Document:

vkin_ex103.htm

EXHIBIT 10.3
  
 Execution Copy
  
 SECURITY AND PLEDGE AGREEMENT
  
 This SECURITY AND PLEDGE AGREEMENT, dated as of December 26, 2018 (this “Agreement”), is between Viking Energy Group, Inc., a Nevada corporation (the “Debtor”) and Bodel Holdings, L.L.C., Cleveland Holdings, L.L.C., Delbo Holdings, L.L.C., DeQuincy Holdings, L.L.C., Gulf Coast Working Partners, L.L.C., Oakley Holdings, L.L.C., SamJam Energy, L.L.C.; and Perry Point Holdings, L.L.C. (collectively, the “Secured Parties”), and is being executed and delivered in connection with the Secured Promissory Note executed and delivered by the Debtor in favor of the Secured Parties on the date hereof (the “Note”).
  
 W I T N E S S E T H:
  
 RECITALS
  
  	  
	A.	The Debtor owns all of the issued and outstanding membership units and/or ownership interests in Ichor Energy Holdings, LLC, a Nevada limited liability company (the “Ichor Holdings Membership Interests”).
	  
	  
	  

	  
	B.	In order to induce the Secured Parties to accept the Note in partial payment of the purchase price under the Purchase and Sale Agreement dated as of September 1, 2018 (the “PSA”) between the Sellers (as defined therein), as sellers, and Debtor, as purchaser, and extend the loans evidenced by the Note, and to secure the prompt payment, performance and discharge in full of all of the Debtor’s obligations under the Note, the Debtor has agreed to execute and deliver to the Secured Parties this Agreement and to grant the Secured Parties a security interest in the Ichor Holdings Membership Interests.

  
 NOW, THEREFORE, in consideration of the agreements herein contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:
  
 1. Certain Definitions. As used in this Agreement, the following terms shall have the meanings set forth in this Section 1. Terms used but not otherwise defined in this Agreement that are defined in Article 9 of the UCC (such as “account”, “chattel paper”, “commercial tort claim”, “deposit account”, “document”, “equipment”, “fixtures”, “general intangibles”, “goods”, “instruments”, “inventory”, “investment property”, “letter-of-credit rights”, “proceeds” and “supporting obligations”) shall have the respective meanings given such terms in Article 9 of the UCC.
   	 
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 (a) “Collateral” means the collateral in which the Secured Parties are granted a security interest by this Agreement and which shall include the following personal property of the Debtor, whether presently owned or existing or hereafter acquired or coming into existence, wherever situated, and all additions and accessions thereto and all substitutions and replacements thereof, and all proceeds, products and accounts thereof, including, without limitation, all proceeds from the sale or transfer of the Collateral and of insurance covering the same and of any tort claims in connection therewith, and all dividends, interest, cash, notes, securities, equity interest or other property at any time and from time to time acquired, receivable or otherwise distributed in respect of, or in exchange for, any or all of the Pledged Securities (as defined below):
  
 (i) all of the issued and outstanding Ichor Holdings Membership Interests; and
  
 (ii) the products and proceeds of all of the foregoing Collateral set forth in clause (i) above.
  
 Without limiting the generality of the foregoing, the “Collateral” shall include all certificates representing such shares and/or equity interests and, in each case, all rights, options, warrants, stock, other securities and/or equity interests that may hereafter be received, receivable or distributed in respect of, or exchanged for, any of the foregoing and all rights arising under or in connection with the Pledged Securities, including, but not limited to:
  
 (i) all other or additional interests, shares, or other securities paid or distributed by way of dividend or otherwise in respect of any of the Pledged Securities;
  
 (ii) all other or additional interests, shares, or other securities paid or distributed in respect of any of the Pledged Securities by way of stock-split, reclassification, combination of shares or similar rearrangement; and
  
 (iii) all other or additional shares, interests, or other securities which may be paid in respect of any of the Pledged Securities by reason of any consolidation, merger, exchange of stock, conveyance of assets, liquidation or similar reorganization provided such consolidation.
  
 Notwithstanding the foregoing, nothing herein shall be deemed to constitute an assignment of any asset which, in the event of an assignment, becomes void by operation of applicable law or the assignment of which is otherwise prohibited by applicable law (in each case to the extent that such applicable law is not overridden by Sections 9-406, 9-407 and/or 9-408 of the UCC or other similar applicable law); provided, however, that to the extent permitted by applicable law, this Agreement shall create a valid security interest in such asset and, to the extent permitted by applicable law, this Agreement shall create a valid security interest in the proceeds of such asset.
  
 (b) “Intellectual Property” intentionally deleted.
  
 (c) “Majority in Interest” means, at any time of determination, the majority in interest (based on then-outstanding principal amounts of Note at the time of such determination) of the Secured Parties.
  
 (d) “Necessary Endorsements” means undated stock powers endorsed in blank or other proper instruments of assignment duly executed and such other instruments or documents as the Secured Parties (as that term is defined below) may reasonably request.
  
 (e) “Secured Obligations” means all of the liabilities and obligations (primary, secondary, direct, contingent, sole, joint or several) due or to become due, or that are now or may be hereafter contracted or acquired, or owing to, of the Debtor to the Secured Parties, including, without limitation, all obligations under this Agreement and the Note. 
   	 
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 (f) “Organizational Documents” means, the documents by which the Debtor was organized (such as a articles of incorporation, certificate of limited partnership or articles of organization, and including, without limitation, any certificates of designation for preferred stock or other forms of preferred equity) and which relate to the internal governance of such entity (such as bylaws, a partnership agreement or an operating, limited liability or members agreement).
  
 (g) “Permitted Liens” means the following:
  
 (i) Liens imposed by law for taxes that are not yet due or are being contested in good faith, which in each case, have been appropriately reserved for;
  
 (ii) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing Secured Obligations that are not overdue by more than thirty (30) days or are being contested in good faith;
  
 (iii) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;
  
 (iv) deposits to secure the performance of bids, trade contracts, leases, statutory Secured Obligations, surety and appeal bonds, performance bonds and other Secured Obligations of a like nature, in each case in the ordinary course of business;
  
 (v) Liens under this Agreement;
  
 (h) “Pledged Interests” shall have the meaning ascribed to such term in Section 4(j).
  
 (i) “Pledged Securities” means all of the Ichor Holdings Membership Interests.
  
 (j) “UCC” means the Uniform Commercial Code of the State of Texas and or any other applicable law of any state or states which has jurisdiction with respect to all, or any portion of, the Collateral or this Agreement, from time to time. It is the intent of the parties that defined terms in the UCC should be construed in their broadest sense so that the term “Collateral” will be construed in its broadest sense. Accordingly if there are, from time to time, changes to defined terms in the UCC that broaden the definitions, they are incorporated herein and if existing definitions in the UCC are broader than the amended definitions, the existing ones shall be controlling.
  
 2. Grant of Security Interest in Collateral. As an inducement for the Secured Parties to extend the loans as evidenced by the Note and to secure the complete and timely payment, performance and discharge in full, as the case may be, of all of the Secured Obligations, the Debtor hereby unconditionally and irrevocably pledges, grants and hypothecates to the Secured Parties a perfected, security interest in and to, a lien upon and a right of set-off against all of its respective right, title and interest of whatsoever kind and nature in and to, the Collateral (a “Security Interest” and, collectively, the “Security Interests”). 
   	 
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 3. Delivery of Certain Collateral. Contemporaneously or prior to the execution of this Agreement, the Debtor shall deliver or cause to be delivered to the Collateral Agent of the Secured Parties (a) any and all certificates and other instruments representing or evidencing the Pledged Securities, and (b) any and all certificates and other instruments or documents representing any of the other Collateral, in each case, together with all Necessary Endorsements. The Debtor is, contemporaneously with the execution hereof, delivering to Secured Parties, or has previously delivered to Secured Parties, a true and correct copy of each of the Organizational Documents governing the issuer of any of the Pledged Securities.
  
 4. Representations, Warranties, Covenants and Agreements of the Debtor. The Debtor represents and warrants to, and covenants and agrees with, the Secured Parties as follows:
  
 (a) The Debtor has the requisite corporate, partnership, limited liability company or other power and authority to enter into this Agreement and otherwise to carry out its Secured Obligations hereunder. The execution, delivery and performance by the Debtor of this Agreement and the filings contemplated therein have been duly authorized by all necessary action on the part of the Debtor and no further action is required by the Debtor. This Agreement has been duly executed by the Debtor. This Agreement constitutes the legal, valid and binding obligation of the Debtor, enforceable against the Debtor in accordance with its terms except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization and similar laws of general application relating to or affecting the rights and remedies of creditors and by general principles of equity.
  
 (b) The Debtor is the sole owner of the Collateral free and clear of any liens, security interests, encumbrances, rights or claims, except for Permitted Liens, and is fully authorized to grant the Security Interests. Except with respect to Permitted Liens or as disclosed in this Agreement, there is not on file in any governmental or regulatory authority, agency or recording office an effective financing statement, security agreement, license or transfer or any notice of any of the foregoing (other than those that will be filed in favor of the Secured Parties pursuant to this Agreement) covering or affecting any of the Collateral. As long as this Agreement shall be in effect, the Debtor shall not execute and shall not knowingly permit to be on file in any such office or agency any other financing statement or other document or instrument (except to the extent filed or recorded in favor of the Secured Parties pursuant to the terms of this Agreement) purporting to grant a security interest in the Collateral except as to Permitted Liens. 
  
 (d) No written claim has been received that any Collateral or the Debtor's use of any Collateral violates the rights of any third party. There has been no adverse decision to the Debtor's claim of ownership rights in or exclusive rights to use the Collateral in any jurisdiction or to the Debtor's right to keep and maintain such Collateral in full force and effect, and there is no proceeding involving said rights pending or, to the best knowledge of the Debtor, threatened before any court, judicial body, administrative or regulatory agency, arbitrator or other governmental authority.
   	 
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 (e) The Debtor shall at all times maintain its books of account and records relating to the Collateral at its principal place of business and its Collateral at the location designated by the Secured Parties, and may not relocate such books of account and records or tangible Collateral unless it delivers to the Secured Parties at least 30 days prior to such relocation (i) written notice of such relocation and the new location thereof (which must be within the United States) and (ii) evidence that appropriate financing statements under the UCC and other necessary documents have been filed and recorded and other steps have been taken to perfect the Security Interests to create in favor of the Secured Parties a valid, perfected and continuing perfected lien in the Collateral, subject to the priority requirements set forth in Section 2 of this Agreement.
  
 (f) This Agreement creates, except as set forth in Section 2 herein, in favor of the Secured Parties a valid first priority security interest in the Collateral securing the payment and performance of the Secured Obligations. Upon making the filings described in the immediately following paragraph, all security interests created hereunder in any Collateral which may be perfected by filing Uniform Commercial Code financing statements shall have been duly perfected. Except for (i) the filing of the Uniform Commercial Code financing statements referred to in the immediately following paragraph, (ii) the execution and delivery of deposit account control agreements satisfying the requirements of Section 9-104(a)(2) of the UCC with respect to each deposit account of the Debtor, (iii) if there is any investment property or deposit account included as Collateral that can be perfected by “control” through an account control agreement, the execution and delivery of securities account control agreements satisfying the requirements of 9-106 of the UCC with respect to each such investment property of the Debtor, and (iv) the delivery of the certificates and other instruments provided in Section 3, Section 4(aa) and Section 4(cc), no action is necessary to create, perfect or protect the security interests created hereunder. Without limiting the generality of the foregoing, except for the foregoing, no consent of any third parties and no authorization, approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for (x) the execution, delivery and performance of this Agreement, (y) the creation or perfection of the Security Interests created hereunder in the Collateral or (z) the enforcement of the rights of the Secured Parties and the Secured Parties hereunder.
  
 (g) The Debtor hereby authorizes the Secured Parties to file one or more financing statements under the UCC, with respect to the Security Interests, with the proper filing and recording agencies in any jurisdiction deemed proper by it.
  
 (h) The execution, delivery and performance of this Agreement by the Debtor does not (i) violate any of the provisions of any Organizational Documents of the Debtor or any judgment, decree, order or award of any court, governmental body or arbitrator or any applicable law, rule or regulation applicable to the Debtor or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing the Debtor's debt or otherwise) or other understanding to which the Debtor is a party or by which any property or asset of the Debtor is bound or affected. If any, all required consents (including, without limitation, from stockholders or creditors of the Debtor) necessary for the Debtor to enter into and perform its Secured Obligations hereunder have been obtained.
   	 
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 (i) All of the Pledged Securities are validly issued, fully paid and non-assessable, and the Debtor is the legal and beneficial owner of the Pledged Securities, free and clear of any lien, security interest or other encumbrance except for the security interests created by this Agreement.
  
 (j) The ownership and other equity interests in partnerships and limited liability companies (if any) included in the Collateral (the “Pledged Interests”) do not provide that they are securities governed by Article 8 of the UCC.
  
 (k) The Debtor shall at all times maintain the liens and Security Interests provided for hereunder as valid and perfected, first priority (except as set forth in Section 2 of this Agreement) liens and security interests in the Collateral in favor of the Secured Parties until this Agreement and the Security Interest hereunder shall be terminated pursuant to Section 14 hereof. The Debtor hereby agrees to defend the same against the claims of any and all persons and entities. The Debtor shall safeguard and protect all Collateral for the account of the Secured Parties. At the request of the Secured Parties, the Debtor will sign and deliver to the Secured Parties on behalf of the Secured Parties at any time or from time to time one or more financing statements pursuant to the UCC in form reasonably satisfactory to the Secured Parties and will pay the cost of filing the same in all public offices wherever filing is, or is deemed by the Secured Parties to be, necessary or desirable to effect the rights and Secured Obligations provided for herein. Without limiting the generality of the foregoing, the Debtor shall pay all fees, taxes and other amounts necessary to maintain the Collateral and the Security Interests hereunder, and the Debtor shall obtain and furnish to the Secured Parties from time to time, upon demand, such releases and/or subordinations of claims and liens which may be required to maintain the priority of the Security Interests hereunder.
  
 (l) The Debtor shall not transfer, pledge, hypothecate, encumber, license, sell or otherwise dispose of any of the Collateral (without the prior written consent of a Majority in Interest).
  
 (m) The Debtor shall, within five (5) days of obtaining knowledge thereof, advise the Secured Parties promptly, in sufficient detail, of any material adverse change in the Collateral, and of the occurrence of any event which would have a material adverse effect on the value of the Collateral or on the Secured Parties’ security interest therein or any Event of Default under the Note.
  
 (n) The Debtor shall promptly execute and deliver to the Secured Parties such further deeds, mortgages, confessions of judgment, assignments, security agreements, financing statements or other instruments, documents, certificates and assurances and take such further action as the Secured Parties may from time to time request and may in their sole discretion deem necessary to perfect, protect or enforce the Secured Parties’ security interest in the Collateral.
   	 
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 (o) The Debtor shall promptly notify the Secured Parties in sufficient detail upon becoming aware of any attachment, garnishment, execution or other legal process levied against any Collateral and of any other information received by the Debtor that may materially affect the value of the Collateral, the Security Interest or the rights and remedies of the Secured Parties hereunder.
  
 (p) All information heretofore, herein or hereafter supplied to the Secured Parties by or on behalf of the Debtor with respect to the Collateral is accurate and complete in all material respects as of the date furnished.
  
 (q) The Debtor shall, and cause Ichor Energy Holdings, LLC and each of its subsidiaries to, at all times preserve and keep in full force and effect their respective valid existence and good standing and any rights and franchises material to its business.
  
 (r) The Debtor will not change its name, type of organization, jurisdiction of organization, organizational identification number (if it has one), legal or corporate structure, or identity, or add any new fictitious name unless it provides at least 30 days prior written notice to the Secured Parties of such change and, at the time of such written notification, the Debtor provides any financing statements or fixture filings necessary to perfect and continue the perfection of the Security Interests granted and evidenced by this Agreement.
  
 (s) The Debtor may not relocate its chief executive office to a new location without providing 30 days prior written notification thereof to the Secured Parties and so long as, at the time of such written notification, the Debtor provides any financing statements or fixture filings necessary to perfect and continue the perfection of the Security Interests granted and evidenced by this Agreement.
  
 (t) The Debtor is organized under the laws of the State of Nevada.
  
 (u) At any time and from time to time that any Collateral consists of instruments, certificated securities or other items that require or permit possession by the Secured Party to perfect the security interest created hereby, the Debtor shall deliver such Collateral to the Collateral Agent, in each case, together with all Necessary Endorsements.
  
 (v) The Debtor hereby agrees to comply with any and all orders and instructions of Secured Parties regarding the Pledged Interests consistent with the terms of this Agreement without the further consent of the Debtor as contemplated by Section 8-106 (or any successor section) of the UCC. Further, the Debtor agrees that it shall not enter into a similar agreement (or one that would confer “control” within the meaning of Article 8 of the UCC) with any other person or entity.
  
 (w) The Debtor shall cause all tangible chattel paper constituting Collateral to be delivered to the Collateral Agent, or, if such delivery is not possible, then to cause such tangible chattel paper to contain a legend noting that it is subject to the security interest created by this Agreement. To the extent that any Collateral consists of electronic chattel paper, the Debtor shall cause the underlying chattel paper to be “marked” within the meaning of Section 9-105 of the UCC (or successor Section thereto).
   	 
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 (x) If there is any investment property or deposit account included as Collateral that can be perfected by “control” through an account control agreement, the Debtor shall cause such an account control agreement, in form and substance in each case satisfactory to the Secured Parties, to be entered into and delivered to the Secured Parties.
  
 (y) To the extent that any Collateral is in the possession of any third party, the Debtor shall join with the Secured Parties in notifying such third party of the Secured Parties’ security interest in such Collateral and shall use its best efforts to obtain an acknowledgement and agreement from such third party with respect to the Collateral, in form and substance reasonably satisfactory to the Secured Parties.
  
 (zz) The Debtor shall vote the Pledged Securities to comply with the covenants and agreements set forth herein and in the Note.
  
 (aa) The Debtor shall register the pledge of the applicable Pledged Securities on the books of the Debtor. The Debtor shall notify each issuer of Pledged Securities to register the pledge of the applicable Pledged Securities in the name of the Secured Parties on the books of such issuer. Further, except with respect to certificated securities delivered to the Secured Parties, the Debtor shall deliver to Secured Parties an acknowledgement of pledge (which, where appropriate, shall comply with the requirements of the relevant UCC with respect to perfection by registration) signed by the issuer of the applicable Pledged Securities, which acknowledgement shall confirm that: (i) it has registered the pledge on its books and records; and (ii) at any time directed by Secured Parties during the continuation of an Event of Default, such issuer will transfer the record ownership of such Pledged Securities into the name of any designee of Secured Parties, will take such steps as may be necessary to effect the transfer, and will comply with all other instructions of Secured Parties regarding such Pledged Securities without the further consent of the Debtor.
  
