Document:

XFIT
BRANDS, INC.

 

______________

 

PREFERRED
STOCK PURCHASE AGREEMENT

 

______________

 

Dated
as of February 1, 2018

 

    	 

     

    

 

XFIT
BRANDS, INC.

 

PREFERRED
STOCK PURCHASE AGREEMENT

 

February
1, 2018

 

PIMCO
Funds: Private Account Portfolio Series: PIMCO High Yield Portfolio

c/o Pacific Investment Management Company LLC

650 Newport Center Drive

Newport Beach, California 92660

 

Ladies
and Gentlemen:

 

XFIT
BRANDS, INC., a Nevada corporation (“XFIT” or the “Company”), hereby agrees with PIMCO Funds: Private
Account Portfolio Series: PIMCO High Yield Portfolio, a separate investment portfolio of PIMCO Funds, a Massachusetts business
trust (the “Purchaser”), as follows:

 

Section
1.        Authorization of Preferred Shares. The Company has authorized the issue
of 1,000 shares of its Series A Preferred Stock, par value $0.0001 per share (collectively, the “Preferred Shares”).
Certain capitalized terms used in this Agreement are defined in Exhibit A; references to a “Schedule” or an
“Exhibit” are, unless otherwise specified, to a Schedule or an Exhibit attached to this Agreement. As used herein,
the term “this Agreement” and references thereto shall mean this Agreement as it may from time to time be amended,
supplemented or otherwise modified.

 

Section
2.        Issue of Preferred Shares.

 

The
Preferred Shares will be dated the date of delivery thereof, and will have the terms and conditions provided in the Certificate
of Designation attached as Exhibit B hereto.

 

Section
3.       Exchange of Existing Notes. Subject to the terms and conditions hereof and
in reliance on the representations and warranties of the Company contained herein, the Purchaser agrees to exchange the entire
aggregate principal amount and accrued interest and penalties thereon of the 9.00% Senior Subordinated Notes of the Company and
the associated Common Stock Purchase Warrants of the Company for the Preferred Shares (the “Exchange Transactions”).
Prior to delivery of the Preferred Shares, Purchaser agrees to deliver a certificate containing certain investment representations
and warranties substantially in the form set out in Exhibit C to this Agreement (the “Purchaser Certificate”).

 

Section
4.       Closing. The Exchange Transactions, including delivery of the Preferred
Shares, shall be made at the offices of Latham & Watkins LLP, 885 Third Avenue, New York, New York 10022 at 10:00 A.M., New
York time on the Closing Date, against payment therefor by delivery by the Purchaser of the certificates representing the Notes
and the Warrants. The Preferred Shares so delivered shall be registered in the Purchaser’s name or otherwise as the Purchaser
shall have advised XFIT in writing not less than one Business Day prior to the Closing Date.

 

    	 

     

    

 

Section
5.       Conditions to Effectiveness. The effectiveness of this Agreement, including
the Purchaser’s obligation to purchase the Preferred Shares to be sold by the Company to the Purchaser on the Closing Date,
is subject to the fulfillment to the Purchaser’s satisfaction, on or prior to the Closing Date, of the following conditions:

 

(a)       Representations
and Warranties. The representations and warranties of the Company in this Agreement and the other Transaction Documents shall
be true and correct on the Closing Date.

 

(b)       Performance;
No Default. Each of the Company shall have performed and complied with all agreements and conditions contained in this Agreement
and each other Transaction Document required to be performed or complied with by it on or prior to the Closing Date and, after
giving effect to the Closing Date Transactions, no Default or Event of Default shall have occurred and be continuing. As of the
Closing Date, no event or circumstance has occurred that may have a Material Adverse Effect.

 

(c)       Documents.
The Purchaser shall have received duly executed copies of this Agreement, a certificate evidencing the Preferred Shares and each
of the other Transaction Documents and original or copies of such other documents as the Purchaser may reasonably request.

 

(d)       Legal
Opinion. The Purchaser shall have received an opinion of counsel to the Company in form and substance satisfactory to the
Purchaser.

 

(e)       Officer’s
Certificate. The Company shall have delivered to the Purchaser an officer’s certificate, dated as of the Closing Date,
certifying that the conditions specified in Sections 5(a), 5(b), 5(g), 5(h) and 5(i) have been
fulfilled.

 

(f)       Secretary’s
Certificate. The Purchaser shall have received a certificate of the Secretary or an Assistant Secretary (or equivalent officer)
of the Company certifying:

 

(i)       that
attached thereto are true and complete copies of all resolutions and other consents adopted by the Company authorizing and approving
the execution, delivery, filing and performance of this Agreement and the other Transaction Documents and the consummation of
the Closing Date Transactions, and that all such resolutions and consents are in full force and effect as of the Closing Date
and are all the resolutions and consents adopted in connection with the transactions contemplated hereby and thereby;

 

(ii)       that
attached thereto are true and complete copies of the certificate of incorporation and by-laws of the Company and that such organizational
documents are in full force and effect as of the Closing Date;

 

    	 

     

    

 

(iii)       the
names and signatures of the officers of the Company authorized to sign this Agreement, the other Transaction Documents and the
other documents to be delivered hereunder and thereunder; and

 

(iv)       that
attached thereto are true and complete copies of good standing certificates (or their equivalent) for the Company and each Subsidiary
from the secretary of state or similar Governmental Authority of the jurisdiction under the Laws in which such Company or Subsidiary
is organized and a foreign qualification certificate (or its equivalent) for such Company or Subsidiary from the secretary of
state or similar Governmental Authority of each jurisdiction in which such Company or Subsidiary has qualified, or is required
to qualify, to do business as a foreign corporation.

 

(g)       Changes
in Structure. Neither the Company nor any Subsidiary or Subsidiary shall have changed its jurisdiction of formation or been
a party to any merger or consolidation and Neither the Company nor any Subsidiary or Subsidiary shall have succeeded to all or
any substantial part of the liabilities of any other entity, except as disclosed in the Schedules hereto.

 

(h)       No
Governmental Order. No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Governmental
Order which is in effect and has the effect of making the transactions contemplated by this Agreement or any other Transaction
Document illegal, otherwise restraining or prohibiting consummation of such transactions or causing any of the transactions contemplated
hereunder or thereunder to be rescinded following completion thereof.

 

(i)       Authorization
and Consents. The Purchaser shall have received duly executed copies of all approvals, consents, filings and waivers necessary
to complete the transactions contemplated herein and in the other Transaction Documents.

 

Section
6.       Representations and Warranties by the Company. The Company represents and
warrants to the Purchaser as of the date hereof that:

 

(a)       Organization;
Power and Authority. The Company and each Subsidiary is a corporation or limited liability company duly incorporated or organized,
validly existing and in good standing under the Laws of the state of its organization, and the Company and each Subsidiary has
full company power and authority to (i) enter into this Agreement and the other Transaction Documents to which the Company is
a party, to carry out its obligations hereunder and thereunder and to consummate the Closing Date Transactions and (ii) own, operate
or lease the properties and assets now owned, operated or leased by it and to carry on its business as it has been and is currently
conducted. The Company and each Subsidiary is duly licensed or qualified to do business and is in good standing in each jurisdiction,
as set forth in Schedule 6(a), in which the properties owned or leased by it or the operation of its business as currently
conducted makes such licensing or qualification necessary, except where such failure could not reasonably be expected to have
a Material Adverse Effect.

 

    	 

     

    

 

(b)       Authorization,
etc. This Agreement and any other Transaction Document to which any of the Company is a party, the performance by the Company
of its obligations hereunder and thereunder and the consummation by the Company of the Exchange Transactions have been duly authorized
by all necessary action on the part of the Company, and this Agreement and each other Transaction Document has been duly executed
and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company
in accordance with its terms.

 

(c)       Compliance
with Laws, Other Instruments, etc. The Company and the Subsidiaries have complied, and are now complying, in all material
respects with all Laws applicable to them or their respective businesses, properties or assets, except where non-compliance would
not have a Material Adverse Effect. The execution, delivery and performance by the Company of this Agreement and each other Transaction
Document will not:

 

(i)       contravene,
result in any breach of, or constitute a default under, or result in the creation of any Encumbrance in respect of any property
of the Company or any Subsidiary under any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, or its
organizational documents or any other agreement or instrument to which the Company or any Subsidiary is bound or by which the
Company or any Subsidiary or any of its properties may be bound or affected;

 

(ii)       conflict
with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to the Company or any Subsidiary or its property; or

 

(iii)       violate
any provision of any statute or other rule or regulation of any Governmental Authority applicable to the Company and any Subsidiary
or any Subsidiary.

 

All
Permits required for the Company and the Subsidiaries to conduct their respective businesses have been obtained by them and are
valid and in full force and effect. All fees and charges with respect to such Permits have been paid in full. No event has occurred
that, with or without notice or lapse of time or both, would reasonably be expected to result in the revocation, suspension, lapse
or limitation of any Permit applicable to the Company or any Subsidiary.

 

(d)       Preferred
Shares. The Preferred Shares have been duly authorized and validly issued and are fully paid and non-assessable, have been
issued (subject to the accuracy of Purchaser’s representations and warranties contained in the Purchaser Certificate) in
compliance with all securities laws and are not subject to any pre-emptive or similar rights.

 

    	 

     

    

 

(e)       Governmental
Authorizations, etc. No consent, approval or authorization of, or registration, filing or declaration with, any Governmental
Authority or any other Person is required in connection with the execution, delivery or performance by the Company of this Agreement
or any other Transaction Document.

 

(f)       Private
Offering by the Company. None of the Company nor anyone acting on their behalf has offered the Preferred Shares or any similar
securities for sale to, or solicited any offer to buy any of the same from, or otherwise approached or negotiated in respect thereof
with, any Person other than the Purchaser. None of the Company nor anyone acting on their behalf has taken, or will take, any
action that would subject the issuance or sale of the Preferred Shares to the registration requirements of the Securities Act.

 

(g)       Litigation;
Observance of Agreements, Statutes and Orders. Except as set forth on Schedule 6(b), there are no actions, suits or
proceedings pending or, to the Knowledge of the Company or any Subsidiary, threatened against the Company or any Subsidiary or
any outstanding Governmental Orders affecting any of the Company or any Subsidiary or any of their respective properties in any
court or before any arbitrator of any kind or before or by any Governmental Authority that, individually or in the aggregate,
could if adversely determined, have a Material Adverse Effect. No injunction, writ, temporary restraining order or any order of
any nature has been issued by, or sought from, any court or other Governmental Authority purporting or seeking to enjoin or restrain
the execution, delivery or performance of this Agreement or any other Transaction Document or directing that the transactions
provided for herein or therein not be consummated as herein or therein provided.

 

(h)       No
Default. Except as set forth in Schedule 6(h), neither the Company nor any Subsidiary is (i) in default under any term
of any agreement or instrument to which it is a party or by which it is bound, or any order, judgment, decree or ruling of any
court, arbitrator or Governmental Authority or (ii) in violation of any applicable law, ordinance, rule or regulation of any Governmental
Authority, except in the case of clause (ii), where such failure could not reasonably be expected to have a Material Adverse Effect.

 

(i)       Financial
Statements. The Company has provided internal (unaudited) financial statements for the fiscal year ended June 30, 2017 and
2016 (the “Financial Statements”). The Financial Statements (i) have been prepared in accordance with GAAP applied
on a consistent basis throughout the period involved and (ii) are based on the books and records of the Company and fairly present
the financial condition of the Company and its consolidated subsidiaries as of years then ended and the results of operations
of the Company and its consolidated subsidiaries for the periods indicated.

