any beneficial ownership interest in any Person (including stock, partnership interest or other securities), and any loan, advance or capital contribution to any Person.

"**Key Person**" is Borrower's Chief Financial Officer, who is Betsy Horton as of the Effective Date.

"**Lender**" is defined in the preamble hereof.

"**Lender Entities**" is defined in <u>Section 12.9</u>.

"**Lender Expenses**" are all audit fees and expenses, costs, and expenses (including reasonable attorneys' fees and expenses) for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents and Specified Letter of Credit (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to Borrower.

"**Lien**" is a claim, mortgage, deed of trust, levy, charge, pledge, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.

"**Loan Documents**" are, collectively, this Agreement, any schedules, exhibits, certificates, notices, and any other documents related to this Agreement, the Specified Letter of Credit, any subordination agreement, including the Subordination Agreement, any note, or notes or guaranties executed by Borrower, and any other present or future agreement by Borrower with or for the benefit of Lender in connection with this Agreement, all as amended, amended and restated, supplemented or otherwise modified.

"**Material Adverse Change**" is (a) a material impairment in the perfection or priority of Lender's Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations, or financial condition of Borrower; or (c) a material impairment of the prospect of repayment of any portion of the Obligations.

"**Maturity Date**" is November 30, 2025.

"**Obligations**" are Borrower's obligations to pay when due any debts, principal, interest, fees, Lender Expenses, and other amounts Borrower owes Lender now or later, whether under this Agreement, the other Loan Documents, or otherwise, including, without limitation, all obligations relating to letters of credit (including reimbursement obligations for drawn and undrawn letters of credit), cash management services, and foreign exchange contracts, if any, and including interest accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower assigned to Lender, and to perform Borrower's duties under the Loan Documents.

"**Operating Documents**" are, for any Person, such Person's formation documents, as certified by the Secretary of State (or equivalent agency) of such Person's jurisdiction of organization on a date that is no earlier than thirty (30) days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its limited liability company 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.

"**Participant**" is defined in <u>Section 12.2</u>.

"**Patents**" are all patents, patent applications and like protections including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same.

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"**Payment Date**" is (i) March 31, June 30, September 30 and December 31 of each year (provided, that if such date is not a Business Day, then on the immediately preceding Business Day), and (ii) the Maturity Date.

"**Permitted Indebtedness**" is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Borrower's Indebtedness to Lender under this Agreement and the other Loan Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Indebtedness existing on the Effective Date and disclosed to Lender in writing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Indebtedness owing to CIBC (and any co-lender under the CIBC Loan Documents) pursuant to the CIBC Loan Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) All Indebtedness permitted under the CIBC Loan Documents; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Subordinated Debt.

"**Permitted Investments**" are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Investments (including, without limitation, Subsidiaries) existing on the Effective Date and disclosed to Lender in writing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All Investments permitted under the CIBC Loan Documents.

"**Permitted Liens**" are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Liens existing on the Effective Date and disclosed to Lender in writing or arising under this Agreement and the other Loan Documents; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All Liens permitted under the CIBC Loan Documents.

"**Person**" is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.

"**PIK Interest**" is defined in <u>Section 2.3(a)</u>.

"**Prime-based Advance**" is a Term Advance which bears interest at the Prime-based Rate.

"**Prime-based Rate**" is, for any Interest Period for a Prime Rate-based Advanced, a rate per annum equal to the sum of (1) the Prime Rate for such Interest Period, plus (2) 6.25%.

"**Prime Rate**" is the greater of (i) highest rate published from time to time by the Wall Street Journal as the Prime Rate and (ii) 1.25%; <u>provided</u>, that in the event the Wall Street Journal ceases to publish the Prime Rate, the Lender and Borrower shall mutually agree on an alternative Prime Rate, which Prime Rate shall be the base, reference or other rate then recognized and utilized by the United States commercial loan market for general commercial loan reference purposes.

"**Registered Organization**" is any "registered organization" as defined in the Code with such additions to such term as may hereafter be made.

"**Requirement of Law**" is as to any Person, the organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

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"**Responsible Officer**" is any of the Chief Executive Officer or Chief Financial Officer of Borrower.

"**SEC**" is the Securities and Exchange Commission, any successor thereto, and any analogous Governmental Authority.

"**Specified Letter of Credit**" is that certain Letter of Credit No. NUSCGS044349 issued by JPMorgan Chase Bank, N.A. for the account of the Lender, in the original amount of $9,000,000<u>, as amended on the First Amendment Effective Date to increase such amount to $12,000,000</u>.

"**Specified Letter of Credit Maturity Date**" is January 23, 2023.

"**Subordination Agreement**" is defined in <u>Section 3.1(d)</u>.

"**Subordinated Debt**" is indebtedness incurred by Borrower subordinated to all of Borrower's now or hereafter indebtedness to Lender (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Lender entered into between Lender and the other creditor), on terms acceptable to Lender.

"**Subsidiary**" is, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless the context otherwise requires, each reference to a Subsidiary herein shall be a reference to a Subsidiary of Borrower.

"**Term Advance**" is defined in <u>Section 2.2(</u><u>a</u><u>b</u><u>)</u>.

"**Term SOFR Rate**" is, for any Interest Period for a Term SOFR-based Advance, the greater of (i) the Term Secured Overnight Financing Rate for such Interest Period, as administrated by CME Group Benchmark Administration Limited (or successor administrator) and displayed by Bloomberg LP (or any successor thereto, or replacement thereof, as reasonably selected by Bank) and as determined by Bank on each Determination Date (the "**Index**") and (ii) 1.25%.

"**Term SOFR-based Advance**" is a Term Advance which bears interest at the Term SOFR-based Rate.

"**Term SOFR-based Rate**" is, for any Interest Period, a rate per annum equal to the sum of (1) the Term SOFR Rate for such Interest Period, plus (2) 9.25%.

"**Trademarks**" are any trademark and servicemark rights, whether registered or not, applications to register and registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks.

"**Transfer**" is defined in <u>Section 7.1</u>.

"**U.S. Government Securities Business Day**" is any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

**[**Signature page follows.**]**

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**IN WITNESS WHEREOF**, the parties hereto have caused this Agreement to be executed as of the Effective Date.

BORROWER:

S&W SEED COMPANY

By <br> Name: Betsy Horton<br>Title: Chief Financial Officer

LENDER:

MFP PARTNERS, L.P.

By: MFP Investors LLC, its General Partner

By: <br> Name:<br>Title:

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**<u>EXHIBIT A</u>**

**CORPORATE BORROWING CERTIFICATE**

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| | |
|:---|:---|
| &nbsp;&nbsp;**Borrower: S&W SEED COMPANY** | &nbsp;&nbsp;**Date: [•],** 2022 |
| &nbsp;&nbsp;**LENDER: MFP PARTNERS L.P.** |  |

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I hereby certify as follows, as of the date set forth above:

1. I am the Secretary, Assistant Secretary or other officer of Borrower. My title is as set forth below.

2. Borrower's exact legal name is set forth above. Borrower is a corporation existing under the laws of the State of Nevada.

3. The following resolutions were duly and validly adopted by Borrower's Board of Directors at a duly held meeting of such directors (or pursuant to a unanimous written consent or other authorized corporate action). Such resolutions are in full force and effect as of the date hereof and have not been in any way modified, repealed, rescinded, amended or revoked, and MFP Partners, L.P. ("Lender") may rely on them until Lender receives written notice of revocation from Borrower.

**Resolved**, that **any one** of the following officers or employees of Borrower, whose names, titles and signatures are below, may act on behalf of Borrower:

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;<u>Name</u> | &nbsp;&nbsp;<u>Title</u> | &nbsp;&nbsp;<u>Signature</u> | &nbsp;&nbsp;Authorized to Add <br>or Remove <u><br>Signatories</u> |
|  |  |  | &nbsp;&nbsp;□ |
|  |  |  | &nbsp;&nbsp;□ |
|  |  |  | &nbsp;&nbsp;□ |
|  |  |  | &nbsp;&nbsp;□ |
|  |  |  | &nbsp;&nbsp;□ |
|  |  |  | &nbsp;&nbsp;□ |

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**Resolved Further,** that **any one** of the persons designated above with a checked box beside his or her name may, from time to time, add or remove any individuals to and from the above list of persons authorized to act on behalf of Borrower.

**Resolved Further,** that such individuals may, on behalf of Borrower:

**Borrow Money**. Borrow money from Lender.

**Execute Loan Documents**. Execute any loan documents Lender requires.

**Grant Security**. Grant Lender a security interest in any of Borrower's assets.

**Negotiate Items**. Negotiate or discount all drafts, trade acceptances, promissory notes, or other indebtedness in which Borrower has an interest and receive cash or otherwise use the proceeds.

**Further Acts**. Designate other individuals to request advances, pay fees and costs and execute other documents or agreements (including documents or agreement that waive Borrower's right to a jury trial) they believe to be necessary to effect these resolutions.

**Resolved Further,** that all acts authorized by the above resolutions and any prior acts relating thereto are ratified.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The persons listed above are Borrower's officers or employees with their titles and signatures shown next to their names.

\*\*\* If the Secretary, Assistant Secretary or other certifying officer executing above is designated by the resolutions set forth in paragraph 4 as one of the authorized signing officers, this Certificate must also be signed by a second authorized officer or director of Borrower.

I, the __________________________ of Borrower, hereby certify as to paragraphs 1 through 5 above, as of the date set forth above.

By: <br> Name: <br> Title:

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**<u>ANNEX B</u>**

First Amendment Warrant

[see attached]

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NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT (I) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (II) PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL SELECTED BY THE HOLDER TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY OR (III) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

**COMMON STOCK PURCHASE WARRANT**

**S&W SEED COMPANY**

Warrant Shares: 166,700 Issuance Date: October [__], 2022

This Common Stock Purchase Warrant (this "<u>Warrant</u>") certifies that, for value received, the receipt and sufficiency of which is hereby acknowledged, MFP Partners, L.P. or its assigns (the "<u>Holder</u>"), is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the Issuance Date and on or prior to the close of business on the five-year anniversary of the Issuance Date (the "<u>Termination Date</u>") but not thereafter, to subscribe for and purchase from S&W Seed Company, a Nevada corporation (the "<u>Company</u>"), up to 166,700 fully paid, nonassessable shares (as subject to adjustment hereunder, the "<u>Warrant Shares</u>") of Common Stock of the Company ("<u>Common Stock</u>"). The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b) of this Warrant.

<u>Section 1.</u><u>Definitions</u>. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Subordinate Loan and Security Agreement, dated September 22, 2022, as amended by the First Amendment thereto dated October [ ], 2022, by and between the Company and the Holder (the "<u>Agreement</u>"). As used in this Warrant, the following terms shall have the following meanings:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a."Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, such Person; provided that, for the purposes of this definition, "control" (including, with correlative meanings, the terms "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b."<u>Business Day</u>" means any day except any Saturday, any Sunday, any day that is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c."<u>Person</u>" means any entity, whether incorporated or not, organization or individual.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d."<u>Proceeding</u>" means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e."<u>Trading Day</u>" means any day on which the Trading Market is not closed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f."<u>Trading Market</u>" means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq

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Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, the OTCQB or the OTCCQX, (or any successors to any of the foregoing).

<u>Section 2.</u><u>Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Exercise of Warrant</u>. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Issuance Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly executed copy of the Notice of Exercise sent to the Company by facsimile or electronic mail in the form annexed hereto and, within three Trading Days of the date said Notice of Exercise, delivery to the Company of the aggregate Exercise Price for the shares thereby purchased by wire transfer or cashier's check drawn on a United States bank or, if available, pursuant to the cashless exercise procedure specified in Section 2(c) below. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case the Holder shall surrender this Warrant to the Company for cancellation as soon as practicable after such issuance without delaying the Company's obligation to deliver the Warrant Shares on the Warrant Share Delivery Date (as defined in Section 2(d)(i) of this Warrant) in order to effect an exercise hereunder. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver confirmation of, or any objection to, any Notice of Exercise within one Business Day of receipt of such notice. **The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.** The Company's obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the conditions hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Exercise Price</u>. The exercise price per share of the Common Stock under this Warrant shall be $1.60, subject to adjustment hereunder (the "<u>Exercise Price</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Cashless Exercise</u>. If at any time after the Issuance Date, there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares by the Holder, then this Warrant may also be exercised, in whole or in part, at such time by means of a "cashless exercise" in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) = the arithmetic average of the VWAP of the Common Stock for the five consecutive Trading Days ending on the date immediately preceding the date of the applicable Notice of Exercise;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) = the Exercise Price of this Warrant then in effect at the time of exercise, as adjusted hereunder; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(X) = the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

For purposes of Rule 144(d) promulgated under the Securities Act of 1933, as amended (the "<u>Securities Act</u>"), as in effect on the date hereof, it is intended that the Warrant Shares issued in a cashless exercise shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced, on the Issuance Date. Notwithstanding anything herein to the contrary, on the

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Termination Date, any unexercised portion of this Warrant shall be automatically exercised via cashless exercise pursuant to this Section 2(c).