 (bb) In the event that, upon an occurrence of an Event of Default, Secured Parties shall sell all or any of the Pledged Securities to another party or parties (herein called the “Transferee”) or shall purchase or retain all or any of the Pledged Securities, the Debtor shall, to the extent applicable: (i) deliver to Secured Parties or the Transferee, as the case may be, the articles of incorporation, bylaws, minute books, stock certificate books, corporate seals, deeds, leases, indentures, agreements, evidences of indebtedness, books of account, financial records and all other Organizational Documents and records of Ichor Energy Holdings, LLC (but not including any items subject to the attorney-client privilege related to this Agreement or any of the transactions hereunder); (ii) direct the resignations of the persons then serving as officers and directors of Ichor Energy Holdings, LLC, if so requested; and (iii) use its best efforts to obtain any approvals that are required by any governmental or regulatory body in order to permit the sale of the Pledged Securities to the Transferee or the purchase or retention of the Pledged Securities by Secured Parties and allow the Transferee or Secured Parties to continue the business of the Debtor and its direct and indirect subsidiaries, including without limitation the other Ichor Companies (as defined in the Note).
   	 
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 (cc) The Debtor will from time to time, at the expense of the Debtor, promptly execute and deliver all such further instruments and documents, and take all such further action as may be necessary or desirable, or as the Secured Parties may reasonably request, in order to perfect and protect any security interest granted or purported to be granted hereby or to enable the Secured Parties to exercise and enforce their rights and remedies hereunder and with respect to any Collateral or to otherwise carry out the purposes of this Agreement.
  
 (dd) The Debtor shall cause Ichor Energy Holdings, LLC not to issue any additional membership interests of Ichor Energy Holdings, LLC to any Person.
  
 5. Effect of Pledge on Certain Rights. Intentionally Omitted.
  
 6. Defaults. The following events shall be “Events of Default”:
  
 (a) The occurrence of an Event of Default (as defined in the Note) under the Note; or
  
 (b) If any provision of this Agreement shall at any time for any reason be declared to be null and void, or the validity or enforceability thereof shall be contested by the Debtor, or a proceeding shall be commenced by the Debtor, or by any governmental authority having jurisdiction over the Debtor, seeking to establish the invalidity or unenforceability thereof, or the Debtor shall deny that the Debtor has any liability or obligation purported to be created under this Agreement.
  
 Until the earlier of (i) such time as the Ichor Credit Facility (as defined in the Note) is paid in full in cash and all commitments to make extensions of credit thereunder have been terminated and (ii) 90 days after delivery of written notice to the administrative agent under the Ichor Credit Facility that an Event of Default has occurred, Secured Party shall (notwithstanding anything to the contrary herein) be prohibited from accelerating the Note and shall be prohibited from (i) taking from or for the account of Debtor or any subsidiary of Debtor, by set-off or in any other manner, the whole or any part of any moneys which may now or hereafter be owing by Debtor or any subsidiary of Debtor with respect to the Note, (ii) suing for payment of, or initiating or participate with others in any suit, action or proceeding against Debtor or any subsidiary of Debtor to (x) enforce payment of or to collect the whole or any part of the amounts owed pursuant to the Note or (y) commence judicial enforcement of any of the rights and remedies under the Note or applicable law with respect to the Note, (iii) accelerating the amounts owed under the Note, (iv) exercising any put option or to cause Debtor or any subsidiary of Debtor to honor any redemption or mandatory prepayment obligation under the Note or (v) taking any action under the provisions of any state or federal law, including, without limitation, the Uniform Commercial Code, or under any contract or agreement, enforcing, foreclosing upon, taking possession of or selling any property or assets of Debtor or any subsidiary of Debtor; provided, that, the Secured Party shall not be bound by this paragraph (other than with respect to the prohibition on any exercise of remedies against the Ichor Companies or the taking of any action described in the foregoing clauses (i)-(v) with respect to the Ichor Companies) if (I) an Event of Default described in Section 6(a)(i), 6(a)(v), 6(a)(vii), 6(a)(viii), (6)(a)(ix) or (6)(a)(x) of the Note, or a payment default under Section 6(a)(vi) constituting an Event of Default, has occurred and is continuing or (II) the holders of the Debtor’s 10% Secured Notes or other defaulted indebtedness or obligation as described in Section 6(a)(vi) of the Note shall have elected to pursue any remedy or enforcement action with respect to a default thereunder.
   	 
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 7. Duty to Hold in Trust.
  
 (a) Upon the occurrence of any Event of Default and at any time thereafter, the Debtor shall, upon receipt of any revenue, income, dividend, interest or other sums subject to the Security Interests, whether payable pursuant to the Note or otherwise, or of any check, draft, note, trade acceptance or other instrument evidencing an obligation to pay any such sum, hold the same in trust for the Secured Parties and shall forthwith endorse and transfer any such sums or instruments, or both, to the Secured Parties, pro-rata in proportion to their respective then-currently outstanding principal amount of Note for application to the satisfaction of the Secured Obligations (and if any Note is not outstanding, pro-rata in proportion to the initial purchases of the remaining Note).
  
 (b) If the Debtor shall become entitled to receive or shall receive any securities or other property (including, without limitation, shares of Pledged Securities or instruments representing Pledged Securities acquired after the date hereof, or any options, warrants, rights or other similar property or certificates representing a dividend, or any distribution in connection with any recapitalization, reclassification or increase or reduction of capital, or issued in connection with any reorganization of the Debtor or any of its direct or indirect subsidiaries) in respect of the Pledged Securities (whether as an addition to, in substitution of, or in exchange for, such Pledged Securities or otherwise), the Debtor agrees to (i) accept the same as the agent of the Secured Parties; (ii) hold the same in trust on behalf of and for the benefit of the Secured Parties; (iii) to deliver any and all certificates or instruments evidencing the same to Secured Parties on or before the close of business on the fifth business day following the receipt thereof by the Debtor, in the exact form received together with the Necessary Endorsements, to be held by Secured Parties subject to the terms of this Agreement as Collateral; and (iv) take all steps necessary to perfect the Secured Parties’ Security Interest in any such additional property.
  
 8. Rights and Remedies Upon Default.
  
 (a) Subject in all respects to the last paragraph of Section 6 hereof, upon the occurrence of any Event of Default and at any time thereafter, the Secured Parties shall have the right to exercise all of the remedies conferred hereunder and under the Note, and the Secured Parties shall have all the rights and remedies of a secured party under the UCC. Without limitation, except as limited by the last paragraph of Section 6 hereof, the Secured Parties, shall have the following rights and powers:
  
 (i) The Secured Parties shall have the right to take possession of the Collateral and, for that purpose, enter, with the aid and assistance of any person, any premises where the Collateral, or any part thereof, is or may be placed and remove the same, and the Debtor shall assemble the Collateral and make it available to the Secured Parties at places which the Secured Parties shall reasonably select, whether at the Debtor's premises or elsewhere, and make available to the Secured Parties, without rent, all of the Debtor’s respective premises and facilities for the purpose of the Secured Parties taking possession of, removing or putting the Collateral in saleable or disposable form.
   	 
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 (ii) Upon notice to the Debtor by Secured Parties, all rights of the Debtor to exercise the voting and other consensual rights which it would otherwise be entitled to exercise and all rights of the Debtor to receive the dividends and interest which it would otherwise be authorized to receive and retain, shall cease. Upon such notice, Secured Parties shall have the right to receive, any interest, cash dividends or other payments on the Collateral and, exercise in such Secured Parties’ discretion all voting rights pertaining thereto. Without limiting the generality of the foregoing, Secured Parties shall have the right (but not the obligation) to exercise all rights with respect to the Collateral as if they were the sole and absolute owner thereof, including, without limitation, to vote and/or to exchange, at their sole discretion, any or all of the Collateral in connection with a merger, reorganization, consolidation, recapitalization or other readjustment concerning or involving the Collateral or the Debtor or any of its direct or indirect subsidiaries.
  
 (iii) The Secured Parties shall have the right to assign, sell, lease or otherwise dispose of and deliver all or any part of the Collateral, at public or private sale or otherwise, either with or without special conditions or stipulations, for cash or on credit or for future delivery, in such parcel or parcels and at such time or times and at such place or places, and upon such terms and conditions as the Secured Parties may deem commercially reasonable, all without (except as shall be required by applicable statute and cannot be waived) advertisement or demand upon or notice to the Debtor or right of redemption of the Debtor, which are hereby expressly waived. Upon each such sale, lease, assignment or other transfer of Collateral, the Secured Parties may, unless prohibited by applicable law which cannot be waived, purchase all or any part of the Collateral being sold, free from and discharged of all trusts, claims, right of redemption and equities of the Debtor, which are hereby waived and released.
  
 (b) The Secured Parties shall comply with any applicable law in connection with a disposition of Collateral and such compliance will not be considered adversely to affect the commercial reasonableness of any sale of the Collateral. The Secured Parties may sell the Collateral without giving any warranties and may specifically disclaim such warranties. If the Secured Parties sell any of the Collateral on credit, the Debtor will only be credited with payments actually made by the purchaser. In addition, the Debtor waives (except as shall be required by applicable statute and cannot be waived) any and all rights that it may have to a judicial hearing in advance of the enforcement of any of the Secured Parties’ rights and remedies hereunder, including, without limitation, their right following an Event of Default to take immediate possession of the Collateral and to exercise their rights and remedies with respect thereto.
   	 
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 9. Applications of Proceeds. The proceeds of any such sale, lease or other disposition of the Collateral hereunder or from payments made on account of any insurance policy insuring any portion of the Collateral shall be applied (i) first, to the reasonable costs, expenses of retaking, holding, storing, processing and preparing for sale, selling, and the like, incurred by the Secured Parties, their representatives, or the Collateral Agent (including, without limitation, any taxes, fees and other costs incurred in connection therewith) of the Collateral; (ii) second to the reasonable attorneys’ fees and expenses incurred by the Secured Parties, their representatives, and the Collateral Agent in enforcing the Secured Parties’ rights hereunder and in connection with collecting, storing and disposing of the Collateral; and (iii) then to satisfaction of the Secured Obligations pro rata among the Secured Parties (based on then-outstanding principal and interest amounts of Note at the time of any such determination), (with respect to the application of payment to the outstanding balance due on the Note, proceeds shall first be applied to all outstanding interest then accrued on the Note until all such interest has been paid, prior to applying any proceeds to the principal of any of the Note) and to the payment of any other amounts required by applicable law, after which the Secured Parties shall pay to the Debtor any surplus proceeds. If, upon the sale, license or other disposition of the Collateral, the proceeds thereof are insufficient to pay all amounts to which the Secured Parties are legally entitled, the Debtor will remain liable for the deficiency, and the reasonable fees of any attorneys employed by the Secured Parties to collect such deficiency. To the extent permitted by applicable law, the Debtor waives all claims, damages and demands against the Secured Parties arising out of the repossession, removal, retention or sale of the Collateral, unless due solely to the gross negligence or willful misconduct of the Secured Parties as determined by a final judgment (not subject to further appeal) of a court of competent jurisdiction.
  
 10. Securities Law Provision. The Debtor recognizes that Secured Parties may be limited in their ability to effect a sale to the public of all or part of the Pledged Securities by reason of certain prohibitions in the Securities Act of 1933, as amended, or other federal or state securities laws (collectively, the “Securities Laws”), and may be compelled to resort to one or more sales to a restricted group of purchasers who may be required to agree to acquire the Pledged Securities for their own account, for investment and not with a view to the distribution or resale thereof. The Debtor agrees that sales so made may be at prices and on terms less favorable than if the Pledged Securities were sold to the public, and that Secured Parties have no obligation to delay the sale of any Pledged Securities for the period of time necessary to register the Pledged Securities for sale to the public under the Securities Laws. The Debtor shall cooperate with Secured Parties in their attempt to satisfy any requirements under the Securities Laws (including, without limitation, registration thereunder if requested by Secured Parties) applicable to the sale of the Pledged Securities by Secured Parties. 
  
 11. Costs and Expenses. The Debtor agrees to pay all reasonable out-of-pocket fees, costs and expenses incurred in connection with any filing required hereunder, including without limitation, any financing statements pursuant to the UCC, continuation statements, partial releases and/or termination statements related thereto or any expenses of any searches reasonably required by the Secured Parties. The Debtor shall also pay all other claims and charges which in the reasonable opinion of the Secured Parties are reasonably likely to prejudice, imperil or otherwise affect the Collateral or the Security Interests therein. The Debtor will also, upon demand, pay to the Secured Parties the amount of any and all reasonable expenses, including the reasonable fees and expenses of their counsel and of any experts and agents, which the Secured Parties, may incur in connection with the creation, perfection, protection, satisfaction, foreclosure, collection or enforcement of the Security Interest and the preparation, administration, continuance, amendment or enforcement of this Agreement and pay to the Secured Parties the amount of any and all reasonable expenses, including the reasonable fees and expenses of their counsel and of any experts and agents, which the Secured Parties may incur in connection with (i) the enforcement of this Agreement, (ii) the custody or preservation of, or the sale of, collection from, or other realization upon, any of the Collateral, or (iii) the exercise or enforcement of any of the rights of the Secured Parties under the Note. Until so paid, any fees payable hereunder shall be added to the principal amount of the Note and shall bear interest at the Default Rate.
   	 
	12
	 
 
	 

  
 12. Responsibility for Collateral. The Debtor assumes all liabilities and responsibility in connection with all Collateral, and the Secured Obligations shall in no way be affected or diminished by reason of the loss, destruction, damage or theft of any of the Collateral or its unavailability for any reason. Without limiting the generality of the foregoing and except as required by applicable law, (a) no Secured Party (i) has any duty (either before or after an Event of Default) to collect any amounts in respect of the Collateral or to preserve any rights relating to the Collateral, or (ii) has any obligation to clean-up or otherwise prepare the Collateral for sale, and (b) the Debtor shall remain obligated and liable under each contract or agreement included in the Collateral to be observed or performed by the Debtor thereunder. No Secured Party shall have any obligation or liability under any such contract or agreement by reason of or arising out of this Agreement or the receipt by any Secured Party of any payment relating to any of the Collateral, nor shall any Secured Party be obligated in any manner to perform any of the Secured Obligations of the Debtor under or pursuant to any such contract or agreement, to make inquiry as to the nature or sufficiency of any payment received by any Secured Party in respect of the Collateral or as to the sufficiency of any performance by any party under any such contract or agreement, to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts which may have been assigned to the Secured Parties or to which any Secured Party may be entitled at any time or times.
  
 13. Security Interests Absolute. All rights of the Secured Parties and all Secured Obligations of the Debtor hereunder, shall be absolute and unconditional, irrespective of: (a) any change in the time, manner or place of payment or performance of, or in any other term of, all or any of the Secured Obligations, or any other amendment or waiver of or any consent to any departure from the Note or any other agreement entered into in connection with the foregoing; (b) any exchange, release or non-perfection of any of the Collateral, or any release or amendment or waiver of or consent to departure from any other collateral for, or any Guaranty, or any other security, for all or any of the Secured Obligations; (c) any action by the Secured Parties to obtain, adjust, settle and cancel in their sole discretion any insurance claims or matters made or arising in connection with the Collateral; or (d) any other circumstance which might otherwise constitute any legal or equitable defense available to the Debtor, or a discharge of all or any part of the Security Interests granted hereby. Until the Secured Obligations shall have been paid and performed in full, the rights of the Secured Parties shall continue even if the Secured Obligations are barred for any reason, including, without limitation, the running of the statute of limitations. The Debtor expressly waives presentment, protest, notice of protest, demand, notice of nonpayment and demand for performance. In the event that at any time any transfer of any Collateral or any payment received by the Secured Parties hereunder shall be deemed by final order of a court of competent jurisdiction to have been a voidable preference or fraudulent conveyance under the bankruptcy or insolvency laws of the United States, or shall be deemed to be otherwise due to any party other than the Secured Parties, then, in any such event, the Debtor’s Secured Obligations hereunder shall survive cancellation of this Agreement, and shall not be discharged or satisfied by any prior payment thereof and/or cancellation of this Agreement, but shall remain a valid and binding obligation enforceable in accordance with the terms and provisions hereof. The Debtor waives all right to require the Secured Parties to proceed against any other person or entity or to apply any Collateral which the Secured Parties may hold at any time, or to marshal assets, or to pursue any other remedy. The Debtor waives any defense arising by reason of the application of the statute of limitations to any obligation secured hereby.
   	 
	13
	 
 
	 

  
 14. Term of Agreement. This Agreement and the Security Interests shall terminate on the date on which all payments under the Note have been indefeasibly paid in full and all other Secured Obligations have been paid or discharged; provided, however, that all indemnities of the Debtor contained in this Agreement (including, without limitation, Annex A hereto) shall survive and remain operative and in full force and effect regardless of the termination of this Agreement.
  
 15. Power of Attorney; Further Assurances.
  
 (a) The Debtor authorizes the Secured Parties, and does hereby make, constitute and appoint the Secured Parties and their officers, agents, successors or assigns with full power of substitution, as the Debtor’s true and lawful attorney-in-fact, with power, in the name of the Secured Parties or the Debtor, to, after the occurrence and during the continuance of an Event of Default, (i) endorse any note, checks, drafts, money orders or other instruments of payment (including payments payable under or in respect of any policy of insurance) in respect of the Collateral that may come into possession of the Secured Parties; (ii) to sign and endorse any financing statement pursuant to the UCC or any invoice, freight or express bill, bill of lading, storage or warehouse receipts, drafts against debtors, assignments, verifications and notices in connection with accounts, and other documents relating to the Collateral; (iii) to pay or discharge taxes, liens, security interests or other encumbrances at any time levied or placed on or threatened against the Collateral; (iv) to demand, collect, receipt for, compromise, settle and sue for monies due in respect of the Collateral; (v) generally, at the option of the Secured Parties, and at the expense of the Debtor, at any time, or from time to time, to execute and deliver any and all documents and instruments and to do all acts and things which the Secured Parties deem necessary to protect, preserve and realize upon the Collateral and the Security Interests granted therein in order to effect the intent of this Agreement and the Note all as fully and effectually as the Debtor might or could do; and the Debtor hereby ratifies all that said attorney shall lawfully do or cause to be done by virtue hereof. This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter as long as any of the Secured Obligations shall be outstanding. The designation set forth herein shall be deemed to amend and supersede any inconsistent provision in the Organizational Documents or other documents or agreements to which the Debtor is subject or to which the Debtor is a party. 
  
 (b) On a continuing basis, the Debtor will make, execute, acknowledge, deliver, file and record, as the case may be, with the proper filing and recording agencies in any jurisdiction, including, without limitation, the States of Nevada and Kansas, all such instruments, and take all such action as may reasonably be deemed necessary or advisable, or as reasonably requested by the Secured Parties, to perfect and maintain the Security Interests granted hereunder and otherwise to carry out the intent and purposes of this Agreement, or for assuring and confirming to the Secured Parties the grant or perfection of a perfected security interest in all the Collateral under the UCC.
   	 
	14
	 
 
	 

  
 (c) The Debtor hereby irrevocably appoints the Secured Parties as the Debtor’s attorney-in-fact, with full authority in the place, and instead, of the Debtor and in the name of the Debtor, from time to time in the Secured Parties’ discretion, to take any action and to execute any instrument which the Secured Parties may deem necessary or advisable to accomplish the purposes of this Agreement, including the filing, in their sole discretion, of one or more financing or continuation statements and amendments thereto, relative to any of the Collateral without the signature of the Debtor where permitted by law, which financing statements may (but need not) describe the Collateral as “all assets” or “all personal property” or words of like import, and ratifies all such actions taken by the Secured Parties. This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter as long as any of the Secured Obligations shall be outstanding.
  
