Document:

Exhibit 10.1

 Exhibit 10.1 
 REVOLVING CREDIT AGREEMENT 
 THIS REVOLVING CREDIT AGREEMENT (the
“Agreement”), dated December 28, 2011, is made and entered into by and between Pegasus Funding, LLC, a Delaware limited liability company (“Borrower”), and Fund Pegasus, LLC, a Delaware limited liability company, or
its assignee (“Lender”). 
 BACKGROUND 
 WHEREAS, Borrower and Lender, among others, are parties or signatories to a certain Limited Liability Company Operating Agreement of Pegasus Funding, LLC, dated of even date herewith (the
“Operating Agreement”), which, among other things, contains the agreement of Lender to provide financing for the business and operations of Borrower (the “Credit Facility”), as described herein. Capitalized terms not otherwise
defined herein shall have the meanings set forth in the Operating Agreement or in the respective Loan Documents, as defined herein. 
 WHEREAS, Lender and Borrower desire to confirm the terms and conditions of the Credit Facility, including the assumption by Borrower of certain liabilities outstanding to Lender in consideration of
the transfer to Borrower of certain assets held by an Affiliate of Borrower, all of the forgoing as more particularly described herein and in the Operating Agreement. 
 NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained, the parties hereto, intending to be legally bound, hereby agree as follows: 

1. The Credit Facility. Subject to the terms and conditions of this Agreement and the Operating Agreement, Lender shall make Loans
to Borrower of up to TWENTY-ONE MILLION EIGHT HUNDRED THOUSAND DOLLARS ($21,800,000) per annum (the “Total Annual Commitment”), with interest calculated at the rate of one percent (1%) per annum, payable monthly in arrears and the
earlier of five (5) years or the expiration or termination of the Operating Agreement (the “Term”), when and as required under Section 1.2 below and Lender shall be the exclusive funding source of Borrower during the Term, as
follows: 
 1.1 Credit Facility: 
 (a) Up to TWENTY MILLION ($20,000,000) per year shall be utilized by Borrower to fund Investments for each twelve (12) month period of the Term (each such annual amount, in the aggregate, the
“Annual Investment Advance Commitment” and individually, the “Investment Advances” or the “Advances”). 
 (b) Up to an aggregate of NINE HUNDRED THOUSAND DOLLARS ($900,000) per TEN MILLION DOLLARS ($10,000,000) in Investments for overhead expenses (each, an “Overhead Advance” and in the aggregate
over each twelve (12) month period following the date hereof, the “Annual Overhead Commitment”). (Advances and Annual Overhead Commitment and interest due hereunder shall hereinafter be collectively referred to as the
“Loans”). 

 1.2 Draws. 
 (a) Within each twelve (12) month period of the Term, Lender shall provide Investment Advances and Overhead Advances in immediately available funds until the aggregate amount advanced is equal to the
Total Annual Commitment in accordance with the terms of the Operating Agreement. 
 (b) Borrower shall repay the Investment
Advances, provided that the aggregate amount of Loans outstanding in any twelve (12) month period shall not exceed the Total Annual Commitment, except as otherwise permitted in this Agreement. Borrower shall repay all Advances, and accrued and
unpaid interest, if any, solely from Distributable Cash Flow as provided in Article V of the Operating Agreement or if funds from the Loans are still in the Operating Account from the Operating Account. . Prior to the Maturity Date, so long as no
Event of Default shall have occurred and be continuing, Lender's sole recourse for the repayment of the Loans shall be from Distributable Cash Flow in accordance with Section 5.1 of the Operating Agreement, payable within ten (10) days of
the end of each month from the balance in the Proceeds Account. Subject to Section 2.3 below, during the continuation of an Event of Default, Borrower shall pay the outstanding principal balance of the Advances, plus accrued interest thereon,
within ten (10) days after the written demand thereof by Lender. 
 1.3 Additional Advances. Lender may, at the
request of Borrower, in its sole but reasonable discretion, make Advances in any calendar year in excess of the Annual Investment Advance Commitment (the “Additional Investment Advances”) Notwithstanding any other provision hereof, Lender
may use outside sources of capital or financing to make Additional Investment Advances, and in any such case, upon notice to Borrower, the reasonable cost of such outside capital or financing, shall be deemed included in the amount of the Loans for
purposes hereof and Section 5.1 of the Operating Agreement. Lender, in its reasonable discretion, may increase the Total Annual Commitment, upon request of Borrower. If Advances plus Overhead Advances in any twelve (12) month period
following the date hereof exceed the Total Annual Commitment, Lender’s cost of funds from third party lenders shall be added to the Loans. The PLF Parties shall have no obligation to repay all or any Advances or Overhead Advances under this
Agreement, the Operating Agreement or the Loan Documents except as expressly provided herein or therein. 
 1.4 Security.
The Loans shall be secured by a first priority security interest in the assets of Borrower to be evidenced by this Agreement, a Revolving Promissory Note (the “Note”) and a Security Agreement of even date herewith in form acceptable to
Lender. This Agreement, the Note and the Security Agreement are referred to herein and in the Operating Agreement as, the “Loan Documents”. 