"<u>VWAP</u>" means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:00 p.m. (New York City time)), (b) if the Common Stock is then listed or quoted on OTCQB or OTCQX, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX, as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported in the "Pink Sheets" published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Mechanics of Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Delivery of Warrant Shares Upon Exercise</u>. Warrant Shares purchased hereunder shall be transmitted by the Company's transfer agent, Transfer Online, Inc. (the "<u>Transfer Agent</u>") to the Holder by crediting the account of the Holder's or its designee's balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system ("<u>DWAC</u>") if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner of sale limitations pursuant to Rule 144, and otherwise by physical delivery of a certificate, registered in the Company's share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is three Trading Days after the delivery to the Company of the Notice of Exercise so long as the Holder delivers the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c)) on or prior to the second Trading Day following the date on which the Company has received the Notice of Exercise (such date, the "<u>Warrant Share Delivery Date</u>") (provided that if the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c) is delivered) has not been delivered by such date, the Warrant Share Delivery Date shall be one Trading Day after the aggregate Exercise Price (or notice of a "cashless exercise" pursuant to Section 2(c)) is delivered. The Warrant Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise Price (or by cashless exercise, if permitted).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.<u>Delivery of New Warrants Upon Exercise</u>. If this Warrant shall have been exercised in part, the Company shall, at its own expense, promptly following the request of the Holder and upon surrender of this Warrant certificate to the Company and in no event later than three Trading Days thereafter, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii.<u>Rescission Rights</u>. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv.<u>Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise</u>. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder's brokerage firm otherwise purchases, shares of Common Stock to deliver in

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satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a "<u>Buy-In</u>"), then the Company shall, within three Trading Days after the Holder's request and in the Holder's discretion, either (A) pay in cash to the Holder an amount equal to the Holder's total purchase price (including brokerage commissions and other out of pocket expenses, if any) for the shares of Common Stock so purchased (the "<u>Buy-In Price</u>"), at which point the Company's obligation to deliver the number of Unavailable Warrant Shares equal to the number of shares of Common Stock purchased by or on behalf of the Holder in respect of such Buy-In shall terminate, or (B) pay in cash to the Holder the amount, if any, by which (x) the Buy-In Price exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) any trading price of the Common Stock selected by the Holder in writing as in effect at any time during the period beginning on the date of the applicable Notice of Exercise and ending on the applicable Warrant Share Delivery Date, and at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver in the manner required by Section 2(d)(i) to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder's right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company's failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v.<u>No Fractional Shares or Scrip</u>. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall round up the number of Warrant Shares so issued to the next whole share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi.<u>Charges, Taxes and Expenses</u>. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to The Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii.<u>Closing of Books</u>. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

<u>Section 3.</u><u>Certain Adjustments</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Stock Dividends and Splits</u>. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Pro Rata Distributions</u>. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "<u>Distribution</u>"), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Fundamental Transaction</u>. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, effects any merger or consolidation of the Company with or into another Person, or any stock sale to, or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, share exchange or scheme of arrangement) with or into another Person (other than such a transaction in which the Company is the surviving or continuing entity and its Common Stock is not exchanged for or converted into other securities, cash or property), (ii) the Company, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, effects any sale of all or substantially all of its assets in one transaction or a series of related transactions, (iii) any tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which more than 50% of the Common Stock not held by the Company or such Person is exchanged for or converted into other securities, cash or property, or (iv) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant (other than as a result of a dividend, subdivision or combination covered by Section 3(a) above) to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (each a "<u>Fundamental Transaction</u>"), then the Company shall use its commercially reasonable efforts to ensure that the Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then issuable upon exercise in full of this Warrant. If any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity does not agree to assume this Warrant in connection with a Fundamental Transaction, then the Holder may exercise this Warrant at any time prior to the consummation of such Fundamental Transaction (and such exercise may be made contingent upon the consummation of such Fundamental Transaction), and any portion of this Warrant that has not been exercised prior to the consummation of such Fundamental Transaction shall terminate and expire, and shall no longer be outstanding. The provisions of this Section 3(c) shall apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Calculations</u>. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Notice to Holder</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Adjustment to Exercise Price</u>. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder a notice by facsimile or electronic mail setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.<u>Notice to Allow Exercise by Holder</u>. If (A) the Company shall declare a dividend or distribution on or a redemption of the Common Stock, (B) the approval of any shareholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any

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compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or (C) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered via facsimile or electronic mail to the Holder at its last address as it shall appear upon the Warrant Register (as defined below), at least 10 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, or redemption are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii.<u>Other Events</u>. If any event occurs of the type contemplated by the provisions of this Section 3 but not expressly provided for by such provisions, then the Company's Board of Directors will make an appropriate adjustment in the Exercise Price and the number of Warrant Shares, as mutually determined by the Company's Board of Directors and the Holder, so as to protect the rights of the Holder; <u>provided</u> that no such adjustment pursuant to Section 3(i) will increase the Exercise Price or decrease the number of Warrant Shares as otherwise determined pursuant to this Section 3.

<u>Section 4.</u><u>Transfer of Warrant</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>Transferability</u>. Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>New Warrants</u>. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Issuance Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Warrant Register</u>. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the "<u>Warrant Register</u>"), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

6. ------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Transfer Restrictions</u>. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the Holder or transferee of this Warrant, as the case may be, comply with the provisions of Section 5.6 of that certain Securities Purchase Agreement, dated February 18, 2022, by and among the Company and the purchasers signatory thereto (the "<u>Purchase Agreement</u>") that are applicable to Common Conversion Shares (as defined in the Purchase Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Representations by the Holder</u>. The Holder, by the acceptance hereof, represents and warrants that it is an accredited investor as that term is defined in Section 501 of Regulation D promulgated under the Securities Act, that it is acquiring this Warrant and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant to sales registered or exempted under the Securities Act; <u>provided</u>, <u>however</u>, that by making the representations herein, the Holder does not agree to hold any of the Warrants or the Warrant Shares for any minimum or other specific term.

<u>Section 6</u>. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.<u>No Rights as Shareholder Until Exercise</u>. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth herein, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person's capacity as the Holder of this Warrant, any of the rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section 6(a), the Company shall provide the Holder with copies of the same notices and other information given to the shareholders of the Company generally, contemporaneously with the giving thereof to the shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.<u>Loss, Theft, Destruction or Mutilation of Warrant</u>. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.<u>Saturdays, Sundays, Holidays, etc</u>. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.<u>Authorized Shares</u>. The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that all

7. ------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e.<u>Noncircumvention</u>. Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its articles of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f.<u>Authorizations</u>. Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g.<u>Governing Law and Venue</u>. This Warrant will be governed by the laws of the State of New York without regard to conflicts of laws principles. The Company and Holder submit to the exclusive jurisdiction of the State and Federal courts in New York, New York. The Company and Holder expressly submit and consent in advance to such jurisdiction in any action or suit commenced in any such court, and the Company and Holder hereby waive any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consent to the granting of such legal or equitable relief as is deemed appropriate by such court.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h.<u>Restrictions</u>. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered and the Holder does not utilize cashless exercise, may have restrictions upon resale imposed by state and federal securities laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.<u>Nonwaiver and Expenses</u>. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder's rights, powers or remedies, notwithstanding the fact that all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys' fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;j.<u>Notices</u>. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Agreement. The foregoing notwithstanding, any notice of exercise intended to be delivered pursuant to this Warrant shall, in addition to the notice provisions of the Agreement, shall also be delivered by e-mail to the following e-mail address: notice@swseedco.com.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;k.<u>Limitation of Liability</u>. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Stock or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

8. ------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;l.<u>Disputes</u>. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail within two Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two Business Days submit via facsimile or electronic mail (a) the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of the Warrant Shares to the Company's independent, outside accountant. The Company shall cause at its expense the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than 10 Business Days from the time it receives the disputed determinations or calculations. Such investment bank's or accountant's determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;m.<u>Remedies</u>. The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant. The Company agrees that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach, including monetary damages, would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled, in addition to all other available remedies, to seek an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required, and the Company expressly agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;n.<u>Successors and Assigns</u>. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o.<u>Amendment</u>. Except as otherwise provided herein, this Warrant may only be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;p.<u>Severability</u>. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant so long as this Warrant as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;q.<u>Headings</u>. This Warrant shall be deemed to be jointly drafted by the Company and the initial Holder and shall not be construed against any Person as the drafter hereof. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;r.**<u>WAIVER OF JURY TRIAL</u>. IN ANY ACTION OR PROCEEDING IN ANY JURISDICTION BROUGHT BY OR ON BEHALF OF THE COMPANY AGAINST ANY OTHER PERSON IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTIONS** 

9. ------

**CONTEMPLATED HEREBY, THE COMPANY KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.**

\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*

(Signature Page Follows)

10. ------

IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

**S&W SEED COMPANY**

By: <br>Name: Betsy Horton <br>Title; Chief Financial Officer

11. ------

**NOTICE OF EXERCISE**

To: S&W Seed Company

(1) The undersigned hereby elects to purchase ___________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

(2) Payment shall take the form of (check applicable box):

[ ] in lawful money of the United States; or

[ ] if permitted, the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).

(3) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

_________________________________________

The Warrant Shares shall be delivered to the following DWAC Account Number:

_________________________________________

_________________________________________

_________________________________________

(4) <u>Accredited Investor</u>. The undersigned is an "accredited investor" as defined in Regulation D promulgated under the Securities Act of 1933, as amended.

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| &nbsp;&nbsp;[SIGNATURE OF HOLDER] |
| &nbsp;&nbsp;(Name of Investing Entity) |
| &nbsp;&nbsp;(Signature of Authorized Signatory of Investing Entity) |
| &nbsp;&nbsp;(Name of Authorized Signatory) |
| &nbsp;&nbsp;(Title of Authorized Signatory) |
| &nbsp;&nbsp;(Date) |

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ASSIGNMENT FORM

(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to Name:

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|:---|:---|
| &nbsp;&nbsp;Name: |  |
|  | &nbsp;&nbsp;(Please Print) |
| &nbsp;&nbsp;Address: |  |
|  | &nbsp;&nbsp;(Please Print) |
| &nbsp;&nbsp;Dated: ___________________________, _____ |  |
| &nbsp;&nbsp;Holder's Signature: ______________________ |  |
| &nbsp;&nbsp;Holder's Address: _______________________ |  |

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## Ex-10

**<u>EIGHTH AMENDMENT TO LOAN AND SECURITY AGREEMENT</u>**

This Eighth Amendment to Loan and Security Agreement (this "**<u>Eighth Amendment</u>**") made and entered into as of the 23<sup>rd</sup> day of December, 2022, is by and among S&W Seed Company, a Nevada corporation ("**<u>S&W Seed</u>**"), Seed Holding, LLC, a Nevada limited liability company ("**<u>Seed Holding</u>**"), and Stevia California, LLC, a California limited liability company ("**<u>Stevia CA</u>**"; S&W Seed, Seed Holding and Stevia CA are each individually a "**<u>Borrower</u>**" and collectively referred to as "**<u>Borrowers</u>**"), the other Loan Parties hereto, the financial institutions that are or may from time to time become parties hereto (together with their respective successors and assigns, the "**<u>Lenders</u>**"), and CIBC Bank USA (in its individual capacity, "**<u>CIBC</u>**"), as administrative agent for the Lenders ("**<u>Administrative Agent</u>**").

**<u>W I T N E S S E T H</u>:**

**Whereas,** prior hereto, Lenders provided loans, extensions of credit and other financial accommodations to Borrowers pursuant to (a) that certain Loan and Security Agreement dated as of December 26, 2019, as amended by that certain First Amendment to Loan and Security Agreement dated as of September 22, 2020, that certain Second Amendment to Loan and Security Agreement dated as of December 30, 2020, that certain Third Amendment to Loan and Security Agreement dated as of May 13, 2021, that certain Fourth Amendment to Loan and Security Agreement dated as of September 24, 2021, that certain Fifth Amendment to Loan and Security Agreement dated as of May 13, 2022, that certain Sixth Amendment to Loan and Security Agreement dated as of September 22, 2022, and that certain Seventh Amendment to Loan and Security Agreement dated as of October 28, 2022, each by and among Lenders, Borrowers, the other Loan Parties thereto and Administrative Agent (collectively, the "**<u>Loan Agreement</u>**"), and (b) the other documents, agreements and instruments referenced in the Loan Agreement or executed and delivered pursuant thereto;

**Whereas,** Borrowers desire Administrative Agent and Lenders to, among other things, extend the Maturity Date from December 23, 2022, to March 23, 2023 (the "**<u>Additional Financial Accommodations</u>**"); and

**Whereas,** Administrative Agent and Lenders are willing to provide the Additional Financial Accommodations, but solely on the terms and subject to the provisions set forth in this Eighth Amendment and the other agreements, documents and instruments referenced herein or executed and delivered pursuant hereto.

**Now, Therefore,** in consideration of the foregoing, the mutual promises and understandings of the parties hereto set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Administrative Agent, Lenders, Borrowers and the other Loan Parties hereto hereby agree as set forth in this Eighth Amendment.

I. **<u>Definitions</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. **<u>Use of Defined Terms</u>**. Except as expressly set forth in this Eighth Amendment, all terms which have an initial capital letter where not required by the rules of grammar are used herein as defined in the Loan Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. **<u>Amended Definitions</u>**. Effective as of the Eighth Amendment Effective Date, Section 1.1 of the Loan Agreement is hereby amended by substituting the definitions set forth below for the corresponding definitions set forth in the Loan Agreement, respectively:

<u>Maturity Date</u> shall mean the first to occur of (a) March 23, 2023, or (b) the scheduled maturity date of the Rooster Debt.

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C. **<u>New Definitions</u>**. Effective as of the Eighth Amendment Effective Date, Section 1.1 of the Loan Agreement is hereby amended by adding the following new definition thereto in the appropriate alphabetical order:

<u>Eighth Amendment Effective Date</u> shall mean December 23, 2022.

II. **<u>Amendments to Loan Agreement</u>**. Effective as of the Eighth Amendment Effective Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A.<u>Collateral Management Fee</u>. Section 4.3 of the Loan Agreement is hereby amended by adding the following new subsection 4.3.6 thereto:

"4.3.6 <u>Collateral Monitoring Fee</u>. In addition to all other fees, Borrowers jointly and severally agree to pay to CIBC a collateral monitoring fee of One Hundred Fifty Thousand and no/100 Dollars ($150,000.00), which fee shall be fully earned as of the Eighth Amendment Effective Date and payable in Fifty Thousand and no/100 Dollars ($50,000.00) installments due on the Eighth Amendment Effective Date and on the same day of each month thereafter until paid in full. Notwithstanding the forgoing, CIBC will refund Fifty Thousand and no/100 Dollars ($50,000.00) of such fee (the "Refund") if Borrowers maintain their primary treasury management relationship with CIBC for twelve (12) consecutive full months immediately following full and final repayment of the Revolving Loans and the termination of this Agreement. Provided Borrowers fully satisfy the aforementioned condition required to receive the Refund, CIBC will pay the Refund within 30 days after Borrowers' request therefor.