 

    	 

     

    

 

(j)       Undisclosed
Liabilities. Except as set forth in the Financial Statements or on Schedule 6(j), Neither the Company nor any Subsidiary
has any Liabilities.

 

(k)       Absence
of Certain Changes, Events and Conditions. Except as set forth in the SEC Reports or Schedule 6(k), since December
31, 2013, there has not been, with respect to the Company or any Subsidiary, any of the following occurrences which continue to
exist as of the date hereof:

 

(i)       event,
occurrence or development that has had, or could have, individually or in the aggregate, a Material Adverse Effect;

 

(ii)       amendment
of the charter, by-laws or other organizational documents of such company;

 

(iii)       split,
combination or reclassification of any shares of its Equity Interests;

 

(iv)       issuance,
sale or other disposition of any of its Equity Interests, or grant of any options, warrants or other rights to purchase or obtain
(including upon conversion, exchange or exercise) any of its Equity Interests;

 

(v)       declaration
or payment of any dividends or distributions on or in respect of any of its Equity Interests or redemption, purchase or acquisition
of its Equity Interests;

 

(vi)       material
change in any method of accounting or accounting practice of such company;

 

(vii)       incurrence,
assumption or guarantee of any Indebtedness except unsecured current obligations and Liabilities incurred in the ordinary course
of business consistent with past practice;

 

(viii)       transfer,
assignment, sale or other disposition of any of the assets shown or reflected in the Financial Statements or cancellation, discharge
or payment of any material debts, liens or entitlements;

 

(ix)       transfer,
assignment or grant of any license or sublicense of any rights under or with respect to any Intellectual Property, other than
licenses granted in the ordinary course of business and consistent with past practice to manufacturers to produce products bearing
Company logos;

 

(x)       any
capital investment in, or any loan to, any other Person;

 

(xi)       acceleration,
termination, material modification or amendment to or cancellation of any material Contract (including, but not limited to, any
Material Contract) to which such Company is a party or by which it is bound;

 

(xii)       any
material Capital Expenditures;

 

(xiii)       imposition
of any Encumbrance upon any of such Company’s properties, capital stock or assets, tangible or intangible;

 

    	 

     

    

 

(xiv)       adoption,
modification or termination of any: (A) material employment, severance, retention or other agreement with any current or former
employee, officer, director, independent contractor or consultant, (B) Benefit Plan or (C) collective bargaining or other agreement
with a Union, in each case whether written or oral;

 

(xv)       any
loan to (or forgiveness of any loan to), or entry into any other transaction with, any of its stockholders, members, directors,
officers and employees;

 

(xvi)       entry
into a new line of business or abandonment or discontinuance of existing lines of business;

 

(xvii)       adoption
of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any
provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar
Law;

 

(xviii)       acquisition
by merger or consolidation with, or by purchase of a substantial portion of the assets or stock of, or by any other manner, any
business or any Person or any division thereof; or

 

(xix)       any
Contract to do any of the foregoing, or any action or omission that would result in any of the foregoing.

 

(l)       Taxes.
Except as set forth of Schedule 6(l) the Company and each Subsidiary:

 

(i)       has
timely filed all Tax Returns that it was required to file. All such Tax Returns were complete and correct in all respects. All
Taxes due and owing by such company (whether or not shown on any Tax Return) have been timely paid;

 

(ii)       has
withheld and paid each Tax required to have been withheld and paid in connection with amounts paid or owing to any employee, independent
contractor, creditor, customer, shareholder or other party, and complied with all information reporting and backup withholding
provisions of applicable Law;

 

(iii)       has
not been given or requested any extensions or waivers of statutes of limitations with respect to any Taxes of such company;

 

(iv)       fully
paid all deficiencies asserted, or assessments made, against such company as a result of any examinations by any taxing authority;

 

(v)       is
not a party to any Action by any taxing authority, and there are no pending or threatened Actions by any taxing authority against
such company;

 

(vi)       has
delivered to the Purchaser copies of all federal, state, local and foreign income, franchise and similar Tax Returns, examination
reports, and statements of deficiencies assessed against, or agreed to by, such company for all Tax periods ending after December
31, 2009;

 

    	 

     

    

 

(vii)       has
not been a member of an affiliated, combined, consolidated or unitary Tax group for Tax purposes; and

 

(viii)       has
no Liability for Taxes of any Person (other than an affiliated company) under Treasury Regulations Section 1.1502-6 (or any corresponding
provision of state, local or foreign Law), as transferee or successor, by contract or otherwise.

 

(m)       Anti-Money
Laundering Laws. The operations of the Company are and have been conducted at all times in compliance in all material respects
with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970,
as amended, the money laundering statutes of all jurisdictions where the Company conduct business, and the rules and regulations
thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving any of the Company with respect to the Money Laundering Laws is pending
or, to the knowledge of the Company and any Subsidiary, threatened.

 

(n)       Foreign
Assets Control Regulations, etc. None of the Company nor, to the Knowledge of the Company, any officer, agent, employee or
Affiliate of the Company and any Subsidiary is (i) currently subject to any U.S. sanctions administered
or enforced by the Office of Foreign Assets Control of the U.S. Treasury Department, the U.S. Department of State, the United
Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively,
“Sanctions”) or (ii) located, organized or resident in a country that is the subject of Sanctions (including,
without limitation, Cuba, Iran, North Korea, Sudan, Russia, the Crimea region of Ukraine and Syria). The Company and their respective
affiliates are not now knowingly engaged in any dealings or transactions with any individual or entity, or in any country or territory,
that is the subject or target of Sanctions and will not use the proceeds of the additional New Preferred Shares or otherwise
make available such proceeds to any Person, for the purpose of financing the activities of any Person that
is the subject or target of Sanctions.

 

(o)       Material
Contracts. Schedule 6(o) lists each Material Contract for the Company each Subsidiary. Each Material Contract is valid
and binding on such Company in accordance with its terms and is in full force and effect. None of the Company nor, to the Knowledge
of the Company and any Subsidiary, any other party thereto is in breach of or default under (or is alleged to be in breach of
or default under), or has provided or received any notice of any intention to terminate, any Material Contract for the Company
and any Subsidiary. No event or circumstance has occurred that, with notice or lapse of time or both, would constitute an event
of default under any Material Contract or result in a termination thereof or would cause or permit the acceleration or other changes
of any right or obligation or the loss of any benefit thereunder. Complete and correct copies of each Material Contract (including
all modifications, amendments and supplements thereto and waivers thereunder) have been made available to the Purchaser.

 

    	 

     

    

 

(p)       Title
to Assets, Real Property. The Company and each Subsidiary, as applicable, has good and valid (and, in the case of owned Real
Property, good and marketable fee simple) title to, or a valid leasehold interest in, all Real Property and personal property
and other assets reflected in the Financial Statements or acquired after the date thereof. All such properties and assets (including
leasehold interests) are free and clear of Encumbrances except for the following (collectively referred to as “Permitted
Encumbrances”):

 

liens
for Taxes not yet due and payable or being contested in good faith by appropriate procedures and for which there are adequate
accruals or reserves on the Financial Statements;

 

mechanics,
carriers’, workmen’s, repairmen’s or other like liens arising or incurred in the ordinary course of business
consistent with past practice or amounts that are not delinquent and which are not, individually or in the aggregate, material
to the business of the Company; or

 

easements,
rights of way, zoning ordinances and other similar encumbrances affecting Real Property which are not, individually or in the
aggregate, material to the business of the Company.

 

(r)       Inventory.
All inventory of the Company and each Subsidiary, whether or not reflected on the Financial Statements, consists of a quality
and quantity usable and salable in the ordinary course of business consistent with past practice, except for obsolete, damaged,
defective or slow-moving items that have been written off or written down to fair market value or for which adequate reserves
have been established. All such inventory is owned by the applicable company free and clear of all Encumbrances, and no inventory
is held on a consignment basis. The quantities of each item of inventory (whether raw materials, work-in-process or finished goods)
are not excessive, but are reasonable in the present circumstances of the applicable company.

 

The
accounts receivable reflected on the Financial Statements and the accounts receivable arising after the date thereof (i) have
arisen from bona fide transactions entered into by the applicable company involving the sale of goods or the rendering of services
in the ordinary course of business consistent with past practice; (ii) constitute only valid, undisputed claims of the applicable
company not subject to claims of set-off or other defenses or counterclaims other than normal cash discounts accrued in the ordinary
course of business consistent with past practice; and (iii) subject to a reserve for bad debts shown on the Financial Statements
or, with respect to accounts receivable arising after the date thereof, on the accounting records of the applicable company, are
collectible in full within 30 days after billing. The reserve for bad debts shown on the Financial Statements or, with respect
to accounts receivable arising after the date thereof, on the accounting records of the Company have been determined in accordance
with GAAP, consistently applied, subject to normal year-end adjustments and the absence of disclosures normally made in footnotes.

 

    	 

     

    

 

(s)       Customers
and Suppliers. The Company has not received any notice, and does not have any reason to believe, that any Material Customer
or Material Supplier has ceased, or intends to cease on or after the date hereof, to use the Company’s or any Subsidiary’s
goods or services, or supply goods or services to the Company or any Subsidiary, or to otherwise terminate or materially reduce
its relationship with the Company or any Subsidiary.

 

(t)       Environmental
Matters. The Company represents and warrants the following regarding environmental matters:

 

(i)       The
Company and each Subsidiary is currently and has been in compliance with all Environmental Laws and has not received from any
Person any: (A) Environmental Notice or Environmental Claim; or (B) written request for information pursuant to Environmental
Law, which, in each case, either remains pending or unresolved, or is the source of ongoing obligations or requirements as of
the date this representation is made.

 

(ii)       The
Company and each Subsidiary has obtained and is in material compliance with all Environmental Permits (each of which is disclosed
in Schedule X) necessary for the ownership, lease, operation or use of the business or assets of such Company and all such
Environmental Permits will be in full force and effect through the date this representation is made in accordance with Environmental
Law, and Neither the Company nor any Subsidiary is aware of any condition, event or circumstance that might prevent or impede,
after the date hereof, the ownership, lease, operation or use of the business or assets of the Company and any Subsidiary as currently
carried out.

 

(iii)       No
real property currently or formerly owned, operated or leased by the Company and any Subsidiary is listed on, or has been proposed
for listing on, the National Priorities List (or CERCLIS) under CERCLA, or any similar state list.

 

(iv)       There
has been no Release of Hazardous Materials in contravention of Environmental Law with respect to the business or assets of the
Company and any Subsidiary or any real property currently or formerly owned, operated or leased by the Company and any Subsidiary,
and neither the Company nor any Subsidiary has received an Environmental Notice that any real property currently or formerly owned,
operated or leased in connection with the business of the Company and any Subsidiary (including soils, groundwater, surface water,
buildings and other structure located on any such real property) has been contaminated with any Hazardous Material which could
reasonably be expected to result in an Environmental Claim against, or a violation of Environmental Law or term of any Environmental
Permit by, the Company and any Subsidiary.

 

(v)       Neither
the Company nor any Subsidiary has retained or assumed, by contract or operation of Law, any liabilities or obligations of third
parties under Environmental Law.