 1.5 Use of Proceeds. Borrower agrees that all proceeds of the Loans shall be used
strictly as permitted under this Agreement and the Operating Agreement. 
 1.6 Prior Advances. The Interim Funding
Agreement shall be deemed terminated as of the date hereof and superseded by the terms of this Agreement, the Security Agreement and the Note. The Asta Parties acknowledge and agree that: 

(a) On and as of the date of this Agreement, Asta has provided PLF with (i) the aggregate amount of Four Million Dollars
($4,000,000) (the “Initial Loan”) to fund the acquisition of certain Purchase Agreements (the “Interim Investments”), and (ii) an additional amount equal to Three Hundred Sixty Thousand Dollars ($360,000) (the “Initial
Overhead Advance”) for operating expenses associated with the Interim Investments pursuant to the terms of a certain Interim Claims Funding Term Sheet, executed by ASFI and PLF on September 28, 2011, (the “Interim Agreement”).
The Initial Loan and the Initial Overhead Advance shall bear interest at the rate of one percent (1%) per annum in accordance with the Note; 
 (b) The right of Asta to repayment of the Initial Loan shall be assigned to Lender upon execution hereof, and the obligation to repay such Interim Loan shall be assumed by Borrower pursuant to an
Assignment and Assumption Agreement, to be executed by Asta, Lender and Borrower on terms which incorporate by reference all of the repayment terms of the Loan Documents, and which shall fully and finally discharge PLF from any further obligation to
Asta or any other party with respect to the Interim Agreement, the Initial Loan or the Investment, except as undertaken pursuant to this Agreement; 
 (c) The Interim Investments shall be irrevocably assigned and transferred by Asta and PLF to Borrower, following which assignment and transfer, the Interim Investments shall be treated, for all purposes,
as Investments made pursuant to the Operating Agreement, including for purposes of Section 5.1 thereof; 
 (d) The amount
of the Interim Loan shall be credited toward fulfillment of the Annual Investment Advance Commitment applicable to the first twelve (12) month period following the date of this Agreement; and 

(e) The Initial Overhead Advance shall be credited toward the Annual Overhead Commitment applicable to the first twelve (12) month
period following the date of this Agreement. 
 1.7 Interest on Advances. Interest of one percent (1%) per annum
shall accrue and be re-payable monthly on any Advance (except an Additional Annual Advance, as provided in Section 1.3 above) until the Maturity Date, unless an Event of Default, as defined below, shall have occurred, and shall be continuing.
The Note shall bear interest during the continuation of 

  
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an Event of Default, and from and after the Maturity Date until paid in full, at the a rate which is equal to Bank Leumi’s prime rate plus five percent (5%). Any interest not charged herein
which is imposed by operation of Law on the Company shall be borne by the Company. All computations of interest called for under the Loan shall be made on the basis of a 360 day year for the actual number of days elapsed.

1.8 Maturity Date. Notwithstanding any other provision hereof, the entire outstanding amount of all Advances, together with
accrued interest thereon, if any, shall be due in full on a date (the “Maturity Date”) as set forth in the Operating Agreement which is the earlier of (a) the date of the last Advance made by Lender to Borrower; or (b) occurrence
of any of the events giving rise to the dissolution or termination of Borrower as specified in the Operating Agreement, or (c) subject to Section 2.3 below, an Event of Default. 

1.9 Prepayment of the Advances Credit Facility. Borrower may prepay the outstanding principal balance of the Credit Facility, in
whole or in part, without the prior written consent of Lender and without premium or penalty. 
 2. Events Of Default And
Remedies/Subordination. 
 2.1 Events of Default. Each of the following shall constitute an event of default
(“Event of Default”) under this Agreement: 
 (a) Failure to Make Distributions and Payments. (i) Prior
to the Maturity Date, and so long as an Event of Default shall have occurred and be continuing, the failure of Borrower to make the distributions of Distributable Cash Flow and Capital Transaction Proceeds to Lender required to be made under Article
V of the Operating Agreement, and (ii) from and after the Maturity Date, or during the continuation of an Event of Default, the failure of Borrower to make any required payment of the principal amount of and accrued interest on the Advances
when and as due as provided herein or in accordance with the Note or Operating Agreement; 
 (b) Breach. Any material
breach by Borrower or the PLF Parties of its or his representations, warranties, covenants or obligations set forth in the Operating Agreement, this Agreement, the Consulting Agreements, or any of the Loan Documents, which breach is not cured within
thirty (30) days after Borrower's receipt of written notice from Lender describing such breach; 
 (c) Insolvency.
If Borrower becomes insolvent or generally fails to pay, or admits in writing its inability to pay, its debts as they mature, or applies for, consents to, or acquiesces in the appointment of a trustee, receiver or other custodian for Borrower or any
property thereof; or, in the absence of such application, consent or acquiescence, a trustee, 