III. **<u>Conditions Precedent</u>**. Administrative Agent's and Lenders' obligations to provide the Additional Financial Accommodations to Borrowers are subject to the full and timely performance of the following covenants prior to or contemporaneously with the execution and delivery of this Eighth Amendment:

A. Borrowers executing and delivering, or causing to be executed and delivered to the Administrative Agent and the Lenders, the following documents, each of which shall be in form and substance acceptable to the Administrative Agent and the Lenders:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a consent to this Eighth Amendment from Rooster;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) an extension of the Specified Letter of Credit expiration date to not earlier than April 23, 2023; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) such other agreements, documents and instruments as Administrative Agent or Lenders may reasonably request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. No Default or Event of Default exists under the Loan Agreement, as amended by this Eighth Amendment, or any of the other Loan Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. No claims, litigation, arbitration proceedings or governmental proceedings not disclosed in writing to Administrative Agent and the Lenders prior to the date hereof shall be pending or known to be threatened against Borrowers or any other Loan Party and no known material development not so disclosed shall have occurred in any claims, litigation, arbitration proceedings or governmental proceedings so disclosed which in the opinion of Administrative Agent is likely to materially or adversely affect the financial position or business of Borrowers or any other Loan Party or the capability of Borrowers to pay their obligations and liabilities to Lenders; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. There shall have been no Material Adverse Effect since the date of each Borrower's most recent financial statements delivered to Administrative Agent.

IV. **<u>Conflict</u>**. If, and to the extent, the terms and provisions of this Eighth Amendment contradict or conflict with the terms and provisions of the Loan Agreement, the terms and provisions of this Eighth Amendment shall govern and control; provided, however, to the extent the terms and provisions of this Eighth Amendment do not contradict or conflict with the terms and provisions of the Loan Agreement, the Loan Agreement, as amended by this Eighth Amendment, shall remain in and have its intended full force and effect, and Lenders, Administrative Agent and Borrowers hereby affirm, confirm and ratify the same.

V. **<u>Severability</u>.** Wherever possible, each provision of this Eighth Amendment shall be interpreted in such manner as to be valid and enforceable under applicable law, but if any provision of this Eighth Amendment is held to be invalid or unenforceable by a court of competent jurisdiction, such provision shall be severed herefrom and such invalidity or unenforceability shall not affect any other provision of this Eighth Amendment, the balance of which shall remain in and have its intended full force and effect. Provided, however, if such provision may be modified so as to be valid and enforceable as a matter of law, such provision shall be deemed to be modified so as to be valid and enforceable to the maximum extent permitted by law.

VI. **<u>Reaffirmation</u>**. Each Loan Party hereby reaffirms and remakes all of its respective representations, warranties, covenants, duties, obligations and liabilities contained in the Loan Agreement, as amended hereby, and the other Loan Documents.

VII. **<u>Fees, Costs and Expenses</u>**. Borrowers agree to pay, upon demand, all fees, costs and expenses of Administrative Agent and Lenders, including, but not limited to, reasonable attorneys' fees, in connection with the preparation, execution, delivery and administration of this Eighth Amendment and the other agreements, documents and instruments executed and delivered in connection herewith or pursuant hereto.

VIII. **<u>Reservation of Rights</u>**. Administrative Agent and Lenders reserve all of their rights and remedies, including all security interests, assignments and liens pursuant to the Loan Agreement and the other Loan Documents, as well as any rights and remedies at law, in equity or otherwise. Nothing contained in this EIGHTH Amendment shall be or be deemed a waiver of any presently existing or any hereafter arising or occurring breach, default or event of default, nor shall preclude the subsequent exercise of any of Administrative Agent's or Lenders' rights or remedies.

IX. **<u>Choice of Law</u>**. This Eighth Amendment has been delivered and accepted in Chicago, Illinois, and shall be governed by and construed in accordance with the laws of the State of Illinois, regardless of the laws that might otherwise govern under applicable principles of conflicts of law as to all matters, including matters of validity, construction, effect, performance and remedies.

X. **<u>Counterparts</u>**. This Eighth Amendment may be executed in two or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument. A facsimile or email transmitted executed counterpart to this Eighth Amendment and the other agreements, documents and instruments executed in connection herewith will be deemed an acceptable original for purposes of consummating this Eighth Amendment and such other agreements, documents and instruments; provided, however, each Borrower and each other Loan Party shall be required to deliver to the Administrative Agent original executed signature pages in substitution for said facsimile or email transmitted signature pages upon the Administrative Agent's request therefor.

XI. **<u>Waiver of Jury Trial.</u>** EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THE LOAN AGREEMENT, AS AMENDED FROM TIME TO TIME, ANY NOTE, ANY OTHER LOAN DOCUMENT AND ANY OTHER AMENDMENT,

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INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ARISING FROM ANY LENDING RELATIONSHIP EXISTING IN CONNECTION WITH ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

XII. **<u>WAIVER AND RELEASE OF CLAIMS</u>**. IN CONSIDERATION OF ADMINISTRATIVE AGENT'S AND EACH LENDER'S EXECUTION AND DELIVERY OF THIS EIGHTH AMENDMENT, EACH BORROWER AND EACH OTHER LOAN PARTY HEREBY, INDIVIDUALLY AND COLLECTIVELY, WAIVES, RELEASES AND FOREVER DISCHARGES ADMINISTRATIVE AGENT, EACH LENDER, THEIR PREDECESSORS, PARENTS, SUBSIDIARIES, AFFILIATES, AGENTS, EMPLOYEES, OFFICERS, DIRECTORS, SHAREHOLDERS, ATTORNEYS, LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS, AND EACH OF THEM (EACH A "**<u>RELEASED PARTY</u>**"), OF AND FROM ANY AND ALL CLAIMS, DEMANDS, COUNTERCLAIMS, SET-OFFS, DEFENSES, DEBTS, OBLIGATIONS, COSTS, EXPENSES, ACTIONS, CAUSES OF ACTION AND DAMAGES OF EVERY KIND, NATURE AND DESCRIPTION WHATSOEVER, KNOWN OR UNKNOWN, FORESEEABLE OR UNFORESEEABLE, LIQUIDATED OR UNLIQUIDATED, AND INSURED OR UNINSURED, WHICH ANY BORROWER OR ANY OTHER LOAN PARTY HERETOFORE, NOW OR FROM TIME TO TIME HEREAFTER OWNS, HOLDS OR HAS BY REASON OF ANY MATTER, CAUSE OR THING WHATSOEVER, ARISING ON OR BEFORE THE DATE OF THIS EIGHTH AMENDMENT FROM, RELATING TO OR IN CONNECTION WITH THE LOAN DOCUMENTS, THE OBLIGATIONS, THIS EIGHTH AMENDMENT, BORROWERS' OR ANY OTHER LOAN PARTY'S BANKING OR CASH MANAGEMENT RELATIONSHIP WITH ADMINISTRATIVE AGENT, ANY LENDER OR ANY OTHER RELEASED PARTY OR ANY MATTERS RELATING TO ANY OF THE FOREGOING.

[signature pages follow]

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**In Witness Whereof,** Administrative Agent, Lenders, Borrowers and each other Loan Party have caused this Eighth Amendment to be executed and delivered by their duly authorized officers as of the date first set forth above.

**BORROWERS:**

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| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;**S&W SEED COMPANY**,<br>a Nevada corporation<br>By<u>/s/ Betsy Horton</u><br>Betsy Horton, Chief Financial Officer | &nbsp;&nbsp;&nbsp;&nbsp;**SEED HOLDING, LLC**,<br>a Nevada limited liability company<br>By<u>/s/ Betsy Horton</u><br>Betsy Horton, Manager |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**STEVIA CALIFORNIA, LLC**,<br>a California limited liability company<br>By<u>/s/ Betsy Horton</u><br>Betsy Horton, Manager<br>|  |

---

[Signature page to Eighth Amendment to Loan and Security Agreement]

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**CIBC BANK USA**,

as Administrative Agent and as a Lender

By:<u>/s/ Jennifer Kempton</u><br>Name: Jennifer Kempton

Title: Managing Director

[Signature page to Eighth Amendment to Loan and Security Agreement]

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## Ex-10

**SECOND AMENDMENT TO** 

**SUBORDINATE LOAN AND SECURITY AGREEMENT**

This SECOND AMENDMENT TO SUBORDINATE LOAN AND SECURITY AGREEMENT, dated as of December 22, 2022 (this "**Amendment**"), is entered into by and between S&W SEED COMPANY, a Nevada corporation (the "**Borrower**"), and MFP PARTNERS, L.P., a Delaware limited partnership the "**Lender**").

WHEREAS, the Borrower and the Lender are parties to that certain Subordinate Loan and Security Agreement, dated as of September 22, 2022 (as amended by that certain First Amendment to Subordinate Loan and Security Agreement, dated as of October 28, 2022, and as may be further amended, restated, amended and restated, supplemented or otherwise modified from time to time, the "**Loan Agreement**"); and

WHEREAS, pursuant to Section 12.7 of the Loan Agreement, the parties hereto have agreed to amend certain terms of the Loan Agreement as hereinafter provided in <u>Section 2</u> to, among other things, extend the Specified Letter of Credit Maturity Date, subject to the satisfaction of the conditions precedent to effectiveness set forth in <u>Section 3</u> hereof.

NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto agree as follows:

Section 1. <u>Definitions</u>. Except as otherwise defined in this Amendment, terms defined in the Loan Agreement are used herein as defined therein.

Section 2. <u>Amendment</u>. Subject to the satisfaction of the conditions precedent set forth in Section 3 of this Amendment, but effective as of the date hereof:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Loan Agreement is hereby amended as set forth in <u>Annex A</u> hereto (stricken text shall be deleted from the Loan Agreement (indicated textually in the same manner as the following example: stricken text) and double-underlined text shall be added to the Loan Agreement (indicated textually in the same manner as the following examples: <u>double-underlined text</u> or <u>double-underlined text</u>)).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Annex</u> B hereto is hereby appended to the Loan Agreement as Exhibit B-4 thereof.

Section 3. <u>Conditions Precedent</u>. The amendments set forth in <u>Section 2</u> shall become effective upon receipt by the Lender of counterparts of this Amendment executed by the Borrower and Lender (such date of receipt, the "**Second Amendment Effective Date**").

Section 4. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) References in the Loan Agreement (including references to the Loan Agreement as amended hereby) to "this Agreement" (and indirect references such as "hereunder",

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"hereby", "herein" and "hereof") shall be deemed to be references to the Loan Agreement as amended by this Amendment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Amendment shall constitute a Loan Document for purposes of the Loan Agreement and the other Loan Documents, and except as specifically modified by this Amendment, the Loan Agreement, and the other Loan Documents shall remain unchanged and shall remain in full force and effect and are hereby ratified and confirmed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The execution, delivery and performance of this Amendment shall not constitute a forbearance, waiver, consent or amendment of any other provision of, or operate as a forbearance or waiver of any right, power or remedy of the Lender under the Loan Agreement or any of the other Loan Documents, all of which are ratified and reaffirmed in all respects and shall continue in full force and effect. This Amendment does not constitute a novation of rights, obligations and liabilities of the respective parties existing under the Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) This Amendment shall be governed by, and construed in accordance with, the law of the State of New York.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) This Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Amendment in electronic (i.e., "pdf" or "tif") format shall be effective as delivery of a manually executed counterpart of this Amendment. Each party hereto agrees and acknowledges that (i) the transaction consisting of this Amendment may be conducted by electronic means, (ii) it is such party's intent that, if such party signs this Amendment using an electronic signature, it is signing, adopting and accepting this Amendment and that signing this Amendment using an electronic signature is the legal equivalent of having placed its handwritten signature on this Amendment on paper and (iii) it is being provided with an electronic or paper copy of this Amendment in a usable format.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) This Amendment, the Loan Agreement and the other Loan Documents represent the final agreement between the parties hereto and thereto and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties.

[Signature Pages Follow]

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[Signature Page to Second Amendment to Subordinate Loan and Security Agreement]

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

<u>BORROWER</u>:

S&W SEED COMPANY

By: <u>/s/Betsy Horton</u> 

Name: Betsy Horton

Title: Chief Financial Officer

[Signature Page to Second Amendment to Subordinate Loan and Security Agreement]

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<u>LENDER</u>:

MFP PARTNERS, L.P.

By: MFP Investors LLC, its General Partner

By: <u>/s/Alexander C. Matina</u> 

Name: Alexander C. Matina

Title: Portfolio Manager and Vice President

[Signature Page to Second Amendment to Subordinate Loan and Security Agreement]

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**<u>ANNEX A</u>**

Amended Loan Agreement

[see attached]

------

**As amended by the First<u>Second</u> Amendment, dated as of October 28<u>December 22</u>, 2022.**

**THE OBLIGATIONS EVIDENCED BY THIS SUBORDINATE LOAN AND SECURITY AGREEMENT ARE SUBORDINATED TO THE PRIOR PAYMENT IN FULL OF THE "SENIOR DEBT" AND THE TERMINATION OF THE "SENIOR COMMITMENT" (AS SUCH TERMS ARE DEFINED IN THE SUBORDINATION AGREEMENT HEREINAFTER REFERRED TO) PURSUANT TO, AND TO THE EXTENT PROVIDED IN, THE SUBORDINATION AGREEMENT DATED AS OF SEPTEMBER 22, 2022, BY AND AMONG CIBC BANK USA, AS ADMINISTRATIVE AGENT FOR THE SENIOR CREDITOR, THE SENIOR LENDER PARTY THERETO, AND MFP PARTNERS, L.P., A DELAWARE LIMITED PARTNERSHIP (THE "CIBC SUBORDINATION AGREEMENT").**

**SUBORDINATE LOAN AND SECURITY AGREEMENT**

**THIS SUBORDINATE LOAN AND SECURITY AGREEMENT** (this "**Agreement**") dated as of September 22, 2022 (the "**Effective Date**") between **MFP PARTNERS, L.P.**, a Delaware limited partnership ("**Lender**"), and **S&W SEED COMPANY**, a Nevada corporation ("**Borrower**"), provides the terms on which Lender shall lend to Borrower and Borrower shall repay Lender. The parties agree as follows:

**1 <u>ACCOUNTING AND OTHER TERMS</u>**

Accounting terms not defined in this Agreement shall be construed following GAAP. Calculations and determinations must be made following GAAP. Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in <u>Section 13</u>. All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein.