 

    	 

     

    

 

(vi)       Neither
the Company nor any Subsidiary is aware of, nor does the Company and any Subsidiary reasonably anticipate, any condition, event
or circumstance concerning the Release or regulation of Hazardous Materials that might prevent, impede or materially increase
the costs associated with the ownership, lease, operation, performance or use of the business or assets of the Company and any
Subsidiary as currently carried out.

 

(vii)       Schedule
6(t) contains (A) a complete and accurate list of all active or abandoned aboveground or underground storage tanks owned or
operated by the Company and any Subsidiary and (B) a complete and accurate list of all off-site Hazardous Materials treatment,
storage, or disposal facilities or locations used by the Company and any Subsidiary and any predecessors of the Company and any
Subsidiary as to which the Company and any Subsidiary may retain liability, and none of these facilities or locations has been
placed or proposed for placement on the National Priorities List (or CERCLIS) under CERCLA, or any similar state list, and Neither
the Company nor any Subsidiary has received any Environmental Notice regarding potential liabilities with respect to such off-site
Hazardous Materials treatment, storage, or disposal facilities or locations used by the Company and any Subsidiary.

 

(viii)       The
Company has listed in Schedule 6(t) and provided or otherwise made available to the Purchaser (A) any and all environmental
reports, studies, audits, records, sampling data, site assessments, risk assessments, economic models and other similar documents
with respect to the business or assets of the Company or any currently or formerly owned, operated or leased real property which
are in the possession or control of the Company and any Subsidiary related to compliance with Environmental Laws, Environmental
Claims or an Environmental Notice or the Release of Hazardous Materials; and (B) any and all material documents concerning planned
or anticipated Capital Expenditures required to reduce, offset, limit or otherwise control pollution and/or emissions, manage
waste or otherwise ensure compliance with current or future Environmental Laws (including, without limitation, costs of remediation,
pollution control equipment and operational changes).

 

(u)       Employee
Benefit Matters. Schedule 6(u) contains a true and complete list of each Benefit Plan. With respect to each Benefit
Plan, the Company has made available to the Purchaser accurate, current and complete copies of each of the following: (i) where
the Benefit Plan has been reduced to writing, the plan document together with all amendments; (ii) where the Benefit Plan has
not been reduced to writing, a written summary of all material plan terms; and (iii) in the case of any Benefit Plan that is intended
to be qualified under Section 401(a) of the Code, a copy of the most recent determination, opinion or advisory letter from the
Internal Revenue Service.

 

    	 

     

    

 

Each
Benefit Plan, other than any Multiemployer Plan, has been established, administered and maintained in accordance with its
terms and in compliance with all applicable Laws (including ERISA and the Code), except where such failure to comply could not
reasonably be expected to have a Material Adverse Effect. Each Qualified Benefit Plan is so qualified and has received
a favorable and current determination letter from the Internal Revenue Service, or with respect to a prototype plan, can rely
on an opinion letter from the Internal Revenue Service to the prototype plan sponsor, to the effect that such Qualified Benefit
Plan is so qualified and that the plan and the trust related thereto are exempt from federal income taxes under Sections 401(a)
and 501(a), respectively, of the Code, and nothing has occurred that could reasonably be expected to cause the revocation of such
determination letter from the Internal Revenue Service or the unavailability of reliance on such opinion letter from the Internal
Revenue Service, as applicable, nor has such revocation or unavailability been threatened. Nothing has occurred with respect to
any Benefit Plan that has subjected or could reasonably be expected to subject the Company and any Subsidiary to a penalty under
Section 502 of ERISA or to tax or penalty under Section 4975 of the Code. All benefits, contributions and premiums relating to
each Benefit Plan have been timely paid in accordance with the terms of such Benefit Plan and all applicable Laws and accounting
principles, and all benefits accrued under any unfunded Benefit Plan have been paid, accrued or otherwise adequately reserved
to the extent required by, and in accordance with, GAAP. There is no pending or, to the Company and any Subsidiary’s Knowledge,
threatened Action relating to a Benefit Plan (other than routine claims for benefits).

 

None
of the Company nor any of their respective ERISA Affiliates has (i) incurred or reasonably expects to incur, either directly or
indirectly, any material Liability under Title I or Title IV of ERISA or related provisions of the Code or foreign Law relating
to employee benefit plans; (ii) failed to timely pay premiums to the Pension Benefit Guaranty Corporation; (iii) withdrawn from
any Benefit Plan; or (iv) engaged in any transaction which would give rise to liability under Section 4069 or Section 4212(c)
of ERISA.

 

With
respect to each Benefit Plan, except as otherwise disclosed on Schedule 6(u), (i) no such plan is a Multiemployer Plan,
and all contributions required to be paid by the Company and any Subsidiary or its ERISA Affiliates have been timely paid to the
applicable Multiemployer Plan; (ii) no such plan is a “multiple employer plan” within the meaning of Section 413(c)
of the Code or a “multiple employer welfare arrangement” (as defined in Section 3(40) of ERISA); (iii) no Action has
been initiated by the Pension Benefit Guaranty Corporation to terminate any such plan or to appoint a trustee for any such plan;
(iv) no such plan is subject to the minimum funding standards of Section 302 of ERISA or Section 412 of the Code, and no such
plan has failed to satisfy the minimum funding standards of Section 302 of ERISA or Section 412 of the Code; and (v) no “reportable
event,” as defined in Section 4043 of ERISA, has occurred with respect to any such plan.

 

Except
as otherwise disclosed on Schedule 6(u), other than as required under Section 601 et. seq. of ERISA or other applicable
Law, no Benefit Plan provides post-termination or retiree welfare benefits to any individual for any reason, and none of the Company
nor any of their respective ERISA Affiliates has any Liability to provide post-termination or retiree welfare benefits to any
individual.

 

    	 

     

    

 

Neither
the execution of this Agreement nor any of the transactions contemplated by this Agreement will (either alone or upon the occurrence
of any additional or subsequent events): (i) entitle any current or former director, officer, employee, independent contractor
or consultant of the Company and any Subsidiary to severance pay or any other payment; (ii) accelerate the time of payment, funding
or vesting, or increase the amount of compensation due to any such individual; (iii) limit or restrict the right of the Company
and any Subsidiary to merge, amend or terminate any Benefit Plan; or (iv) increase the amount payable under or result in any other
material obligation pursuant to any Benefit Plan.

 

(v)       Employment
Matters. Except as otherwise disclosed on Schedule 6(v), (i) all compensation, including wages, commissions and bonuses,
payable to employees, independent contractors or consultants of the Company and any Subsidiary for services performed on or prior
to the date this representation is made have been paid in full (or accrued in full on the balance sheet contained in the Financial
Statements) and there are no outstanding agreements, understandings or commitments of the Company and any Subsidiary with respect
to any employment, compensation, commissions or bonuses; (ii) neither the Company nor any Subsidiary is, and neither the Company
nor any Subsidiary has ever been, a party to, bound by, or negotiating any collective bargaining agreement or other Contract with
a Union, and there is not, and has never been, any Union representing or purporting to represent any employee of the Company and
any Subsidiary, and, to The Company and each Subsidiary’s Knowledge, no Union or group of employees is seeking or has sought
to organize employees for the purpose of collective bargaining; (iii) there has never been, nor has there been any threat of,
any strike, slowdown, work stoppage, lockout, concerted refusal to work overtime or other similar labor disruption or dispute
affecting the Company and any Subsidiary or any of its employees; Neither the Company nor any Subsidiary has any duty to bargain
with any Union; (iv) The Company and each Subsidiary is and has been in compliance in all material respects with the terms of
the collective bargaining agreements and other Contracts listed on Schedule XI, all applicable Laws pertaining to employment
and employment practices, including all Laws relating to labor relations, equal employment opportunities, fair employment practices,
employment discrimination, harassment, retaliation, reasonable accommodation, disability rights or benefits, immigration, wages,
hours, overtime compensation, child labor, hiring, promotion and termination of employees, working conditions, meal and break
periods, privacy, health and safety, workers’ compensation, leaves of absence and unemployment insurance; (v) all individuals
characterized and treated by the Company and any Subsidiary as independent contractors or consultants are properly treated as
independent contractors under all applicable Laws; (vi) all employees classified as exempt under the Fair Labor Standards Act
and state and local wage and hour laws are properly classified; and (vii) there are no Actions against the Company and any Subsidiary
pending, or to the Knowledge of the Company and any Subsidiary, threatened to be brought or filed, by or with any Governmental
Authority or arbitrator in connection with the employment of any current or former applicant, employee, consultant, volunteer,
intern or independent contractor of the Company and any Subsidiary, including, without limitation, any claim relating to unfair
labor practices, employment discrimination, harassment, retaliation, equal pay, wage and hours or any other employment related
matter arising under applicable Laws.

 

    	 

     

    

 

(w)       Books
and Records. The minute books and stock record books of the The Company and each Subsidiary, all of which have been made available
to the Purchaser, are complete and correct and have been maintained in accordance with sound business practices. The minute books
of The Company and each Subsidiary contain, in all material respects, accurate and complete records of all meetings, and actions
taken by written consent of, the stockholders, the board of directors and any committees of the board of directors of the applicable
company, and no meeting, or action taken by written consent, of any such stockholders, board of directors or committee has been
held for which minutes have not been prepared and are not contained in such minute books.

 

(x)       Brokers.
No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection
with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements made by or on behalf
of the Company and any Subsidiary.

 

(y)       Foreign
Corrupt Practices Act. None of the Company nor, to the Knowledge of the Company and any Subsidiary, any other person associated
with or acting on behalf of the Company and any Subsidiary, including, without limitation, any director, officer, agent, employee
or Affiliate of the Company and any Subsidiary has (i) used any corporate funds for any unlawful contribution, gift, entertainment
or other unlawful expense relating to political activity or to influence official action; (ii) made any direct or indirect unlawful
payment to any foreign or domestic government official or employee from corporate funds; (iii) made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment; or (iv) violated or is in violation of any provision of the U.S. Foreign
Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder; and The Company and each Subsidiary has instituted
and maintains policies and procedures designed to ensure compliance therewith.

 

(z)       Transactions
with Affiliates. There are no Contracts or other transactions between or among any of the Company, on the one hand, and any
officer, director, employee, present or former stockholder (including any spouse, parent, sibling, descendants (including adoptive
relationships and stepchildren) of any such natural persons, or trust or other entity in which any such natural persons or such
other individuals owns or otherwise holds any beneficial interest in) or Affiliate of any of the Company, on the other hand.

 

    	 

     

    

 

(aa)       Full
Disclosure. No representation or warranty by the Company and any Subsidiary in this Agreement, any other Transaction Document
or any certificate or other document furnished or to be furnished to the Purchaser pursuant to this Agreement or any other Transaction
Document contains any untrue statement of a material fact, or omits to state a material fact necessary to make the statements
contained therein, in light of the circumstances in which they are made, not misleading.

 

Section
7.       Representations and Warranties by the Purchaser. The Purchaser represents
and warrants to The Company and each Subsidiary that it is acquiring the New Preferred Shares for its own account for investment.
The Purchaser agrees that if it should in the future determine to transfer, sell, assign, pledge, hypothecate or otherwise dispose
of the New Preferred Shares, or any interests therein, such transfer, sale or other disposition shall not be made in violation
of Section 5 of the Securities Act.