  
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receiver or other custodian is appointed for Borrower or for a substantial part of the property of the Borrower and is not discharged within 60 days; or the bankruptcy, reorganization, debt
arrangement, or other proceeding under any bankruptcy or insolvency law, or any dissolution or liquidation proceeding is instituted by or against Borrower and if instituted against Borrower an order for relief or similar order is entered against
Borrower and remains undismissed for 30 days or Borrower consents to or acquiesces in such proceedings or any warrant of attachment is issued against any substantial portion of the property of Borrower which is not released or bonded within 60 days
of service; and 
 (d) Judgment. If any Judgment is entered against Borrower in the amount of THIRTY-FIVE THOUSAND
DOLLARS ($35,000) or more. 
 2.2 Remedies. If any Event of Default described in Section 2.1 shall occur and be
continuing following the expiration of the notice period herein, Lender may declare the Note and the Advances immediately due and payable without further demand and shall have all rights as set forth herein, in the Note and in the Security
Agreement. Upon an Event of Default, Borrower shall cease making nay new Loans or withdrawing any funds from its bank accounts without Lender’s express, prior written consent. 

2.3 Subordination. Lender hereby agrees that, notwithstanding an Event of Default under the Operating Agreement or any of the Loan
Documents, other than an Event of Default resulting from a breach of fiduciary duty by, or the gross negligence or willful misconduct of, the PLF Parties, Lender shall subordinate and forbear in the exercise of its rights and remedies under the Loan
Documents and the Operating Agreement, (including any right to accelerate repayment of the Loans or to foreclose on the assets of Borrower), to the rights of PLF and the PLF Parties under the Operating Agreement as necessary to enable the PLF to
receive payments due pursuant to the Operating Agreement on its Percentage Interest with respect to each Investment at the time and in the manner required by Section 5.1 of the Operating Agreement and only to the extent that an Investment has
been made. To the extent the PLF Parties are entitled to any Management Fees or Consulting Fees, such amounts shall be subject and subordinate to Lender’s rights to repayment of the Loan and Interest except and to the extent that the PLF
Parties continue to render services under any of the Asta Agreements with the Company for which such compensation becomes payable following an Event of Default. 
 3. Representations And Warranties Of Borrower. 
 3.1 Organization and
Authority. Borrower is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware and has the power and authority to use its assets and carry on the Business as is now conducted. The
execution, delivery and performance by Borrower of this Agreement, the Note [and the Security Agreement] and the consummation of the transactions contemplated hereby and thereby, is within Borrower’s corporate authority and has been duly
authorized by proper corporate proceedings of Borrower. 

  
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 3.2 Validity of Agreement. This Agreement, the Note [and the Security Agreement] have
been duly authorized, executed and delivered by Borrower and constitute legal, valid, binding and enforceable obligations of Borrower. The execution and delivery of this the Loan Documents by Borrower and performance of its obligations thereunder do
not require the consent or approval of any third party and will not result in any breach, violation of default under Borrower’s Certificate of Formation or Operating Agreement or of any agreement or decree to which Borrower is a party or by
which Borrower is bound. 
 4. General. 
 4.1 Delay. No delay on the part of Lender in the exercise of any power or right shall operate as a waiver thereof, nor shall any single or partial exercise of any power or right preclude any other
or further exercise thereof, or the exercise of any other power or right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. 
 4.2 Notice. Any notice hereunder to the Borrower or Lender shall be in writing and, if mailed, shall be deemed to be given when sent by registered or certified mail, postage prepaid, and addressed
to Borrower or Lender at their respective addresses set forth below, or at such other address as Borrower or Lender may, by written notice, designate as its address for purposes of notice hereunder. 

 

	 	Borrower:	Pegasus Funding, LLC 

	 	    	c/o Asta Funding, Inc. 

	 	    	221 Sylvan Avenue 

	 	    	Englewood Cliffs, NJ 07632 

With required copy to: 

	 	    	Dominic S. Liberi, Esq. 

	 	    	1617 JFK Blvd. 19th Floor 

	 	    	Philadelphia, PA 19103 

With required copy to: 

	 	    	Pegasus Legal Funding, LLC 

	 	    	291 Broadway, Suite 300 

	 	    	New York, NY 10007 

	 	    	Attention: Mr. Max Alperovich 

  
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	 	Lender:	Fund Pegasus, LLC. 

	 	    	221 Sylvan Avenue 

	 	    	Englewood Cliffs, NJ 07632 

	 	    	Attention: Mr. Gary Stern, CEO 

 With required copy to: 

	 	    	Asta Funding, Inc. 

	 	    	221 Sylvan Avenue 

	 	    	Englewood Cliffs, NJ 07632 

	 	    	Attention: Mr. Gary Stern, CEO 

  

	 	    	Ted D. Rosen, Esq. 