 16. Notices. All notices, requests, demands and other communications hereunder and under the Note shall be subject to the notice provision of the PSA.
  
 17. Other Security. To the extent that the Secured Obligations are now or hereafter secured by property other than the Collateral or by the Guaranty, endorsement or property of any other person, firm, corporation or other entity, then the Secured Parties shall have the right, in their sole discretion, to pursue, relinquish, subordinate, modify or take any other action with respect thereto, without in any way modifying or affecting any of the Secured Parties’ rights and remedies hereunder.
  
 18. Appointment of Collateral Agent. The Secured Parties in their sole discretion may delegate certain of their rights hereunder to one or more Collateral Agent. If and as applicable, the Secured Parties may insert the name of the selected Collateral Agent in this Section 18. To this end, the Secured Parties hereby appoint Brothers Investments, LLC to act as their Collateral Agent (the “Collateral Agent”) for purposes of exercising any and all rights and remedies of the Secured Parties hereunder. Such appointment shall continue until revoked in writing by a Majority in Interest, at which time a Majority in Interest may appoint a new Collateral Agent. 
  
 19. Miscellaneous.
  
 (a) No course of dealing between the Debtor and the Secured Parties, nor any failure to exercise, nor any delay in exercising, on the part of the Secured Parties, any right, power or privilege hereunder or under the Note shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege.
  
 (b) All of the rights and remedies of the Secured Parties with respect to the Collateral, whether established hereby or by the Note or by any other agreements, instruments or documents or by law or in equity or by statute shall be cumulative and concurrent and shall be in addition to every other such right, power or remedy. The exercise or beginning of the exercise by the Secured Parties of any one or more of the rights, powers or remedies provided for hereby or by the Note or by any other agreements, instruments or documents now or hereafter existing at law or in equity or by statute or otherwise shall not preclude the simultaneous or later exercise by the Secured Parties of all such other rights, powers or remedies, and no failure or delay on the part of the Secured Parties to exercise any such right, power or remedy shall operate as a waiver thereof.
   	 
	15
	 
 
	 

  
 (c) This Agreement, together with the exhibits and schedules hereto and the other Transaction Documents, contain the entire understanding of the parties with respect to the subject matter hereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into this Agreement and the exhibits and schedules hereto. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Debtor and the Secured Parties holding 51% or more of the principal amount of Note then outstanding, or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought.
  
 (d) If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
  
 (e) No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.
  
 (f) This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. The Debtor and the Subsidiaries may not assign this Agreement or any rights or Secured Obligations hereunder without the prior written consent of each Secured Party (other than by merger). Any Secured Party may assign any or all of its rights under this Agreement to any Person to whom such Secured Party assigns or transfers any Secured Obligations, provided such transferee agrees in writing to be bound, with respect to the transferred Secured Obligations, by the provisions of this Agreement that apply to the “Secured Parties.”
  
 (g) Each party shall take such further action and execute and deliver such further documents as may be necessary or appropriate in order to carry out the provisions and purposes of this Agreement.
   	 
	16
	 
 
	 

  
 (h) Except to the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, all questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Texas, without regard to the principles of conflicts of law thereof. Except to the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, the Debtor agrees that all proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and the Note (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of Houston, Texas. Except to the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, the Debtor hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of Houston, Texas for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such proceeding is improper. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.
  
 (i) This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and, all of which taken together shall constitute one and the same Agreement. In the event that any signature is delivered by facsimile transmission, such signature shall create a valid binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force and effect as if such facsimile signature were the original thereof.
  
 (j) The Debtor shall indemnify, reimburse and hold harmless the Secured Parties and their respective partners, members, shareholders, officers, directors, employees and agents (inclusive of any Collateral Agent or other representative appointed by the Secured Parties) (and any other persons with other titles that have similar functions) (collectively, “Indemnitees”) from and against any and all losses, claims, liabilities, damages, penalties, suits, costs and expenses, of any kind or nature, (including fees relating to the cost of investigating and defending any of the foregoing) imposed on, incurred by or asserted against such Indemnitee in any way related to or arising from or alleged to arise from the Note, this Agreement or the Collateral, except any such losses, claims, liabilities, damages, penalties, suits, costs and expenses which result from the gross negligence or willful misconduct of the Indemnitee as determined by a final, non-appealable decision of a court of competent jurisdiction. This indemnification provision is in addition to, and not in limitation of, any other indemnification provision in the Note or any other agreement, instrument or other document executed or delivered in connection herewith or therewith. 
  
 (k) Nothing in this Agreement shall be construed to subject any Secured Party to liability as a partner in the Debtor or any of its direct or indirect subsidiaries that is a partnership or as a member in the Debtor or any of its direct or indirect subsidiaries that is a limited liability company, no Secured Party shall be deemed to have assumed any Secured Obligations under any partnership agreement or limited liability company agreement, as applicable, of the Debtor or any of its direct or indirect subsidiaries or otherwise, unless and until any such Secured Party exercises its right to be substituted for the Debtor as a partner or member, as applicable, pursuant hereto.
  
 (l) To the extent that the grant of the security interest in the Collateral and the enforcement of the terms hereof require the consent, approval or action of any partner or member, as applicable, of the Debtor or any direct or indirect subsidiary of the Debtor or compliance with any provisions of any of the Organizational Documents, the Debtor hereby represents that all such consents and approvals have been obtained.
  
 [SIGNATURE PAGE OF DEBTOR FOLLOWS]
   	 
	17
	 
 
	 

  
 IN WITNESS WHEREOF, the parties hereto have caused this Security and Pledge Agreement to be duly executed on the day and year first above written.
  
  	 VIKING ENERGY GROUP, INC.
	
	 	 	  

	By:	 /s/ James A. Doris
	
	Name:	 James A. Doris
	
	 Title:
	 President & CEO
	

  
 [SIGNATURE PAGE OF SECURED PARTIES FOLLOWS]
   	 
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 [SIGNATURE PAGE OF SECURED PARTIES TO SECURITY AND PLEDGE AGREEMENT]
  
  
  	 Name of Secured Party:
	  
	 BODEL HOLDINGS, LLC
 CLEVELAND HOLDINGS, L.L.C.
 DELBO HOLDINGS, L.L.C.
 DEQUINCY HOLDINGS, L.L.C.
 GULF COAST WORKING PARTNERS, L.L.C.
 OAKLEY HOLDINGS, L.L.C.
 SAMJAM ENERGY, L.L.C.
 PERRY POINT HOLDINGS, L.L.C.
	  

	  
	  
	  
	  

	 Signature of Authorized Signatory of Secured Party:
	  
	 /s/ Jennifer Bohannon-Ramirez
	  

	  
	  
	  
	  

	 Name of Authorized Signatory:
	  
	 Jennifer Bohannon-Ramirez
	  

	  
	  
	  
	  

	 Title of Authorized Signatory:
	  
	 Manager of Brothers Investments, LLC,
 as the sole member of each Secured Party
	  

  
  	 
	19
	 
 
	 

  
 ANNEX A
 to
 SECURITY AND PLEDGE
 AGREEMENT
 THE COLLATERAL AGENT
  
 1. Appointment. The Secured Parties (all capitalized terms used herein and not otherwise defined shall have the respective meanings provided in the Security and Pledge Agreement to which this Annex A is attached (the "Agreement")), by their acceptance of the benefits of the Agreement, hereby designate Brothers Investments, LLC (the “Collateral Agent”) as the Collateral Agent to act as specified herein and in the Agreement. Each Secured Party shall be deemed to have irrevocably authorized the Collateral Agent to take such action on its behalf under the provisions of the Agreement and the Note and to exercise such powers and to perform such duties hereunder and thereunder as are specifically delegated to or required of the Collateral Agent by the terms hereof and thereof and such other powers as are reasonably incidental thereto. The Collateral Agent may perform any of its duties hereunder by or through its agents or employees.
  
 2. Nature of Duties. The Collateral Agent shall have no duties or responsibilities except those expressly set forth in the Agreement. Neither the Collateral Agent nor any of its partners, members, shareholders, officers, directors, employees or agents shall be liable for any action taken or omitted by it as such under the Agreement or hereunder or in connection herewith or therewith, be responsible for the consequence of any oversight or error of judgment or answerable for any loss, unless caused solely by its or their gross negligence or willful misconduct as determined by a final judgment (not subject to further appeal) of a court of competent jurisdiction. The duties of the Collateral Agent shall be mechanical and administrative in nature; the Collateral Agent shall not have by reason of the Agreement or any other Transaction Document a fiduciary relationship in respect of the Debtor or any Secured Party; and nothing in the Agreement or any other Transaction Document, expressed or implied, is intended to or shall be so construed as to impose upon the Secured Parties any obligations in respect of the Agreement or any other Transaction Document except as expressly set forth herein and therein.
  
 3. Lack of Reliance on the Collateral Agent. Independently and without reliance upon the Collateral Agent, each Secured Party, to the extent it deems appropriate, has made and shall continue to make (i) its own independent investigation of the financial condition and affairs of the Debtor and its subsidiaries in connection with such Secured Party’s investment in the Debtor, the creation and continuance of the Secured Obligations, the transactions contemplated by the Transaction Documents, and the taking or not taking of any action in connection therewith, and (ii) its own appraisal of the creditworthiness of the Debtor and its subsidiaries, and of the value of the Collateral from time to time, and the Secured Parties shall have no duty or responsibility, either initially or on a continuing basis, to provide any Secured Party with any credit, market or other information with respect thereto, whether coming into its possession before any Secured Obligations are incurred or at any time or times thereafter. The Collateral Agent shall not be responsible to the Debtor or any Secured Party for any recitals, statements, information, representations or warranties herein or in any document, certificate or other writing delivered in connection herewith, or for the execution, effectiveness, genuineness, validity, enforceability, perfection, collectability, priority or sufficiency of the Agreement or any other Transaction Document, or for the financial condition of the Debtor or the value of any of the Collateral, or be required to make any inquiry concerning either the performance or observance of any of the terms, provisions or conditions of the Agreement or any other Transaction Document, or the financial condition of the Debtor, or the value of any of the Collateral, or the existence or possible existence of any default or Event of Default under the Agreement, the Note or any of the other Transaction Documents.
   	 
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 4. Certain Rights of the Collateral Agent. The Collateral Agent shall have the right to take any action with respect to the Collateral, on behalf of all of the Secured Parties. To the extent practical, the Collateral Agent may, but in no case shall be required to, request instructions from the Secured Parties with respect to any material act or action (including failure to act) in connection with the Agreement or any other Transaction Document, and shall be entitled to act or refrain from acting in accordance with the instructions of a Majority in Interest; if such instructions are not provided despite the Collateral Agent’s request therefor, the Collateral Agent shall be entitled to refrain from such act or taking such action, and if such action is taken, shall be entitled to appropriate indemnification from the Secured Parties in respect of actions to be taken by the Collateral Agent; and the Collateral Agent shall not incur liability to any person or entity by reason of so refraining. Without limiting the foregoing, (a) no Secured Party shall have any right of action whatsoever against the Collateral Agent as a result of the Collateral Agent acting or refraining from acting hereunder in accordance with the terms of the Agreement or any other Transaction Document, and the Debtor shall have no right to question or challenge the authority of, or the instructions given by the Majority in Interest to, the Collateral Agent pursuant to the foregoing and (b) the Collateral Agent shall not be required to take any action which the Collateral Agent believes (i) could reasonably be expected to expose it to personal liability or (ii) is contrary to this Agreement, the Transaction Documents or applicable law.
  
 5. Reliance. The Collateral Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, statement, certificate, telex, teletype or tele copier message, cablegram, radiogram, order or other document or telephone message signed, sent or made by the proper person or entity, and, with respect to all legal matters pertaining to the Agreement and the other Transaction Documents and their duties thereunder, upon advice of counsel selected by it and upon all other matters pertaining to this Agreement and the other Transaction Documents and their duties thereunder, upon advice of other experts selected by it. Anything to the contrary notwithstanding, the Collateral Agent shall have no obligation whatsoever to any Secured Party to assure that the Collateral exists or is owned by the Debtor or is cared for, protected or insured or that the liens granted pursuant to the Agreement have been properly or sufficiently or lawfully created, perfected, or enforced or are entitled to any particular priority.
  
 6. Indemnification. To the extent that the Collateral Agent is not reimbursed and indemnified by the Debtor, the Secured Parties will jointly and severally reimburse and indemnify the Collateral Agent, in proportion to their initially purchased respective principal amounts of Note, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against the Collateral Agent in performing their duties hereunder or under the Agreement or any other Transaction Document, or in any way relating to or arising out of the Agreement or any other Transaction Document except for those determined by a final judgment (not subject to further appeal) of a court of competent jurisdiction to have resulted solely from the Collateral Agent’s own gross negligence or willful misconduct. Prior to taking any action hereunder as Collateral Agent, the Collateral Agent may require each Secured Party to deposit with it sufficient sums as the Collateral Agent determines in good faith is necessary to protect the Collateral Agent for costs and expenses associated with taking such action.
   	 
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 7. Resignation by the Collateral Agent.
  
 (a) The Collateral Agent may resign from the performance of all of its functions and duties under the Agreement and the other Transaction Documents at any time by giving 30 days' prior written notice (as provided in the Agreement) to the Debtor and the Secured Parties. Such resignation shall take effect upon the appointment of a successor Collateral Agent pursuant to clauses (b) and (c) below.
  
 (b) Upon any such notice of resignation, the Secured Parties, acting by a Majority in Interest, shall appoint a successor Collateral Agent hereunder.
  
 (c) If a successor Collateral Agent shall not have been so appointed within said 30-day period, the Collateral Agent shall then appoint a successor Collateral Agent who shall serve as Collateral Agent until such time, if any, as the Secured Parties appoint a successor Collateral Agent as provided above. If a successor Collateral Agent has not been appointed within such 30-day period, the Collateral Agent may petition any court of competent jurisdiction or may interplead the Debtor and the Secured Parties in a proceeding for the appointment of a successor Collateral Agent, and all fees, including, but not limited to, extraordinary fees associated with the filing of interpleader action and expenses associated therewith, shall be payable by the Debtor on demand.
  
 8. Rights with respect to Collateral. Each Secured Party agrees with all other Secured Parties and the Collateral Agent (a) that it shall not, and shall not attempt to, exercise any rights with respect to its security interest in the Collateral, whether pursuant to any other agreement or otherwise (other than pursuant to this Agreement), or take or institute any action against the Collateral Agent or any of the other Secured Parties in respect of the Collateral or its rights hereunder (other than any such action arising from the breach of this Agreement) and (b) that such Secured Party has no other rights with respect to the Collateral other than as set forth in this Agreement and the other Transaction Documents. Upon the acceptance of any appointment as Collateral Agent hereunder by a successor Collateral Agent, such successor Collateral Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Collateral Agent and the retiring Collateral Agent shall be discharged from its duties and Secured Obligations under the Agreement. After any retiring Collateral Agent’ resignation or removal hereunder as Collateral Agent, the provisions of the Agreement including this Annex A shall inure to their benefit as to any actions taken or omitted to be taken by it while they were Collateral Agent.
   	 
	22EXHIBIT 10.1

 

LOAN
AND SECURITY AGREEMENT

 

THIS
LOAN AND SECURITY AGREEMENT (this “Agreement”) dated as of December 28, 2018 (the “Effective Date”)
by and among SILICON VALLEY BANK, a California corporation with a loan production office located at 380 Interlocken Crescent,
Suite 600, Broomfield, Colorado 80021 (“Bank”), VIEWRAY, INC., a Delaware corporation (“Viewray”)
and VIEWRAY TECHNOLOGIES, INC., a Delaware corporation (“Technologies”, and together with Viewray, individually
and collectively, jointly and severally, the “Borrower”) each with offices located at 2 Thermo Fisher Way,
Oakwood Village, Ohio 44146, provides the terms on which Bank shall lend to Borrower and Borrower shall repay Bank. The parties
agree as follows:

 

1.            ACCOUNTING
AND OTHER TERMS

 

Accounting
terms not defined in this Agreement shall be construed following GAAP as in effect from time to time. Calculations and determinations
must be made following GAAP as in effect from time to time. Capitalized terms not otherwise defined in this Agreement shall have
the meanings set forth in Section 13. 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.            LOAN AND TERMS OF PAYMENT

 

2.1               
Promise to Pay. Borrower hereby individually
and collectively, jointly and severally, unconditionally promises to pay Bank the outstanding principal amount of all Credit Extensions
and accrued and unpaid interest thereon as and when due in accordance with this Agreement.

 

2.1.1      Term Loan.

 

(a)                
Availability. Bank shall make a growth capital term loan in the maximum principal amount not to exceed Fifty Six
Million Dollars ($56,000,000.00) (the “Term Loan”) available to Borrower on the Effective Date, subject to
the satisfaction of the terms and conditions of this Agreement.

 

(b)               
Repayment. Commencing on the first day of the month following the month in which a Funding Date occurs, and thereafter
on the first day of each successive calendar month until the Term Loan is paid in full, Borrower shall make monthly payments of
interest with respect to the outstanding principal amount of the Term Loan. Commencing on the Term Loan Amortization Date, Borrower
shall repay the outstanding principal balance of the Term Loan in accordance with the Term Loan Amortization Schedule (each payment
of interest and/or payment of principal on the Term Loan being a “Term Loan Payment”). Borrower’s final
Term Loan Payment, due on the Term Loan Maturity Date, shall include all outstanding principal and accrued and unpaid interest
under the Term Loan. Once repaid, the Term Loan, or any portion thereof, may not be reborrowed.

 

(c)                
Mandatory Prepayment Upon an Acceleration. If the Term Loan is accelerated by Bank following the occurrence and
during the continuance of an Event of Default, Borrower shall immediately pay to Bank an amount equal to the sum of (i) all outstanding
principal plus accrued and unpaid interest with respect to the Term Loan; (ii) the Final Payment; (iii) the Prepayment Premium,
if applicable, and (iv) all other sums, if any, that shall have become due and payable with respect to the Term Loan, including
interest at the Default Rate with respect to any past due amounts.

 

(d)               
Optional Prepayment. Borrower shall have the option to prepay all, but not less than all, of the Term Loan, without
premium or penalty, provided Borrower (i) delivers written notice to Bank of its election to prepay the Term Loan at least ten
(10) days prior to such prepayment, and (ii) pays, on the date of such prepayment (A) the outstanding principal plus accrued and
unpaid interest with respect to the Term Loan; (B) the Final Payment (provided, that in the event the Term Loan
is refinanced by Bank, the unearned portion of the Final Payment will be waived); (C) the Prepayment Premium, if applicable, and
(D) all other sums, if any, that shall have become due and payable with respect to the Term Loan, including interest at the Default
Rate with respect to any past due amounts.

 

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2.2          Payment
of Interest on the Credit Extensions. 

 

(a)                
Interest Rate – Term Loan. Subject to Section 2.2(b), the principal amount outstanding under the Term
Loan shall accrue interest at a fixed per annum rate equal to six and three-tenths of one percent (6.30%), which interest shall
in any event be payable monthly.