 

Section
8.       Affirmative Covenants. Unless the Company have received the prior written
consent or waiver of the Purchaser, The Company and each Subsidiary jointly and severally shall comply with and be subject to
each of the following covenants:

 

(a)       Annual
Financial Statements. Within 90 days after the end of each fiscal year of XFIT, XFIT shall deliver to the Purchaser copies
of its consolidated financial statements consisting of a balance sheet of XFIT and its consolidated subsidiaries as at the end
of such fiscal year and statements of income, stockholders’ equity and cash flows of XFIT and its consolidated subsidiaries
for such fiscal year, setting forth in comparative form the corresponding figures for the preceding fiscal year (if applicable),
certified by and containing an opinion, unqualified as to scope, of a firm of independent certified public accountants selected
by XFIT and acceptable to the Purchaser; provided that the foregoing delivery requirement shall be satisfied if XFIT shall have
filed with the SEC its Annual Report on Form 10-K for such fiscal year, which is available to the public via EDGAR or any successor
system.

 

(b)       Quarterly
Financial Statements. Within 45 days after the end of each of the first three quarters of each fiscal year of XFIT, XFIT shall
deliver to the Purchaser copies of financial statements consisting of consolidated balance sheets of XFIT and its consolidated
subsidiaries as at the end of such quarter and statements of income, stockholders’ equity and cash flows of XFIT and its
consolidated subsidiaries for each such quarter, setting forth in comparative form the corresponding figures for the corresponding
periods of the preceding fiscal year (if applicable), all in reasonable detail and certified (subject to normal year-end audit
adjustments) by a senior financial officer of XFIT as having been prepared in accordance with GAAP; provided that the foregoing
delivery requirement shall be satisfied if XFIT shall have filed with the SEC its Quarterly Report on Form 10-Q for such fiscal
quarter, which is available to the public via EDGAR or any successor system.

 

    	 

     

    

 

(c)       Board
Minutes. The Company and each Subsidiary shall deliver to the Purchaser upon request copies of the minutes of each meeting
of the board of directors or other governing body of such Company, each action taken by written consent of the members or stockholders,
the board of directors or other governing body and any committees of the board of directors or other governing body of such Company,
all of which shall be complete and correct and maintained in accordance with sound business practices, and no meeting, or action
taken by written consent, of any such stockholders, board of directors, other governing body or committee shall be held for which
minutes are not prepared.

 

(d)       Corporate
Existence, etc. The Company and each Subsidiary shall at all times maintain (i) under the Laws of the state of California,
Delaware or Nevada, as the case may be, its valid company existence and good standing, (ii) its due license and qualification
to do business and good standing in each jurisdiction set forth on Schedule II and, following the date of this Agreement,
each other jurisdiction in which the properties owned or leased by it or the operation of its business makes such licensing or
qualification necessary and (iii) all Permits necessary to the conduct of its businesses.

 

(e)       Compliance
with Law. The Company and each Subsidiary shall comply with all Laws applicable to it or its business, properties or assets.

 

(f)       Contractual
Obligations. The Company and each Subsidiary shall (i) comply with all contractual obligations, unless and to the extent such
obligations are being contested in good faith by appropriate proceedings and adequate reserves (as determined in accordance with
GAAP) have been established on its books and financial statements of such Company for such obligations; and (ii) perform and observe
all of its obligations and covenants set forth in each of the Transaction Documents.

 

(g)       Payment
of Taxes, Fees and Claims. The Company and each Subsidiary shall (i) pay and discharge all Taxes due and owing by such Company
before the same becomes delinquent and before penalties accrue thereon, unless and to the extent such Taxes are being contested
in good faith by appropriate procedures and adequate accruals or reserves (as determined in accordance with GAAP) have been established
on the books and financial statements of such Company for such Taxes; (ii) pay when due all transfer, documentary, sales, use,
stamp, registration, value added and other such Taxes and fees (including any penalties and interest) incurred in connection with
this Agreement (including any real property transfer Tax and any other similar Tax). The Company and each Subsidiary shall, at
its own expense, timely file any Tax Return or other document with respect to such Taxes or fees (and the Purchaser shall cooperate
with respect thereto as necessary); (iii) pay and discharge all claims for labor, material and supplies which, if unpaid and delinquent,
would become under applicable Law a Lien upon property of the Company and any Subsidiary, unless and to the extent such claims
are being contested in good faith by appropriate procedures and adequate accruals or reserves (as determined in accordance with
GAAP) have been established on the books and financial statements of the Company for such claims.

 

    	 

     

    

 

(h)       Maintenance
of Assets, Insurance, and Records; Inspection. The Company and each Subsidiary shall (i) maintain and keep its properties
and assets in good repair, working order and condition, ordinary wear and tear excepted; (ii) maintain with financially sound
and reputable insurance companies (x) property and casualty and other insurance covering risks and hazards of such types and in
such amounts as are customary for adequately-insured companies of similar size engaged in similar industries and lines of business,
and (y) directors and officers liability insurance with coverage of no less than $1,000,000 per occurrence/in an amount per occurrence
and on terms and conditions satisfactory to the Purchaser; and (iii) keep adequate books, accounts and records in accordance with
past custom and practice as used in the preparation of the Financial Statements, which books, accounts and records shall fairly
present the financial condition and results of operations of the Company. Such books, accounts and records shall be available
for inspection by one or more representatives of the Purchaser during normal business hours and upon not less than three (3) Business
Days’ prior notice.

 

(i)       Other
Covenants. The Company and each Subsidiary shall (i) own, exclusively or jointly with other Persons, all right, title and
interest in and to, or have a valid license for, and shall maintain all Intellectual Property necessary to the conduct of its
business, free and clear of Encumbrances, (ii) enter into and maintain in full force and effect binding, written agreements with
every current and former employee of such Company, and with every current and former independent contractor, whereby such employees
and independent contractors (x) assign to the applicable company any ownership interest and right they may have in the Company
Intellectual Property and (y) acknowledge the applicable company’s exclusive ownership of all Company Intellectual Property,
and (iii) remain in full compliance with all legal requirements applicable to the Company Intellectual Property and the applicable
company’s ownership and use thereof.

 

Section
9.       Negative Covenants. The Company and each Subsidiary jointly and severally
covenants that so long as any of the Preferred Shares are outstanding:

 

(a)       Merger,
Consolidation, etc. Neither the Company nor any Subsidiary will consolidate with or merge with any other Person or convey,
transfer or lease all or substantially all of its assets in a single transaction or series of transactions to any Person unless:

 

the
successor formed by such consolidation or the survivor of such merger or the Person that acquires by conveyance, transfer or lease
substantially all of the assets of such Company as an entirety, as the case may be, shall be a solvent corporation or limited
liability company organized and existing under the laws of the United States or any State thereof (including the District of Columbia)
with a net worth equal to or in excess of such Company immediately following the consummation of such transaction, and such Person
shall have (x) executed and delivered to each holder of any Preferred Shares its assumption of the due and punctual performance
and observance of each covenant and condition of this Agreement and the Preferred Shares and (y) caused to be delivered to each
holder of any Preferred Shares an opinion of nationally recognized independent counsel, or other independent counsel satisfactory
to the Purchaser, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with
their terms and comply with the terms hereof; and

 

    	 

     

    

 

immediately
after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing.

 

No
such conveyance, transfer or lease of all or substantially all of the assets of the Company and any Subsidiary shall have the
effect of releasing the Company and any Subsidiary or any successor thereof that shall theretofore have become such in the manner
prescribed in this Section 10(a) from its liability under this Agreement or the other Transaction Documents.

 

(d)       Restricted
Payments. Neither the Company nor any Subsidiary will, directly or indirectly, declare, pay, or make any Restricted Payments.

 

Section
10.       Further Assurances. Following the date hereof, each of the parties hereto
shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances
and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect
to the transactions contemplated by this Agreement.

 

    	 

     

    

 

Section
11.       Indemnification.

 

(a)       Survival.
The representations and warranties contained herein and in the other Transaction Documents shall survive the execution and delivery
of this Agreement, the Closing Date and the termination of this Agreement. All covenants and agreements of the parties contained
herein shall survive the execution and delivery of this Agreement, the Closing Date and the termination of this Agreement indefinitely
or for the period explicitly specified therein.

 

(b)       Indemnification
by Company. The Company and each Subsidiary shall jointly and severally indemnify and defend the Purchaser and its Affiliates
and their respective Representatives (collectively, the “Purchaser Indemnitees”) against, and shall hold each
of them harmless from and against, and shall pay and reimburse each of them for, any and all Losses incurred or sustained by,
or imposed upon, the Purchaser Indemnitees based upon, arising out of, with respect to or by reason of:

 

(i)       any
inaccuracy in or breach of any of the representations or warranties of the Company and any Subsidiary contained in this Agreement
or any other Transaction Document or in any certificate or instrument delivered by or on behalf of the Company and any Subsidiary
pursuant to this Agreement or any other Transaction Document;

 

(ii)       any
breach or non-fulfillment of any covenant, agreement or obligation to be performed by the Company and any Subsidiary pursuant
to this Agreement or any other Transaction Document; or

 

(iii)       otherwise
relating to or arising out of this Agreement, any other Transaction Document or any transaction contemplated hereby or thereby,
or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement, any other Transaction
Document or any transaction contemplated hereby or thereby.

 

(c)       Effect
of Investigation. Neither the representations, warranties and covenants of the Company, nor the right to indemnification of
any Purchaser Indemnitee making a claim under this Section 11 with respect thereto, shall be affected or deemed waived
by reason of any investigation made by or on behalf of a Purchaser Indemnitee (including by any of its Representatives) or by
reason of the fact that a Purchaser Indemnitee or any of its Representatives knew or should have known that any such representation
or warranty is, was or might be inaccurate or by reason of a Purchaser Indemnitee’s waiver of any condition set forth in
Section 7.

 

    	 

     

    

 

Section
12.       Waiver, Change or Modification; Counterparts. No course of dealing between
the Company and any Subsidiary and the Purchaser (or any Person acting on its behalf) or delay on the part of the Purchaser in
exercising any rights hereunder or under the Preferred Shares shall operate as a waiver of any rights of the Purchaser, except
to the extent expressly waived in writing by the Purchaser. This Agreement may not be changed orally, but only by an agreement
in writing signed by, or on behalf of, each of the Company and the Purchaser. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but such counterparts shall together constitute but one and
the same instrument

 

Section
13.       Replacement of Preferred Shares. Upon receipt of evidence reasonably satisfactory
to XFIT, on behalf of the Company, of the loss, theft, destruction, defacing or mutilation of any Note, then in each such case
the Company will execute and deliver a new Preferred Share certificate of like tenor and unpaid principal amount, in lieu of such
lost, stolen, destroyed, defaced or mutilated certificate.

 

Section
14.       Miscellaneous.

 

(a)       Successors
and Assigns. All covenants and other agreements contained in this Agreement by or on behalf of any of the parties hereto shall
bind and inure to the benefit of their respective successors and permitted assigns (including, without limitation, any subsequent
holder of Preferred Shares) whether so expressed or not, provided that neither the Company nor any Subsidiary may assign its rights
or obligations hereunder or any interest herein without the prior written consent of the Purchaser. Any assignment by the Company
and any Subsidiary without such consent required above shall be null and void.