	 	    	Fox Rothschild, LLP 

	 	    	 100 Park Avenue,
15th Floor 

	 	    	New York, NY 10017 

 4.3
Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction. 
 4.4
Law/Venue. This Agreement has been executed in and shall be construed and enforced in accordance with, and governed by, the laws of the State of Delaware. Borrower hereby irrevocably and unconditionally submits, for itself and its property,
to the nonexclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York City, and any appellate court thereof, in any action or proceeding arising out of or relating to this Agreement, the
Security Agreement or the Note, or for recognition or enforcement of any judgment. Each of the parties hereto hereby irrevocably and unconditionally agrees that, to the extent permitted by applicable law, all claims in respect of any such action or
proceeding may be heard and determined in such New York State court or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Except as 

  
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provided in Section 2.3 hereof, nothing in this Agreement shall affect any right that the Lender or any other secured party may otherwise have to bring any action or proceeding relating to
this Agreement, the Security Agreement or the Note against any Borrower or any of its property, in the courts of any jurisdiction. 
 4.5 Successors and Assigns. This Agreement shall be binding upon the Borrower and Lender and their respective successors and assigns, and shall inure to the benefit of Lender and the heirs and
assigns of Lender. Neither party shall assign its rights or duties hereunder without the prior written consent of the other party, except that Lender may assign it’s the Loan Documents to an affiliate to Lender. 

4.6 Entire Agreement. This Agreement, the Operating Agreement, the Note and the Security Agreement and all other instruments and
agreements issued hereunder or referenced herein supersede all prior negotiations and agreements between the parties with respect thereto. 
 4.7 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (a) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (b) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 4.8 WAIVER OF SPECIAL DAMAGES. THE BORROWER WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT THE
UNDERSIGNED MAY HAVE TO CLAIM OR RECOVER FROM THE LENDER IN ANY LEGAL ACTION OR PROCEEDING ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES. 
 4.9 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute an original and all of which taken together shall constitute one and the same
instrument. 
 4.10 Modification. This Agreement may not be changed orally, but only by an agreement in writing signed by
the party or parties against whom enforcement of any waiver, change, modification, or discharge is sought. 

  
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 4.11 Conflict. If there is any conflict between any provision of this Agreement and the
Operating Agreement, the provisions of the Operating Agreement shall control. 
 [THE BALANCE OF THIS PAGE IS INTENTIONALLY LEFT
BLANK] 

  
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 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
respective duly authorized officers as of date first written above. 
  

			
	“Borrower”
	
	PEGASUS FUNDING, LLC
		
	By:	 	/s/    Max Alperovich         
	Name:	 	Max Alperovich
	Title:	 	Authorized Officer

  

			
	“Lender”
	
	FUND PEGASUS, LLC
		
	By:	 	/s/    Gary Stern         
	Name:	 	Gary Stern
	Title:	 	Manager/CEO

  
 9Exhibit 10.2

 Exhibit 10.2 
 SECURITY AGREEMENT 
 THIS SECURITY AGREEMENT (the
“Agreement”) is made and entered into as of December 28, 2011, by and between Pegasus Funding LLC, a Delaware limited liability company (“Debtor”), with a principal place of business at 291 Broadway, Ste. 300, New York, NY
10007 and Fund Pegasus, LLC, a Delaware limited liability company (“Secured Party”), with a principal place of business at 210 Sylvan Avenue, Engelwood Cliffs, NJ 07632 

BACKGROUND 
 WHEREAS, Debtor, ASFI Pegasus Holdings, LLC, Pegasus Legal Funding, LLC (“PLF”) and Secured Party, among others, are parties or signatories to a certain Operating Agremeent, dated of even
date herewith (the “Operating Agreement”). Capitalized terms not otherwise defined herein shall have the meanings set forth in the Operating Agreement. 
 WHEREAS, Debtor and Secured Party are parties to that certain Revolving Credit Agreement (the “Revolving Credit Agreement”) and that certain Revolving Promissory Note (the
“Note”) each dated of even date herewith, together with this Agreement, collectively, the “Loan Documents.” 

WHEREAS, Secured Party requires that Debtor secure its obligations to Secured Party pursuant to the Revolving Credit Agreement and
the Note by granting to Secured Party a security interest in all assets of the Debtor, subject to PLF’s rights under the Section 2.3 of the Revolving Credit Agreement. 

AGREEMENT 
 NOW, THEREFORE, in consideration of the foregoing Background, which is incorporated herein by reference, other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties hereto agree as follows: 
 1. Definitions.

 (a) As used herein, unless otherwise defined herein, all terms shall have the meanings set forth in the Delaware Uniform
Commercial Code, as amended from time to time (“Delaware Uniform Commercial Code”). 
 (b) “Debtor’s
Liabilities” shall mean all liabilities, obligations and indebtedness of any and every kind and nature, heretofore, now or hereafter owing, arising, due or payable by Debtor to Secured Party pursuant to the Loan Documents. 