**2 <u>LOAN AND TERMS OF PAYMENT</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.1 Promise to Pay.** Borrower hereby unconditionally promises to pay Lender the outstanding principal amount of all Credit Extensions and all accrued and unpaid interest thereon as and when due in accordance with this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.2 Specified Letter of Credit; Term Advances.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Specified Letter of Credit</u>. Subject to the terms and conditions of this Agreement, on the Effective Date, Lender shall provide the Specified Letter of Credit to CIBC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Availability</u>. Subject to the terms and conditions of this Agreement, Lender shall make advances (each a "Term Advance", and collectively, the "Term Advances") to Borrower in an aggregate amount not to exceed the Available Amount. Each Term Advance shall bear interest from the Funding Date thereof for so long as any part of such Term Advance remains outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Repayment</u>. Borrower shall not be required to make any principal payments prior to the Maturity Date. The entire unpaid principal balance of the Term Advances, and all accrued but unpaid interest thereon, shall be due and payable on the Maturity Date, or

[Signature page to Loan and Security Agreement]

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such earlier date as the same may become due and payable in accordance with the terms of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Prepayment</u>. Borrower may prepay all or any portion of the Term Advances at any time without penalty or premium, provided that Borrower may not reborrow any amount so prepaid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.3 Payment of Interest on the Credit Extensions.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Interest Rate; Payment</u>. Subject to <u>Sections 2.3(b)</u> and <u>2.3(d)</u>, the principal amount outstanding for each Term Advance shall accrue interest at a per annum rate equal to the Term SOFR-based Rate. Accrued interest on the Term Advances, if any, shall be payable in arrears on each Payment Date in cash, and upon the payment or prepayment of the Term Advances (on the principal amount being so paid or prepaid); <u>provided</u> that interest payable at the Default Rate shall also be payable in cash from time to time on demand by the Lender. Notwithstanding the foregoing, 50% of the interest payable for each applicable period shall be payable in kind by capitalizing and adding such interest to the outstanding principal amount of the Term Advances on such Payment Date ("**PIK Interest**"); <u>provided</u>, that the Borrower may, at its option, irrevocably elect, by written notice to the Lender prior to any Payment Date, to decrease the rate of interest per annum capitalized as PIK Interest for such Payment Date by paying such amount in cash, or that no PIK Interest will be capitalized for such Payment Date, and, in each case, Borrower will pay such amount of interest that is owing and not capitalized as PIK Interest in cash as regular interest on such Payment Date. For purposes of this Agreement and the other Loan Documents, PIK Interest capitalized pursuant to this <u>Section 2.3(a)</u> shall constitute a portion of the principal amount outstanding of the Term Advances hereunder and shall bear interest in accordance with this <u>Section 2.3</u> and all references herein or in any other Loan Document to the principal amount of the loans shall include all interest accrued and capitalized as a result of any payment of PIK Interest. Any PIK Interest shall automatically be capitalized on the applicable Payment Date in accordance with the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Default Rate</u>. Immediately upon the occurrence and during the continuance of an Event of Default, Obligations shall bear interest at a rate per annum which is two percentage points (2.0%) above the rate that is otherwise applicable thereto (the "**Default Rate**"). Fees and expenses which are required to be paid by Borrower pursuant to the Loan Documents (including, without limitation, Lender Expenses) but are not paid when due shall bear interest until paid at a rate equal to the highest rate applicable to the Obligations. Payment or acceptance of the increased interest rate provided in this <u>Section 2.3(b)</u> is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Lender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Interest Computation</u>. Interest shall be computed on the basis of a 360-day year for the actual number of days elapsed. In computing interest, (i) all payments received after 12:00 p.m. Pacific time on any day shall be deemed received at the opening of business on the next Business Day, and (ii) the date of the making of any Credit Extension shall be included and the date of payment shall be excluded; <u>provided</u>, however, that if any Credit Extension is repaid on the same day on which it is made, such day shall be included in computing interest on such Credit Extension.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Additional Provisions Regarding Term SOFR-based Advances</u>. If Lender shall have determined that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the Term SOFR Rate for any Interest Period, Lender shall give written notice thereof to Borrower. If such notice is given (x) any Term SOFR-based Advances made thereafter shall be made as Prime-based Advances, and (y) any outstanding Term SOFR-based Advances shall be converted, on the last day of the then-current Interest Period, to Prime-based Advances, in each case until Lender withdraws such notice. Notwithstanding the foregoing or anything herein or in any other Loan Document to the contrary, in the event that (i) the Index is permanently or indefinitely unavailable or unascertainable, (ii) the Index can no longer be lawfully relied upon in contracts of this nature by any or all of the parties, or (iii) the Index does not accurately and fairly reflect the cost of making or maintaining the type of loans or advances under this Agreement and in any such case, such circumstances are unlikely to be temporary, then all references to the interest rate herein will instead be to Daily Simple SOFR, and if Lender is unable to determine or ascertain Daily Simple SOFR (which determination shall be conclusive and binding absent manifest error), then to a replacement rate selected by mutual agreement of the Lender and the Borrower, each including any adjustment to the replacement rate to reflect a different credit spread, term or other mathematical adjustment agreed by Lender and Borrower. Lender and Borrower shall negotiate in good faith to determine such replacement rate as applicable pursuant to the preceding sentence, which will be effective on the date of the earliest event set forth in clauses (i)-(iii) of this paragraph. Lender and Borrower may also from time to time, in their mutual discretion, make any technical, administrative or operational changes (including changes to the timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length or applicability of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) ("Conforming Changes") that Lender and Borrower collectively decide may be appropriate to reflect the adoption and implementation of such replacement rate and to permit the administration of the loans in an administratively and operationally practicable manner.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.4 Fees; Warrants; Lender Expenses.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Specified Letter of Credit Fee</u>. Borrower shall pay Lender, through the Specified Letter of Credit Maturity Date, a cash fee equal to 3.50% per annum on all amounts remaining undrawn under the Specified Letter of Credit, such fee to be paid quarterly in arrears.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Warrants</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. On the Effective Date, Borrower shall issue the Initial Warrant to Lender, to purchase 500,000 shares of the Borrower's common stock (subject to adjustment as set forth in the Initial Warrant).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. On the First Amendment Effective Date, Borrower shall issue the First Amendment Warrant to Lender, to purchase 166,700 shares of the Borrower's common stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>iii.</u> <u>On the Second Amendment Effective Date, Borrower shall issue the Second Amendment Warrant to Lender, to purchase 666,700 shares of the Borrower's common stock.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>iv.</u> iii. Within five business days of each Bank Draw, the Borrower shall issue Lender an Additional Warrant to purchase shares of the Borrower's common stock, for such number of shares of the Borrower's common stock as is equal to (A) the product of: (x) the amount of such Bank Draw multiplied by (y) 40%, divided by (B) $1.60. Upon the issuance of each Additional Warrant, the Initial Warrant shall become exercisable for a lesser number of shares as provided in the Initial Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Lender Expenses</u>. Borrower shall pay to Lender all Lender Expenses (including reasonable and documented (x) attorneys' fees and expenses for documentation, negotiation and enforcement of this Agreement incurred through and after the Effective Date; and (y) all fees charged by JPMorgan Chase Bank, N.A. in connection with issuing and/or maintaining the Specified Letter of Credit), when due (or, if no stated due date, upon demand by Lender). Unless otherwise provided in this Agreement or in a separate writing by Lender, Borrower shall not be entitled to any credit, rebate, or repayment of any Lender Expenses owed by Borrower pursuant to this Agreement notwithstanding any termination of this Agreement or the suspension or termination of Lender's obligation to make loans and advances hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.5 Payments; Application of Payments; Debit of Accounts.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All payments to be made by Borrower under any Loan Document shall be made in immediately available funds in Dollars to Lender at Lender's office in immediately available funds on the date due, without setoff or counterclaim, before 3:00 p.m. Pacific time. Payments of principal and/or interest received after 3:00 p.m. Pacific time are considered received at the opening of business on the next Business Day. When a payment is due on a day that is not a Business Day, the payment shall be due the next Business Day, and additional fees or interest, as applicable, shall continue to accrue until paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Lender has the exclusive right to determine the order and manner in which all payments with respect to the Obligations may be applied. Borrower shall have no right to specify the order or the accounts to which Lender shall allocate or apply any payments required to be made by Borrower to Lender or otherwise received by Lender under this Agreement when any such allocation or application is not specified elsewhere in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.6 Withholding.** Payments received by Lender from Borrower under this Agreement will be made free and clear of and without deduction for any and all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority (including any interest, additions to tax or penalties applicable thereto). Specifically, however, if at any time any Governmental Authority, applicable

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law, regulation or international agreement requires Borrower to make any withholding or deduction from any such payment or other sum payable hereunder to Lender, Borrower hereby covenants and agrees that the amount due from Borrower with respect to such payment or other sum payable hereunder will be increased to the extent necessary to ensure that, after the making of such required withholding or deduction, Lender receives a net sum equal to the sum which it would have received had no withholding or deduction been required, and Borrower shall pay the full amount withheld or deducted to the relevant Governmental Authority. Borrower will, upon request, furnish Lender with proof reasonably satisfactory to Lender indicating that Borrower has made such withholding payment; <u>provided</u>, however, that Borrower need not make any withholding payment if the amount or validity of such withholding payment is contested in good faith by appropriate and timely proceedings and as to which payment in full is bonded against by Borrower. The agreements and obligations of Borrower contained in this <u>Section 2.6</u> shall survive the termination of this Agreement.

**3 <u>CONDITIONS OF LOANS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.1 Conditions Precedent to Effectiveness.** This Agreement shall become effective upon Lender's receipt of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) duly executed signatures to the Loan Documents, the Specified Letter of Credit and the Initial Warrant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Operating Documents and long-form good standing certificates of Borrower certified by the Secretary of State (or equivalent agency) of Borrower's jurisdiction of organization or formation and each jurisdiction in which Borrower is qualified to conduct business, each as of a date no earlier than thirty (30) days prior to the Effective Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) duly executed signatures to the completed Borrowing Resolutions for Borrower;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) a subordination agreement by and between CIBC and Lender, together with the duly executed signatures thereto (the "Subordination Agreement");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) certified copies, dated as of a recent date, of financing statement searches, as Lender may request, accompanied by written evidence (including any UCC termination statements) that the Liens indicated in any such financing statements either constitute Permitted Liens or have been terminated or released; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) payment of the fees and Lender Expenses then due as specified in <u>Section 2.4</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.2 Making of Term Advances.** Immediately upon the occurrence of any Bank Draw, Lender shall be deemed to have made a Term Advance in an aggregate principal amount equal to the amount of such Bank Draw. Lender shall notify Borrower in writing of the making of any Term Advance pursuant to this <u>Section 3.2</u> and the principal amount thereof in accordance with Section 10 of this Agreement by 12:00 p.m. Pacific time on the first (1st) Business Day following the later of (i) the applicable Funding Date, or (ii) the date on which JPMorgan Chase

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Bank, N.A., the issuer under the Specified Letter of Credit, notifies Lender that a Bank Draw has been made.

**4 <u>CREATION OF SECURITY INTEREST</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.1 Grant of Security Interest.** Borrower hereby grants Lender, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Lender, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof.

If this Agreement is terminated, Lender's Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations, but, for the avoidance of doubt, including indemnity obligations owing from Borrower on the date of such termination pursuant to <u>Section 12.3</u>) are repaid in full in cash. Upon payment in full in cash of the Obligations and at such time as Lender's obligation to make Credit Extensions has terminated, Lender shall, at Borrower's sole cost and expense, release its Liens in the Collateral and all rights therein shall revert to Borrower.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.2 Priority of Security Interest.** Borrower represents, warrants, and covenants that the security interest granted herein is and shall at all times continue to be (a) subject and subordinate to the prior security interest granted to CIBC, as set forth in the CIBC Loan Documents, and (b) otherwise a first priority perfected security interest in the Collateral (subject only to Permitted Liens that may have superior priority to Lender's Lien under this Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.3 Authorization to File Financing Statements.** Borrower hereby authorizes Lender to file financing statements, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Lender's interest or rights hereunder, including a notice that any disposition of the Collateral, by either Borrower or any other Person, shall be deemed to violate the rights of Lender under the Code.

**5 <u>REPRESENTATIONS AND WARRANTIES</u>** 

Borrower represents and warrants as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.1 Due Organization, Authorization; Power and Authority.** Borrower is duly existing and in good standing in the State of Nevada, being its jurisdiction of formation, and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property requires that it be qualified except where the failure to do so could not reasonably be expected to have a Material Adverse Change. If Borrower is not now a Registered Organization but later becomes one, Borrower shall promptly notify Lender of such occurrence and provide Lender with Borrower's organizational identification number.