 

(b)       Public
Announcements. Neither the Company nor any Subsidiary shall issue any press release or make any other public announcement
or disclosure with respect to this Agreement and the transactions contemplated herein without the prior written consent of the
Purchaser, except for any press release, public announcement or other public disclosure that is required by applicable law or
governmental regulations or by order of a court of competent jurisdiction. Prior to making any such required disclosure, the applicable
company shall have given written notice to the Purchaser describing in reasonable detail the proposed content of such disclosure
and shall permit the Purchaser to review and comment upon the form and substance of such disclosure.

 

(c)       Expenses.
Whether or not the transaction hereby contemplated shall be consummated, the Company shall jointly and severally pay all of the
fees, expenses and disbursements incurred by the Company and any Subsidiary in connection with the negotiation, execution and
delivery of the Transaction Documents.

 

(d)       Severability.
Each provision of this Agreement shall be considered severable and if for any reason any provision that is not essential to the
effectuation of the basic purposes of the Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable
and contrary to existing or future applicable law, such invalidity shall not impair the operation of or affect those provisions
of this Agreement that are valid. In that case, this Agreement shall be construed so as to limit any term or provision so as to
make it enforceable or valid within the requirements of any applicable law, and in the event such term or provision cannot be
so limited, this Agreement shall be construed to omit such invalid or unenforceable provisions.

 

    	 

     

    

 

(e)       Construction.
Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other
covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) be deemed
to excuse compliance with any other covenant. Where any provision herein refers to action to be taken by any Person, or which
such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly
by such Person.

 

(f)       Headings.
The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

 

(g)       Entire
Agreement. This Agreement and the other Transaction Documents constitute the sole and entire agreement of the parties to this
Agreement with respect to the subject matter contained herein and therein and supersede all prior and contemporaneous understandings
and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between the statements
in the body of this Agreement and those in the other Transaction Documents, the Exhibits and Schedules, the statements in the
body of this Agreement will control.

 

(h)       Notices.
All notices, requests, consents and other communications and transmissions hereunder, or under or in respect of any Note, shall
be in writing and shall be deemed to have been duly given to any party when delivered personally (by courier service or otherwise),
upon receipt or three (3) days after being mailed by registered first-class mail, postage prepaid and return receipt requested
in each case to the applicable address set forth below:

 

(i)       if
to the Purchaser, at PIMCO Funds: Private Account Portfolio Series: PIMCO High Yield Portfolio, c/o Pacific Investment Management
Company LLC, 650 Newport Center Drive, Newport Beach, California 92660, Attn: General Counsel with a copy to Latham & Watkins
LLP, 885 Third Avenue, New York, New York 10022-4834, Attn: Loren N. Finegold;

 

(ii)       if
to XFIT, at Attn: J. Gregory Barrow, 25731 Commercentre Drive, Lake Forest CA 92630, with a copy to Joseph Galda, Esq., 1055 Westlakes
Drive, Suite 300, Berwyn, Pennsylvania 19312;

 

(iii)       or,
in each case, at such other address in the United States of America as shall have been furnished in writing pursuant to this Section
16.

 

(i)       No
Third-party Beneficiaries. Except as provided in Section 12 herein, this Agreement is for the sole benefit of the parties
hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer
upon any other Person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of
this Agreement.

 

    	 

     

    

 

(j)       Governing
Law. THIS AGREEMENT AND ALL CLAIMS OR CAUSES OF ACTION (WHETHER IN CONTRACT, TORT OR OTHERWISE) THAT MAY BE BASED UPON, ARISE
OUT OF OR RELATE IN ANY WAY HERETO OR THERETO OR THE NEGOTIATION, EXECUTION OR PERFORMANCE THEREOF OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY, UNLESS OTHERWISE EXPRESSLY SET FORTH THEREIN, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW
OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THAT WOULD RESULT IN THE APPLICATION OF ANY LAW OTHER
THAN THE LAW OF THE STATE OF NEW YORK.

 

(k)       Waiver
of Jury Trial. EACH OF THE COMPANY AND THE PURCHASER HEREBY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF, OR RELATING TO, THIS AGREEMENT, THE PREFERRED SHARES OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

[SIGNATURE
PAGE FOLLOWS]

 

    	 

     

    

 

If
the foregoing correctly sets forth our understanding, please sign the form of acceptance on the enclosed counterpart of this letter
and return the same to the undersigned, whereupon this letter shall become a binding contract between the Purchaser and the Company.

 

	 	Very
    truly yours,
	 	 	 
	 	XFIT
    BRANDS, INC.
	 	 	 
	 	By:	/s/
    J. Gregory Barrow
	 	Name:	J.
    Gregory Barrow
	 	Title:	CEO

 

    	 

     

    

 

The
foregoing Preferred Stock Purchase Agreement

is hereby accepted as of the date first

set forth above.

 

PIMCO
FUNDS: PRIVATE ACCOUNT PORTFOLIO SERIES: 

PIMCO HIGH YIELD PORTFOLIO

By: Pacific Investment Management Company LLC,

as its Investment Advisor, acting through Investors

Fiduciary Trust Company, in the Nominee Name of IFTCO

 

	By:	/s/
    T. Christian Stracke	 
	Name:	T.
    Christian Stracke	 
	Title:	Managing
    DirectorForm of Medium-Term Notes, Series S

 Exhibit 4.1 

[Face of Note] 

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation
(“DTC”), to the Company or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein. 
  

	 CUSIP NO. 95001B2A1 
	
FACE AMOUNT: $                   
          

 REGISTERED NO.      

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES S 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the Lowest Performing of the 

EURO STOXX 50 ® Index and the iShares
® MSCI Emerging Markets ETF 
 due February 7, 2028 

WELLS FARGO & COMPANY, a corporation duly organized and existing under the laws of the State of Delaware (hereinafter
called the “Company,” which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & Co., or registered assigns, an amount equal to the
Redemption Amount (as defined below) on the Stated Maturity Date (as defined below), unless this Security is redeemed prior to the Stated Maturity Date as provided below under “Optional Redemption,” and to pay Contingent Coupon Payments
(as defined below) on the Face Amount of this Security to the extent provided herein on the Contingent Coupon Payment Dates specified herein at the Contingent Coupon Rate (as defined below) until the earlier of the Stated Maturity Date and the
Optional Redemption Date (as defined below), if any. The “Initial Stated Maturity Date” shall be February 7, 2028. If the Final Calculation Day (as defined below) is not postponed, the Initial Stated Maturity Date will be the
“Stated Maturity Date.” If the Final Calculation Day is postponed, the “Stated Maturity Date” shall be the later of (i) the Initial Stated Maturity Date and (ii) three Business Days (as defined below)
after the last Final Calculation Day as postponed. 
 “Face Amount” shall mean, when used with respect to
this Security, the amount set forth on the face of this Security as its “Face Amount.” 

 Optional Redemption 

The Company may, at its option, redeem this Security, in whole but not in part, on any Optional Redemption Date by giving
notice to the Holder hereof on or before the Calculation Day (as defined below) immediately preceding that Optional Redemption Date. If this Security is redeemed, the Holder hereof will receive the Optional Redemption Price (as defined below) plus a
final Contingent Coupon Payment (as defined below), if any, on the applicable Optional Redemption Date. Unless the Company defaults in the payment of the Optional Redemption Price plus the final Contingent Coupon Payment, if any, this Security will
cease to be outstanding on such Optional Redemption Date, no additional Contingent Coupon Payments will be payable on this Security and the Holder hereof will have no further rights under this Security after such Optional Redemption Date. The
“Optional Redemption Price” is equal to the Face Amount of this Security. The “Optional Redemption Dates” shall be the Contingent Coupon Payment Dates (as defined below) following each Calculation Day scheduled to
occur from February 2019 to November 2027, inclusive. 
 Payment of Contingent Coupon Payments, the Redemption Amount and the Optional Redemption
Price 
 On each quarterly Contingent Coupon Payment Date, the Company shall pay a Contingent Coupon Payment if, and
only if, the Closing Value (as defined below) of the Lowest Performing Market Measure (as defined below) on the related Calculation Day is greater than or equal to its Coupon Threshold Value (as defined below). A “Contingent Coupon
Payment,” if payable as provided herein, shall be equal to the product of (i) the Face Amount of this Security, (ii) the Contingent Coupon Rate, and (iii) 90/360. The “Contingent Coupon Payment Dates” shall
be the third Business Day following each Calculation Day, as each such Calculation Day may be postponed as herein provided, provided that the Contingent Coupon Payment Date with respect to the Final Calculation Day will be the Stated Maturity Date.
If a Calculation Day is postponed with respect to one or both Market Measures, the related Contingent Coupon Payment Date will be three Business Days after the last Calculation Day as postponed. The “Contingent Coupon Rate” is 9.40%
per annum. Any Contingent Coupon Payments will be rounded to the nearest cent, with one-half cent rounded upward. 

Any Contingent Coupon Payment so payable, and punctually paid or duly provided for, on any Contingent Coupon Payment Date
will, as provided in the Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such Contingent Coupon Payment next preceding such
Contingent Coupon Payment Date. The Regular Record Date for a Contingent Coupon Payment Date shall be the date one Business Day prior to such Contingent Coupon Payment Date. 

Any Contingent Coupon Payment not punctually paid or duly provided for will forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series 

  
 2 

 
may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture. 

Payment of any Contingent Coupon Payment on this Security will be made in immediately available funds at the office or agency
of the Company maintained for that purpose in the City of Minneapolis, Minnesota; provided, however, that, at the option of the Company, payment of any Contingent Coupon Payment may be paid by check mailed to the Person entitled thereto at such
Person’s last address as it appears in the Security Register or by wire transfer to such account as may have been designated by such Person. Payments of any Contingent Coupon Payment and the Redemption Amount or the Optional Redemption Price,
as applicable, on this Security at Maturity will be made against presentation of this Security at the office or agency of the Company maintained for that purpose in the City of Minneapolis, Minnesota and at any other office or agency maintained by
the Company for such purpose. Notwithstanding the foregoing, for so long as this Security is a Global Security registered in the name of the Depositary, any payments on this Security will be made to the Depositary by wire transfer of immediately
available funds. 
 Payment of the Redemption Amount or the Optional Redemption Price, as applicable, and any Contingent
Coupon Payments on this Security will be made in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 

Definitions Relating to Redemption Amount, the Optional Redemption Price and Contingent Coupon Payments 

If this Security is not redeemed prior to the Stated Maturity Date as provided above under “Optional Redemption,”
the “Redemption Amount” of this Security will equal: 
  

	 	•	 	 if the Ending Value of the Lowest Performing Market Measure on the Final Calculation Day is greater than or
equal to its Downside Threshold Value: the Face Amount; or 

  

	 	•	 	 if the Ending Value of the Lowest Performing Market Measure on the Final Calculation Day is less than its
Downside Threshold Value: 

  

																											
		 		 		 		 		 		 		 		 		 		 		 		 		 	
		 		 		 		 	 	 	Face Amount	 	  x        	 	Performance Factor of the Lowest Performing	 	 	 		 		 		 		 	
		 		 		 		 	 	 	 	 	Market Measure on the Final Calculation Day	 	 	 		 		 		 		 	

 All calculations with respect to the Redemption Amount will be rounded to the nearest one hundred-thousandth,
with five one-millionths rounded upward (e.g., 0.000005 would be rounded to 0.00001); and the Redemption Amount will be rounded to the nearest cent, with one-half cent
rounded upward. 
 “Index” shall mean the EURO STOXX 50 Index. 

“Fund” shall mean the iShares MSCI Emerging Markets ETF. 

“Market Measure” shall mean each Index and the Fund. 