 (c) “Proceeds” shall mean whatever is received when any of the Collateral (as
hereinafter defined) is sold, exchanged, leased, collected, or otherwise disposed of, including, without limitation, cash, rents, issues, profits, credits, rebates, refunds, insurance proceeds, negotiable instruments and other instruments for the
payment of money, chattel paper, security agreements, other documents, and other cash and noncash proceeds. 
 2.
Grant of Security Interest. 
 (a) Subject to the rights of PLF under Section 2.3 of the Revolving Credit Agreement,
Debtor hereby grants to Secured Party a continuing first priority security interest in all of Debtor’s presently owned and hereafter acquired assets including but not limited to: 

(i) the proceeds from Liquidations; 
 (ii) the bank accounts of Debtor, (including but not limited, to the Proceeds Account, Overhead Account, the Investment Advance Account), 

(iii) Purchase Agreements and proceeds thereof; 
 (iv) subject to the rights of PLF, as licensor, under Section 6.17 of the Operating Agreement, trademarks, service marks, trade names, logos, label designs, brand names, patents, patent applications;

 (v) patent rights, ideas, discoveries, inventions, copyrights, drawings, sketches, diagrams, specifications, models,
writings, documents, trade secrets, data, databases, computer applications, computer programs, computer software (including both source code and object code), plans, blueprints, patterns, licenses, formulas, technology, technical processes,
technical data, other know-how; 
 (vi) all of Debtor’s presently owned and hereafter acquired accounts receivable;
accounts; money; checks; deposit accounts; securities; investment property; promissory notes; leases; documents; instruments; chattel paper; negotiable instruments; negotiable documents; all other rights to the payment of money whether or not owed,
including, but not limited to, rights to unearned and returned insurance premiums; equipment; general intangibles; goods (including, but not limited to, goods held for sale, returned, reclaimed or repossessed goods, with the right of stoppage in
transit, sold, consigned, leased or otherwise furnished by Debtor); contract rights; contracts; choses in action; rights of action; rights of action; rights; notes; manuals; preference claims; motor vehicles; furniture; office equipment; machinery;
warranties; bills of sale; records (which term shall include correspondence; memoranda; tapes; data; books of account, and other books relating to or being records of the accounts or by which the accounts are or may hereafter be secured, evidenced,
acknowledged or made payable; books; paper; ledger sheets; writings; information; records; files; bills; receipts; deeds; certificates and documents of ownership; invoices; invoice documents and other documents or transcribed information of any
type, whether expressed in the ordinary or in machine language); merchandise; supplies; incidentals; office supplies; packaging materials; inventory, whether owned, consigned or held in consignment (including, but not limited to, inventory held for
sale or lease or furnished or to be furnished under contracts of service); raw 

 
materials; work in process; goods used or consumed in business and all other personal property of whatever kind or description; wherever located, now existing or hereafter acquired, and all
additions, accessories, parts, substitutions, accretions, accessions, increases and attachments thereto and thereof and components and replacements thereof and products and Proceeds of the same and all guaranties, security and other collateral with
respect to any of the foregoing (collectively, the “Collateral”). 
 (b) Debtor shall, at its own cost and expense,
concurrently with the execution of this Agreement, and at any time(s) thereafter, at the request of Secured Party, execute and deliver to Secured Party such financing statements, continuation statements, amendments and other documents (collectively,
along with this Agreement, the “Security Documents”) and take such actions, and cause to be taken such actions (including delivery of Collateral to Secured Party), as Secured Party determines shall be appropriate to perfect and to keep
perfected Secured Party’s security interest in the Collateral and to consummate fully all of the transactions contemplated herein, and Debtor shall pay the cost of all public office filings deemed appropriate by Secured Party. Photocopies of
this Agreement may be filed as or with financing statements. 
 3. Priority and Continuing Nature of Security
Interest. Debtor represents and warrants that it is now, and at all times hereafter shall be, the sole owner of indefeasible title to the Collateral, free and clear of all liens, judgments, charges, seizures, attachments, levies, mortgages,
security interests, garnishments, and other encumbrances of any kind whatsoever, other than the rights of PLF and the PLF Members to receive payments from the Debtor as specified in Section 2.3 of the Revolving Credit Agreement, and Debtor
shall not permit the Collateral to be reached by judicial process, except for the security interests granted to Secured Party, heretofore or herein, except by reason of Section 2.3 of the Revolving Credit Agreement. Subject as aforesaid, Debtor
shall keep the Collateral free from, and defend the Collateral against, all liens, judgments, charges, seizures, attachments, levies, mortgages, security interests, garnishments and other encumbrances of any kind whatsoever., . This Agreement and
the security interests granted hereby shall remain in full force and effect until Secured Party shall file termination statements terminating all financing with respect to the Collateral, which termination statements Secured Party shall promptly
file upon satisfaction of Debtor’s Liabilities under the Loan Documents. 
 4. Disposal of Collateral. Debtor
shall not, without the prior written consent of Secured Party, sell, offer to sell, contract to sell, lease or otherwise dispose of or transfer all or any part of the Collateral, or any interest therein until all of Debtor’s Liabilities have
been satisfied in full, expect for any Collateral that is replaced with similar Collateral of equivalent or greater value or which is sold or disposed of in the general course of business. 