The execution, delivery and performance by Borrower of the Loan Documents and Specified Letter of Credit to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower's organizational documents, (ii) contravene, conflict with, constitute a default under or violate

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any material Requirement of Law, (iii) contravene, conflict or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any of its Subsidiaries or any of their property or assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and effect or (v) conflict with, contravene, constitute a default or breach under, or result in or permit the termination or acceleration of, any material agreement by which Borrower is bound. Borrower is not in default under any agreement to which it is a party or by which it is bound in which the default could reasonably be expected to have a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.2 Collateral.** Borrower has good title to, rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted Liens. **<u>Schedule 5.2</u>** to the Disclosure Letter sets forth a list of all Liens existing on the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.3 Litigation.** There are no actions or proceedings pending or, to the knowledge of any Responsible Officer, threatened in writing by or against Borrower or any of its Subsidiaries, which would reasonably be expected to cause a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.4 Solvency.** Borrower is able to pay its debts (including trade debts) as they mature.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.5 Regulatory Compliance.** Borrower is not an "investment company" or a company "controlled" by an "investment company" under the Investment Company Act of 1940, as amended. Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Borrower (a) has complied in all material respects with all Requirements of Law, and (b) has not violated any Requirements of Law the violation of which could reasonably be expected to have a Material Adverse Change. None of Borrower's or any of its Subsidiaries' properties or assets has been used by Borrower or any Subsidiary or, to the best of Borrower's knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than legally. Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Government Authorities that are necessary to continue their respective businesses as currently conducted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.6 Subsidiaries; Investments.** Borrower does not own any stock, partnership, or other ownership interest or other equity securities except for Permitted Investments. **<u>Schedule 5.6</u>** to the Disclosure Letter sets forth a list of all Investments (including, without limitation, Subsidiaries), existing on the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.7 Tax Returns and Payments; Pension Contributions.** Borrower has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except (a) to the extent such taxes are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted, so long as such reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor, or (b) if such taxes,

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assessments, deposits and contributions, individually or in the aggregate, would not reasonably be expected to cause a Material Adverse Change.

To the extent Borrower defers payment of any contested taxes, Borrower shall (i) notify Lender in writing of the commencement of, and any material development in, the proceedings, and (ii) post bonds or take any other steps required to prevent the governmental authority levying such contested taxes from obtaining a Lien upon any of the Collateral that is other than a "Permitted Lien." Borrower is unaware of any claims or adjustments proposed for any of Borrower's prior tax years which could result in additional taxes becoming due and payable by Borrower, which would reasonably be expected to have a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.8 Use of Proceeds.** Term Advances shall be made available to Borrower for the sole purpose of covering the principal amount of any Bank Draw as set forth in <u>Section 3.2</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.9 Full Disclosure.** No written representation, warranty or other statement of Borrower in any certificate or written statement given to Lender, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Lender, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized by Lender that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.12 Definition of "Knowledge."** For purposes of the Loan Documents, whenever a representation or warranty is made to Borrower's knowledge or awareness, to the "best of" Borrower's knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable investigation, of any Responsible Officer.

**6 <u>AFFIRMATIVE COVENANTS</u>**

Borrower shall do all of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.1 Government Compliance.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Maintain its and all its Subsidiaries' legal existence and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would reasonably be expected to have a Material Adverse Change. Borrower shall comply, and have each Subsidiary comply, in all material respects, with all laws, ordinances and regulations to which it is subject.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Obtain all of the Governmental Approvals necessary for the performance by Borrower of its obligations under the Loan Documents to which it is a party and the grant of a security interest to Lender in the Collateral. Borrower shall promptly provide copies of any such obtained Governmental Approvals to Lender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.2 Notices and Financial Information.** Provide Lender with the following:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Legal Action Notice</u>. A prompt report of any legal actions pending or threatened in writing against Borrower or any of its Subsidiaries that is reasonably likely to result in a Material Adverse Change; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Financial Information</u>. Financial information reasonably requested by Lender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.3 Taxes; Pensions.** Timely file, and require each of its Subsidiaries to timely file, all required tax returns and reports and timely pay, and require each of its Subsidiaries to timely pay, all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries, except for deferred payment of any taxes contested pursuant to the terms of <u>Section 5.7</u> hereof, and shall deliver to Lender, on demand, appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.4 Insurance.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Keep its business and the Collateral insured for risks and in amounts standard for companies in Borrower's industry and location and as Lender may reasonably request. Insurance policies shall be in a form, with financially sound and reputable insurance companies that are not Affiliates of Borrower, and in amounts that are satisfactory to Lender. Upon Lender's request, Borrower shall cause all property policies to have a lender's loss payable endorsement showing Lender as an additional loss payee. Upon Lender's request, Borrower shall cause all liability policies to show, or have endorsements showing, Lender as an additional insured. Upon Lender's request, Borrower shall cause Lender to be named as lender loss payee and/or additional insured with respect to any such insurance providing coverage in respect of any Collateral.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) At Lender's request, Borrower shall deliver certified copies of insurance policies and evidence of all premium payments. Upon Lender's request, Borrower shall cause each provider of any such insurance to agree, by endorsement upon the policy or policies issued by it or by independent instruments furnished to Lender, that it will give Lender thirty (30) days prior written notice before any such policy or policies shall be materially altered or canceled. If Borrower fails to obtain insurance as required under this <u>Section 6.4</u> or to pay any amount or furnish any required proof of payment to third persons and Lender, Lender may make all or part of such payment or obtain such insurance policies required in this <u>Section 6.4</u>, and take any action under the policies Lender deems prudent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.5 Litigation Cooperation.** From the date hereof and continuing through the termination of this Agreement, make available to Lender, without expense to Lender, Borrower and its officers, employees and agents and Borrower's books and records, to the extent that Lender may deem them reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or against Lender with respect to any Collateral or relating to Borrower.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.6 Access to Collateral; Books and Records.** Allow Lender, or its agents, at reasonable times, on two (2) Business Days' notice (provided no notice is required if an Event of Default has occurred and is continuing), to inspect the Collateral and audit and copy

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Borrower's Books. Such inspections or audits shall be conducted no more often than twice during the term of this Agreement unless an Event of Default has occurred and is continuing in which case such inspections and audits shall occur as often as Lender shall determine is necessary. The foregoing inspections and audits shall be at Borrower's expense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.7 Further Assurances.** Execute any further instruments and take further action as Lender reasonably requests to perfect or continue Lender's Lien in the Collateral or to effect the purposes of this Agreement.

**7 <u>NEGATIVE COVENANTS</u>**

Borrower shall not do any of the following without Lender's prior written consent, which consent may be withheld in Lender's sole and absolute discretion:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.1 Dispositions.** Convey, sell, lease, transfer, assign, or otherwise dispose of (collectively, "**Transfer**") all or any part of the Collateral, except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn-out or obsolete equipment that is, in the reasonable judgment of Borrower, no longer economically practicable to maintain or useful in the ordinary course of business of Borrower; (c) consisting of Permitted Liens and Permitted Investments; (d) consisting of the sale or issuance of any stock of Borrower permitted under <u>Section 7.2</u> of this Agreement; (e) consisting of Borrower's use or transfer of money or Cash Equivalents in the ordinary course of its business for the payment of ordinary course business expenses in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents; (f) of non-exclusive licenses for the use of the property of Borrower or its Subsidiaries in the ordinary course of business and licenses that could not result in a legal transfer of title of the licensed property but that may be exclusive in respects other than territory and that may be exclusive as to territory only as to discreet geographical areas outside of the United States and (g) any other Transfers permitted under the CIBC Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.2 Changes in Business, Management, Control, or Business Locations.** (a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower and such Subsidiary, as applicable, or reasonably related thereto; (b) liquidate or dissolve; or (c) (i) fail to provide notice to Lender of any Key Person departing from or ceasing to be employed by Borrower within ten (10) Business Days after their departure from Borrower; or (ii) permit or suffer any Change of Control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.3 Mergers or Acquisitions.** Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person (including, without limitation, by the formation of any Subsidiary) except to the extent permitted under the CIBC Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.4 Indebtedness.** Create, incur, assume, or be liable for any Indebtedness other than Permitted Indebtedness. **<u>Schedule 7.4</u>** to the Disclosure Letter sets forth a list of all Indebtedness existing on the Effective Date.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.5 Encumbrance.** Create, incur, allow, or suffer any Lien on any of the Collateral except for Permitted Liens or permit any Collateral not to be subject to the security interest granted herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.6 Distributions; Investments.** (a) Pay any dividends or make any distribution or payment or redeem, retire or purchase any capital stock except to the extent permitted under the CIBC Loan Documents; or (b) directly or indirectly make any Investment (including, without limitation, by the formation of any Subsidiary) other than Permitted Investments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.7 Transactions with Affiliates.** Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for this Agreement and transactions that are in the ordinary course of Borrower's business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm's length transaction with a non-affiliated Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.8 Subordinated Debt.** (a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor, or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to the Subordinated Debt which would increase the amount thereof, provide for earlier or greater principal, interest, or other payments thereon, or adversely affect the subordination thereof to Obligations owed to Lender.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.9 Compliance.** Become an "investment company" or a company controlled by an "investment company", under the Investment Company Act of 1940, as amended, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit Extension for that purpose; fail to (a) meet the minimum funding requirements of ERISA, (b) prevent a Reportable Event or Prohibited Transaction, as defined in ERISA, from occurring, or (c) comply with the Federal Fair Labor Standards Act, the failure of any of the conditions described in clauses (a) through (c) which could reasonably be expected to have a Material Adverse Change; or violate any other law or regulation, if the violation could reasonably be expected to have a Material Adverse Change, or permit any of its Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from participation in, permit partial or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency.

**8 <u>EVENTS OF DEFAULT</u>**

Any one of the following shall constitute an event of default (an "Event of Default") under this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.1 Payment Default.** Borrower fails to (a) make any payment of principal or interest on any Credit Extension when due, or (b) pay any other Obligations within three (3) Business Days after such Obligations are due and payable (which three (3) Business Day cure period shall not apply to payments due on the Maturity Date). During the cure period, the failure to make or

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pay any payment specified under clause (b) hereunder is not an Event of Default (but no Credit Extension will be made during the cure period);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.2 Covenant Default.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Borrower fails or neglects to perform any obligation in <u>Sections 6.2</u>, <u>6.3</u>, <u>6.4</u>, or <u>6.5</u> or violates any covenant in <u>Section 7</u>; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in <u>Section 8.2(a)</u> and <u>Sections 8.3</u> through <u>8.9</u>) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within ten (10) days after the occurrence thereof; provided, however, that if the default cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed ten (10) days) to attempt to cure such default, and within such reasonable time period the failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.3 Material Adverse Change.** A Material Adverse Change occurs;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.4 Insolvency.** (a) Borrower or any of its Subsidiaries is unable to pay its debts (including trade debts) as they become due or otherwise becomes insolvent; (b) Borrower or any of its Subsidiaries begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower or any of its Subsidiaries and is not dismissed or stayed within thirty (30) days (but no Credit Extensions shall be made while any of the conditions described in clause (a) exist and/or until any Insolvency Proceeding is dismissed);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.5 Other Agreements.** There is under any agreement to which Borrower is a party with a third party or parties (including the CIBC Loan Documents), any default resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount individually or in the aggregate in excess of One Million Dollars ($1,000,000); <u>provided</u>, however, that any failure to comply with this <u>Section 8.5</u> shall not be deemed an Event of Default if such breach or default under such other agreement shall be cured or waived within ten (10) days of Borrower's receipt of written notice thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.6 Judgments; Penalties.** One or more fines, penalties or final judgments, orders or decrees for the payment of money in an amount, individually or in the aggregate, of at least Five Hundred Thousand Dollars ($500,000) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower by any Governmental Authority, and the same are not, within ten (10) days after the entry, assessment or issuance thereof, discharged, satisfied or paid, or after execution thereof, stayed or bonded pending appeal, or such judgments are not discharged prior to the expiration of any such stay (provided that no Credit Extensions will be made prior to the satisfaction, payment, discharge, stay, or bonding of such fine, penalty, judgment, order or decree);

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.7 Misrepresentations.** Borrower or any Person acting for Borrower makes any representation, warranty, or other statement now or later in this Agreement, any Loan Document or in any writing delivered to Lender or to induce Lender to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.8 Subordinated Debt.** The Obligations shall for any reason not have the priority contemplated by this Agreement or the Subordination Agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.9 Governmental Approvals.** Any Governmental Approval shall have been (a) revoked, rescinded, suspended, modified in an adverse manner or not renewed in the ordinary course for a full term or (b) subject to any decision by a Governmental Authority that designates a hearing with respect to any applications for renewal of any of such Governmental Approval or that could result in the Governmental Authority taking any of the actions described in clause (a) above, and such decision or such revocation, rescission, suspension, modification or non-renewal (i) cause, or could reasonably be expected to cause, a Material Adverse Change, or (ii) adversely affects the legal qualifications of Borrower or any of its Subsidiaries to hold such Governmental Approval in any applicable jurisdiction and such revocation, rescission, suspension, modification or non-renewal could reasonably be expected to affect the status of or legal qualifications of Borrower or any of its Subsidiaries to hold any Governmental Approval in any other jurisdiction.