  
 3 

 The “Pricing Date” shall mean February 2, 2018. 

The “Lowest Performing Market Measure” for any Calculation Day will be the Market Measure with the lowest
Performance Factor on that Calculation Day (as such Calculation Day may be postponed for one or both Market Measures). 

The “Performance Factor” with respect to a Market Measure on any Calculation Day is its Closing Value on such
Calculation Day divided by its Starting Value (expressed as a percentage). 
 The “Closing Value” with
respect to the Index on any Trading Day is its Closing Level on that Trading Day; and with respect to the Fund on any Trading Day is its Fund Closing Price on that Trading Day. 

The “Starting Value” with respect to the EURO STOXX 50 Index is 3523.28, and with respect to the iShares MSCI
Emerging Markets ETF is $49.05. 
 The “Ending Value” of a Market Measure will be its Closing Value on the
Final Calculation Day. 
 The “Coupon Threshold Value” with respect to the EURO STOXX 50 Index is 2642.46,
which is equal to 75% of its Starting Value, and with respect to the iShares MSCI Emerging Markets ETF, is $36.7875, which is equal to 75% of its Starting Value. 

The “Downside Threshold Value” with respect to the EURO STOXX 50 Index is 2113.968, which is equal to 60% of
its Starting Value, and with respect to the iShares MSCI Emerging Markets ETF, is $29.43, which is equal to 60% of its Starting Value. 

The “Closing Level” of the Index on any Trading Day means the official closing level of the Index reported by
the Index Sponsor on such Trading Day, as obtained by the Calculation Agent on such Trading Day from the licensed third-party market data vendor contracted by the Calculation Agent at such time; in particular, taking into account the decimal
precision and/or rounding convention employed by such licensed third-party market data vendor on such date, subject to the provisions set forth below under “—Market Disruption Events” and “—Discontinuance of the Index;
Alteration of Method of Calculation.” 
 The “Fund Closing Price” with respect to the Fund on any
Trading Day means the product of (i) the Closing Price of one share of the Fund (or one unit of any other security for which a Fund Closing Price must be determined) on such Trading Day and (ii) the Adjustment Factor on such Trading Day.

 The “Closing Price” for one share of the Fund (or one unit of any other security for which a Closing
Price must be determined) on any Trading Day means the official closing price on such day published by the principal United States securities exchange registered under the Securities Exchange Act of 1934, as amended, on which the Fund (or any such
other security) is listed or admitted to trading. 

  
 4 

 The “Adjustment Factor” means, with respect to a share of
the Fund (or one unit of any other security for which a Fund Closing Price must be determined), 1.0, subject to adjustment in the event of certain events affecting the shares of the Fund. See “Anti-dilution Adjustments Relating to the Fund;
Alternate Calculation” below. 
 “Index Sponsor” shall mean the sponsor or publisher of the Index.

 “Business Day” shall mean a day, other than a Saturday or Sunday, that is neither a legal holiday nor a
day on which banking institutions are authorized or required by law or regulation to close in New York, New York. 
 The
“Calculation Days” shall be the 2nd day of each February, May, August and November, commencing May 2018 and ending November 2027, and the Final Calculation Day. If any such day is
not a Trading Day with respect to either Market Measure, such Calculation Day for each Market Measure will be postponed to the next succeeding day that is a Trading Day with respect to each Market Measure. A Calculation Day for a Market Measure is
also subject to postponement due to the occurrence of a Market Disruption Event (as defined below) with respect to such Market Measure on such Calculation Day. The “Final Calculation Day” is February 2, 2028. If a Market
Disruption Event occurs or is continuing with respect to a Market Measure on any Calculation Day, then such Calculation Day for such Market Measure will be postponed to the first succeeding Trading Day for such Market Measure on which a Market
Disruption Event for such Market Measure has not occurred and is not continuing; however, if such first succeeding Trading Day has not occurred as of the eighth Trading Day for such Market Measure after the originally scheduled Calculation Day, that
eighth Trading Day shall be deemed to be the Calculation Day for such Market Measure. If a Calculation Day has been postponed eight Trading Days for a Market Measure after the originally scheduled Calculation Day and a Market Disruption Event occurs
or is continuing with respect to such Market Measure on such eighth Trading Day, the Calculation Agent will determine the Closing Value of such Market Measure on such eighth Trading Day (i) in the case of the Index, in accordance with the
formula for and method of calculating the Closing Level of the Index last in effect prior to commencement of the Market Disruption Event, using the closing price (or, with respect to any relevant security, if a Market Disruption Event has occurred
with respect to such security, its good faith estimate of the value of such security at the time at which the official Closing Level of the Index is calculated and published by the Index Sponsor) on such date of each security included in the Index
and (ii) in the case of the Fund, based on its good faith estimate of the value of the shares (or other applicable securities) of the Fund as of the close of trading on such date. As used in clause (i) of the immediately preceding
sentence, “closing price” means, with respect to any security on any date, the Relevant Stock Exchange traded or quoted price of such security as of the time at which the official Closing Level of such Index is calculated and
published by the Index Sponsor. Notwithstanding the postponement of a Calculation Day for a Market Measure due to a Market Disruption Event with respect to such Market Measure on such Calculation Day, the originally scheduled Calculation Day will
remain the Calculation Day for the other Market Measure if such other Market Measure is not affected by a Market Disruption Event on such day. 

  
 5 

 “Calculation Agent Agreement” shall mean the Calculation
Agent Agreement dated as of January 24, 2018 between the Company and the Calculation Agent, as amended from time to time. 

“Calculation Agent” shall mean the Person that has entered into the Calculation Agent Agreement with the
Company providing for, among other things, whether a Contingent Coupon Payment will be made, the Optional Redemption Price, if any, and the Redemption Amount, if any, which term shall, unless the context otherwise requires, include its successors
under such Calculation Agent Agreement. The initial Calculation Agent shall be Wells Fargo Securities, LLC. Pursuant to the Calculation Agent Agreement, the Company may appoint a different Calculation Agent from time to time after the initial
issuance of this Security without the consent of the Holder of this Security and without notifying the Holder of this Security. 
 Certain Definitions

 A “Trading Day” with respect to the Index means a day, as determined by the Calculation Agent, on
which (i) the Index Sponsor is scheduled to publish the level of the Index and (ii) each Related Futures or Options Exchange is scheduled to be open for trading for its regular trading session. The “Relevant Stock
Exchange” for any security underlying the Index means the primary exchange or quotation system on which such security is traded, as determined by the Calculation Agent. The “Related Futures or Options Exchange” for the
Index means an exchange or quotation system where trading has a material effect (as determined by the Calculation Agent) on the overall market for futures or options contracts relating to the Index. 

A “Trading Day” with respect to the Fund means a day, as determined by the Calculation Agent, on which the
Relevant Stock Exchange and each Related Futures or Options Exchange with respect to the Fund or any successor thereto are scheduled to be open for trading for their respective regular trading sessions. The “Relevant Stock Exchange”
for the Fund means the primary exchange or quotation system on which shares (or other applicable securities) of the Fund are traded, as determined by the Calculation Agent. The “Related Futures or Options Exchange” for the Fund
means each exchange or quotation system where trading has a material effect (as determined by the Calculation Agent) on the overall market for futures or options contracts relating to the Fund. 

Discontinuance of the Index; Alteration of Method of Calculation 

If the Index Sponsor discontinues publication of the Index, and such Index Sponsor or another entity publishes a successor or
substitute equity index that the Calculation Agent determines, in its sole discretion, to be comparable to the Index (a “Successor Equity Index”), then, upon the Calculation Agent’s notification of that determination to the
Trustee and the Company, the Calculation Agent will substitute the Successor Equity Index as calculated by the Index Sponsor or any other entity for purposes of calculating the Closing Level of the Index on any date of determination. Upon any
selection by the Calculation Agent of a Successor Equity Index, the Company will cause notice to be given to the Holder of this Security. 

In the event that the Index Sponsor discontinues publication of the Index prior to, and the discontinuance is continuing on, a
Calculation Day and the Calculation Agent determines that 

  
 6 

 
no Successor Equity Index is available at such time, the Calculation Agent will calculate a substitute Closing Level for the Index in accordance with the formula for and method of calculating the
Index last in effect prior to the discontinuance, but using only those securities that comprised the Index immediately prior to that discontinuance. If a Successor Equity Index is selected or the Calculation Agent calculates a level as a substitute
for the Index, the Successor Equity Index or level will be used as a substitute for the Index for all purposes, including the purpose of determining whether a Market Disruption Event exists. 

If on a Calculation Day the Index Sponsor fails to calculate and announce the level of the Index, the Calculation Agent will
calculate a substitute Closing Level of the Index in accordance with the formula for and method of calculating the Index last in effect prior to the failure, but using only those securities that comprised the Index immediately prior to that failure;
provided that, if a Market Disruption Event occurs or is continuing on such day with respect to the Index, then the provisions set forth above under the definition of “Calculation Days” shall apply in lieu of the foregoing. 

If at any time the method of calculating the Index or a Successor Equity Index, or the Closing Level thereof, is changed in a
material respect, or if the Index or a Successor Equity Index is in any other way modified so that such index does not, in the opinion of the Calculation Agent, fairly represent the level of such index had those changes or modifications not been
made, then the Calculation Agent will, at the close of business in New York, New York, on each date that the closing level of such index is to be calculated, make such calculations and adjustments as, in the good faith judgment of the Calculation
Agent, may be necessary in order to arrive at a level of an equity index comparable to the Index or Successor Equity Index as if those changes or modifications had not been made, and the Calculation Agent will calculate the Closing Level of the
Index or Successor Equity Index with reference to such index, as so adjusted. Accordingly, if the method of calculating the Index or Successor Equity Index is modified so that the level of such index is a fraction or a multiple of what it would have
been if it had not been modified (e.g., due to a split or reverse split in such index), then the Calculation Agent will adjust the Index or Successor Equity Index in order to arrive at a level of such index as if it had not been modified
(e.g., as if the split or reverse split had not occurred). 
 Anti-dilution Adjustments Relating To The Fund; Alternate Calculation

 Anti-dilution Adjustments 

The Calculation Agent will adjust the Adjustment Factor with respect to the Fund as specified below if any of the events
specified below occurs with respect to the Fund and the effective date or ex-dividend date, as applicable, for such event is after the Pricing Date and on or prior to the Final Calculation Day. 

The adjustments specified below do not cover all events that could affect the Fund. The Calculation Agent may, in its sole
discretion, make additional adjustments to any terms of this Security upon the occurrence of other events that affect or could potentially affect the market price of, or shareholder rights in, the Fund, with a view to offsetting, to the extent
practical, any such change, and preserving the relative investment risks of this Security. In addition, the Calculation Agent may, in its sole discretion, make adjustments or a series of adjustments that

  
 7 

 
differ from those described herein if the Calculation Agent determines that such adjustments do not properly reflect the economic consequences of the events specified herein or would not preserve
the relative investment risks of this Security. All determinations made by the Calculation Agent in making any adjustments to the terms of this Security, including adjustments that are in addition to, or that differ from, those described herein,
will be made in good faith and a commercially reasonable manner, with the aim of ensuring an equitable result. In determining whether to make any adjustment to the terms of this Security, the Calculation Agent may consider any adjustment made by the
Options Clearing Corporation or any other equity derivatives clearing organization on options contracts on the Fund. 
 For
any event described below, the Calculation Agent will not be required to adjust the Adjustment Factor unless the adjustment would result in a change to the Adjustment Factor then in effect of at least 0.10%. The Adjustment Factor resulting from any
adjustment will be rounded up or down, as appropriate, to the nearest one-hundred thousandth. 
  