5. Use and Maintenance of Collateral. The Collateral shall be used by Debtor for Debtor’s business purposes only, and Debtor
shall maintain the Collateral in good condition and repair; shall not abandon, conceal, injure or destroy the Collateral, nor deface any identifying marks thereon; shall not permit the Collateral to be used illegally; shall not permit anything to be
done to impair the value of the Collateral and will pay and discharge all taxes, charges, assessments and other impositions derived from the Collateral or from its use and from the operation of Debtor’s business, as well as the cost of repairs
to or maintenance of the Collateral. 

  
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 In the event Debtor fails to pay any of the aforesaid sums, Secured Party may, but shall not be required to,
do so for Debtor’s account with the right of subrogation. Any and all sums so advanced by Secured Party shall constitute an item of Debtor’s Liabilities and shall bear interest at the rate of Bank Leumi’s prime rate plus five percent
(5%) per annum until paid, and said unpaid sums and said interest thereon shall be secured by the Collateral and be payable on demand. 
 6. Destruction of Collateral. No injury to or loss or destruction of the Collateral shall relieve Debtor’s obligation to pay and perform in full Debtor’s Liabilities. 

7. Affirmative Representations and Covenants of Debtor. Debtor covenants and warrants that: 

(a) The name of Debtor as reflected in its Certificate of Formation is Pegasus Funding LLC. the principal place of business of the Debtor
is New York, New York. Debtor was duly formed as a limited liability company and validly exists under the laws of the State of Delaware. 
 (b) Debtor shall not, without providing thirty (30) days prior written notice to Secured Party, (i) amend its Certificate of Formation to change Debtor’s name, (ii) change its address
from that set forth herein or (iii) change its state of organization. 
 (c) Debtor shall, at Secured Party’s request,
segregate any or all Proceeds and hold same, which shall constitute trust funds, in trust, for Secured Party’s benefit, and/or deliver said Proceeds to Secured Party. 
 (d) Debtor is not a party to, does not hold, and shall not acquire or enter into any contracts giving, or to give rise to any accounts from the United States or any department, agency or instrumentality
thereof without Secured Party’s prior written consent, and shall execute all papers and take all actions requested by Secured Party to cause all monies due and to become due under such contracts to be assigned to Secured Party and notice to be
given to the government under the Federal Assignment of Claims Act or any similar law. 
 8. Power of Attorney. Upon an
Event of Default (as defined below), Debtor hereby irrevocably appoints Secured Party and any of its agents and attorneys as Debtor’s attorney-infact with full power and authority to do any and every act which Debtor is obligated by this
Agreement to do with respect to the Collateral and Secured Party’s security interest therein, including, without limitation, the right to exercise all rights of Debtor in the Collateral, to make collections, to sign the name of Debtor on checks
received, to execute any and all documents and instruments and to do all things necessary to preserve and protect the Collateral and to protect Secured Party’s security interest in the Collateral and Secured Party’s interest in insurance
proceeds and/or unearned premiums. Neither Secured Party nor any of his agents or attorneys shall be liable for any act of commission or omission, nor for any error of judgment or mistake of fact or law. This power, being coupled with an interest,
is irrevocable so long as any of Debtor’s Liabilities remain unsatisfied. 

  
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 9. Events of Default. Debtor shall be in default under this Agreement upon the
happening of any of the following events or conditions (an “Event of Default”): 
 (a) The failure of Debtor, PLF or
the PLF Parties to comply with, or any of the aforesaid parties breach of, any obligation, undertaking, representation, agreement, condition, warranty, or covenant in favor of Secured Party, contained or referred to in the Note, the Revolving Credit
Agreement, the Operating Agreement, or the Consulting Agreements with either Max Alperovich or Alexander Khanas or this Agreement. 
 (b) Any event occurs which results in the acceleration of the maturity of any indebtedness of Debtor or any other party liable for any or all of Debtor’s Liabilities to any party, other than Secured
Party, under any indenture, agreement or other undertaking. 
 (c) Loss, theft, governmental taking or condemnation, damage,
destruction, sale or other transfer (except as herein expressly provided) or encumbrance to or on any of the Collateral (except as herein expressly provided), or the making of any levy, lien, charge, garnishment, seizure or attachment with respect
to any property of Debtor (except as herein expressly provided) or of any other party liable for any or all of Debtor’s Liabilities. 
 (d) Appointment of a receiver for any part of the property of Debtor, assignment for the benefit of creditors by or against Debtor, or the commencement of any proceeding under any bankruptcy or insolvency
laws by or against Debtor or any other party liable for any or all of Debtor’s Liabilities. 
 (e) Actual or attempted (or
preparation for) dissolution, termination of existence, liquidation, merger, insolvency, business failure, reorganization, or cessation of operations of Debtor or of any other party liable for any or all of Debtor’s Liabilities (or death of any
such other party). 
 (f) The termination of the Operating Agreement. 