 

(b)               
Default Rate. 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 (2.00%) above the rate that is otherwise applicable thereto (the
“Default Rate”), unless Bank, in its sole discretion, from time to time elects to impose a smaller increase.
Fees and expenses which are required to be paid by Borrower pursuant to the Loan Documents (including, without limitation, Bank
Expenses) but are not paid when due shall bear interest until paid at a rate equal to the Default Rate. Payment or acceptance
of the increased interest rate provided in this Section 2.2(b) 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 Bank.

 

(c)                
Adjustment to Interest Rate. Changes to the interest rate of any Credit Extension based on changes to the Prime
Rate shall be effective on the effective date of any change to the Prime Rate and to the extent of any such change.

 

(d)               
Payment; Interest Computation. Interest is payable monthly on the first calendar day of each month and 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 noon 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; provided, 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.

 

2.3          Fees. Borrower shall pay to Bank:

 

(a)                
Final Payment. A final payment (which final payment is in addition to and not a substitution for the regular monthly
payments of principal plus accrued interest, and shall be referred to herein as the “Final Payment”), due on
the earliest to occur of (a) the Term Loan Maturity Date, (b) the acceleration of the Term Loan, or (c) the prepayment of the
Term Loan in full pursuant to Section 2.1.1(c) and/or Section 2.1.1(d) (provided, that in the event the Term Loan
is refinanced by Bank, the unearned portion of the Final Payment will be waived), equal to (i) the original aggregate principal
amount of the Term Loan funded by Bank and drawn by Borrower; multiplied by (ii) three and fifteen one-hundredths of one
percent (3.15%); and

 

(b)               
Prepayment Premium. Upon repayment of the Term Loan for any reason prior to the Term Loan Maturity Date, in addition
to the payment of any other amounts then-owing, a prepayment premium (the “Prepayment Premium”) in an amount
equal to one percent (1.00%) of the funded amount of the Term Loan (i.e. Five Hundred Sixty Thousand Dollars ($560,000.00); provided
that no Prepayment Premium shall be charged if, so long as no Event of Default has occurred and is continuing, the credit
facility hereunder is replaced with a new facility from Bank; and

 

(c)                
Bank Expenses. All Bank Expenses (including reasonable attorneys’ fees and expenses for documentation and
negotiation of this Agreement) incurred through and after the Effective Date, when due (or, if no stated due date, upon demand
by Bank). Borrower and Bank acknowledge and agree that Borrower has delivered a Fifty Thousand Dollar ($50,000.00) good faith
deposit (the “Good Faith Deposit”), which Good Faith Deposit shall be applied to pay a portion of the Bank
Expenses as of the Effective Date.

 

(d)               
Fees Fully Earned. Unless otherwise provided in this Agreement or in a separate writing by Bank, Borrower shall
not be entitled to any credit, rebate, or repayment of any fees earned by Bank pursuant to this Agreement notwithstanding any
termination of this Agreement or the suspension or termination of Bank’s obligation to make loans and advances hereunder.
Bank may deduct amounts owing by Borrower under the clauses of this Section 2.3 pursuant to the terms of Section 2.4(c). Bank
shall provide Borrower written notice of deductions made from the Designated Deposit Account pursuant to the terms of the clauses
of this Section 2.3.

 

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2.4          Payments; Application of Payments; Debit of Accounts. 

 

(a)                
All payments to be made by Borrower under any Loan Document shall be made in immediately available funds in Dollars, without
setoff or counterclaim, before 12:00 noon Pacific time on the date when due. Payments of principal and/or interest received after
12:00 noon 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.

 

(b)               
Bank 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 Bank shall allocate or apply any payments
required to be made by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application
is not specified elsewhere in this Agreement.

 

(c)                
Bank may debit any of Borrower’s deposit accounts, including the Designated Deposit Account, for principal and interest
payments or any other amounts Borrower owes Bank when due. These debits shall not constitute a set-off.

 

2.5          Withholding. Payments received by Bank or
any other 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 Bank or any other 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, Bank or such lender receives a net sum equal to the
sum which it would have received had no withholding or deduction been required (the amount of such increase, an “Additional
Amount”), and Borrower shall pay the full amount withheld or deducted to the relevant Governmental Authority; provided,
however, that Borrower shall not be required to pay an Additional Amount to the applicable lender with respect to any withholding
or deduction imposed (A) pursuant to a law in effect on the date on which such lender became a party to this Agreement, except
to the extent that an Additional Amount was payable to such lender’s assignor before such lender became party hereto, (B)
as a result of such lender’s failure to comply with Section 2.6 or (C) under FATCA. Borrower will, upon request, furnish
Bank with proof reasonably satisfactory to Bank indicating that Borrower has made such withholding payment; provided, 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 or reserved against by Borrower. The agreements
and obligations of Borrower contained in this Section 2.5 shall survive the termination of this Agreement.

 

2.6          Tax Forms. If Bank or any other lender is
entitled to an exemption from or reduction of withholding tax with respect to payments made under any Loan Document, it shall
deliver to Borrower, at the time or times reasonably requested by Borrower, such properly completed and executed documentation
reasonably requested by Borrower as will permit such payments to be made without withholding or at a reduced rate of withholding.
In addition, Bank or any other lender, if reasonably requested by Borrower, shall deliver such other documentation prescribed
by applicable law or reasonably requested by Borrower as will enable Borrower to determine whether or not such lender is subject
to backup withholding or information reporting requirements. Each of Bank and any other lender that is party to this Agreement
agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it
shall update such form or certification or promptly notify Borrower in writing of its legal inability to do so.

 

3.            CONDITIONS OF LOANS

 

3.1          Conditions Precedent to Initial Credit Extension.
Bank’s obligation to make the initial Credit Extension is subject to the condition precedent that Bank shall have received,
in form and substance satisfactory to Bank, such documents, and completion of such other matters, as Bank may reasonably deem
necessary or appropriate, including, without limitation:

 

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(a)                
duly executed signatures to the Loan Documents;

 

(b)               
duly executed signatures to the Control Agreement, if any;

 

(c)                
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 dated as of a date no earlier than thirty (30) days prior to the Effective Date;

 

(d)               
duly executed signatures to the completed Borrowing Resolutions for Borrower;

 

(e)                
[reserved];

 

(f)                 
duly executed original signature to a payoff letter from CRG (the “Prior Lender”), together with all
documents and agreements executed in connection therewith, shall have been terminated and all amounts thereunder shall have been
paid in full;

 

(g)               
evidence that (i) the Liens securing Indebtedness owed by Borrower to Prior Lender will be terminated and (ii) the documents
and/or filings evidencing the perfection of such Liens, including without limitation any financing statements and/or control agreements,
have or will, concurrently with the initial Credit Extension, be terminated;

 

(h)               
certified copies, dated as of a recent date, of financing statement searches, as Bank 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 or, in connection with the initial Credit Extension, will be terminated or released;

 

(i)                 
the Perfection Certificates of Borrower, together with the duly executed signatures thereto;

 

(j)                 
[reserved];

 

(k)               
a bailee’s waiver in favor of Bank for each location where Borrower maintains property with a third party, by each
such third party, as required by Bank, together with the duly executed signatures thereto;

 

(l)                 
a legal opinion of Borrower’s counsel dated as of the Effective Date together with the duly executed signature thereto;

 

(m)              
[reserved]; and

 

(n)               
payment of the fees and Bank Expenses then due as specified in Section 2.3 hereof.

 

3.2          Conditions Precedent to all Credit Extensions.
Bank’s obligations to make each Credit Extension, including the initial Credit Extension, is subject to the following conditions
precedent:

 

(a)                
timely receipt of an executed Payment/Advance Form;

 

(b)               
the representations and warranties in this Agreement shall be true, accurate, and complete in all material respects on
the date of the Payment/Advance Form and on the Funding Date of each Credit Extension; provided, however, that such
materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by
materiality in the text thereof; and provided, further that those representations and warranties expressly referring to
a specific date shall be true, accurate and complete in all material respects as of such date, and no Event of Default shall have
occurred and be continuing or result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty
on that date that the representations and warranties in this Agreement remain true, accurate, and complete in all material respects;
provided, however, that such materiality

 

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qualifier
shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text
thereof; and provided, further that those representations and warranties expressly referring to a specific date
shall be true, accurate and complete in all material respects as of such date; and

 

(c)                
Bank determines to its satisfaction that there has not been any material impairment in the general affairs, management,
results of operation, financial condition or the prospect of repayment of the Obligations, or any material adverse deviation by
Borrower from the most recent business plan of Borrower presented to and accepted by Bank.

 

3.3          Covenant to Deliver. Borrower agrees to deliver
to Bank each item required to be delivered to Bank under this Agreement as a condition precedent to any Credit Extension. Borrower
expressly agrees that a Credit Extension made prior to the receipt by Bank of any such item shall not constitute a waiver by Bank
of Borrower’s obligation to deliver such item, and the making of any Credit Extension in the absence of a required item
shall be in Bank’s sole discretion.

 

3.4          Procedures for Borrowing.

 

(a)                
Term Loan. Subject to the prior satisfaction of all other applicable conditions to the making of any Term Loan set
forth in this Agreement, Borrower shall deliver to Bank by electronic mail or facsimile a Payment/Advance Form and the request
for such Term Loan.

 

4.            CREATION OF SECURITY INTEREST

 

4.1          Grant of Security Interest. Borrower hereby
grants Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges
to Bank, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof.

 

Borrower
acknowledges that it previously has entered, and/or may in the future enter, into Bank Services Agreements with Bank. Regardless
of the terms of any Bank Services Agreement, Borrower agrees that any amounts Borrower owes Bank thereunder shall be deemed to
be Obligations hereunder and that it is the intent of Borrower and Bank to have all such Obligations secured by the first priority
perfected security interest in the Collateral granted herein (subject only to Permitted Liens that are permitted pursuant to the
terms of this Agreement to have superior priority to Bank’s Lien in this Agreement).

 

If
this Agreement is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity
obligations) are repaid in full in cash. Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations)
and at such time as Bank’s obligation to make Credit Extensions has terminated or at the time Collateral is transferred
or to be transferred as part of or in connection with any sale, transfer or disposition permitted hereunder or under any other
Loan Document to any Person other than any other Borrower, Bank’s Lien in such Collateral (but not in the proceeds thereof)
shall be automatically released and all rights therein shall revert to Borrower, and Bank shall, at the sole cost and expense
of Borrower, take all other actions, recordings and filings to record the release of its Liens in the Collateral. In the event
(x) all Obligations (other than inchoate indemnity obligations), except for Bank Services, are satisfied in full, and (y) this
Agreement is terminated, Bank shall terminate the security interest granted herein upon Borrower providing cash collateral acceptable
to Bank in its good faith business judgment for Bank Services, if any. In the event such Bank Services consist of outstanding
Letters of Credit, Borrower shall provide to Bank cash collateral in an amount equal to (x) if such Letters of Credit are
denominated in Dollars, then at least one hundred five percent (105.0%); and (y) if such Letters of Credit are denominated
in a Foreign Currency, then at least one hundred ten percent (110.0%), of the Dollar Equivalent of the face amount of all such
Letters of Credit plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its
business judgment), to secure all of the Obligations relating to such Letters of Credit.

 

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 first priority perfected
security interest in the Collateral (subject only to Permitted Liens that are permitted pursuant to the terms of this Agreement
to have

 

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superior
priority to Bank’s Lien under this Agreement). If Borrower shall acquire a commercial tort claim in excess of Seventy-Five
Thousand Dollars ($75,000.00), Borrower shall promptly notify Bank in a writing signed by Borrower of the general details thereof
and grant to Bank in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement,
with such writing to be in form and substance reasonably satisfactory to Bank.

 

4.3          Authorization to File Financing Statements.
Borrower hereby authorizes Bank to file financing statements, without notice to Borrower, with all appropriate jurisdictions to
perfect or protect Bank’s interest or rights hereunder. Such financing statements may indicate the Collateral as “all
assets of the Debtor” or words of similar effect, or as being of an equal or lesser scope, or with greater detail, all in
Bank’s discretion.

 

5.            REPRESENTATIONS AND WARRANTIES

 

Borrower
represents and warrants as follows:

 

5.1          Due Organization, Authorization; Power and Authority.
Borrower is duly existing and in good standing as a Registered Organization in 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 effect on Borrower’s business. In connection with this Agreement, Borrower has delivered to Bank a completed certificate
signed by Borrower, entitled “Perfection Certificate”. Borrower represents and warrants to Bank that (a) Borrower’s
exact legal name is that indicated on the Perfection Certificate and on the signature page hereof; (b) Borrower is an organization
of the type and is organized in the jurisdiction set forth in the Perfection Certificate; (c) the Perfection Certificate accurately
sets forth Borrower’s organizational identification number or accurately states that Borrower has none; (d) the Perfection
Certificate accurately sets forth Borrower’s place of business, or, if more than one, its chief executive office as well
as Borrower’s mailing address (if different than its chief executive office); (e) Borrower (and each of its predecessors)
has not, in the past five (5) years, changed its jurisdiction of formation, organizational structure or type, or any organizational
number assigned by its jurisdiction; and (f) all other information set forth on the Perfection Certificate pertaining to Borrower
and each of its Subsidiaries is accurate and complete (it being understood and agreed that Borrower may from time to time update
certain information in the Perfection Certificate after the Effective Date, whether by e-mail correspondence, on the Compliance
Certificate or other written disclosure delivered to Bank; provided that such disclosure is accepted by the Bank by e-mail
correspondence or other written disclosure). If Borrower is not now a Registered Organization but later becomes one, Borrower
shall promptly notify Bank of such occurrence and provide Bank with Borrower’s organizational identification number.

 

The
execution, delivery and performance by Borrower of the Loan Documents 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 effect on Borrower’s business.

 

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. Borrower has no Collateral Accounts at or with any bank or financial institution other
than Bank or Bank’s Affiliates except for the Collateral Accounts described in the Perfection Certificate delivered to Bank
in connection herewith and which Borrower has taken such actions as are necessary to give Bank a perfected security interest therein,
pursuant to the term of Section 6.6(b). The Accounts are bona fide, existing obligations of the Account Debtors.

 

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The
Collateral is not in the possession of any third party bailee (such as a warehouse) except (i) as otherwise provided in the Perfection
Certificate or (ii) at such times as the Collateral may be in transit or is stored or is being installed at customer sites. None
of the components of the Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as
permitted pursuant to Section 7.2.

 

All
Inventory is in all material respects of good and marketable quality, free from material defects.

 

Borrower
is the sole owner of the Intellectual Property which it owns or purports to own except for (a) non-exclusive licenses granted
to its customers in the ordinary course of business, (b) over-the-counter software that is commercially available to the public,
and (c) material Intellectual Property licensed to Borrower and noted on the Perfection Certificate. Each Patent which it owns
or purports to own and which is material to Borrower’s business is valid and enforceable, and no part of the Intellectual
Property which Borrower owns or purports to own and which is material to Borrower’s business has been judged invalid or
unenforceable, in whole or in part. To the best of Borrower’s knowledge, no claim has been made that any part of the Intellectual
Property violates the rights of any third party except to the extent such claim would not reasonably be expected to have a material
adverse effect on Borrower’s business.

 

Except
as noted on the Perfection Certificate, Borrower is not a party to, nor is it bound by, any Restricted License.

 

5.3          Litigation. Except as disclosed to Bank pursuant
to Section 6.2(i), 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 involving more than, individually or in the aggregate, Five Hundred
Thousand Dollars ($500,000.00).

 

5.4          Financial Statements; Financial Condition.
All consolidated financial statements for Borrower and any of its Subsidiaries delivered to Bank fairly present in all material
respects Borrower’s consolidated financial condition and Borrower’s consolidated results of operations. There has
not been any material deterioration in Borrower’s consolidated financial condition since the date of the most recent financial
statements submitted to Bank.

 

5.5          Solvency. The fair salable value of Borrower’s
consolidated assets (including goodwill minus disposition costs) exceeds the fair value of Borrower’s liabilities; Borrower
is not left with unreasonably small capital after the transactions in this Agreement; and Borrower is able to pay its debts (including
trade debts) as they mature.

 

5.6          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 effect on its business. 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 Governmental Authorities that are necessary to continue their respective businesses as currently conducted.

 

5.7          Subsidiaries; Investments. Borrower does
not own any stock, partnership, or other ownership interest or other equity securities except for Permitted Investments.

 

5.8          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

 

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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 do not, individually or in the aggregate, exceed One Hundred Thousand Dollars ($100,000.00).

 

To
the extent Borrower defers payment of any contested taxes, Borrower shall (i) notify Bank 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 in excess of One Hundred Thousand Dollars ($100,000.00). Borrower
has paid all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with
their terms, and Borrower has not withdrawn from participation in, and has not permitted partial or complete termination of, or
permitted the occurrence of any other event with respect to, any such 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.

 

5.9          Use of Proceeds. Borrower shall use the proceeds
of the Credit Extensions (i) for the repayment in full of Prior Lender; and (ii) as working capital and to fund its general business
requirements and not for personal, family, household or agricultural purposes.

 

5.10        Full Disclosure. No written representation,
warranty or other statement of Borrower in any certificate or written statement given to Bank, as of the date such representation,
warranty, or other statement was made, taken together with all such written certificates and written statements given to Bank,
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 Bank 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).

 

5.11        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.             AFFIRMATIVE COVENANTS

 

Borrower
shall do all of the following:

 

6.1           Government Compliance. 

 

(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 effect on Borrower’s business or operations. Borrower shall comply, and have each Subsidiary comply, in all material
respects, with all laws, ordinances and regulations to which it is subject.

 

(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 Bank in all of its property. Borrower shall promptly provide copies
of any such obtained Governmental Approvals to Bank.