**9 <u>LENDER'S RIGHTS AND REMEDIES</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.1 Rights and Remedies.** Upon the occurrence and during the continuance of an Event of Default, Lender may, without notice or demand, do any or all of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) declare all Obligations immediately due and payable (but if an Event of Default described in <u>Section 8.4</u> occurs all Obligations are immediately due and payable without any action by Lender);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) stop advancing money or extending credit for Borrower's benefit under this Agreement or under any other agreement between Borrower and Lender;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) verify the amount of, demand payment of and performance under, and collect any Accounts and General Intangibles, settle or adjust disputes and claims directly with Account Debtors for amounts on terms and in any order that Lender considers advisable, and notify any Person owing Borrower money of Lender's security interest in such funds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the Collateral. Borrower shall assemble the Collateral if Lender requests and make it available as Lender designates. Lender may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be prior or superior to its security interest and pay all expenses incurred. Borrower grants Lender a license to enter and occupy any of its premises, without charge, to exercise any of Lender's rights or remedies;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) apply to the Obligations any (i) balances and deposits of Borrower it holds or controls, or (ii) any amount held or controlled by Lender owing to or for the credit or the account of Borrower;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) place a "hold" on any account maintained with Lender and/or deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any Control Agreement or similar agreements providing control of any Collateral;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) demand and receive possession of Borrower's Books; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) exercise all rights and remedies available to Lender under the Loan Documents or at law or equity, including all remedies provided under the Code (including disposal of the Collateral pursuant to the terms thereof).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.2 Power of Attorney.** Borrower hereby irrevocably appoints Lender as its lawful attorney-in-fact, exercisable upon the occurrence and during the continuance of an Event of Default, to: (a) endorse Borrower's name on any checks or other forms of payment or security; (b) sign Borrower's name on any invoice or bill of lading for any Account or drafts against Account Debtors; (c) settle and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and on terms Lender determines reasonable; (d) make, settle, and adjust all claims under Borrower's insurance policies; (e) pay, contest or settle any Lien, charge, encumbrance, security interest, and adverse claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and (f) transfer the Collateral into the name of Lender or a third party as the Code permits. Borrower hereby appoints Lender as its lawful attorney-in-fact to sign Borrower's name on any documents necessary to perfect or continue the perfection of Lender's security interest in the Collateral regardless of whether an Event of Default has occurred until all Obligations have been satisfied in full and Lender is under no further obligation to make Credit Extensions hereunder. Lender's foregoing appointment as Borrower's attorney in fact, and all of Lender's rights and powers, coupled with an interest, are irrevocable until all Obligations have been fully repaid and performed and Lender's obligation to provide Credit Extensions terminates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.3 Protective Payments.** If Borrower fails to obtain the insurance called for by <u>Section 6.4</u> or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under this Agreement or any other Loan Document or which may be required to preserve the Collateral, Lender may obtain such insurance or make such payment, and all amounts so paid by Lender are Lender Expenses and immediately due and payable, bearing interest at the then highest rate applicable to the Obligations, and secured by the Collateral. Lender will make reasonable efforts to provide Borrower with notice of Lender obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Lender are deemed an agreement to make similar payments in the future or Lender's waiver of any Event of Default.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.4 Application of Payments and Proceeds Upon Default.** If an Event of Default has occurred and is continuing, Lender shall have the right to apply in any order any funds in its possession, whether from Borrower payments, proceeds realized as the result of any collection of Accounts or other disposition of the Collateral, or otherwise, to the Obligations. Lender shall

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pay any surplus to Borrower by credit to an account designated by Borrower or to other Persons legally entitled thereto; Borrower shall remain liable to Lender for any deficiency. If Lender, directly or indirectly, enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Lender shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price or deferring the reduction of the Obligations until the actual receipt by Lender of cash therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.5 Lender's Liability for Collateral.** If Lender takes possession or control of the Collateral pursuant to the terms of this Agreement after an Event of Default, so long as Lender complies with reasonable banking practices regarding the safekeeping of the Collateral in the possession or under the control of Lender (for the avoidance of doubt, the reference to "control" in this sentence shall not mean constructive control solely as a result of entering into this Agreement), Lender shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or (d) any act or default of any carrier, warehouseman, bailee, or other Person. Borrower bears all risk of loss, damage or destruction of the Collateral.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.6 No Waiver; Remedies Cumulative.** Lender's failure, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan Document shall not waive, affect, or diminish any right of Lender thereafter to demand strict performance and compliance herewith or therewith. No waiver hereunder shall be effective unless signed by the party granting the waiver and then is only effective for the specific instance and purpose for which it is given. Lender's rights and remedies under this Agreement and the other Loan Documents are cumulative. Lender has all rights and remedies provided under the Code, by law, or in equity. Lender's exercise of one right or remedy is not an election and shall not preclude Lender from exercising any other remedy under this Agreement or other remedy available at law or in equity, and Lender's waiver of any Event of Default is not a continuing waiver. Lender's delay in exercising any remedy is not a waiver, election, or acquiescence.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.7 Demand Waiver.** Borrower waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Lender on which Borrower is liable.

**10 <u>NOTICES</u>** 

All notices, consents, requests, approvals, demands, or other communication by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S. mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address or email address indicated below. Lender or Borrower may change its mailing or electronic mail address by giving the other party written notice thereof in accordance with the terms of this <u>Section 10</u>.

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If to Borrower: S&W Seed Company

2101 Ken Pratt Blvd, Suite 201

Longmont, CO 80501

Attn: Betsy Horton, Chief Financial Officer

Email: BetsyHorton@swseedco.com

If to Lender: MFP Partners, L.P.

909 Third Ave., 33<sup>rd</sup> Floor

New York, NY 10022

Attn: Timothy E. Ladin, General Counsel and VP

Email: notices@mfpllc.com

**11 <u>CHOICE OF LAW, VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE</u>**

This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of New York. The parties hereby submit to the non-exclusive jurisdiction of the state and federal courts located in New York, New York. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH PARTY RECOGNIZES AND AGREES THAT THE FOREGOING WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO ENTER INTO THIS AGREEMENT. EACH PARTY REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.

This <u>Section 11</u> shall survive the termination of this Agreement.

**12 <u>GENERAL PROVISIONS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.1 Termination Prior to Maturity Date; Survival.** All covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations have been satisfied. So long as Borrower has satisfied the Obligations (other than inchoate indemnity obligations, and any other obligations which, by their terms, are to survive the termination of this Agreement), this Agreement may be terminated prior to the Maturity Date by Borrower, effective three (3) Business Days after written notice of termination is given to Lender. Those obligations that are expressly specified in this Agreement as surviving this Agreement's termination shall continue to survive notwithstanding this Agreement's termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.2 Successors and Assigns.** This Agreement binds and is for the benefit of the successors and permitted assigns of each party. Borrower may not assign this Agreement or any rights or obligations under it without Lender's prior written consent (which may be granted or withheld in Lender's discretion). Lender has the right, without the consent of or notice to

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Borrower, to sell, transfer, assign, negotiate, or grant participation in all or any part of, or any interest in, Lender's obligations, rights, and benefits under this Agreement and the other Loan Documents. For the avoidance of doubt, any assignee of all or any part of Lender's interest in and of Lender's obligations, rights, and benefits under this Agreement and the other Loan Documents will be deemed a "Lender" under this Agreement and the other Loan Documents; <u>provided</u> that in such case, determinations of "Lender" under this Agreement and the other Loan Documents shall be based on the decision of the Lender or Lenders holding a majority in interest of the Obligations; and, <u>provided further</u> that in the event that Lender sells a participation to any Person (each, a "Participant") in all or any part of Lender's rights and/or obligations under this Agreement or the other Loan Documents, (i) such Participant shall not be deemed a "Lender" under this Agreement or the other Loan Documents, (ii) Lender's obligations under this Agreement and the other Loan Documents shall remain unchanged, (iii) Lender shall remain solely responsible to Borrower for the performance of such obligations, and (iv) Borrower shall continue to deal solely and directly with Lender in connection with Lender's rights and obligations under this Agreement and the other Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.3 Indemnification.** Borrower agrees to indemnify, defend and hold Lender (and, for the avoidance of doubt, Lender's assignees) and its (and any such assignee's) directors, officers, employees, agents, attorneys, or any other Person affiliated with or representing Lender (or its assignee) (each, an "**Indemnified Person**") harmless against: (i) all obligations, demands, claims, and liabilities (collectively, "**Claims**") claimed or asserted by any other party in connection with the transactions contemplated by the Loan Documents; and (ii) all losses or expenses (including Lender Expenses) in any way suffered, incurred, or paid by such Indemnified Person as a result of, following from, consequential to, or arising from transactions between Lender and Borrower (including reasonable attorneys' fees and expenses), except for Claims and/or losses directly caused by such Indemnified Person's gross negligence or willful misconduct.

This <u>Section 12.3</u> shall survive until all statutes of limitation with respect to the Claims, losses, and expenses for which indemnity is given shall have run.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.4 Time of Essence.** Time is of the essence for the performance of all Obligations in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.5 Severability of Provisions.** Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.6 Correction of Loan Documents.** Lender may correct patent errors and fill in any blanks in the Loan Documents consistent with the agreement of the parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.7 Amendments in Writing; Waiver; Integration.** No purported amendment or modification of any Loan Document, or waiver, discharge or termination of any obligation under any Loan Document, shall be enforceable or admissible unless, and only to the extent, expressly set forth in a writing signed by the party against which enforcement or admission is sought. Without limiting the generality of the foregoing, no oral promise or statement, nor any action, inaction, delay, failure to require performance or course of conduct shall operate as, or evidence, an amendment, supplement or waiver or have any other effect on any Loan Document. Any

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waiver granted shall be limited to the specific circumstance expressly described in it, and shall not apply to any subsequent or other circumstance, whether similar or dissimilar, or give rise to, or evidence, any obligation or commitment to grant any further waiver. The Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of the Loan Documents merge into the Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.8 Counterparts.** This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, is an original, and all taken together, constitute one Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.9 Confidentiality.** In handling any confidential information, Lender shall exercise the same degree of care that it exercises for its own proprietary information, but disclosure of information may be made: (a) to Lender's Subsidiaries or Affiliates (such Subsidiaries and Affiliates, together with Lender, collectively, "Lender Entities"); (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided, however, Lender shall use commercially reasonable efforts to obtain any prospective transferee's or purchaser's agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to Lender's regulators or as otherwise required in connection with Lender's examination or audit; (e) as Lender considers appropriate in exercising remedies under the Loan Documents; and (f) to third-party service providers of Lender so long as such service providers have executed a confidentiality agreement with Lender or are otherwise subject to a duty of confidentiality, with terms no less restrictive than those contained herein. Confidential information does not include information that is either: (i) in the public domain or in Lender's possession when disclosed to Lender, or becomes part of the public domain (other than as a result of its disclosure by Lender in violation of this Agreement) after disclosure to Lender; or (ii) disclosed to Lender by a third party, if Lender does not know that the third party is prohibited from disclosing the information.

Lender Entities may use anonymous forms of confidential information for aggregate datasets, for analyses or reporting, and for any other uses not expressly prohibited in writing by Borrower. The provisions of the immediately preceding sentence shall survive termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.10 Attorneys' Fees, Costs and Expenses.** In any action or proceeding between Borrower and Lender arising out of or relating to the Loan Documents, the prevailing party shall be entitled to recover its reasonable attorneys' fees and other costs and expenses incurred, in addition to any other relief to which it may be entitled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.11 Electronic Execution of Documents.** The words "execution," "signed," "signature" and words of like import in any Loan Document shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity and enforceability as a manually executed signature or the use of a paper-based recordkeeping systems, as the case may be, to the extent and as provided for in any applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.12 Captions.** The headings used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.13 Construction of Agreement.** The parties mutually acknowledge that they and their attorneys have participated in the preparation and negotiation of this Agreement. In cases of uncertainty this Agreement shall be construed without regard to which of the parties caused the uncertainty to exist.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.14 Relationship.** The relationship of the parties to this Agreement is determined solely by the provisions of this Agreement. The parties do not intend to create any agency, partnership, joint venture, trust, fiduciary or other relationship with duties or incidents different from those of parties to an arm's-length contract.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.15 Third Parties.** Nothing in this Agreement, whether express or implied, is intended to: (a) confer any benefits, rights or remedies under or by reason of this Agreement on any persons other than the express parties to it, Indemnified Persons and their respective permitted successors and assigns; (b) relieve or discharge the obligation or liability of any person not an express party to this Agreement; or (c) give any person not an express party to this Agreement any right of subrogation or action against any party to this Agreement.

**13 <u>DEFINITIONS</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.1 Definitions.** As used in the Loan Documents, the word "shall" is mandatory, the word "may" is permissive, the word "or" is not exclusive, the words "includes" and "including" are not limiting, the singular includes the plural, and numbers denoting amounts that are set off in brackets are negative. As used in this Agreement, the following capitalized terms have the following meanings:

"**Account**" is any "account" as defined in the Code with such additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to Borrower.

"**Account Debtor**" is any "account debtor" as defined in the Code with such additions to such term as may hereafter be made.

"**Additional Warrant**" is a warrant delivered pursuant to this Agreement, evidenced by an instrument substantially the form of <u>Exhibit B-2</u>, as amended, replaced or otherwise modified pursuant to the terms thereof.

"**Affiliate**" is, with respect to any Person, each other Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person's senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person's managers and members.

"**Agreement**" is defined in the preamble hereof.

"**Available Amount**" is Twelve Million Dollars ($12,000,000).

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"**Bank Draw**" is any draw down by CIBC under the terms of the Specified Letter of Credit.

"**Borrower**" is defined in the preamble hereof.

"**Borrower's Books**" are all Borrower's books and records including ledgers, federal and state tax returns, records regarding Borrower's assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.

"**Borrowing Resolutions**" are, with respect to any Person, those resolutions substantially in the form attached hereto as <u>Exhibit A</u>.

"**Business Day**" is any day that is not a Saturday, Sunday or a day on which Lender is closed.

"**Cash Equivalents**" means (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after its creation and having the highest rating from either Standard & Poor's Ratings Group or Moody's Investors Service, Inc.; and (c) money market funds at least ninety-five percent (95%) of the assets of which constitute Cash Equivalents of the kinds described in clauses (a) and (b) of this definition.

"**Change of Control**" means any event, transaction, or occurrence as a result of which any "person" (as such term is defined in Sections 3(a)(9) and 13(d)(3) of the Exchange Act), other than MFP Partners, L.P. or a trustee or other fiduciary holding securities under an employee benefit plan of Borrower, is or becomes a beneficial owner (within the meaning Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of Borrower, representing more than forty percent (40%) or more of the combined voting power of Borrower's then outstanding securities; <u>provided</u> that if Borrower and CIBC amend the definition of Change of Control in the CIBC Loan Documents with the purpose or effect of waiving a Change of Control with respect to a particular investor, event, transaction, or occurrence, upon the written request of Lender, the definition of Change of Control in this Agreement shall be waived or amended in a similar manner.

"**CIBC**" is CIBC Bank USA.