(g) A judgment is obtained against Debtor in the amount of at least $35,000. 

10. Remedies. Upon the occurrence of an Event of Default, in addition to any other rights, powers or remedies, equitable or legal,
Secured Party may have, Secured Party may, at its option, exercise any and all of the following rights, all of which shall be cumulative to the extent permitted by law, subject in all events, to the rights of PLF specified in the Revolving Credit
Agreement: 
 (a) Cure or attempt to cure such default and, in doing so, Secured Party may elect temporarily to take possession
and/or control of the Collateral, as agent for Debtor, and for Debtor’s account, but no cure or attempt to cure by Secured Party shall constitute a waiver of any of Secured Party’s rights, powers and remedies in respect of such default.

 (b) Notify the account debtors under any or all accounts, and any other party(ies) indebted to Debtor, to make payment
directly to Secured Party, or to a lockbox, as provided below, and take control and possession of any or all Proceeds. Debtor hereby 

  
 5 

 
irrevocably appoints Secured Party as Debtor’s attorney-in-fact with full power and authority, including the power of substitution, at the cost and expense of Debtor, to demand payment,
collect payment and compromise and/or institute any action or proceeding for the collection of any monies due upon any accounts (or other sums owing to Debtor) and to otherwise enforce the rights set forth in this Paragraph 10. Pursuant to the
foregoing, Secured Party may institute and prosecute suits in the name of either Debtor or Secured Party, as Secured Party shall elect, for the collection of any monies due and take all steps and actions deemed by Secured Party to be necessary or
desirable to affect collection, to enforce payment of any account and to settle, compromise, sell, assign, discharge or release, in whole or in part, any accounts and to make allowances and adjustments with respect thereto. Debtor shall cooperate
fully with Secured Party and shall supply such records, witnesses and the testimony of such of its officers, employees or agents as reasonably may be required by Secured Party; provided, however, that the rights of Secured Party, set forth in this
Paragraph 10, may be enforced by Secured Party before, as well as after, the occurrence of an Event of Default. 
 (c)
Accelerate any or all payments and other performance due by Debtor to Secured Party and otherwise declare any or all of Debtor’s Liabilities immediately due and/or payable in full, as the case may be. 

(d) Exercise any and all rights, powers and remedies granted to a secured party upon default under the Delaware Uniform Commercial Code,
and/or under any other applicable law, with respect to the Collateral, including, but not limited to, the right to sell, lease or otherwise dispose of the Collateral, or any part thereof, at public or private sale, for cash, credit or combination
thereof. Secured Party may require Debtor to assemble the Collateral or any part thereof and make it available to Secured Party at a place to be designated by Secured Party. Notice of the time and place of any public sale or of the date after which
any private sale or other intended disposition is to be made is agreed to be commercially reasonable if sent five (5) days in advance thereof. Secured Party shall have the right to purchase at any such sale(s), free from any equity of
redemption and other claims. The Proceeds of any sale or other disposition of the Collateral shall first be applied to Secured Party’s expenses, fees, costs and charges of retaking, holding, preparing for sale, selling, and the like and to
attorneys’ fees, expenses, costs and charges incurred by Secured Party in connection therewith, and the balance shall be applied on account of Debtor’s Liabilities pursuant to this Agreement. Any surplus shall be paid to Debtor, and Debtor
shall be liable for all deficiencies after liquidation of the Collateral. 
 (e) Use the Collateral in any lawful manner and
collect and receive all rents, income, revenue, earnings, issues and profits therefrom. 
 (f) Use, in furtherance of its
rights, powers and remedies, any of the Collateral. 
 (g) Take any and all actions deemed by Secured Party to be necessary or
advisable to protect its rights and interests hereunder. 

  
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 11. Costs. 