 

6.2           Financial Statements, Reports, Certificates.
Provide Bank with the following:

 

(a)                
Quarterly Financial Statements. As soon as available, but no later than forty-five (45) days after the last day
of each calendar quarter, a company prepared consolidated and consolidating balance sheet, statement of cash flows and income
statement covering Borrower’s consolidated operations for such calendar quarter, certified by a Responsible Officer and
in a form acceptable to Bank;

 

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(b)               
AR/AP Agings. Weekly, on the last Business Day of each week, aged listings of accounts receivable and accounts payable
(aged by invoice date) (collectively, the “Agings Reports”); provided, that in the event Borrower
has maintained a Liquidity Ratio equal to or greater than 2.00:1.00 at all times during a calendar month, such Agings Reports
will only be due monthly within thirty (30) days after the last day of such month;

 

(c)                
Account Debtor Listing; Inventory Reports. Within thirty (30) days after the last day of each calendar month, (i)
a detailed accounts receivable ledger submitted electronically, in form and substance reasonably acceptable to Bank; and (ii) perpetual
inventory reports for the Inventory valued on a first-in, first-out basis at the lower of cost or market (in accordance with GAAP)
or such other inventory reports as are requested by Bank in its good faith business judgment;

 

(d)               
Compliance Certificate. Within thirty (30) days after the last day of each calendar month (provided, that so long
as Borrower maintains the Minimum Balance, forty-five (45) days after the last day of each quarter), a duly completed Compliance
Certificate signed by a Responsible Officer, certifying that as of the end of such calendar month, Borrower was in full compliance
with all of the terms and conditions of this Agreement, and setting forth calculations showing compliance with the financial covenants
set forth in this Agreement and such other information as Bank may reasonably request;

 

(e)                
Annual Operating Budget and Financial Projections. Within thirty (30) days after the end of each fiscal year of
Borrower, and contemporaneously with any updates or amendments thereto, (i) annual operating budgets (including income statements,
balance sheets and cash flow statements, by month) for the upcoming fiscal year of Borrower, and (ii) annual financial projections
for the following fiscal year (on a quarterly basis) as approved by Borrower’s board of directors, together with any related
business forecasts used in the preparation of such annual financial projections;

 

(f)                 
Annual Audited Financial Statements. As soon as available, but no later than one hundred eighty (180) days after
the last day of Borrower’s fiscal year, audited consolidated financial statements prepared under GAAP, consistently applied,
together with an unqualified opinion on the financial statements from an independent certified public accounting firm reasonably
acceptable to Bank;

 

(g)               
Other Statements. Within five (5) days of delivery, copies of all statements, reports and notices made available
to Borrower’s security holders or to any holders of Subordinated Debt;

 

(h)               
SEC Filings. Within five (5) days of filing, copies of all periodic and other reports, proxy statements and other
materials filed by Borrower with the SEC, any Governmental Authority succeeding to any or all of the functions of the SEC or with
any national securities exchange, or distributed to its shareholders, as the case may be. Documents required to be delivered pursuant
to the terms hereof (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered
electronically and if so delivered, shall be deemed to have been delivered on the date on which Borrower posts such documents,
or provides a link thereto, on Borrower’s website on the Internet at Borrower’s website address; provided,
however, Borrower shall promptly notify Bank in writing (which may be by electronic mail) of the posting of any such documents;

 

(i)                 
Legal Action Notice. A prompt report of any legal actions pending or threatened in writing against Borrower or any
of its Subsidiaries that could result in damages or costs to Borrower or any of its Subsidiaries of, individually or in the aggregate,
Five Hundred Thousand Dollars ($500,000.00) or more; and

 

(j)                 
Other Financial Information. Other financial information reasonably requested by Bank.

 

6.3           Inventory; Returns. Keep all Inventory in
good and marketable condition, free from material defects. Returns and allowances between Borrower and its Account Debtors shall
follow Borrower’s customary practices as they exist at the Effective Date. Borrower must promptly notify Bank of all returns,
recoveries, disputes and claims outside Borrower’s customary practices as they exist at the Effective Date that involve
more than Two Hundred Fifty Thousand Dollars ($250,000.00).

 

    -9-

     

    

6.4           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 Section 5.9 hereof, and shall
deliver to Bank, 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.

 

6.5           Insurance. 

 

(a)                
Keep its business and the Collateral insured for risks and in amounts, and as the Bank may reasonably request, in each
case, standard for companies in Borrower’s industry and location. 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 reasonably satisfactory to
Bank (provided that such amounts shall be deemed to be reasonably satisfactory to Bank if they are standard for companies in Borrower’s
industry and location). All property policies shall have a lender’s loss payable endorsement showing Bank as the sole lender
loss payee. All liability policies shall show, or have endorsements showing, Bank as an additional insured. Bank shall be named
as lender loss payee and/or additional insured with respect to any such insurance providing coverage in respect of any Collateral.

 

(b)               
Ensure that proceeds payable under any property policy are, at Bank’s option, payable to Bank on account of the Obligations.

 

(c)                
At Bank’s request, Borrower shall deliver certified copies of insurance policies and evidence of all premium payments.
Each provider of any such insurance required under this Section 6.5 shall agree, by endorsement upon the policy or policies issued
by it or by independent instruments furnished to Bank, that it will give Bank 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
Section 6.5 or to pay any amount or furnish any required proof of payment to third persons and Bank, Bank may make all or
part of such payment or obtain such insurance policies required in this Section 6.5, and take any action under the policies Bank
deems prudent.

 

6.6           Operating Accounts.

 

(a)                
Accounts. Maintain all of its and all of its Subsidiaries’ operating and other deposit accounts and securities
accounts with Bank and Bank’s Affiliates, other than (i) deposit accounts exclusively used for payroll, payroll taxes and
other employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower
as such; and (ii) accounts of Foreign Subsidiaries maintained outside the United States at financial institutions other than Bank
and Bank’s Affiliates (the “Foreign Bank Accounts”), so long as the aggregate balance in all such Foreign
Bank Accounts does not exceed Twenty Million Dollars ($20,000,000.00) at any time, with amounts in excess of Five Million Dollars
($5,000,000.00) transferred to an account of Borrower maintained at Bank within thirty (30) days (or such later date as Bank shall
determine, in its sole but reasonable discretion), after deposit by such Foreign Subsidiaries in such Foreign Bank Accounts. Notwithstanding
the foregoing, Borrower shall be permitted to maintain its existing domestic accounts at financial institutions other than Bank
and Bank’s Affiliates (collectively, the “Existing Accounts”), so long as on or before January 31, 2019,
all such Existing Accounts are closed, with the proceeds transferred to an account of Borrower maintained at Bank or Bank’s
Affiliates.

 

(b)               
Control Agreements. Provide Bank five (5) days prior written notice before establishing any Collateral Account at
or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account that Borrower
at any time maintains, Borrower shall cause the applicable bank or financial institution (other than Bank) at or with which any
Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such
Collateral Account to perfect Bank’s Lien in such Collateral Account in accordance with the terms hereunder which Control
Agreement may not be terminated without the prior written consent of Bank. The provisions of the previous sentence shall not apply
to Foreign Bank Accounts held by Immaterial Foreign Subsidiaries (unless such Immaterial Foreign Subsidiary owning such Foreign
Bank Account becomes a Loan Party hereunder), deposit accounts exclusively used for payroll, payroll taxes and

 

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other
employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such.

 

(c)                
Collection of Accounts. Borrower shall direct Account Debtors to deliver or transmit all proceeds of Accounts into
a lockbox account, or such other “blocked account” as specified by Bank (either such account, the “Cash Collateral
Account”). Whether or not an Event of Default has occurred and is continuing, Borrower shall immediately deliver all
payments on and proceeds of Accounts to the Cash Collateral Account. All amounts received in the Cash Collateral Account shall
be (i) prior to the occurrence and continuance of an Event of Default, transferred on a daily basis to Borrower’s operating
account with Bank; and (ii) after the occurrence and during the continuance of an Event of Default, applied pursuant to Section
9.4 hereof. Borrower hereby authorizes Bank to transfer to the Cash Collateral Account any amounts that Bank reasonably determines
are proceeds of the Accounts (provided that Bank is under no obligation to do so and this allowance shall in no event relieve
Borrower of its obligations hereunder).

 

(d)               
Business Credit Card Accounts. Borrower shall be permitted to maintain is existing unsecured credit cards at financial
institutions other than Bank and Bank’s Affiliates (the “Existing Credit Card Accounts”), so long as
(i) such Existing Credit Card Accounts have an aggregate maximum balance for all such Existing Credit Card Accounts at all times
equal to or less than Five Hundred Thousand Dollars ($500,000.00); and (ii) on or before the date that is one hundred eighty (180)
days after the Effective Date, such Existing Credit Cards Accounts are canceled and/or closed, as the case may be.

 

6.7           Financial Covenants. Maintain the following
as indicated:

 

(a)                
Liquidity Ratio. For any monthly period in which the Borrower has failed to maintain the Minimum Balance for any
day in such month, Borrower shall maintain at all times, to be certified by Borrower as of the last day of each calendar month,
a Liquidity Ratio equal to or greater than 1.50:1.00.

 

(b)               
Revenue. For any calendar quarter in which the Borrower has failed to maintain the Minimum Balance for any day in
such fiscal quarter AND Borrower has maintained a Liquidity Ratio less than 2.25:1.00 on any day in such fiscal quarter, Borrower
shall achieve revenue, measured in accordance with GAAP on a trailing twelve month basis as of the last day of such fiscal quarter,
of at least the following:

 

	Trailing
    Twelve Month Period Ending	Minimum
    Revenue
	March 31, 2019	 $70,000,000.00
	June 30, 2019	$80,000,000.00
	September 30, 2019	$90,000,000.00
	December 31, 2019	$100,000,000.00
	March 31, 2020	$115,000,000.00
	June 30, 2020	$125,000,000.00
	September 30, 2020	$135,000,000.00
	December 31, 2020	$150,000,000.00

 

Minimum
revenue financial covenant requirements for the fiscal quarterly periods in subsequent fiscal years will be determined by Bank
annually, on or before March 31 of each such fiscal year, at the greater of (i) a twenty-five percent (25.0%) cushion to the revenue
forecasts contained in the projections for each such fiscal year provided by Borrower to Bank in accordance with Section 6.2(e),
and (ii) twenty percent (20.0%) year-over year

 

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annual
growth for each corresponding quarterly test period, unless the Borrower and the Bank shall otherwise agree in writing.

 

6.8          Protection of Intellectual Property Rights.

 

(a)                
(i) Protect, defend and maintain the validity and enforceability of its Intellectual Property that is material to the conduct
of its business; (ii) promptly advise Bank in writing of material infringements or any other event that could reasonably be expected
to materially and adversely affect the value of its Intellectual Property that is material to the conduct of its business; and
(iii) not allow any Intellectual Property material to Borrower’s business to be abandoned, forfeited or dedicated to the
public without Bank’s written consent.

 

(b)               
Provide written notice to Bank within ten (10) days of entering or becoming bound by any Restricted License (other than
over-the-counter software that is commercially available to the public). Borrower shall take commercially reasonable steps as
the Bank may reasonably request to obtain the consent of, or waiver by, any person whose consent or waiver is necessary for (i)
any Restricted License to be deemed “Collateral” and for Bank to have a security interest in it that might otherwise
be restricted or prohibited by law or by the terms of any such Restricted License, whether now existing or entered into in the
future, and (ii) Bank to have the ability in the event of a liquidation of any Collateral to dispose of such Collateral in accordance
with Bank’s rights and remedies under this Agreement and the other Loan Documents.

 

6.9          Litigation Cooperation. From the date hereof
and continuing through the termination of this Agreement, make available to Bank, without expense to Bank, Borrower and its officers,
employees and agents and Borrower’s books and records, to the extent that Bank may deem them reasonably necessary to prosecute
or defend any third-party suit or proceeding instituted by or against Bank with respect to any Collateral or relating to Borrower;
provided however, that, Borrower and its Subsidiaries shall not be required to disclose or provide any books and records
or otherwise be required to disclose or provide any information (i) that constitutes non-financial trade secrets or non-financial
proprietary information of Borrower or any of its Subsidiaries or any of their respective customers and/or suppliers, (ii) in
respect of which disclosure to the Bank (or any of their respective representatives) is prohibited by any applicable law, (iii)
that is subject to attorney-client or similar privilege or constitutes attorney work product or (iv) in respect of which Borrower
or any Subsidiary owes confidentiality obligations to any third party (provided such confidentiality obligations were not
entered into solely in contemplation of the requirements of this Section 6.9).

 

6.10        Access to Collateral; Books and Records.
Upon the Borrower failing to maintain the Minimum Balance, no later than ninety (90) days thereafter (or such later date as Bank
shall determine, in its sole discretion), with no less than five (5) Business Days’ notice, Bank shall conduct an inspection
of Borrower’s Accounts, the Collateral, and Borrower’s Books. Thereafter, Borrower shall allow Bank, or its agents,
at reasonable times, on five (5) 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 once every twelve (12) months (or more frequently as Bank shall determine conditions warrant, provided that
such inspections shall be limited to no more than four (4) times in any twelve (12) months), unless an Event of Default has occurred
and is continuing in which case such inspections and audits shall occur as often as Bank shall determine is necessary. The foregoing
inspections and audits shall be at Borrower’s expense, and the charge therefor shall be $1,000.00 per person per day (or
such higher amount as shall represent Bank’s then-current standard charge for the same), plus reasonable and documented
out-of-pocket expenses. In the event Borrower and Bank schedule an audit more than ten (10) days in advance, and Borrower cancels
or seeks to reschedule the audit with less than ten (10) days written notice to Bank, then (without limiting any of Bank’s
rights or remedies), Borrower shall pay Bank a fee of $2,000.00 plus any reasonable and documented out-of-pocket expenses incurred
by Bank to compensate Bank for the anticipated costs and expenses of the cancellation or rescheduling.

 

6.11        Formation or Acquisition of Subsidiaries.
Notwithstanding and without limiting the negative covenants contained in Sections 7.3 and 7.7 hereof, within thirty (30) days
in the case of a Domestic Subsidiary (excluding a US Holdco) or ninety (90) days in the case of a Foreign Subsidiary and/or US
Holdco (or such later date as Bank shall determine, in its sole but reasonable discretion) following the date that Borrower or
any Guarantor forms any direct or indirect Subsidiary or acquires any direct or indirect Subsidiary after the Effective Date,
Borrower or such Guarantor, as applicable, shall (a) cause such new Subsidiary to provide to Bank a joinder to

 

    -12-

     

    

this
Agreement to become a co-borrower hereunder or a Guaranty to become a Guarantor hereunder, together with such appropriate financing
statements and/or Control Agreements, all in form and substance reasonably satisfactory to Bank (including being sufficient to
grant Bank a first priority Lien (subject to Permitted Liens) in and to the assets of such newly formed or acquired Subsidiary),
(b) provide to Bank appropriate certificates and powers and financing statements, pledging all of the direct or beneficial ownership
interest in such new Subsidiary, in form and substance reasonably satisfactory to Bank and (c) provide to Bank all other documentation
in form and substance satisfactory to Bank, including one or more opinions of counsel satisfactory to Bank, which in its opinion
is appropriate with respect to the execution and delivery of the applicable documentation referred to above; provided,
that with respect to any Foreign Subsidiary and/or US Holdco, in the event that Borrower provides Bank evidence reasonably
satisfactory to Bank that (i) the grant of a continuing pledge and security interest in and to the assets of any such Foreign
Subsidiary and/or US Holdco, (ii) the guaranty of the Obligations of the Borrower by any such Foreign Subsidiary and/or US Holdco
(or, in either case, subsidiary thereof) (iii) the pledge by Borrower of a perfected security interest in more than two-thirds
of the stock, units or other evidence of ownership of each Foreign Subsidiary or US Holdco and/or (iv) the provision of a joinder
to become co-borrower under this Agreement by any such Foreign Subsidiary and/or US Holdco (or, in either case, subsidiary thereof),
would be expected to have a material adverse tax effect on the Borrower, then the Borrower shall: (A) if such Foreign Subsidiary
and/or US Holdco is a first-tier Subsidiary of Borrower, be required only to grant and pledge to Bank a perfected security interest
in up to sixty-five percent (65%) of the stock, units or other evidence of ownership of such Foreign Subsidiary and/or US Holdco
(it being understood that none of the assets of such Foreign Subsidiary and/or US Holdco will in such case be pledged to Bank
as Collateral and that such Foreign Subsidiary and/or US Holdco (or, in either case, subsidiary thereof) will neither guaranty
the Obligations of the Borrower nor become a co-borrower under this Agreement) and (B) if such Subsidiary is a Subsidiary of a
Foreign Subsidiary and/or US Holdco, not be required to (x) grant or pledge to Bank a perfected security interest in the stock,
units or other evidence of ownership of such Subsidiary, or any assets thereof or (y) have such Subsidiary guaranty the Obligations
of the Borrower or become a co-borrower under this Agreement. Notwithstanding anything to the contrary in this Agreement, in no
event shall any Subsidiary of Borrower be required to grant security or provide a guaranty of the Obligations to Bank to the extent
that (A) Borrower provides Bank evidence reasonably acceptable to Bank that (i) such grant of security or guaranty would violate
any applicable law or any contractual obligation (and in the case of such contractual obligation, not entered into in contemplation
of the acquisition or formation of such Subsidiary) or (ii) would require governmental (including regulatory) consent, approval,
license or authorization to provide security or give a guarantee, unless such consent, approval, license or authorization has
been received or (B) Borrower and Bank mutually agree that the cost or other consequences of providing a guarantee or granting
security shall be excessive in view of the benefits obtained by the Bank therefrom. Any document, agreement, or instrument executed
or issued pursuant to this Section 6.11 shall be a Loan Document. The foregoing requirements of this Section 6.11 shall not apply
to any Immaterial Foreign Subsidiary, and so long as Borrower maintains the Minimum Balance, Borrower shall be permitted to create
any such Immaterial Foreign Subsidiary upon five (5) Business Days prior written notice to Bank.

 

6.12        Designated Senior Indebtedness. Borrower
shall designate all principal of, interest (including all interest accruing after the commencement of any bankruptcy or similar
proceeding, whether or not a claim for post-petition interest is allowable as a claim in any such proceeding), and all fees, costs,
expenses and other amounts accrued or due under this Agreement as “Designated Senior Indebtedness”, or such similar
term, in any future Subordinated Debt incurred by Borrower after the date hereof, if such Subordinated Debt contains such term
or similar term and if the effect of such designation is to grant to Bank the same or similar rights as granted to Bank as a holder
of “Designated Senior Indebtedness” under the applicable indenture or other loan arrangement.

 

6.13        Further Assurances. Execute any further instruments
and take further action as Bank reasonably requests to perfect or continue Bank’s Lien in the Collateral or to effect the
purposes of this Agreement. Deliver to Bank, within five (5) days after the same are sent or received, copies of all correspondence,
reports, documents and other filings with any Governmental Authority regarding compliance with or maintenance of Governmental
Approvals or Requirements of Law or that could reasonably be expected to have a material effect on any of the Governmental Approvals
or otherwise on the operations of Borrower or any of its Subsidiaries.

 

6.14        Post-closing Matters. Borrower shall deliver
the following to Bank in the time frames indicated below:

 

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(a)                
On or before the date that is thirty (30) days after the Effective Date (or such later date as Bank shall determine, in
its sole but reasonable discretion), provide Bank evidence satisfactory to Bank that the insurance policies and endorsements required
by Section 6.5 hereof are in full force and effect, together with appropriate evidence showing loss payable and/or additional
insured clauses or endorsements in favor of Bank; and

 

(b)               
On or before January 31, 2019 (or such later date as Bank shall determine, in its sole but reasonable discretion), deliver
to Bank a landlord’s consent in favor of Bank for each leased location of Borrower, by each respective landlord thereof,
together with the duly executed signatures thereto.