	 	(A)	 Stock Splits and Reverse Stock Splits 

If a stock split or reverse stock split has occurred, then once such split has become effective, the Adjustment Factor will
be adjusted to equal the product of the prior Adjustment Factor and the number of securities which a holder of one share (or other applicable security) of the Fund before the effective date of such stock split or reverse stock split would have owned
or been entitled to receive immediately following the applicable effective date. 
  

	 	(B)	 Stock Dividends 

If a dividend or distribution of shares (or other applicable securities) to which this Security is linked has been made by
the Fund ratably to all holders of record of such shares (or other applicable security), then the Adjustment Factor will be adjusted on the ex-dividend date to equal the prior Adjustment Factor plus the
product of the prior Adjustment Factor and the number of shares (or other applicable security) of the Fund which a holder of one share (or other applicable security) of the Fund before the ex-dividend date
would have owned or been entitled to receive immediately following that date; provided, however, that no adjustment will be made for a distribution for which the number of securities of the Fund paid or distributed is based on a fixed cash
equivalent value. 
  

	 	(C)	 Extraordinary Dividends 

If an Extraordinary Dividend (as defined below) has occurred, then the Adjustment Factor will be adjusted on the ex-dividend date to equal the product of the prior Adjustment Factor and a fraction, the numerator of which is the Closing Price per share (or other applicable security) of the Fund on the Trading Day preceding the ex-dividend date, and the denominator of which is the amount by which the Closing Price per share (or other applicable security) of the Fund on the Trading Day preceding the
ex-dividend date exceeds the Extraordinary Dividend Amount (as defined below). 

  
 8 

 For purposes of determining whether an Extraordinary Dividend has occurred:

  

	 	(1)	 “Extraordinary Dividend” means any cash dividend or distribution (or portion thereof) that
the Calculation Agent determines, in its sole discretion, is extraordinary or special; and 

  

	 	(2)	 “Extraordinary Dividend Amount” with respect to an Extraordinary Dividend for the securities
of the Fund will equal the amount per share (or other applicable security) of the Fund of the applicable cash dividend or distribution that is attributable to the Extraordinary Dividend, as determined by the Calculation Agent in its sole discretion.

 A distribution on the securities of the Fund described below under the section entitled
“—Reorganization Events” below that also constitutes an Extraordinary Dividend will only cause an adjustment pursuant to that “—Reorganization Events” section. 

 

	 	(D)	 Other Distributions 

If the Fund declares or makes a distribution to all holders of the shares (or other applicable security) of the Fund of any non-cash assets, excluding dividends or distributions described under the section entitled “—Stock Dividends” above, then the Calculation Agent may, in its sole discretion, make such adjustment (if
any) to the Adjustment Factor as it deems appropriate in the circumstances. If the Calculation Agent determines to make an adjustment pursuant to this paragraph, it will do so with a view to offsetting, to the extent practical, any change in the
economic position of a holder of this Security that results solely from the applicable event. 
  

	 	(E)	 Reorganization Events 

If the Fund, or any Successor Fund, is subject to a merger, combination, consolidation or statutory exchange of securities
with another exchange traded fund, and the Fund to which this Security is linked is not the surviving entity (a “Reorganization Event”), then, on or after the date of such event, the Calculation Agent shall, in its sole discretion,
make an adjustment to the Adjustment Factor or the method of determining the Redemption Amount or any other terms of this Security as the Calculation Agent determines appropriate to account for the economic effect on this Security of such event, and
determine the effective date of that adjustment. If the Calculation Agent determines that no adjustment that it could make will produce a commercially reasonable result, then the Calculation Agent may deem such event a Liquidation Event (as defined
below). 
 Liquidation Events 

If the Fund is de-listed, liquidated or otherwise terminated (a “Liquidation
Event”), and a successor or substitute exchange traded fund exists that the Calculation Agent determines, in its 

  
 9 

 
sole discretion, to be comparable to the Fund, then, upon the Calculation Agent’s notification of that determination to the Trustee and the Company, any subsequent Fund Closing Price for the
Fund will be determined by reference to the Fund Closing Price of such successor or substitute exchange traded fund (such exchange traded fund being referred to herein as a “Successor Fund”), with such adjustments as the Calculation
Agent determines are appropriate to account for the economic effect of such substitution on the holder of this Security. 

If the Fund undergoes a Liquidation Event prior to, and such Liquidation Event is continuing on, the date that any Fund
Closing Price of the Fund is to be determined and the Calculation Agent determines that no Successor Fund is available at such time, then the Calculation Agent will, in its discretion, calculate the Fund Closing Price for the Fund on such date by a
computation methodology that the Calculation Agent determines will as closely as reasonably possible replicate the Fund, provided that if the Calculation Agent determines in its discretion that it is not practicable to replicate the Fund (including
but not limited to the instance in which the sponsor of the index underlying the Fund discontinues publication of that index), then the Calculation Agent will calculate the Fund Closing Price for the Fund in accordance with the formula last used to
calculate such Fund Closing Price before such Liquidation Event, but using only those securities that were held by the Fund immediately prior to such Liquidation Event without any rebalancing or substitution of such securities following such
Liquidation Event. 
 If a Successor Fund is selected or the Calculation Agent calculates the Fund Closing Price as a
substitute for the Fund, such Successor Fund or Fund Closing Price will be used as a substitute for the Fund for all purposes, including for purposes of determining whether a Market Disruption Event exists. 

If any event is both a Reorganization Event and a Liquidation Event, such event will be treated as a Reorganization Event for
purposes of this Security unless the Calculation Agent makes the determination referenced in the last sentence of the section entitled “—Anti-dilution Adjustments—Reorganization Events” above. 

Alternate Calculation 

If at any time the method of calculating the Fund or a Successor Fund, or the related index underlying the Fund or Successor
Fund, is changed in a material respect, or if the Fund or a Successor Fund is in any other way modified so that the Fund does not, in the opinion of the Calculation Agent, fairly represent the price of the securities of the Fund or a Successor Fund
had such changes or modifications not been made, then the Calculation Agent may, at the close of business in New York City on the date that any Fund Closing Price is to be determined, make such calculations and adjustments as, in the good faith
judgment of the Calculation Agent, may be necessary in order to arrive at a Closing Price of the Fund comparable to the Fund or such Successor Fund, as the case may be, as if such changes or modifications had not been made, and calculate the Fund
Closing Price and the Redemption Amount with reference to such adjusted Closing Price of the Fund or a Successor Fund, as applicable. 

  
 10 

 Market Disruption Events 

A “Market Disruption Event” with respect to the Index means any of (A), (B), (C) or (D) below, as
determined by the Calculation Agent in its sole discretion: 
  

	 	(A)	 Any of the following events occurs or exists with respect to any security included in the Index or any
Successor Equity Index, and the aggregate of all securities included in the Index or Successor Equity Index with respect to which any such event occurs comprise 20% or more of the level of the Index or Successor Equity Index: 

 

	 	•	 	 a material suspension of or limitation imposed on trading by the Relevant Stock Exchange for such security or
otherwise at any time during the one-hour period that ends at the Scheduled Closing Time for the Relevant Stock Exchange for such security on that day, whether by reason of movements in price exceeding limits
permitted by the Relevant Stock Exchange or otherwise; 

  

	 	•	 	 any event, other than an early closure, that materially disrupts or impairs the ability of market participants
in general to effect transactions in, or obtain market values for, such security on its Relevant Stock Exchange at any time during the one-hour period that ends at the Scheduled Closing Time for the Relevant
Stock Exchange for such security on that day; or 

  

	 	•	 	 the closure on any Exchange Business Day of the Relevant Stock Exchange for such security prior to its
Scheduled Closing Time unless the earlier closing is announced by such Relevant Stock Exchange at least one hour prior to the earlier of (i) the actual closing time for the regular trading session on such Relevant Stock Exchange and
(ii) the submission deadline for orders to be entered into the Relevant Stock Exchange system for execution at the Scheduled Closing Time for such Relevant Stock Exchange on that day. 

 

	 	(B)	 Any of the following events occurs or exists with respect to futures or options contracts relating to the
Index or any Successor Equity Index: 

  

	 	•	 	 a material suspension of or limitation imposed on trading by any Related Futures or Options Exchange or
otherwise at any time during the one-hour period that ends at the close of trading on such Related Futures or Options Exchange on that day, whether by reason of movements in price exceeding limits permitted by
the Related Futures or Options Exchange or otherwise; 

  

	 	•	 	 any event, other than an early closure, that materially disrupts or impairs the ability of market participants
in general to effect transactions in, or obtain market values for, futures or options contracts relating to the Index or Successor Equity Index on any Related Futures or Options Exchange at any time during the
one-hour period that ends at the close of trading on such Related Futures or Options Exchange on that day; or 

  
 11 

	 	•	 	 the closure on any Exchange Business Day of any Related Futures or Options Exchange prior to its Scheduled
Closing Time unless the earlier closing time is announced by such Related Futures or Options Exchange at least one hour prior to the earlier of (i) the actual closing time for the regular trading session on such Related Futures or Options
Exchange and (ii) the submission deadline for orders to be entered into the Related Futures or Options Exchange system for execution at the close of trading for such Related Futures or Options Exchange on that day. 

 

	 	(C)	 The Index Sponsor fails to publish the level of the Index or any Successor Equity Index (other than as a
result of the Index Sponsor having discontinued publication of the Index or Successor Equity Index and no Successor Equity Index being available). 

  

	 	(D)	 Any Related Futures or Options Exchange fails to open for trading during its regular trading session.

 For purposes of determining whether a Market Disruption Event has occurred with respect
to the Index: 
  

	 	(1)	 the relevant percentage contribution of a security included in the Index or any Successor Equity Index to the
level of such index will be based on a comparison of (x) the portion of the level of such index attributable to that security to (y) the overall level of such index, in each case using the official opening weightings as published by the
Index Sponsor as part of the market opening data; 

  

	 	(2)	 the “Scheduled Closing Time” of any Relevant Stock Exchange or Related Futures or Options
Exchange on any Trading Day means the scheduled weekday closing time of such Relevant Stock Exchange or Related Futures or Options Exchange on such Trading Day, without regard to after hours or any other trading outside the regular trading session
hours; and 

  

	 	(3)	 an “Exchange Business Day” means any Trading Day on which (i) the Index Sponsor
publishes the level of the Index or any Successor Equity Index and (ii) each Related Futures or Options Exchange is open for trading during its regular trading session, notwithstanding any Related Futures or Options Exchange closing prior to
its Scheduled Closing Time. 

 A “Market Disruption Event” with respect to the Fund means
any of the following events as determined by the Calculation Agent in its sole discretion: 
  

	 	(A)	 The occurrence or existence of a material suspension of or limitation imposed on trading by the Relevant Stock
Exchange or otherwise relating to the shares (or other applicable securities) of the Fund or any Successor Fund on the Relevant Stock Exchange at any time during the one-hour period that ends at the Close of
Trading on such day, whether by reason of movements in price exceeding limits permitted by such Relevant Stock Exchange or otherwise. 