(a) Debtor agrees to reimburse Secured Party for any payment made or any expense, fee, cost or charge incurred by Secured Party in
connection with this Agreement and/or with respect to the Collateral, and without limitation of the foregoing, in furtherance of its rights, powers and remedies hereunder and protection of its interest in the Collateral. Any and all sums so advanced
by Secured Party shall constitute an item of Debtor’s Liabilities and shall bear interest at the rate of Bank Leumi’s prime rate plus five percent (5%) per annum until paid, and said sums and said interest shall be secured by the
Collateral and be payable on demand. 
 (b) If at any time or times hereafter Secured Party employs counsel to assist Secured
Party in any way in connection with this Agreement and/or with respect to the Collateral, and without limitation of the foregoing, in furtherance of its rights, powers and remedies hereunder and protection of its interest in the Collateral
(including, but not limited to, employing counsel to protect, take possession of, or liquidate any Collateral, or to attempt to enforce any security interest or lien in any Collateral, or to enforce any rights of Secured Party, including, but not
limited to, any proceedings by Secured Party under the Bankruptcy Code), Debtor shall pay all legal and other expenses, fees, costs and charges thereby incurred by Secured Party. Any and all sums so advanced by Secured Party shall constitute an item
of Debtor’s Liabilities and shall bear interest at the rate of Bank Leumi’s prime rate plus five percent (5%) per annum (pre- and post -judgment) until paid, and said sums and said interest shall be secured by the Collateral and be
payable on demand. 
 12. No Waiver; Cumulative Remedies. No failure or delay on the part of Secured Party in exercising
any right, power or privilege hereunder shall operate as a waiver thereof. Nor shall any single or partial exercise of any right, power or privilege hereunder preclude or require any other or further exercise thereof or the exercise of any other
right, power or privilege. Secured Party shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by Secured Party, and then only to the extent
specifically set forth in writing. A waiver with respect to one event shall not be construed as continuing or as a bar to or a waiver of any right or remedy with respect to a subsequent event. The rights and remedies herein provided are cumulative
and not exclusive of any rights or remedies provided by law. 
 13. Waiver. Debtor hereby waives presentment for
payment, notice of demand, maturity, notice of non-payment, partial payment, dishonor, protest, notice of default and all other demands and notices in connection with the creation, delivery, acceptance, performance, default, collection or
enforcement of this Agreement except as set forth explicitly to the contrary herein. Debtor also waives all benefit that might accrue to Debtor by virtue of any present or future laws exempting any property, real or personal, or any part of the
proceeds arising from any sale of any such property, from attachment, levy, or sale under execution, or providing for any stay of execution, exemption from civil process or extension of time for payment. Debtor agrees that any real estate that may
be levied upon pursuant to a judgment obtained by virtue hereof, or on any writ of execution issued thereon, may be sold in whole or in part in any order desired by Secured Party. 

  
 7 

 14. Waiver of Immunity. Debtor hereby irrevocably and unconditionally waives
any right to claim immunity in respect of itself or any of the Collateral, including immunity from attachment in aid of execution of judgment, and immunity from execution of judgment, all in respect of any legal suit, action or proceeding arising
out of or relating to this Agreement. 
 15. Notice. All notices permitted or required under this Agreement shall
be deemed given when deposited in the United States mail. All notices by mail shall be sent by registered or certified mail, postage prepaid, return receipt requested, addressed to the respective parties at the addresses set forth above or as the
parties may, from time to time, designate in writing. 
 16. Applicable Law; Jurisdiction. This Agreement shall be
governed by the laws of the State of Delaware, except to the extent that the Delaware Uniform Commercial Code governs. Debtor and Secured Party each agrees that the Courts of the State of New York, County of New York and the United States District
Court for the Southern District of New York shall have exclusive jurisdiction to hear and determine any claims or disputes pertaining or arising directly or indirectly to this Agreement or any amendment or supplement hereto or to any matter arising
herefrom or therefrom. Debtor and Secured Party expressly submit and consent in advance, to such exclusive jurisdiction in any action or proceeding in such courts, agree that venue will be proper in such courts for all such matters. 

17. Instrument under Seal. This instrument is intended to take effect as an instrument under seal. 

18. Severability. If any provision or subprovision of this Agreement shall for any reason be held to be invalid or
unenforceable, such invalidity or unenforceability shall not affect any other provision or subprovision hereof, but this Agreement shall be construed as if such invalid or unenforceable provision or subprovision had never been contained herein.

  
 8 

 19. Legal Effect. This Agreement and all other instruments and documents
executed and delivered pursuant hereto or to consummate the transactions contemplated hereunder shall be binding upon and inure to the benefit of the successors and assigns of the parties thereto. 

20. Entire Agreement: Modification and Captions. This Agreement contains the entire agreement between the parties with
respect to the subject matter hereof other than as set forth in the Note. Further, there are no oral agreements between the parties. The captions of the various sections hereof are for convenience only and shall not control or affect the meaning or
construction of any of the terms or provisions of this Agreement. Any change or modification hereof must be in writing and signed by both parties hereto. 
 21. Acknowledgement. Notwithstanding anything to the contrary in this Agreement, Secured Party hereby authorizes Debtor to take all actions necessary to comply with the provisions of Section 2.3
of the Revolving Credit Agreement in respect of the rights of the PLF Parties and PLF specified therein, and to comply with all of Debtor’s obligations to the PLF Parties and PLF under and pursuant to the Operating Agreement. 

[THE BALANCE OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 

  
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 IN WITNESS WHEREOF, this Security Agreement has been duly executed on the day and
year first above written. 
  

			
	PEGASUS FUNDING LLC
		
	By:	 	/s/    Max Alperovich        
	Name:	 	Max Alperovich
	Title:	 	Authorized Officer

  

			
	FUND PEGASUS, LLC.
		
	By:	 	/s/    Gary Stern        
	Name:	 	Gary Stern
	Title:	 	Manager/CEO

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