 

7.             NEGATIVE COVENANTS

 

Borrower
shall not do any of the following without Bank’s prior written consent:

 

7.1           Dispositions. Convey, sell, lease, transfer,
assign, or otherwise dispose of (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer,
all or any part of its business or property, except for (a) Transfers of Inventory in the ordinary course of business (including
on an intracompany basis); (b) Transfers of worn-out or obsolete Equipment or other property that is, in each case, in the reasonable
judgment of Borrower, no longer economically practicable to maintain or useful in the ordinary course of business of Borrower;
(c) Transfers consisting of Permitted Liens and Permitted Investments; (d) Transfers to customers’ of Equipment located
at a customer’s site for research and collaboration; (e) Transfers consisting of Borrower’s use or transfer of money
or Cash Equivalents in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents; (f) Transfers
consisting of (i) licensing and cross-licensing (including sub-licensing) arrangements involving any technology, Intellectual
Property, Intellectual Property rights of Borrower or any Subsidiary in the ordinary course of business, (ii) abandonments, cancellations
or lapses of Intellectual Property rights or issuances or registrations, or applications for issuances or registrations, of Intellectual
Property rights in the ordinary course of business, or which, in the good faith determination of Borrower, are not material to
the conduct of the business of Borrower or its Subsidiaries, or are no longer economical to maintain in light of its use and (iii)
of any technology, intellectual property or other Intellectual Property rights of Borrower or any Subsidiary involving their customers
in the ordinary course of business; (g) the leasing or subleasing of real property in the ordinary course of business; (h) Transfers
of notes receivable or accounts receivable in the ordinary course of business (including any discount and/or forgiveness thereof)
or in connection with the collection or compromise thereof, or as part of any bankruptcy or similar proceeding; (i) (i) any termination
of any lease, sublease, license or sub-license in the ordinary course of business (and any related Transfer of improvements made
to leased real property resulting therefrom), (ii) any expiration of any option agreement in respect of real or personal property,
and (iii) any surrender or waiver of contractual rights or the settlement, release or surrender of contractual rights or litigation
claims (including in tort) in the ordinary course of business; (j) Transfers and/or terminations of, or constituting, leases,
subleases, licenses, sublicenses or cross-licenses (including the provision of software under any open source license), the Transfers
or terminations of which (i) do not materially interfere with the business of the Borrower and its Subsidiaries, (ii) relate to
closed facilities or the discontinuation of any product line or (iii) are made in the ordinary course of business; (k) any sale
of motor vehicles and information technology equipment purchased at the end of an operating lease and resold thereafter; and (l)
other Transfers not otherwise permitted in clauses (a) through (k) involving assets having a fair market value of not more than
One Million Dollars ($1,000,000.00) in any fiscal year, so long as immediately prior to and after giving effect to any such Transfers
pursuant to this clause (l), Borrower has maintained the Minimum Balance.

 

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; provided that any Subsidiary
that is not a Loan Party can liquidate or dissolve, so long as the assets of such Subsidiary are transferred to a Loan Party and
there would be no material adverse tax effect on the Borrower resulting from such transfer (as determined by Borrower); (c) fail
to provide notice to Bank of any Key Person departing from or ceasing to be employed by Borrower within five (5) days after such
Key Person’s departure from Borrower; or (d) permit or suffer any Change in Control.

 

Borrower
shall not, without at least thirty (30) days prior written notice to Bank: (1) add any new offices or business locations, including
warehouses (unless such new offices or business locations contain less than One

 

    -14-

     

    

Hundred
Thousand Dollars ($100,000.00) in Borrower’s assets or property) or deliver any portion of the Collateral valued, individually
or in the aggregate, in excess of One Hundred Thousand Dollars ($100,000.00) to a bailee at a location other than to a bailee
and at a location already disclosed in the Perfection Certificate (or at such times as the Collateral may be in transit or stored
or being installed at customer sites), (2) change its jurisdiction of organization, (3) change its organizational structure or
type, (4) change its legal name, or (5) change any organizational number (if any) assigned by its jurisdiction of organization.
If Borrower intends to deliver any portion of the Collateral valued, individually or in the aggregate, in excess of One Hundred
Thousand Dollars ($100,000.00) to a bailee, and Bank and such bailee are not already parties to a bailee agreement governing both
the Collateral and the location to which Borrower intends to deliver the Collateral, then Borrower will first receive the written
consent of Bank, and such bailee shall execute and deliver a bailee agreement in form and substance satisfactory to Bank.

 

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), other than (i) in accordance with clause (d)(ii) of the definition of Permitted Investments and
(ii) the formation of Immaterial Foreign Subsidiaries to the extent permitted pursuant to Section 6.11. A Subsidiary may merge
or consolidate into another Subsidiary or into Borrower.

 

7.4           Indebtedness. Create, incur, assume, or be
liable for any Indebtedness, or permit any Subsidiary to do so, other than Permitted Indebtedness.

 

7.5           Encumbrance. Create, incur, allow, or suffer
any Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit
any of its Subsidiaries to do so, except for Permitted Liens, permit any Collateral not to be subject to the first priority security
interest granted herein, or enter into any agreement, document, instrument or other arrangement (except with or in favor of Bank)
with any Person which directly or indirectly prohibits or has the effect of prohibiting Borrower or any Subsidiary from assigning,
mortgaging, pledging, granting a security interest in or upon, or encumbering any of Borrower’s or any Subsidiary’s
Intellectual Property, except as is otherwise permitted in Section 7.1 hereof and the definition of “Permitted Liens”
herein.

 

7.6           Maintenance of Collateral Accounts.  Maintain
any Collateral Account except pursuant to the terms of Section 6.6(b) hereof.

 

7.7           Distributions; Investments. (a) Pay any dividends
or make any distribution or payment or redeem, retire or purchase any capital stock; provided that Borrower may (i) convert
any of its convertible securities into other securities pursuant to the terms of such convertible securities or otherwise in exchange
thereof, (ii) pay dividends solely in common stock; (iii) repurchase the stock of former employees or consultants pursuant to
stock repurchase agreements so long as an Event of Default does not exist at the time of any such repurchase and would not exist
after giving effect to any such repurchase; (iv) make cash payments in lieu of the issuance of fractional shares in connection
with the exercise of warrants, options or other securities convertible into or exchangeable for capital stock, or in connection
with dividends, share splits, reverse share splits (or any combination thereof) and other Investments permitted hereunder, in
an aggregate maximum amount not to exceed One Hundred Thousand Dollars ($100,000.00) in any fiscal year; or (v) cash dividends
approved by the Borrower’s board of directors, in an aggregate maximum amount not to exceed One Million Dollars ($1,000,000.00)
so long as immediately prior to and after giving effect to any such dividend or distribution pursuant to this clause (v), (i)
no Event of Default has occurred and is continuing, or would result immediately after giving effect to such dividend, and (ii)
Borrower has maintained the Minimum Balance; or (b) directly or indirectly make any Investment (including, without limitation,
by the formation of any Subsidiary), other than Permitted Investments, or permit any of its Subsidiaries to do so.

 

7.8           Transactions with Affiliates.  Directly or
indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for 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.

 

7.9           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,

 

    -15-

     

    

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 Bank.

 

7.10         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 effect on Borrower’s business; or violate any other law
or regulation, if the violation could reasonably be expected to have a material adverse effect on Borrower’s business, 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.              EVENTS OF DEFAULT

 

Any
one of the following shall constitute an event of default (an “Event of Default”) under this Agreement:

 

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 Term Loan 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);

 

8.2            Covenant Default. 

 

(a)                
Borrower fails or neglects to perform any obligation in Sections 6.2, 6.4, 6.5, 6.6, 6.7, 6.8(c), 6.10, 6.11 or violates
any covenant in Section 7; or

 

(b)               
Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained
in this Agreement (including, without limitation, the on-going requirement to update the Perfection Certificate pursuant to Section
5.1), or any Loan Documents, and as to any default (other than those specified in this Section 8) 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 thirty (30) 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). Cure periods provided under this section shall not apply to any financial
covenants or any other covenants set forth in clause (a) above;

 

8.3            Material Adverse Change. A Material Adverse
Change occurs:

 

8.4            Attachment; Levy; Restraint on Business. 

 

(a)                
(i) The service of process seeking to attach, by trustee or similar process, any funds of Borrower or of any entity under
the control of Borrower (including a Subsidiary), or (ii) a notice of lien or levy is filed against any of Borrower’s assets
by any Governmental Authority, and the same under subclauses (i) and (ii) hereof are not, within ten (10) days after the occurrence
thereof, discharged or stayed (whether through the posting

 

    -16-

     

    

of
a bond or otherwise); provided, however, no Credit Extensions shall be made during any ten (10) day cure period;
or

 

(b)               
(i) any material portion of Borrower’s assets is attached, seized, levied on, or comes into possession of a trustee
or receiver, or (ii) any court order enjoins, restrains, or prevents Borrower from conducting all or any material part of
its business;

 

8.5            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);

 

8.6            Other Agreements. There is, under any agreement
to which Borrower or any Guarantor is a party with a third party or parties, (a) 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 Five Hundred Thousand Dollars ($500,000.00); or (b) any breach or default by Borrower or Guarantor,
the result of which could have a material adverse effect on Borrower’s or any Guarantor’s business;

 

8.7            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 ($500,000.00) (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);

 

8.8            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 Bank or to induce Bank to enter this Agreement or any Loan Document, and such representation, warranty,
or other statement is incorrect in any material respect when made;

 

8.9            Subordinated Debt. Any document, instrument,
or agreement evidencing any Subordinated Debt shall for any reason be revoked or invalidated or otherwise cease to be in full
force and effect, any Person shall be in breach thereof or contest in any manner the validity or enforceability thereof or deny
that it has any further liability or obligation thereunder, or the Obligations shall for any reason be subordinated or shall not
have the priority contemplated by this Agreement or any applicable subordination or intercreditor agreement; or

 

8.10          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 cause, or could reasonably be expected to cause, a Material Adverse Change.

 

9.               BANK’S RIGHTS AND REMEDIES

 

9.1             Rights and Remedies. Upon the occurrence
and during the continuance of an Event of Default, Bank may, without notice or demand, do any or all of the following:

 

(a)                
declare all Obligations immediately due and payable (but if an Event of Default described in Section 8.5 occurs all Obligations
are immediately due and payable without any action by Bank);

 

    -17-

     

    

(b)               
stop advancing money or extending credit for Borrower’s benefit under this Agreement or under any other agreement
between Borrower and Bank;

 

(c)                
demand that Borrower (i) deposit cash with Bank in an amount equal to at least 105% (110% for Letters of Credit denominated
in a Currency other than Dollars), of the Dollar Equivalent of the aggregate face amount of all Letters of Credit remaining undrawn
(plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business
judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any
future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance
all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit;

 

(d)               
terminate any FX Contracts;

 

(e)                
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 Bank considers advisable,
and notify any Person owing Borrower money of Bank’s security interest in such funds;

 

(f)                 
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 Bank requests and make it available as Bank designates. Bank 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 Bank a license to enter and occupy any of its premises, without charge, to exercise any of Bank’s rights
or remedies;

 

(g)               
apply to the Obligations any (i) balances and deposits of Borrower it holds, or (ii) any amount held by Bank owing to or
for the credit or the account of Borrower;

 

(h)               
ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell the Collateral.
Bank is hereby granted a non-exclusive, royalty-free license or other right to use, without charge, Borrower’s labels, Patents,
Copyrights, mask works, rights of use of any name, trade secrets, trade names, Trademarks, and advertising matter, or any similar
property as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and,
in connection with Bank’s exercise of its rights under this Section, Borrower’s rights under all licenses and all
franchise agreements inure to Bank’s benefit;

 

(i)                 
place a “hold” on any account maintained with Bank 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;

 

(j)                 
provided the Bank has commenced exercising its rights and remedies hereunder, demand and receive possession of Borrower’s
Books; and

 

(k)               
exercise all rights and remedies available to Bank 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).

 

9.2          Power of Attorney. Borrower hereby irrevocably
appoints Bank 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 Bank 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 Bank or a third party as the Code permits. Borrower hereby appoints
Bank as its lawful attorney-in-fact to sign Borrower’s name on any documents necessary

 

    -18-

     

    

to
perfect or continue the perfection of Bank’s security interest in the Collateral regardless of whether an Event of Default
has occurred until all Obligations have been satisfied in full and Bank is under no further obligation to make Credit Extensions
hereunder. Bank’s foregoing appointment as Borrower’s attorney in fact, and all of Bank’s rights and powers,
coupled with an interest, are irrevocable until all Obligations have been fully repaid and performed and Bank’s obligation
to provide Credit Extensions terminates.

 

9.3          Protective Payments. If Borrower fails to
obtain the insurance called for by Section 6.5 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, Bank
may obtain such insurance or make such payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable,
bearing interest at the Default Rate, and secured by the Collateral. Bank will make reasonable efforts to provide Borrower with
notice of Bank obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Bank
are deemed an agreement to make similar payments in the future or Bank’s waiver of any Event of Default.

 

9.4          Application of Payments and Proceeds Upon Default.
If an Event of Default has occurred and is continuing, Bank shall have the right to apply in any order any funds in its possession,
whether from Borrower account balances, payments, proceeds realized as the result of any collection of Accounts or other disposition
of the Collateral, or otherwise, to the Obligations. Bank shall pay any surplus to Borrower by credit to the Designated Deposit
Account or to other Persons legally entitled thereto; Borrower shall remain liable to Bank for any deficiency. If Bank, directly
or indirectly, enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Bank 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 Bank of cash therefor.

 

9.5          Bank’s Liability for Collateral. So
long as Bank complies with reasonable banking practices regarding the safekeeping of the Collateral in the possession or under
the control of Bank, Bank 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.

 

9.6          No Waiver; Remedies Cumulative. Bank’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 Bank 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. Bank’s rights and remedies under this Agreement and the other
Loan Documents are cumulative. Bank has all rights and remedies provided under the Code, by law, or in equity. Bank’s exercise
of one right or remedy is not an election and shall not preclude Bank from exercising any other remedy under this Agreement or
other remedy available at law or in equity, and Bank’s waiver of any Event of Default is not a continuing waiver. Bank’s
delay in exercising any remedy is not a waiver, election, or acquiescence.

 

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 Bank on which Borrower
is liable.

 

10.          NOTICES

 

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 or facsimile transmission; (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, facsimile number, or email address indicated
below.

 

    -19-

     

    

Bank
or Borrower may change its mailing or electronic mail address or facsimile number by giving the other party written notice thereof
in accordance with the terms of this Section 10.

 

	 	If
    to Borrower:	c/o Viewray, Inc.
	 	 	2 Thermo Fisher Way
	 	 	Oakwood Village, Ohio 44146
	 	 	Attn: Robert McCormack
	 	 	Fax:  (800) 417-3459
	 	 	Email: rmccormack@viewray.com
	 	 	 
	 	 	Website URL: https://viewray.com
	 	with
    a copy to:	Davis Polk & Wardwell LLP
	 	 	450 Lexington Avenue  
	 	 	New York, New York 10017
	 	 	Attn:	Joseph
    Hadley
	 	 	Fax:	(212)
    450-4007
	 	 	Email:	joseph.hadley@davispolk.com

 

	 	If
    to Bank:	Silicon Valley Bank
	 	 	380 Interlocken Crescent, Suite 600
	 	 	Broomfield, Colorado 80021
	 	 	Attn: Tom Hertzberg
	 	 	Fax:  (303) 469-9088
	 	 	Email:  thertzberg@svb.com
	 	 	 
	 	with
    a copy to:	Riemer & Braunstein LLP
	 	 	One Center Plaza
	 	 	Boston, Massachusetts  02108
	 	 	Attn:	Charles
    W. Stavros, Esquire
	 	 	Fax:	(617)
    880-3456
	 	 	Email:	cstavros@riemerlaw.com

 

11.          CHOICE OF LAW, VENUE AND JURY TRIAL WAIVER

 

Except
as otherwise expressly provided in any of the Loan Documents, New York law governs the Loan Documents without regard to principles
of conflicts of law. Borrower and Bank each submit to the exclusive jurisdiction of the State and Federal courts in New York,
New York; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing
suit or taking other legal action in any other jurisdiction to realize on the Collateral or any other security for the Obligations,
or to enforce a judgment or other court order in favor of Bank. Borrower expressly submits and consents in advance to such jurisdiction
in any action or suit commenced in any such court, and Borrower hereby waives any objection that it may have based upon lack of
personal jurisdiction, improper venue, or forum non conveniens and hereby consents to the granting of such legal or equitable
relief as is deemed appropriate by such court. Borrower hereby waives personal service of the summons, complaints, and other process
issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered
or certified mail addressed to Borrower at the address set forth in, or subsequently provided by Borrower in accordance with,
Section 10 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s
actual receipt thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid.

 

TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT,
TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT.
EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.

 

    -20-

     

    

This
Section 11 shall survive the termination of this Agreement.

 

12.          GENERAL PROVISIONS

 

12.1        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 Bank’s prior written consent (which may be granted or withheld in Bank’s discretion).
Bank 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, Bank’s obligations, rights, and benefits under this Agreement and the other Loan
Documents; provided, that so long as an Event of Default has not occurred and is not continuing, Bank shall endeavor to provide
Borrower contemporaneous notice of any such sale, transfer, assignment, or participation hereunder, but the failure of Bank to
provide such notice shall not be deemed a breach of this Agreement by Bank.

 

12.2        Indemnification. Borrower agrees to indemnify,
defend and hold Bank and its directors, officers, employees, agents, attorneys, or any other Person affiliated with or representing
Bank (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 Bank 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 Bank 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
Section 12.2 shall survive until all statutes of limitation with respect to the Claims, losses, and expenses for which indemnity
is given shall have run.

 

12.3        Time of Essence. Time is of the essence for
the performance of all Obligations in this Agreement.

 

12.4        Severability of Provisions. Each provision
of this Agreement is severable from every other provision in determining the enforceability of any provision.

 

12.5        Correction of Loan Documents. Bank may correct
patent errors and fill in any blanks in the Loan Documents consistent with the agreement of the parties.

 

12.6        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.

 

12.7        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.

 

12.8        Confidentiality. In handling any confidential
information, Bank shall exercise the same degree of care that it exercises for its own proprietary information, but disclosure
of information may be made: (a) to Bank’s Subsidiaries or Affiliates (such Subsidiaries and Affiliates, together with Bank,
collectively, “Bank Entities”); (b) to prospective transferees or purchasers of any interest in the Credit
Extensions (provided, however, Bank shall use commercially reasonable efforts to obtain any prospective transferee’s
or purchaser’s agreement to the terms of this

 

    -21-

     

    

provision);
(c) as required by law, regulation, subpoena, or other order; (d) to Bank’s regulators or as otherwise required
in connection with Bank’s examination or audit; (e) as Bank considers appropriate in exercising remedies under the
Loan Documents; and (f) to third-party service providers of Bank so long as such service providers have executed a confidentiality
agreement with Bank 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 Bank’s possession when disclosed to Bank, or becomes part of the public
domain (other than as a result of its disclosure by Bank in violation of this Agreement) after disclosure to Bank; or (ii) disclosed
to Bank by a third party, if Bank does not know that the third party is prohibited from disclosing the information.

 

Bank
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.

 

12.9        Right of Set Off. Borrower hereby grants
to Bank, a lien, security interest and right of set off as security for all Obligations to Bank, whether now existing or hereafter
arising upon and against all deposits, credits, collateral and property, now or hereafter in the possession, custody, safekeeping
or control of Bank or any entity under the control of Bank (including a Bank subsidiary) or in transit to any of them. At any
time after the occurrence and during the continuance of an Event of Default, without demand or notice, Bank may set off the same
or any part thereof and apply the same to any liability or obligation of Borrower even though unmatured and regardless of the
adequacy of any other collateral securing the Obligations. ANY AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES
WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH
DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

 

12.10      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.

 

12.11      Captions. The headings used in this Agreement
are for convenience only and shall not affect the interpretation of this Agreement.

 

12.12      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.

 

12.13      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.

 

12.14      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 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.