  
 12 

	 	(B)	 The occurrence or existence of a material suspension of or limitation imposed on trading by any Related
Futures or Options Exchange or otherwise in futures or options contracts relating to the shares (or other applicable securities) of the Fund or any Successor Fund on any Related Futures or Options Exchange at any time during the one-hour period that ends at the Close of Trading on that day, whether by reason of movements in price exceeding limits permitted by the Related Futures or Options Exchange or otherwise. 

 

	 	(C)	 The occurrence or existence of any event, other than an early closure, that materially disrupts or impairs the
ability of market participants in general to effect transactions in, or obtain market values for, shares (or other applicable securities) of the Fund or any Successor Fund on the Relevant Stock Exchange at any time during the one-hour period that ends at the Close of Trading on that day. 

  

	 	(D)	 The occurrence or existence of any event, other than an early closure, that materially disrupts or impairs the
ability of market participants in general to effect transactions in, or obtain market values for, futures or options contracts relating to shares (or other applicable securities) of the Fund or any Successor Fund on any Related Futures or Options
Exchange at any time during the one-hour period that ends at the Close of Trading on that day. 

  

	 	(E)	 The closure of the Relevant Stock Exchange or any Related Futures or Options Exchange with respect to the Fund
or any Successor Fund prior to its Scheduled Closing Time unless the earlier closing time is announced by the Relevant Stock Exchange or Related Futures or Options Exchange, as applicable, at least one hour prior to the earlier of (1) the
actual closing time for the regular trading session on such Relevant Stock Exchange or Related Futures or Options Exchange, as applicable, and (2) the submission deadline for orders to be entered into the Relevant Stock Exchange or Related
Futures or Options Exchange, as applicable, system for execution at the Close of Trading on that day. 

  

	 	(F)	 The Relevant Stock Exchange or any Related Futures or Options Exchange with respect to the Fund or any
Successor Fund fails to open for trading during its regular trading session. 

 For
purposes of determining whether a market disruption event has occurred with respect to the Fund: 
  

	 	(1)	 “Close of Trading” means the Scheduled Closing Time of the Relevant Stock Exchange with
respect to the Fund or any Successor Fund; and 

  

	 	(2)	 the “Scheduled Closing Time” of the Relevant Stock Exchange or any Related Futures or Options
Exchange on any Trading Day for the Fund or any Successor Fund means the scheduled weekday closing time of such Relevant Stock Exchange or Related Futures or Options Exchange on such Trading Day, without regard to after hours or any other trading
outside the regular trading session hours. 

  
 13 

 Calculation Agent 

The Calculation Agent will determine whether a Contingent Coupon Payment will be made, the Optional Redemption Price, if any,
and the Redemption Amount, if any. In addition, the Calculation Agent will (i) determine if adjustments are required to the Closing Value of a Market Measure under the circumstances described in this Security, (ii) if publication of the
Index is discontinued, select a Successor Equity Index or, if no Successor Equity Index is available, determine the Closing Value of the Index under the circumstances described in this Security, (iii) if the Fund undergoes a Liquidation Event,
select a Successor Fund or, if no Successor Fund is available, determine the Closing Value of the Fund, and (iv) determine whether a Market Disruption Event has occurred. 

The Company covenants that, so long as this Security is Outstanding, there shall at all times be a Calculation Agent (which
shall be a broker-dealer, bank or other financial institution) with respect to this Security. 

All determinations made by the Calculation Agent with respect to this Security will be at the sole discretion of the
Calculation Agent and, in the absence of manifest error, will be conclusive for all purposes and binding on the Company and the Holder of this Security. 

Redemption and Repayment 

This Security is not subject to repayment at the option of the Holder hereof prior to February 7, 2028. This Security is
subject to redemption prior to February 7, 2028 as set forth under “Optional Redemption” above. This Security is not entitled to any sinking fund. 

Acceleration 
 If
an Event of Default, as defined in the Indenture, with respect to this Security shall occur and be continuing, the Redemption Amount (calculated as set forth in the next two sentences) of this Security may be declared due and payable in the manner
and with the effect provided in the Indenture. The amount payable to the Holder hereof upon any acceleration permitted under the Indenture will be equal to the Redemption Amount hereof calculated as provided herein, plus a portion of a final
Contingent Coupon Payment, if any. The Redemption Amount and any final Contingent Coupon Payment will be calculated as though the date of acceleration were the Final Calculation Day. The final Contingent Coupon Payment, if any, will be prorated from
and including the immediately preceding Contingent Coupon Payment Date to but excluding the date of acceleration. 
  

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place. 

  
 14 

 Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature or its duly authorized agent under the Indenture referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid
or obligatory for any purpose. 
 [The remainder of this page has been left intentionally blank] 

  
 15 

 IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal. 
 DATED: 

 

					
	WELLS FARGO & COMPANY
		
	By:	 	 
		 	 
		 	Its:	 	 

  

					
	Attest:	 	 
		 	 
		 	Its:	 	 

  

			
	 TRUSTEE’S CERTIFICATE OF

AUTHENTICATION
 This is one of the Securities of the

series designated therein described
 in the within-mentioned Indenture.

	
	 CITIBANK, N.A.,

      as Trustee

		
	By:	 	 
		 	Authorized Signature
	
	OR
	
	 WELLS FARGO BANK, N.A.,

  as Authenticating Agent for the Trustee

		
	By:	 	 
		 	Authorized Signature

  
 16 

 [Reverse of Note] 

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES S 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the Lowest Performing of the 

EURO STOXX 50 ® Index and the iShares
® MSCI Emerging Markets ETF 
 due February 7, 2028 

This Security is one of a duly authorized issue of securities of the Company (herein called the
“Securities”), issued and to be issued in one or more series under an indenture dated as of February 21, 2017, as amended or supplemented from time to time (herein called the “Indenture”), between the Company
and Citibank, N.A., as Trustee (herein called the “Trustee,” which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is
one of the series of the Securities designated as Medium-Term Notes, Series S, of the Company. The amount payable on the Securities of this series may be determined by reference to the performance of one or more equity-, commodity- or currency-based
indices, exchange traded funds, securities, commodities, currencies, statistical measures of economic or financial performance, or a basket comprised of two or more of the foregoing, or any other market measure or may bear interest at a fixed rate
or a floating rate. The Securities of this series may mature at different times, be redeemable at different times or not at all, be repayable at the option of the Holder at different times or not at all and be denominated in different currencies.

 The Securities are issuable only in registered form without coupons and will be either
(a) book-entry securities represented by one or more Global Securities recorded in the book-entry system maintained by the Depositary or (b) certificated
securities issued to and registered in the names of, the beneficial owners or their nominees. 
 The Company agrees, to the
extent permitted by law, not to voluntarily claim the benefits of any laws concerning usurious rates of interest against a Holder of this Security. 

Modification and Waivers 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights
and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the
Securities at the time Outstanding of all series to be affected, acting together as a class. The Indenture also contains provisions permitting the Holders of a majority in principal amount of the Securities of all series at

  
 17 

 
the time Outstanding affected by certain provisions of the Indenture, acting together as a class, on behalf of the Holders of all Securities of such series, to waive compliance by the Company
with those provisions of the Indenture. Certain past defaults under the Indenture and their consequences may be waived under the Indenture by the Holders of a majority in principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series. Solely for the purpose of determining whether any consent, waiver, notice or other action or Act to be taken or given by the Holders of Securities pursuant to the Indenture has been given or
taken by the Holders of Outstanding Securities in the requisite aggregate principal amount, the principal amount of this Security will be deemed to be equal to the amount set forth on the face hereof as the “Face Amount” hereof. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this Security. 
 Defeasance 

Section 403 and Article Fifteen of the Indenture and the provisions of clause (ii) of Section 401(1)(B) of the
Indenture, relating to defeasance at any time of (a) the entire indebtedness on this Security and (b) certain restrictive covenants, upon compliance by the Company with certain conditions set forth therein, shall not apply to this
Security. The remaining provisions of Section 401 of the Indenture shall apply to this Security. 
 Authorized Denominations 

This Security is issuable only in registered form without coupons in denominations of $1,000 or any amount in excess thereof
which is an integral multiple of $1,000. 
 Registration of Transfer 

Upon due presentment for registration of transfer of this Security at the office or agency of the Company in the City of
Minneapolis, Minnesota, a new Security or Securities of this series, with the same terms as this Security, in authorized denominations for an equal aggregate Face Amount will be issued to the transferee in exchange herefor, as provided in the
Indenture and subject to the limitations provided therein and to the limitations described below, without charge except for any tax or other governmental charge imposed in connection therewith. 

This Security is exchangeable for definitive Securities in registered form only if (x) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for this Security or if at any time the Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not
appointed within 90 days after the Company receives such notice or becomes aware of such ineligibility, (y) the Company in its sole discretion determines that this Security shall be exchangeable for definitive Securities in registered form
and notifies the Trustee thereof or (z) an Event of Default with respect to the Securities represented hereby has occurred and is continuing. If this Security is exchangeable pursuant to the preceding sentence, it shall be exchangeable for
definitive Securities in registered form, bearing interest at the same rate, having the same date of issuance, Stated Maturity Date and other terms and of authorized denominations aggregating a like amount. 

  
 18 

 This Security may not be transferred except as a whole by the Depositary to
a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor of the Depositary or a nominee of such successor. Except as provided above,
owners of beneficial interests in this Global Security will not be entitled to receive physical delivery of Securities in definitive form and will not be considered the Holders hereof for any purpose under the Indenture. 

Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary. 
 Obligation of the Company Absolute 

No reference herein to the Indenture and no provision of this Security or the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the Contingent Coupon Payments, if any, and the Redemption Amount or the Optional Redemption Price, as applicable, on this Security at the times, place and rate, and in the coin or
currency, herein prescribed, except as otherwise provided in this Security. 
 No Personal Recourse 

No recourse shall be had for the payment of any Contingent Coupon Payments or the Redemption Amount or the Optional Redemption
Price, as applicable, on this Security or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer or director, as
such, past, present or future, of the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly waived and released. 
 Defined Terms 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture
unless otherwise defined in this Security. 
 Governing Law 

This Security shall be governed by and construed in accordance with the law of the State of New York, without regard to
principles of conflicts of laws. 

  
 19 

 ABBREVIATIONS 

The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they
were written out in full according to applicable laws or regulations: 
  

					
	 TEN COM
	 	  -- 
	 	 as tenants in common

			
	 TEN ENT
	 	  -- 
	 	 as tenants by the entireties

			
	 JT TEN
	 	  -- 
	 	 as joint tenants with right

of survivorship and not
 as
tenants in common

  

									
	 UNIF GIFT MIN ACT
	 	  -- 
	 	 	 	 Custodian
	 	 
		 		 	(Cust)	 		 	(Minor)

  

	
	Under Uniform Gifts to Minors Act
	
	   

	(State)

 Additional abbreviations may also be used though not in the above list. 

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto 

 

	
	 Please Insert Social Security or
 Other
Identifying Number of Assignee

	
	   

  
  

 
  
  

 
 (PLEASE
PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE)

  
 20 

 the within Security of WELLS FARGO & COMPANY and does hereby irrevocably constitute
and appoint
                                        
attorney to transfer the said Security on the books of the Company, with full power of substitution in the premises. 
 Dated:
                                        

  

	
	   

  

	
	   

 NOTICE: The signature to this assignment must correspond with the name as written upon the face of the
within instrument in every particular, without alteration or enlargement or any change whatever. 

  
 21

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00278-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00278-of-00352.parquet"}]]