"**CIBC Loan Documents**" are that certain Loan and Security Agreement, dated as of December 26, 2019, among the Borrower and certain of its Subsidiaries, as borrowers, the other loan parties party thereto, the various financial institutions party thereto as lenders, and CIBC, as administrative agent for the lenders, together with all other documents, instruments and other agreements entered into in connection therewith, all as amended, restated, amended and restated, supplemented or otherwise modified from time to time.

"**Claims**" is defined in <u>Section 12.3</u>.

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"**Code**" is the New York Uniform Commercial Code.

"**Collateral**" is all of Borrower's right, title and interest in and to the Collateral (as defined in the CIBC Loan Documents).

"**Conforming Changes**" is defined in <u>Section 2.3</u>.

"**Contingent Obligation**" is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation, in each case, directly or indirectly guaranteed, endorsed, co-made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but "Contingent Obligation" does not include endorsements in the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.

"**Copyrights**" are any and all copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret.

"**Credit Extension**" is any Term Advance or any other extension of credit by Lender for Borrower's benefit.

"**Daily Simple SOFR**" is the Daily Secured Overnight Financing Rate for any day (i) if such day is a U.S. Government Securities Business Day, published on such day or (ii) if such day is not a U.S. Government Securities Business Day, published on the U.S. Government Securities Business Day immediately preceding such day, in each case, as published by the Federal Reserve Bank of New York (or successor administrator) and displayed by Bloomberg LP (or any successor thereto, or replacement thereof, as approved by Lender) and as determined by Lender.

"**Default Rate**" is defined in <u>Section 2.3(b)</u>.

"**Determination Date**" is, with respect to a Term SOFR-based Advance, the day such Term SOFR-based Advance is made or the last day of the Interest Period of a Term SOFR-based Advance, as applicable; <u>provided</u> that if any Determination Date is not a U.S. Government Securities Business Day, the rate applicable on such Determination Date shall be the rate for the immediately preceding U.S. Government Securities Business Day.

"**Disclosure Letter**" is that certain Disclosure Letter of even date herewith, delivered to Lender by Borrower on the date hereof.

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"**Dollars**," "**dollars**" or use of the sign "$" are only lawful money of the United States and not any other currency, regardless of whether that currency uses the "$" sign to denote its currency or may be readily converted into lawful money of the United States.

"**Effective Date**" is defined in the preamble hereof.

"**ERISA**" is the Employee Retirement Income Security Act of 1974, and its regulations.

"**Event of Default**" is defined in <u>Section 8</u>.

"**Exchange Act**" is the Securities Exchange Act of 1934, as amended.

"**First Amendment**" means that certain First Amendment to Subordinate Loan and Security Agreement, dated as of the First Amendment Effective Date, by and between the Borrower and the Lender.

"**First Amendment Effective Date**" is October 28, 2022.

"**First Amendment Warrant**" is a warrant delivered pursuant to this Agreement, evidenced by an instrument substantially the form of <u>Exhibit B-3</u>, as amended, replaced or otherwise modified pursuant to the terms thereof.

"**Funding Date**" is any date on which a Credit Extension is made to or for the account of Borrower.

"**GAAP**" is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination; <u>provided</u>, that with respect to the accounting for leases as either operating leases or capital leases and the impact of such accounting in accordance with FASB ASC 840 on the definitions and covenants herein, GAAP as in effect on December 31, 2018 shall be applied.

"**General Intangibles**" is all "general intangibles" as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all Intellectual Property, claims, income and other tax refunds, security and other deposits, payment intangibles, contract rights, options to purchase or sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of insurance and rights to payment of any kind.

"**Governmental Approval**" is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority.

"**Governmental Authority**" is any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank

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or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory organization.

"**Indebtedness**" is (a) indebtedness for borrowed money or the deferred price of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, and (d) Contingent Obligations.

"**Indemnified Person**" is defined in <u>Section 12.3</u>.

"**Index**" is defined in the definition of "Term SOFR Rate."

"**Initial Warrant**" is a warrant delivered pursuant to this Agreement, evidenced by an instrument substantially the form of <u>Exhibit B-1</u>, as amended, replaced or otherwise modified pursuant to the terms thereof.

"**Insolvency Proceeding**" is any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief.

"**Intellectual Property**" is, with respect to any Person, means all of such Person's right, title, and interest in and to the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) its Copyrights, Trademarks and Patents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any and all trade secrets and trade secret rights, including, without limitation, any rights to unpatented inventions, know-how, operating manuals;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any and all source code;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any and all design rights which may be available to such Person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the Intellectual Property rights identified above; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents.

"**Interest Period**" is, for each Term SOFR-based Advance, a period of three (3) months; <u>provided</u> that Borrower may at any time elect any other Interest Period then available in the SOFR market (e.g., a period of one (1) month) by written notice to Lender, which election shall take effect commencing with the immediately following Interest Period; <u>provided</u>, <u>further</u>, that the last day of each Interest Period shall be determined in accordance with the practices of the SOFR market as from time to time in effect. Any Term SOFR-based Advances shall

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automatically continue for the same Interest Period upon the last day of the applicable Interest Period,

unless the Borrower otherwise elects in accordance with the first proviso of the preceding sentence.

"**Inventory**" is all "inventory" as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products, including without limitation such inventory as is temporarily out of Borrower's custody or possession or in transit and including any returned goods and any documents of title representing any of the above.

"**Investment**" is any beneficial ownership interest in any Person (including stock, partnership interest or other securities), and any loan, advance or capital contribution to any Person.

"**Key Person**" is Borrower's Chief Financial Officer, who is Betsy Horton as of the Effective Date.

"**Lender**" is defined in the preamble hereof.

"**Lender Entities**" is defined in <u>Section 12.9</u>.

"**Lender Expenses**" are all audit fees and expenses, costs, and expenses (including reasonable attorneys' fees and expenses) for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents and Specified Letter of Credit (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to Borrower.

"**Lien**" is a claim, mortgage, deed of trust, levy, charge, pledge, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.

"**Loan Documents**" are, collectively, this Agreement, any schedules, exhibits, certificates, notices, and any other documents related to this Agreement, the Specified Letter of Credit, any subordination agreement, including the Subordination Agreement, any note, or notes or guaranties executed by Borrower, and any other present or future agreement by Borrower with or for the benefit of Lender in connection with this Agreement, all as amended, amended and restated, supplemented or otherwise modified.

"**Material Adverse Change**" is (a) a material impairment in the perfection or priority of Lender's Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations, or financial condition of Borrower; or (c) a material impairment of the prospect of repayment of any portion of the Obligations.

"**Maturity Date**" is November 30, 2025.

"**Obligations**" are Borrower's obligations to pay when due any debts, principal, interest, fees, Lender Expenses, and other amounts Borrower owes Lender now or later, whether under this Agreement, the other Loan Documents, or otherwise, including, without limitation, all

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obligations relating to letters of credit (including reimbursement obligations for drawn and undrawn letters of credit), cash management services, and foreign exchange contracts, if any, and including interest accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower assigned to Lender, and to perform Borrower's duties under the Loan Documents.

"**Operating Documents**" are, for any Person, such Person's formation documents, as certified by the Secretary of State (or equivalent agency) of such Person's jurisdiction of organization on a date that is no earlier than thirty (30) days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its limited liability company 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.

"**Participant**" is defined in <u>Section 12.2</u>.

"**Patents**" are all patents, patent applications and like protections including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same.

"**Payment Date**" is (i) March 31, June 30, September 30 and December 31 of each year (provided, that if such date is not a Business Day, then on the immediately preceding Business Day), and (ii) the Maturity Date.

"**Permitted Indebtedness**" is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Borrower's Indebtedness to Lender under this Agreement and the other Loan Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Indebtedness existing on the Effective Date and disclosed to Lender in writing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Indebtedness owing to CIBC (and any co-lender under the CIBC Loan Documents) pursuant to the CIBC Loan Documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) All Indebtedness permitted under the CIBC Loan Documents; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Subordinated Debt.

"**Permitted Investments**" are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Investments (including, without limitation, Subsidiaries) existing on the Effective Date and disclosed to Lender in writing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All Investments permitted under the CIBC Loan Documents.

"**Permitted Liens**" are:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Liens existing on the Effective Date and disclosed to Lender in writing or arising under this Agreement and the other Loan Documents; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All Liens permitted under the CIBC Loan Documents.

"**Person**" is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.

"**PIK Interest**" is defined in <u>Section 2.3(a)</u>.

"**Prime-based Advance**" is a Term Advance which bears interest at the Prime-based Rate.

"**Prime-based Rate**" is, for any Interest Period for a Prime Rate-based Advanced, a rate per annum equal to the sum of (1) the Prime Rate for such Interest Period, plus (2) 6.25%.

"**Prime Rate**" is the greater of (i) highest rate published from time to time by the Wall Street Journal as the Prime Rate and (ii) 1.25%; <u>provided</u>, that in the event the Wall Street Journal ceases to publish the Prime Rate, the Lender and Borrower shall mutually agree on an alternative Prime Rate, which Prime Rate shall be the base, reference or other rate then recognized and utilized by the United States commercial loan market for general commercial loan reference purposes.

"**Registered Organization**" is any "registered organization" as defined in the Code with such additions to such term as may hereafter be made.

"**Requirement of Law**" is as to any Person, the organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

"**Responsible Officer**" is any of the Chief Executive Officer or Chief Financial Officer of Borrower.

"**SEC**" is the Securities and Exchange Commission, any successor thereto, and any analogous Governmental Authority.

<u>"</u>**<u>Second Amendment</u>**<u>" means that certain Second Amendment to Subordinate Loan and Security Agreement, dated as of the Second Amendment Effective Date, by and between the Borrower and the Lender.</u>

<u>"</u>**<u>Second Amendment Effective Date</u>**<u>" is December 22, 2022.</u> 

<u>"</u>**<u>Second Amendment Warrant</u>**<u>" is a warrant delivered pursuant to this Agreement, evidenced by an instrument substantially the form of Exhibit B-4, as amended, replaced or otherwise modified pursuant to the terms thereof.</u> 

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"**Specified Letter of Credit**" is that certain Letter of Credit No. NUSCGS044349 issued by JPMorgan Chase Bank, N.A. for the account of the Lender, in the original amount of $9,000,000, as amended on the First Amendment Effective Date to increase such amount to $12,000,000.

"**Specified Letter of Credit Maturity Date**" is January 23<u>April 30</u>, 2023.

"**Subordination Agreement**" is defined in <u>Section 3.1(d)</u>.

"**Subordinated Debt**" is indebtedness incurred by Borrower subordinated to all of Borrower's now or hereafter indebtedness to Lender (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Lender entered into between Lender and the other creditor), on terms acceptable to Lender.

"**Subsidiary**" is, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless the context otherwise requires, each reference to a Subsidiary herein shall be a reference to a Subsidiary of Borrower.

"**Term Advance**" is defined in <u>Section 2.2(b)</u>.

"**Term SOFR Rate**" is, for any Interest Period for a Term SOFR-based Advance, the greater of (i) the Term Secured Overnight Financing Rate for such Interest Period, as administrated by CME Group Benchmark Administration Limited (or successor administrator) and displayed by Bloomberg LP (or any successor thereto, or replacement thereof, as reasonably selected by Bank) and as determined by Bank on each Determination Date (the "Index") and (ii) 1.25%.

"**Term SOFR-based Advance**" is a Term Advance which bears interest at the Term SOFR-based Rate.

"**Term SOFR-based Rate**" is, for any Interest Period, a rate per annum equal to the sum of (1) the Term SOFR Rate for such Interest Period, plus (2) 9.25%.

"**Trademarks**" are any trademark and servicemark rights, whether registered or not, applications to register and registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks.

"**Transfer**" is defined in <u>Section 7.1</u>.

"**U.S. Government Securities Business Day**" is any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association<br>

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recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

[Signature page follows.]

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**As amended by the First<u>Second</u> Amendment, dated as of October 28<u>December 22</u>, 2022.**

**IN WITNESS WHEREOF**, the parties hereto have caused this Agreement to be executed as of the Effective Date.

BORROWER:

S&W SEED COMPANY

By: <u>/s/Betsy Horton</u> 

Name: Betsy Horton

Title: Chief Financial Officer

LENDER:

MFP PARTNERS, L.P.

By: MFP Investors LLC, its General Partner

By:

Name:

Title:

[Signature page to Loan and Security Agreement]

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**<u>EXHIBIT A</u>**

**CORPORATE BORROWING CERTIFICATE**

**Borrower: S&W SEED COMPANY Date**: [●], 2022

**LENDER: MFP PARTNERS, L.P.**

I hereby certify as follows, as of the date set forth above:

1. I am the Secretary, Assistant Secretary or other officer of Borrower. My title is as set forth below.

2. Borrower's exact legal name is set forth above. Borrower is a corporation existing under the laws of the State of Nevada.

3. The following resolutions were duly and validly adopted by Borrower's Board of Directors at a duly held meeting of such directors (or pursuant to a unanimous written consent or other authorized corporate action). Such resolutions are in full force and effect as of the date hereof and have not been in any way modified, repealed, rescinded, amended or revoked, and MFP Partners, L.P. ("Lender") may rely on them until Lender receives written notice of revocation from Borrower.

**Resolved**, that any one of the following officers or employees of Borrower, whose names, titles and signatures are below, may act on behalf of Borrower:

---

| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;Name | &nbsp;&nbsp;Title | &nbsp;&nbsp;Signature | &nbsp;&nbsp;Authorized to Add or Remove <u>Signatories</u> |
|  |  |  | &nbsp;&nbsp;□ |
|  |  |  | &nbsp;&nbsp;□ |
|  |  |  | &nbsp;&nbsp;□ |
|  |  |  | &nbsp;&nbsp;□ |

---

**Resolved Further**, that any one of the persons designated above with a checked box beside his or her name may, from time to time, add or remove any individuals to and from the above list of persons authorized to act on behalf of Borrower.