 

12.15      Borrower Liability. Any Borrower may, acting
singly, request Credit Extensions hereunder. Each Borrower hereby appoints each other as agent for the other for all purposes
hereunder, including with respect to requesting Credit Extensions hereunder. Each Borrower hereunder shall be jointly and severally
obligated to repay all Credit Extensions made hereunder, regardless of which Borrower actually receives said Credit Extension,
as if each Borrower hereunder directly received all Credit Extensions. Each Borrower waives (a) any suretyship defenses available
to it under the Code or any other applicable law, and (b) any right to require Bank to: (i) proceed against any Borrower or any
other person; (ii) proceed against or exhaust any security; or (iii) pursue any other remedy. Bank may exercise or not exercise
any right or remedy it has against any Borrower or any security it holds

 

    -22-

     

    

(including
the right to foreclose by judicial or non-judicial sale) without affecting any Borrower’s liability. Notwithstanding any
other provision of this Agreement or other related document, each Borrower irrevocably waives all rights that it may have at law
or in equity (including, without limitation, any law subrogating Borrower to the rights of Bank under this Agreement) to seek
contribution, indemnification or any other form of reimbursement from any other Borrower, or any other Person now or hereafter
primarily or secondarily liable for any of the Obligations, for any payment made by Borrower with respect to the Obligations in
connection with this Agreement or otherwise and all rights that it might have to benefit from, or to participate in, any security
for the Obligations as a result of any payment made by Borrower with respect to the Obligations in connection with this Agreement
or otherwise. Any agreement providing for indemnification, reimbursement or any other arrangement prohibited under this Section
9.8 shall be null and void. If any payment is made to a Borrower in contravention of this Section 9.8, such Borrower shall hold
such payment in trust for Bank and such payment shall be promptly delivered to Bank for application to the Obligations, whether
matured or unmatured.

 

12.16      Participation Register. The Bank, acting
solely for this purpose as an agent of the Borrower, shall maintain at one of its offices in Santa Clara, California, a copy of
each assignment and assumption agreement delivered to it and a register for the recordation of the names and addresses of the
lenders, and the commitments of, and principal amounts (and stated interest) of the loans owing to, each lender pursuant to the
terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest
error, and the Borrower, the Bank and the other lenders shall treat each Person whose name is recorded in the Register pursuant
to the terms hereof as a lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by
the Borrower and any lender, at any reasonable time and from time to time upon reasonable prior notice. Further, each lender that
sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which
it enters the name and address of each participant and the principal amounts (and stated interest) of each participant’s
interest in the loans or other obligations under the Loan Documents (the “Participant Register”); provided
that no lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity
of any participant or any information relating to a participant’s interest in any commitments, loans, letters of credit
or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish
that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United
States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such lender
shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes
of this Agreement notwithstanding any notice to the contrary.

 

13.           DEFINITIONS

 

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, and the singular includes the plural. 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.

 

“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.

 

“Agings
Reports” is defined in Section 6.2(b).

 

“Agreement”
is defined in the preamble hereof.

 

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“Authorized
Signer” is any individual listed in Borrower’s Borrowing Resolution who is authorized to execute the Loan Documents,
including any Advance request, on behalf of Borrower.

 

“Bank”
is defined in the preamble hereof.

 

“Bank
Entities” is defined in Section 12.8.

 

“Bank
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 (including, without limitation,
those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to Borrower.

 

“Bank
Services”  are any products, credit services, and/or financial accommodations previously, now, or hereafter provided
to Borrower or any of its Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any letters of credit, cash
management services (including, without limitation, merchant services, direct deposit of payroll, business credit cards, and check
cashing services), interest rate swap arrangements, and foreign exchange services as any such products or services may be identified
in Bank’s various agreements related thereto (each, a “Bank Services Agreement”).

 

“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 adopted by such Person’s board of directors (and,
if required under the terms of such Person’s Operating Documents, stockholders) and delivered by such Person to Bank approving
the Loan Documents to which such Person is a party and the transactions contemplated thereby, together with a certificate executed
by its secretary on behalf of such Person certifying (a) such Person has the authority to execute, deliver, and perform its
obligations under each of the Loan Documents to which it is a party, (b) that set forth as a part of or attached as an exhibit
to such certificate is a true, correct, and complete copy of the resolutions then in full force and effect authorizing and ratifying
the execution, delivery, and performance by such Person of the Loan Documents to which it is a party, (c) the name(s) of the Person(s)
authorized to execute the Loan Documents, including any Advance request, on behalf of such Person, together with a sample of the
true signature(s) of such Person(s), and (d) that Bank may conclusively rely on such certificate unless and until such Person
shall have delivered to Bank a further certificate canceling or amending such prior certificate.

 

“Business
Day” is any day that is not a Saturday, Sunday or a day on which Bank is closed.

 

“Cash
Collateral Account” is defined in Section 6.6(c).

 

“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.; (c) Bank’s certificates of deposit issued maturing no more than
one (1) year after issue; and (d) money market funds at least ninety-five percent (95%) of the assets of which constitute Cash
Equivalents of the kinds described in clauses (a) through (c) of this definition.

 

“CFC”
means an entity that is a controlled foreign corporation within the meaning of Section 957 of the Internal Revenue Code of
1986, as amended.

 

“Change
in Control” means (a) a transaction in which any “person” or “group” (within the
meaning of Section 13(d) and 14(d)(2) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule
13d-3 under Exchange Act), directly or indirectly, of greater than 35% of the shares of all classes of stock then outstanding
of

 

    -24-

     

    

Borrower
ordinarily entitled to vote in the election of directors; or (b) at any time, Borrower shall cease to own and control, of record
and beneficially, directly or indirectly, 100% of each class of outstanding capital stock of each subsidiary of Borrower free
and clear of all Liens (except Liens created by this Agreement).

 

“Claims”
is defined in Section 12.2.

 

“Code”
is the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of New York; provided,
that, to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently
in different Articles or Divisions of the Code, the definition of such term contained in Article or Division 9 shall govern; provided
further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, or priority
of, or remedies with respect to, Bank’s Lien on any Collateral is governed by the Uniform Commercial Code in effect in a
jurisdiction other than the State of New York, the term “Code” shall mean the Uniform Commercial Code as enacted
and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection,
priority, or remedies and for purposes of definitions relating to such provisions.

 

“Collateral”
is any and all properties, rights and assets of Borrower described on Exhibit A; provided that in no event will the
Collateral include Excluded Assets.

 

“Collateral
Account” is any Deposit Account, Securities Account, or Commodity Account.

 

“Commodity
Account” is any “commodity account” as defined in the Code with such additions to such term as may hereafter
be made.

 

“Compliance
Certificate” is that certain certificate in the form attached hereto as Exhibit B.

 

“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.

 

“Control
Agreement” is any control agreement entered into among the depository institution at which Borrower maintains a Deposit
Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity
Account, Borrower, and Bank pursuant to which Bank obtains control (within the meaning of the Code) over such Deposit Account,
Securities Account, or Commodity Account.

 

“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 Loan or any other extension of credit by Bank for Borrower’s benefit.

 

“Currency”
is coined money and such other banknotes or other paper money as are authorized by law and circulate as a medium of exchange.

 

“Default
Rate” is defined in Section 2.2(b).

 

    -25-

     

    

“Deposit
Account” is any “deposit account” as defined in the Code with such additions to such term as may hereafter
be made.

 

“Designated
Deposit Account” is account number ending ***235 (last three numbers), maintained by Borrower with Bank.

 

“Dollars,”
“dollars” or use of the sign “$” means only lawful money of the United States and not any
other currency, regardless of whether that currency uses the “$” sign to denote its currency or may be readily converted
into lawful money of the United States.

 

“Dollar
Equivalent” is, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect
to any amount denominated in a Foreign Currency, the equivalent amount therefor in Dollars as determined by Bank at such time
on the basis of the then-prevailing rate of exchange in San Francisco, California, for sales of the Foreign Currency for transfer
to the country issuing such Foreign Currency.

 

“Domestic
Subsidiary” means a Subsidiary organized under the laws of the United States or any state or territory thereof or the
District of Columbia.

 

“Effective
Date” is defined in the preamble hereof.

 

“Equipment”
is all “equipment” as defined in the Code with such additions to such term as may hereafter be made, and includes
without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of
the foregoing.

 

“ERISA”
is the Employee Retirement Income Security Act of 1974, and its regulations.

 

“Event
of Default” is defined in Section 8.

 

“Exchange
Act” is the Securities Exchange Act of 1934, as amended.

 

“Excluded
Assets” are (i) all leasehold estates with respect to office space used by Borrower or any of its Subsidiaries, (ii)
deposit accounts specifically and exclusively used for payroll, payroll taxes and other employee wage and benefit plans to or
for the benefit of any Loan Party’s employees, (iii) any item of general intangibles that is now or hereafter held by Borrower
or any of its Subsidiaries but only to the extent that such item of general intangibles (or any agreement evidencing such item
of general intangibles) contains a term, provision or other contractual obligation or is subject to a rule of law, statute or
regulation that restricts, prohibits, or requires a consent (that has not been obtained) of a Person (other than Borrower or any
of its Subsidiaries) to, the grant, creation, attachment or perfection of the security interest granted in the Loan Document,
and any such restriction, prohibition and/or requirement of consent is effective and enforceable under applicable law and is not
rendered ineffective by applicable law (including, without limitation, pursuant to Sections 9.406, 9.407, 9.408 or 9.409 of the
UCC, and any successor provision thereto), and (iv) any interest of any Loan Party as a lessee or sublessee under a real property
lease or an Equipment lease if such Loan Party is prohibited by the terms of such lease from granting a security interest in such
lease or under which such an assignment or Lien would cause a default to occur under such lease (but only to the extent that such
prohibition is enforceable under all applicable laws including, without limitation, the Code); provided, however,
that upon termination of such prohibition, such interest shall immediately become Collateral without any action by such Loan Party
or Bank.

 

“Existing
Accounts” is defined in Section 6.6(a).

 

“Existing
Credit Card Accounts” is defined in Section 6.6(d).

 

“FATCA”
means Sections 1471 through 1474 of the Internal Revenue Code (including, for the avoidance of doubt, any agreements entered into
pursuant to Section 1471(b)(1) of the Internal Revenue Code), as of the closing date (and any amended or successor version thereof
that is substantively comparable and not materially more onerous to comply with), any current or future Treasury Regulations promulgated
under the Internal Revenue Code

 

    -26-

     

    

or
other official administrative guidance promulgated thereunder, any intergovernmental agreements entered into in connection with
the implementation thereof, and any fiscal or regulatory legislation, rules or practices adopted pursuant to such intergovernmental
agreement.

 

“Final
Payment” is defined in Section 2.3(a).

 

“Foreign
Bank Accounts” is defined in Section 6.6(a).

 

“Foreign
Currency” means lawful money of a country other than the United States.

 

“Foreign
Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

 

“Funding
Date” is any date on which a Credit Extension is made to or for the account of Borrower which shall be a Business Day.

 

“FX
Contract” is any foreign exchange contract by and between Borrower and Bank under which Borrower commits to purchase
from or sell to Bank a specific amount of Foreign Currency on a specified date.

 

“GAAP”
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. Notwithstanding anything to the contrary in this Agreement,
unless the Borrower elects otherwise, all obligations of any Person that are or would have been treated as operating leases for
purposes of GAAP prior to the issuance by the Financial Accounting Standards Board on February 25, 2016 of an Accounting Standards
Update (the “ASU”) shall continue to be accounted for as operating leases for purposes of all financial definitions,
calculations and deliverables under this Agreement or any other Loan Document (whether or not such operating lease obligations
were in effect on such date) notwithstanding the fact that such obligations are required in accordance with the ASU (on a prospective
or retroactive basis or otherwise) to be treated as capital lease obligations or otherwise accounted for as liabilities in financial
statements.

 

“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.

 

“Good
Faith Deposit” is defined in Section 2.3(c).

 

“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.

 

“Guarantor”
is any Person providing a Guaranty in favor of Bank.

 

“Guaranty”
is any guarantee of all or any part of the Obligations, as the same may from time to time be amended, restated, modified or otherwise
supplemented.

 

    -27-

     

    

“Immaterial
Foreign Subsidiary” is, at any date of determination, any Foreign Subsidiary of any Loan Party (other than a Borrower
or a Guarantor) designated as such by the Borrower in writing and which as of such date (a) holds assets representing five
percent (5.00%) or less of Borrower’s consolidated total assets (excluding the value of Transferred Inventory) as of such
date (determined in accordance with GAAP), (b) which has generated less than five percent (5.00%) of Borrower’s consolidated
total revenues (excluding revenue generated from Transferred Inventory) determined in accordance with GAAP for the four fiscal
quarter period ending on the last day of the most recent period for which financial statements have been delivered after the Effective
Date pursuant to Section 6.2(a)(b); provided that all Foreign Subsidiaries that are individually an Immaterial Foreign
Subsidiary shall not have aggregate consolidated total assets that would represent ten percent (10%) or more of the Borrower’s
consolidated total assets (excluding the value of Transferred Inventory) as of such date or have generated ten percent (10%) or
more of Borrower’s consolidated total revenues (excluding revenue generated from Transferred Inventory), for such four fiscal
quarter period, in each case determined in accordance with GAAP, and (c) which owns no material Intellectual Property.

 

“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 to the extent the applicable obligation itself constitutes “Indebtedness”
described in clause (a) through (c).

 

“Indemnified
Person” is defined in Section 12.2.

 

“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” means, with respect to any Person, means all of such Person’s right, title, and interest in and to the
following:

 

(a)                
its Copyrights, Trademarks and Patents;

 

(b)               
any and all trade secrets and trade secret rights, including, without limitation, any rights to unpatented inventions,
know-how, and operating manuals;

 

(c)                
any and all source code;

 

(d)               
any and all design rights which may be available to such Person;

 

(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

 

(f)                 
all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents.

 

“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 Executive Officer, who is Scott Drake as of the Effective Date.

 

    -28-

     

    

“Letter
of Credit” is a standby or commercial letter of credit issued by Bank upon request of Borrower based upon an application,
guarantee, indemnity, or similar agreement.

 

“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.

 

“Liquidity
Ratio” is, as of any date of measurement, the result of (i) (a) Borrower’s unrestricted and unencumbered cash
maintained at Bank and Bank’s Affiliates; plus (b) net billed accounts receivable (excluding Accounts (i) for which the
Account Debtor is Borrower’s Affiliate, officer, employee, investor, or agent, or (ii) that are intercompany Accounts);
divided by (b) all outstanding Obligations of Borrower owed to Bank.

 

“Loan
Documents” are, collectively, this Agreement and any schedules, exhibits, certificates, notices, and any other documents
related to this Agreement, the Perfection Certificate, any subordination agreement, any note, or notes or guaranties executed
by Borrower or any Guarantor, and any other present or future agreement by Borrower and/or any Guarantor with or for the benefit
of Bank in connection with this Agreement, all as amended, restated, or otherwise modified.

 

“Loan
Party” and “Loan Parties” means (i) a Borrower and (ii) any secured Guarantor, as the context requires.

 

“Material
Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s Lien in the Collateral or
in the value of such Collateral; (b) a material adverse change in the business, operations, or condition (financial or otherwise)
of Borrower; or (c) a material impairment of the prospect of repayment of any portion of the Obligations.

 

“Minimum
Balance” is Borrower’s unrestricted and unencumbered cash and Cash Equivalents maintained at Bank and Bank’s
Affiliates, of at least One Hundred Million Dollars ($100,000,000.00).

 

“Obligations”
are Borrower’s obligations to pay when due any debts, principal, interest, fees, Bank Expenses, the Final Payment, the Prepayment
Premium, and other amounts Borrower owes Bank now or later, whether under this Agreement, the other Loan Documents, or otherwise,
including, without limitation, all obligations relating to Bank Services and interest accruing after Insolvency Proceedings begin
and debts, liabilities, or obligations of Borrower assigned to Bank, 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.

 

“Patents”
means all patents, patent applications and like protections including without limitation improvements, divisions, continuations,
renewals, reissues, extensions and continuations-in-part of the same.

 

“Payment/Advance
Form” is that certain form attached hereto as Exhibit C.

 

“Perfection
Certificate” is defined in Section 5.1.

 

“Permitted
Indebtedness” is:

 

(a)                
Borrower’s Indebtedness to Bank under this Agreement and the other Loan Documents;

 

(b)               
Indebtedness existing on the Effective Date and shown on the Perfection Certificate;

 

    -29-

     

    

(c)                
(i) unsecured Indebtedness to trade creditors incurred in the ordinary course of business; and (ii) accounts payable and
other liabilities incurred in the ordinary course of business and not past due by more than ninety (90) days, unless after such
ninety (90) day period such payables or liabilities are being actively contested in a matter consistent with past practices of
the Borrower;

 

(d)               
Subordinated Debt existing on the Effective Date;

 

(e)                
Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business;

 

(f)                 
Indebtedness secured by Liens permitted under clauses (a) and (c) of the definition of “Permitted Liens” hereunder;

 

(g)               
(i) Indebtedness of any Loan Party owed to any other Loan Party; (ii) Indebtedness of any Subsidiary that is not a Loan
Party owed to any other Subsidiary that is not a Loan Party; and (iii) Indebtedness of Subsidiaries that are not Loan Parties
owed to any Loan Party, in an aggregate maximum amount not to exceed, together with the Investments permitted pursuant to clause
(d)(iii) of the definition of “Permitted Investments”, One Million Dollars ($1,000,000.00) at any time;

 

(h)               
Indebtedness of the Borrower and/or any Subsidiary (i) pursuant to tenders, statutory obligations (including health, safety
and environmental obligations), bids, leases, governmental contracts, trade contracts, surety, indemnity, stay, customs, judgment,
appeal, performance, completion and/or return of money bonds or guaranties or other similar obligations incurred in the ordinary
course of business and (ii) in respect of letters of credit, bank guaranties, surety bonds, performance bonds or similar instruments
to support any of the foregoing items;

 

(i)                 
Indebtedness consisting of the Existing Credit Card Accounts, to the extent permitted pursuant to Section 6.6(d);

 

(j)                 
customer deposits and advance payments received in the ordinary course of business from customers for goods and services
purchased in the ordinary course of business;

 

(k)               
other unsecured Indebtedness not otherwise permitted hereunder, in an aggregate maximum amount not to exceed One Million
Dollars ($1,000,000.00) at any time;

 

(l)                 
subject to the cash transfer requirements of Section 6.6(a), Indebtedness of Subsidiaries in respect of Transferred Inventory;

 

(m)              
obligations incurred in the ordinary course of business, in amounts and in a manner consistent with past practices, in
respect of workers’ compensation claims, unemployment insurance (including premiums related thereto), payroll and other
employee benefit-related obligations (not otherwise in violation of this Agreement), and property, casualty and/or liability insurance
or self-insurance; and

 

(n)               
extensions, refinancings, modifications, amendments and restatements of any items of Permitted Indebtedness (a) through
(m) above; provided that the principal amount thereof is not increased or the terms thereof are not modified to impose
more burdensome terms upon Borrower or its Subsidiary, as the case may be; and

 

“Permitted
Investments” are:

 

(a)                
Investments (including, without limitation, Subsidiaries) existing on the Effective Date and shown on the Perfection Certificate;

 

(b)               
Investments consisting of Cash Equivalents;

 

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(c)                
Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in
the ordinary course of Borrower;

 

(d)               
Investments (i) of any Loan Party in any other Loan Party; (ii) of any Subsidiary that is not a Loan Party in any other
Subsidiary that is not a Loan Party; and (iii) Investments of any Loan Party in Subsidiaries, that are not a Loan Party, in an
aggregate amount for all such Investments under this clause (iii) not to exceed, together with the Indebtedness permitted pursuant
to clause (g)(iii) of the definition of “Permitted Indebtedness”, One Million Dollars ($1,000,000.00) at any time;

 

(e)                
Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the
ordinary course of business, and (ii) loans to employees, officers or directors relating to the purchase of equity securities
of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by the Borrower’s board
of directors;

 

(f)                 
Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers
who are not Affiliates, in the ordinary course of business; provided that this paragraph (f) shall not apply to Investments
of Borrower in any Subsidiary;

 

(g)               
(i) Investments of Foreign Subsidiaries in the Foreign Bank Accounts, but only to the extent permitted pursuant to Section
6.6(a); and (ii) Investments in the Existing Accounts, but only to the extent permitted pursuant to Section 6.6(a);

 

(h)               
Investments consisting of Transferred Inventory;

 

(i)                 
Investments accepted in connection with Transfers permitted by Section 7.1;

 

(j)                 
other Investments not otherwise permitted hereunder, in an aggregate maximum amount not to exceed One Million Dollars ($1,000,000.00).

 

“Permitted
Liens” are:

 

(a)                
Liens existing on the Effective Date and shown on the Perfection Certificate or arising under this Agreement and the other
Loan Documents;

 

(b)               
Liens for taxes, fees, assessments or other government charges or levies, either (i) not due and payable or (ii) being
contested in good faith and for which Borrower maintains adequate reserves on its Books, provided that no notice of any
such Lien has been filed or recorded under the Internal Revenue Code of 1986, as amended, and the Treasury Regulations adopted
thereunder;

 

(c)                
purchase money Liens or capital leases securing no more than One Million Dollars ($1,000,000.00) in the aggregate amount
outstanding (i) on Equipment acquired or held by Borrower incurred for financing the acquisition of the Equipment, or (ii) existing
on Equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the Equipment;

 

(d)               
Liens of carriers, warehousemen, suppliers, or other Persons that are possessory in nature arising in the ordinary course
of business so long as such Liens attach only to Inventory, securing liabilities in the aggregate amount not to exceed Five Hundred
Thousand Dollars ($500,000.00) and which are not delinquent or remain payable without penalty or which are being contested in
good faith and by appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property
subject thereto;

 

(e)                
Liens to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other
like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA);

 

    -31-

     

    

(f)                 
Liens incurred in the extension, renewal or refinancing of the indebtedness secured by Liens described in (a) through (c),
but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the
principal amount of the indebtedness may not increase;

 

(g)               
leases or subleases of real property granted in the ordinary course of Borrower’s business (or, if referring to another
Person, in the ordinary course of such Person’s business), and leases, subleases, non-exclusive licenses or sublicenses
of personal property (other than Intellectual Property) granted in the ordinary course of Borrower’s business (or, if referring
to another Person, in the ordinary course of such Person’s business), if the leases, subleases, licenses and sublicenses
do not prohibit granting Bank a security interest therein;

 

(h)               
non-exclusive licenses of Intellectual Property granted to third parties in the ordinary course of business, and licenses
of Intellectual Property that could not result in a legal transfer of title of the licensed property 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;

 

(i)                 
Liens in favor of other financial institutions arising in connection with (i) the Existing Credit Card Accounts; provided
that such accounts are permitted to be maintained pursuant to Section 6.6(d) of this Agreement; and (ii) the Existing Accounts;
provided that such accounts are permitted to be maintained pursuant to Section 6.6(a) of this Agreement; and

 

(j)                 
Liens arising from attachments or judgments, orders, or decrees in circumstances not constituting an Event of Default under
Sections 8.4 and 8.7.

 

“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.

 

“Prepayment
Premium” is defined in Section 2.3(b).

 

“Prime
Rate” is the rate of interest per annum from time to time published in the money rates section of The Wall Street Journal
or any successor publication thereto as the “prime rate” then in effect; provided that, in the event such rate
of interest is less than zero, such rate shall be deemed to be zero for purposes of this Agreement; and provided further
that if such rate of interest, as set forth from time to time in the money rates section of The Wall Street Journal, becomes unavailable
for any reason as determined by Bank, the “Prime Rate” shall mean the rate of interest per annum announced by Bank
as its prime rate in effect at its principal office in the State of California (such Bank announced Prime Rate not being intended
to be the lowest rate of interest charged by Bank in connection with extensions of credit to debtors).

 

“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, President, Chief Financial Officer and Controller of Borrower.

 

“Restricted
License” is any material license or other agreement with respect to which Borrower is the licensee (a) that prohibits
or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such license or agreement or
any other property, or (b) for which a default under or termination of could interfere with the Bank’s right to sell
any Collateral.

 

    -32-

     

    

“SEC”
shall mean the Securities and Exchange Commission, any successor thereto, and any analogous Governmental Authority.

 

“Securities
Account” is any “securities account” as defined in the Code with such additions to such term as may hereafter
be made.

 

“Subordinated
Debt” is indebtedness incurred by Borrower subordinated to all of Borrower’s now or hereafter indebtedness to
Bank (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Bank entered
into between Bank and the other creditor), on terms acceptable to Bank.

 

“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
Loan” is defined in Section 2.1.1(a).

 

“Term
Loan Amortization Date” is December 1, 2020; provided, that following the occurrence of the Term Loan
I/O Extension Event, at Borrower’s election (such election to be made in writing to Bank on or prior to December 1, 2020),
the Term Loan Amortization Date shall be extended to June 1, 2021.

 

“Term
Loan Amortization Schedule” is thirty-six (36) equal payments of principal, based on a thirty-six (36) month amortization
schedule; provided, that after the occurrence of the Term Loan I/O Extension Event, at Borrower’s election
(such election to be made in writing to Bank on or prior to December 1, 2020), the Term Loan Amortization Schedule shall be thirty
(30) equal payments of principal, based on a thirty (30) month amortization schedule.

 

“Term
Loan I/O Extension Event” means the date, which in any event shall be on or prior to December 1, 2020, on which Borrower
provides Bank evidence satisfactory to Bank, in its reasonable discretion, that Borrower has achieved revenue, measured on a trailing
twelve month basis and determined in accordance with GAAP, of at least Two Hundred Fifteen Million Dollars ($215,000,000.00).

 

“Term
Loan Maturity Date” is December 1, 2023 (the first day of the month that is 60 months after the Effective Date).

 

“Term
Loan Payment” is defined in Section 2.1.1(b)

 

“Trademarks”
means 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 Section 7.1.

 

“Transferred
Inventory” is Inventory of Borrower transferred to a Foreign Subsidiary for sale outside the United States, the proceeds
of which shall be, subject to Section 6.6(a), transferred by such Foreign Subsidiary to Borrower pursuant to the Borrower’s
board approved transfer pricing policies with respect to such Inventory.

 

“US
Holdco” means any domestic Subsidiary of the Borrower, the sole assets (other than immaterial assets) of which consist
of the equity interests of CFCs.

 

[Signature
page follows.]

 

    -33-

     

    

IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the Effective Date.

 

BORROWER:

 

VIEWRAY,
INC.

 

	By	/s/
    Robert McCormack
	Name:	Robert
    McCormack
	Title:	Senior
    Vice President, General Counsel
	 	&
    Corporate Secretary

 

 

VIEWRAY
TECHNOLOGIES, INC.

 

	By	 /s/
    Robert McCormack
	Name:	Robert
    McCormack
	Title:	Vice
    President and Secretary

 

 

BANK:

 

SILICON
VALLEY BANK

 

	By	/s/
    Tom Hertzberg
	Name:	Tom
    Hertzberg
	Title:	Managing
    Director

 

    [Signature Page to Loan Agreement]

     

    

EXHIBIT
A – COLLATERAL DESCRIPTION

 

The
Collateral consists of all of Borrower’s right, title and interest in and to the following personal property:

 

All
goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases,
license agreements, franchise agreements, General Intangibles (except as provided below), commercial tort claims, documents, instruments
(including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts, fixtures, letters of
credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property,
supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and

 

all
Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions
for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds
of any or all of the foregoing.

 

Notwithstanding
the foregoing, the Collateral does not include any Intellectual Property; provided, however, the Collateral shall
include all Accounts and all proceeds of Intellectual Property.
If a judicial authority (including a U.S. Bankruptcy Court) would hold that a security interest in the underlying Intellectual
Property is necessary to have a security interest in such Accounts and such property that are proceeds of Intellectual Property,
then the Collateral shall automatically, and effective as of the Effective Date, include the Intellectual Property to the extent
necessary to permit perfection of Bank’s security interest in such Accounts and such other property of Borrower that are
proceeds of the Intellectual Property.

 

In
no event will the Collateral include an Excluded Assets.

 

Pursuant
to the terms of a certain negative pledge arrangement with Bank, Borrower has agreed not to encumber any of its Intellectual Property
without Bank’s prior written consent.

 

    2

     

    

EXHIBIT
B

 

COMPLIANCE
CERTIFICATE

 

	TO:	SILICON
    VALLEY BANK	Date:  	 
	FROM:	VIEWRAY,
    INC.	 	 
	 	VIEWRAY
    TECHNOLOGIES, INC.	 	 

 

The
undersigned authorized officer of Viewray, Inc. (“Viewray”) and Viewray Technologies, Inc., (“Technologies”,
and together with Viewray, individually and collectively, jointly and severally, the “Borrower”), certifies
that under the terms and conditions of the Loan and Security Agreement between Borrower and Bank (the “Agreement”):

 

(1) Borrower
is in complete compliance for the period ending _______________ with all required covenants except as noted below; (2) there
are no Events of Default; (3) all representations and warranties in the Agreement are true and correct in all material respects
on this date except as noted below; provided, however, that such materiality qualifier shall not be applicable to
any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided,
further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete
in all material respects as of such date; (4) Borrower, and each of its Subsidiaries, 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 as otherwise permitted pursuant to the terms of Section 5.9 of the Agreement; and (5) no Liens have
been levied or claims made against Borrower or any of its Subsidiaries relating to unpaid employee payroll or benefits of which
Borrower has not previously provided written notification to Bank.

 

Attached
are the required documents supporting the certification. The undersigned certifies that these are prepared in accordance with
GAAP consistently applied from one period to the next except as explained in an accompanying letter or footnotes. The undersigned
acknowledges that no borrowings may be requested at any time or date of determination that Borrower is not in compliance with
any of the terms of the Agreement, and that compliance is determined not just at the date this certificate is delivered. Capitalized
terms used but not otherwise defined herein shall have the meanings given them in the Agreement.

 

	Please indicate compliance status by circling
    Yes/No under “Complies” column.
	 
	Reporting
    Covenants	Required	Complies
	 	 	 
	Quarterly
    financial statements 

    	Quarterly
    within 45 days	Yes   No
	Compliance
    Certificate	Monthly
        within 30 days (45 days after each

        

        quarter
        in which the Minimum Balance has

        

        been
        maintained)

        
	Yes   No
	A/R
    – A/P Agings	Monthly
        within 30 days if Liquidity

        Ratio is >  2.00:1.00, otherwise weekly,

        

        on
        the last Business Day of each week

        
	Yes   No
	Account
    Debtor listing; Inventory reports	Monthly
    within 30 days	Yes   No
	Annual
    financial statement (CPA Audited) + CC	FYE
    within 180 days	Yes   No
	10-Q,
    10-K and 8-K	Within
    5 days after filing with SEC	Yes   No
	Annual
    Projections and Operating Budgets	30
    days after  FYE, and as updated	Yes   No
	Detailed
        Accounts Receivable ledger report,

        

        submitted
        electronically

        
	Monthly
    within 30 days	Yes   No

    3

     

    

	Financial
    Covenants	Required	Actual	Complies
	 	 	 	 
	Maintain
    as indicated:	 	 	 
	Minimum
        Balance (at all times)

        
	$100,000,000.00	$_______	Yes   No
	If
        Minimum Balance NOT maintained in any 

        

        calendar
        month:

        
	 	 	 
	 	 	 	 
	Liquidity
        Ratio (at all times, certified monthly)

        
	1.50:1.00	_____:1.00	Yes   No
	If
    Minimum Balance NOT maintained in any fiscal quarter AND Liquidity Ratio at any time during such fiscal quarter is less than
    2.25:1.00 	 	 	 
	 	 	 	 
	Minimum
    TTM revenue (tested quarterly)	*	$________	Yes   No

* See Section
6.9(b) of the Loan Agreement

 

Other
Matters

 

	Have there been any amendments of or other changes
    to the capitalization table of Borrower and to the Operating Documents of Borrower or any of its Subsidiaries?  If
    yes, provide copies of any such amendments or changes with this Compliance Certificate.	Yes	No

 

The
following are the exceptions with respect to the certification above: (If no exceptions exist, state “No exceptions to note.”)

 

 

 

 

 

	Viewray, Inc.
	Viewray Technologies, Inc.
	 
	 
	By:	 
	Name:	 
	Title:	 

	BANK USE ONLY
	 
	Received
    by:	 
	 	authorized
    signer
	 	 
	Date:	 
	 	 
	Verified:	 
	 	authorized
    signer
	 	 
	Date:	 
	 	 
	Compliance
    Status:	Yes     No

    4

     

    

Schedule
1 to Compliance Certificate

 

[Financial
Covenants of Borrower]

 

Dated:____________________

 

I.       Liquidity
Ratio (Section 6.9(a))

 

Required:For
any monthly period in which the Borrower has failed to maintain the Minimum Balance for any day in such month, Borrower shall
maintain at all times, to be certified by Borrower as of the last day of each calendar month, a Liquidity Ratio equal to or greater
than 1.50:1.00.

 

Actual:

 

	A.	Aggregate
        value of the unrestricted and unencumbered cash of Borrower maintained at Bank

        
	$__________

	B.	Aggregate
        value of the net billed accounts receivable of Borrower (excluding Accounts (i) for which the Account Debtor is Borrower’s
        Affiliate, officer, employee, investor, or agent, or (ii) that are intercompany Accounts)

        
	$__________ 

	C.	Quick Assets (the sum of lines A and B)	$__________ 

	D.	Aggregate value of outstanding Obligations of Borrower owed
    to Bank	$__________ 

	E.	LIQUIDITY RATIO (line C divided by line D)	__________:1.00

        

 

Is line
E equal to or greater than 1.50:1:00?

 

	 	No,
    not in compliance	 	  ________Yes,
    in compliance
	 	 	 	 
	 	 	 	 
	Is
    line E equal to or greater than 2.00:1:00?
	 	 	 	 
	 	No,
    Agings Reports due weekly	 	  ________Yes,
    Agings Reports due monthly within 30 days
	 	 	 	 
	 	 	 	 
	Is
    line E equal to or greater than 2.25:1:00?
	 	 	 	 
	 	No,
    Borrower subject to minimum revenue covenant testing	 	 
	 	 	 	 
	 	 	 	  ________Yes,
    minimum revenue covenant not tested

    5

     

    

II.       Minimum
Revenue (Section 6.9(b))

 

Required:For
any calendar quarter in which the Borrower has failed to maintain the Minimum Balance for any day in such fiscal quarter AND Borrower
has maintained a Liquidity Ratio less than 2.25:1.00 on any day in such fiscal quarter, Borrower shall achieve revenue, measured
in accordance with GAAP on a trailing twelve month basis as of the last day of such fiscal quarter, of at least the following:

 

	Trailing
    Twelve Month Period Ending	Minimum
    Revenue
	March 31, 2019	 $70,000,000.00
	June 30, 2019	$80,000,000.00
	September 30, 2019	$90,000,000.00
	December 31, 2019	$100,000,000.00
	March 31, 2020	$115,000,000.00
	June 30, 2020	$125,000,000.00
	September 30, 2020	$135,000,000.00
	December 31, 2020	$150,000,000.00

 

Minimum
revenue financial covenant requirements for the fiscal quarterly periods in subsequent fiscal years will be determined by Bank
annually, on or before March 31 of each such fiscal year, at the greater of (i) a twenty-five percent (25.0%) cushion to the revenue
forecasts contained in the projections for each such fiscal year provided by Borrower to Bank in accordance with Section 6.2(e),
and (ii) twenty percent (20.0%) year-over year annual growth for each corresponding quarterly test period, unless the Borrower
and the Bank shall otherwise agree in writing.

 

Actual:
all amounts measured on a trailing twelve month basis

 

	A.	Revenue	$________________

 

Is line
A equal to or greater than $ [______________]?

 

	 	No,
    not in compliance	 __________ Yes,
    in compliance

    6

     

    

EXHIBIT C
– LOAN PAYMENT/ADVANCE REQUEST FORM

 

Deadline
for same day processing is Noon Pacific Time

 

	Fax To:  	Date:
_____________________

	 	 

 

	Loan
    Payment:	 	Viewray,
    Inc. & Viewray Technologies, Inc.
	From
    Account #________________________________	 	To
    Account #__________________________________________________
	(Deposit
    Account #)	 	(Loan
    Account #)
	Principal
    $____________________________________	 	and/or
    Interest $________________________________________________
	Authorized
    Signature:	 	Phone
    Number: ____________________________________________
	Print
    Name/Title: 	 	 

 

Loan
Advance:

 

Complete
Outgoing Wire Request section below if all or a portion of the funds from this loan advance are for an outgoing wire.

 

	From Account #________________________________	 	To
    Account #__________________________________________________
	(Loan
    Account #)	 	(Deposit
    Account #)
	Amount
    of Advance $___________________________	 	 

 

All Borrower’s
representations and warranties in the Loan and Security Agreement are true, correct and complete in all material respects on the
date of the request for an advance; provided, however, that such materiality qualifier shall not be applicable to
any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided,
further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete
in all material respects as of such date:

 

	Authorized Signature:_______________________	 	Phone
    Number: ___________________________
	Print
    Name/Title: ___________________________	 	 

 

Outgoing
Wire Request:

 

Complete
only if all or a portion of funds from the loan advance above is to be wired.

 

Deadline
for same day processing is noon, Pacific Time

 

	Beneficiary Name: _____________________________	 	Amount
    of Wire: $________________________________________
	Beneficiary
    Bank: ______________________________	 	Account
    Number: ________________________________________
	City
    and State: ________________________________	 	 
	Beneficiary
    Bank Transit (ABA) #: _________________	 	Beneficiary
    Bank Code (Swift, Sort, Chip, etc.): __________________
		 	(For
    International Wire Only)
	Intermediary
    Bank: _____________________________	 	Transit
    (ABA) #: _________________________________________
	For Further Credit to: ___________________________________________________________________________________________________________
	Special Instruction: _____________________________________________________________________________________________________________

 

By signing
below, I (we) acknowledge and agree that my (our) funds transfer request shall be processed in accordance with and subject to
the terms and conditions set forth in the agreements(s) covering funds transfer service(s), which agreements(s) were previously
received and executed by me (us).

 

	Authorized Signature: ___________________________	 	2nd
    Signature (if required): _______________________________________
	Print
    Name/Title: _______________________________	 	Print
    Name/Title: ______________________________________________
	Telephone
    #: 	 	Telephone
    #: 

 

    7

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