**Resolved Further**, that such individuals may, on behalf of Borrower:

**Borrow Money.** Borrow money from Lender.

**Execute Loan Documents.** Execute any loan documents Lender requires.

**Grant Security.** Grant Lender a security interest in any of Borrower's assets.

**Negotiate Items.** Negotiate or discount all drafts, trade acceptances, promissory notes, or other indebtedness in which Borrower has an interest and receive cash or otherwise use the proceeds.

**Further Acts.** Designate other individuals to request advances, pay fees and costs and execute other documents or agreements (including documents or agreement that waive Borrower's right to a jury trial) they believe to be necessary to effect these resolutions.

**Resolved Further**, that all acts authorized by the above resolutions and any prior acts relating thereto are ratified.

5. The persons listed above are Borrower's officers or employees with their titles and signatures shown next to their names.

By:

Name:

Title:

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\*\*\* If the Secretary, Assistant Secretary or other certifying officer executing above is designated by the resolutions set forth in paragraph 4 as one of the authorized signing officers, this Certificate must also be signed by a second authorized officer or director of Borrower.

I, the __________________________ of Borrower, hereby certify as to paragraphs 1 through 5 above, as of the date set forth above.

By:

Name:

Title:

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**<u>EXHIBIT B-1</u>**

**FORM OF INITIAL WARRANT**

**[ATTACHED]**

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**<u>EXHIBIT B-2</u>**

**FORM OF ADDITIONAL WARRANT**

**[ATTACHED]**

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**<u>EXHIBIT B-3</u>**

**<u>FORM OF FIRST AMENDMENT WARRANT</u>**

**<u>[ATTACHED]</u>**

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**<u>EXHIBIT B-4</u>**

**<u>FORM OF SECOND AMENDMENT WARRANT</u>**

**<u>[ATTACHED]</u>**

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**<u>ANNEX B</u>**

Second Amendment Warrant

[see attached]

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## Ex-10

**THIRD AMENDMENT TO NOTE**

Loan # R1036

This Third Amendment to Note (this "**Third Amendment**"), dated effective as of December 23, 2022 (the "**Effective Date**"), is entered into by and between S&W Seed Company, a Nevada corporation ("**Borrower**"), and Rooster Capital LLC, a Delaware limited liability company ("**Lender**").

**RECITALS**

WHEREAS, Borrower executed a promissory note dated November 30, 2017, in the original principal amount of $10,400,000.00 payable to Conterra Agricultural Capital, LLC (the "Note"), and subsequently endorsed to Lender, which is secured by a Deed of Trust, Security Agreement, Assignment of Rents and Fixture Filing dated November 30, 2017 (the "Security Instrument"), and recorded on (i) December 4, 2017, as Instrument No. 2017-0156048-00 in the land records of Fresno County, California, as affected by Corrective Assignment of Deed of Trust dated December 1, 2017, and recorded on March 2, 2020, as Instrument No. 2020-0026497 in the land records of Fresno County, California , and (ii) December 4, 2017, as Instrument No. 2017-052694 in the land records of Canyon County, Idaho as affected by a Corrective Assignment of Deed of Trust dated November 5, 2019 and recorded on February 18, 2020 as Instrument No.2020-009002 in the land records of Canyon County, Idaho.

WHEREAS, on or around December 24, 2019, an Amendment to Note (the "First Amendment") was entered into by Borrower and Lender, whereby the Maturity Date of the Note was extended to November 30, 2022.

WHERAS, on or around September 22, 2022, a Second Amendment to Note (the "Second Amendment") was entered into by Borrower and Lender, whereby the Maturity Date of the Note was extended to December 23, 2022.

WHEREAS, Lender is the current holder of the Note and the Security Instrument.

WHEREAS, Borrower has requested to extend the Maturity Date of the Note to March 1, 2023, and Lender has approved Borrower's request subject to the terms and requirements set forth in this Third Amendment.

NOW THEREFORE, for the reason set forth above and for other good and valuable consideration, the sufficiency of which is acknowledged, Borrower and Lender (each a "Party" and collectively, the "Parties") hereby agree as follows:

**AGREEMENT**

&nbsp;&nbsp;&nbsp;&nbsp;1.**Amendment to Note**

The Parties agree that the recitals set forth above are true and accurate and are hereby incorporated in and made a part of this Third Amendment. The Note is hereby amended by the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.Section 2 of the Note is hereby deleted in its entirety and replaced with the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.INTEREST

Prior to default, interest will be charged on unpaid Principal until the full amount of Principal has been paid. Borrower will pay interest at a yearly rate of 9.25% as of the Effective Date.

After and during the continuance of any default, interest will be charged on unpaid Principal at the interest rate stated in Section 8 of this Note.

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Third Amendment to Note

Page 2 of 3

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Section 3(A) of the Note is hereby deleted in its entirety and replaced with the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) Time and Amount of Payments

1 interest only payment due and payable on January 1, 2018, with interest calculated from the date of closing on the unpaid Principal balance of the Note at 7.5% per annum; 4 consecutive semi-annual Principal and interest payments of

$515,710.54 each, beginning July 1, 2018; 6 consecutive semi-annual Principal and interest payments of $454,185.24 each, beginning July 1, 2020; and a final payment due and payable March 1, 2023 (which is called the "Maturity Date"), in an amount equal to all remaining Principal and all accrued unpaid interest, plus any applicable costs and expenses.

&nbsp;&nbsp;&nbsp;&nbsp;**2.** **Lender's fee and Other Expenses**

In consideration for Lender entering into this Third Amendment, Borrower shall pay to Lender upon entering into this Third Amendment: (i) an extension fee in the amount of $50,000.00, and (ii) a servicing fee in the amount of $750.00. As further consideration for Lender entering into this Third Amendment, Borrower shall pay to Lender upon entering into this Third Amendment any additional costs and expenses incurred by Lender in connection with this Third Amendment, including without limitation attorneys' fees and costs.

&nbsp;&nbsp;&nbsp;&nbsp;**3.** **Terms of Note**

Capitalized terms used in this Third Amendment that are not defined shall have the meaning assigned to such terms in the Note, First Amendment, and Second Amendment. Except as set forth in this Third Amendment, all of the provisions of the Note, First Amendment, and Second Amendment shall remain unchanged, shall continue in full force and effect, and are hereby ratified and confirmed in all respects by the Parties.

IN WITNESS WHEREOF, the Parties, intending to be legally bound, have executed this Third Amendment as of the day and date first written above.

**BORROWER:**

**S&W SEED COMPANY, a Nevada corporation**

By: <u>/s/ Elizabeth Horton</u> Elizabeth E. Horton

Its: Chief Financial Officer

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Third Amendment to Note

Page 3 of 3

**LENDER:**

**ROOSTER CAPITAL LLC, a Delaware limited liability company**

By: Conterra Holdings, LLC Its: Administrative Member

By: <u>/s/ Mark A. Smith</u> Mark A. Smith

Its: COO & General Counsel

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## Ex-10

**S&W Seed Company**

**Non-Employee Director Compensation Policy**

Each member of the Board of Directors (the "**Board**") of S&W Seed Company (the "**Company**") who is not also serving as an employee of or consultant to the Company or any of its subsidiaries (each such member, an "**Eligible Director**") will receive the compensation described in this Non-Employee Director Compensation Policy (this "**Policy**") for his or her Board service. This Policy is made effective as of December 14, 2022 (the "**Effective Date**"), and may be amended at any time in the sole discretion of the Board. An Eligible Director may decline all or any portion of his or her compensation by giving notice to the Company prior to the payment of cash or grant of equity awards pursuant to this Policy.

**A. Board Service Cash Compensation**

Each Eligible Director will receive an annual cash retainer of $40,000, except that the Chair of the Board shall receive an annual cash retainer of $50,000 (the "**Board Service Retainer**"). The Board Service Retainer will be payable in equal quarterly installments in advance on the first day of each fiscal quarter. If an Eligible Director first joins the Board on a day other than the first day of a fiscal quarter, the first quarterly installment will be pro-rated based on the number of days remaining in such fiscal quarter. All installments are vested upon payment.

**B. Board Service Equity Compensation** 

Effective as of immediately following the conclusion of each annual meeting of stockholders of the Company (each, an "**Annual Meeting**"), beginning with the Annual Meeting held on December 14, 2022, each then-serving Eligible Director will automatically, and without further action by the Board, be granted a restricted stock unit (an "**RSU Award**") under the Company's 2019 Equity Incentive Plan, as amended, or any successor plan thereto (the "**Plan**"), for a number of shares equal to $55,000 (except that for the Chair of the Board such value shall be $75,000) divided by the Fair Market Value (as defined in the Plan) of one share of Common Stock the date of grant, rounded down to the nearest whole share (the "**Annual RSU Award**"). If an Eligible Director first joins the Board after the date of an Annual Meeting, such Eligible Director will automatically, and without further action by the Board, be granted a pro-rated portion of the applicable Annual RSU Award effective upon his or her appointment date, based on the number of days remaining between such appointment date and the first anniversary of the immediately preceding Annual Meeting.

**B. Committee Service Compensation**

Each Eligible Director will receive annual Board committee service retainers as set forth below in respect of their service on each applicable committee of the Board, paid in cash and equity as follows (each, a "**Committee Service Retainer**"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.A cash payment equal to 70% of the aggregate value of the applicable Committee Service Retainer (each, a "**Committee Cash Retainer**"); and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.An RSU Award for a number of shares equal to (i) 30% of the applicable value of the Committee Service Retainer divided by (ii) the Fair Market Value (as defined in the Plan) of one share of Common Stock the date of grant, rounded down to the nearest whole share (each, a "**Committee RSU Award**").

Committee Cash Retainers will be payable in equal quarterly installments in advance on the first day of each fiscal quarter. If an Eligible Director joins a committee of the Board on a day other than the first day of a fiscal quarter, the first quarterly installment will be pro-rated based on the number of days remaining in such fiscal quarter. All installments are vested upon payment.

Effective as of immediately after the conclusion of each Annual Meeting, beginning with the Annual Meeting held on December 14, 2022, Committee RSU Awards will be granted to each then-serving Eligible Director automatically, and without further action by the Board. If an Eligible Director joins a Committee after the date of an Annual Meeting, such Eligible Director will automatically, and without further action by the Board, be granted a pro-rated portion of the applicable Committee RSU Award effective upon his or her appointment date, based on the number of days remaining between such appointment date and the first anniversary of the immediately preceding Annual Meeting.

<u>Committee Service Retainers</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Audit Committee:

Chair - $25,000

Member - $12,500

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Compensation Committee:

Chair - $20,000

Member - $10,000

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Nominating and Governance Committee:

Chair - $20,000

Member - $10,000

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Finance Committee:

Chair - $25,000

Member - $12,500

**D. Expenses**

The Company will reimburse each Eligible Director for ordinary, necessary and reasonable out-of-pocket expenses incurred by such director in connection with attendance at Board or committee meetings or incurred in connection with the performance of Board business; provided, that such director timely submits to the Company appropriate documentation substantiating such expenses.

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**E. Vesting of Equity Awards; Directors Resident Outside of U.S.** 

All equity awards granted to Eligible Directors under this Policy (or otherwise) shall vest in full upon the earlier of (i) the first anniversary of the most recent Annual Meeting held prior to the date of grant, (ii) the date of the next Annual Meeting held following the date of grant, and (iii) upon a Change in Control (as defined in the Plan), subject in each case to the Eligible Director's Continuous Service through such date.

Notwithstanding anything to the contrary in this Policy, an Eligible Director who is not a United States resident shall receive, in lieu of any Annual RSU Award or Committee RSU Award to be granted under this Policy, an additional Board Service Retainer or Committee Cash Retainer, as applicable, in an amount equal to the stated dollar value of the applicable RSU Award(s).

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## Ex-31

**Exhibit 31.1**

**CERTIFICATION OF CHIEF EXECUTIVE OFFICER**

**PURSUANT TO SECTION 302 OF**

**THE SARBANES-OXLEY ACT OF 2002**

I, Mark W. Wong, certify that:

1. I have reviewed this report on Form 10-Q of S&W Seed Company (the "registrant");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: February 13, 2023

---

| |
|:---|
| /s/ Mark W. Wong |
| President and Chief Executive Officer |
| (Principal Executive Officer) |

---

------

## Ex-31

**Exhibit 31.2**

**CERTIFICATION OF CHIEF FINANCIAL OFFICER**

**PURSUANT TO SECTION 302 OF**

**THE SARBANES-OXLEY ACT OF 2002**

I, Elizabeth Horton, certify that:

1. I have reviewed this report on Form 10-Q of S&W Seed Company (the "registrant");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: February 13, 2023

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| |
|:---|
| /s/ Elizabeth Horton |
| Elizabeth Horton<br>Chief Financial Officer<br>(Principal Financial and Accounting Officer) |

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## Ex-32

**Exhibit 32.1**

**CERTIFICATION PURSUANT TO**

**18 U.S.C. SECTION 1350**

In connection with the Quarterly Report on Form 10-Q of S&W Seed Company, or the Company, for the quarter ended December 31, 2022 as filed with the Securities and Exchange Commission on the date hereof, or the Report, I, Mark W. Wong, President and Chief Executive Officer of the Company, certify, pursuant to § 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1350, that to my knowledge:

**1.**The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or 78o(d)); and

**2.**The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: February 13, 2023

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| |
|:---|
| /s/ Mark W. Wong |
| Mark W. Wong |
| President and Chief Executive Officer<br>(Principal Executive Officer) |

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## Ex-32

**Exhibit 32.2**

**CERTIFICATION PURSUANT TO**

**18 U.S.C. SECTION 1350**

In connection with the Quarterly Report on Form 10-Q of S&W Seed Company, or the Company, for the quarter ended December 31, 2022 as filed with the Securities and Exchange Commission on the date hereof, or the Report, I, Elizabeth Horton, Chief Financial Officer of the Company, certify, pursuant to § 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1350, that to my knowledge:

**1.**The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or 78o(d)); and

**2.**The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: February 13, 2023

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| |
|:---|
| /s/ Elizabeth Horton |
| Elizabeth Horton  |
| Chief Financial Officer<br>(Principal Financial and Accounting Officer)<br>|

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