Document:

EX-4.3

 Exhibit 4.3 

EXECUTED VERSION 
 US$
400,000,000 
 Precision Drilling Corporation 

5.250% Senior Notes due 2024 

REGISTRATION RIGHTS AGREEMENT 

June 3, 2014 
 CREDIT
SUISSE SECURITIES (USA) LLC 
 RBC CAPITAL MARKETS, LLC 

MORGAN STANLEY & CO. LLC 

MERRILL LYNCH, PIERCE, FENNER & SMITH 

                        
INCORPORATED 
 HSBC SECURITIES (USA) INC. 

SCOTIA CAPITAL (USA) INC. 

TD SECURITIES (USA) LLC 
 WELLS
FARGO SECURITIES, LLC 
 c/o Credit Suisse Securities (USA) LLC 

      Eleven Madison Avenue 

      New York, New York 10010-3629 

Ladies and Gentlemen: 
 Precision Drilling
Corporation, an Alberta corporation (the “Issuer”), proposes to issue and sell to Credit Suisse Securities (USA) LLC, RBC Capital Markets, LLC, Morgan Stanley & Co. LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated,
HSBC Securities (USA) Inc., Scotia Capital (USA) Inc., TD Securities (USA) LLC and Wells Fargo Securities, LLC (collectively, the “Initial Purchasers”), upon the terms set forth in a purchase agreement dated as of May 29, 2014 (the
“Purchase Agreement”), US$400,000,000 aggregate principal amount of its 5.250% Senior Notes due 2024 (the “Initial Securities”) to be unconditionally guaranteed (the “Guarantees”) by each of the entities listed on Annex
E hereto (the “Guarantors” and, together with the Issuer, the “Company”). The Initial Securities will be issued pursuant to an Indenture, dated as of June 3, 2014 (the “Indenture”), among the Issuer, the Guarantors
named therein, The Bank of New York Mellon, as trustee (the “U.S. Trustee”), and Valiant Trust Company, as Canadian co-trustee (the “Canadian Trustee” and, together with the U.S. Trustee, the “Trustee”). As an
inducement to the Initial Purchasers, the Company agrees with the Initial Purchasers, for the benefit of the holders of the Initial Securities (including, without limitation, the Initial Purchasers), the Exchange Securities (as defined below) and
the Private Exchange Securities (as defined below) (collectively the “Holders”), as follows: 
 1. Registered Exchange
Offer. The Company shall, at its own cost, prepare and file with the Securities and Exchange Commission (the “Commission”) a registration statement (the “Exchange Offer Registration Statement”) on an appropriate form
under the Securities Act of 1933, as amended (the “Securities Act”), with respect to a proposed offer (the “Registered Exchange Offer”) to the Holders of Transfer Restricted Securities (as defined in Section 6 hereof), who
are not prohibited by any law or policy of the Commission from participating in the Registered Exchange Offer, to issue and deliver to such Holders, in exchange for the Initial Securities, a like aggregate principal amount of debt securities (the
“Exchange Securities”) of the Company issued under the Indenture and identical in all material respects to the Initial Securities (except for the transfer restrictions relating to the Initial Securities under the Securities

 
Act and the provisions relating to the matters described in Section 6 hereof) that would be registered under the Securities Act. The Company shall use its commercially reasonable efforts to
cause such Exchange Offer Registration Statement to become effective under the Securities Act and shall keep the Exchange Offer Registration Statement effective for not less than 20 business days (or longer, if required by applicable law) after
the date notice of the Registered Exchange Offer is mailed to the Holders (such period being called the “Exchange Offer Registration Period”). 

If the Company effects the Registered Exchange Offer, the Company will be entitled to close the Registered Exchange Offer 20 business days
after the commencement thereof provided that the Company has accepted all the Initial Securities theretofore validly tendered in accordance with the terms of the Registered Exchange Offer. 

Following the declaration of the effectiveness of the Exchange Offer Registration Statement, the Company shall promptly commence the
Registered Exchange Offer, it being the objective of such Registered Exchange Offer to enable each Holder of Transfer Restricted Securities electing to exchange the Initial Securities for Exchange Securities (assuming that such Holder is not an
“affiliate” of the Company within the meaning of Rule 405 under the Securities Act, acquires the Exchange Securities in the ordinary course of such Holder’s business and has no arrangements with any person to participate in the
distribution of the Exchange Securities and is not prohibited by any law or policy of the Commission from participating in the Registered Exchange Offer) to trade such Exchange Securities from and after their receipt without any limitations or
restrictions under the Securities Act and without material restrictions under the securities laws of the several states of the United States. 

The Company acknowledges that, pursuant to current interpretations by the Commission’s staff of Section 5 of the Securities Act, in
the absence of an applicable exemption therefrom, (i) each Holder which is a broker-dealer electing to exchange Securities, acquired for its own account as a result of market making activities or other trading activities, for Exchange
Securities (an “Exchanging Dealer”), is required to deliver a prospectus containing the information set forth in (a) Annex A hereto on the cover, (b) Annex B hereto in the “Exchange Offer Procedures” section and the
“Purpose of the Exchange Offer” section, and (c) Annex C hereto in the “Plan of Distribution” section of such prospectus in connection with a sale of any such Exchange Securities received by such Exchanging Dealer pursuant
to the Registered Exchange Offer and (ii) an Initial Purchaser that elects to sell Exchange Securities acquired in exchange for Securities constituting any portion of an unsold allotment is required to deliver a prospectus containing the
information required by Items 507 or 508 of Regulation S-K under the Securities Act, as applicable, in connection with such sale. 
 The
Company shall use its commercially reasonable efforts to keep the Exchange Offer Registration Statement effective and to amend and supplement the prospectus contained therein, in order to permit such prospectus to be lawfully delivered by all
persons subject to the prospectus delivery requirements of the Securities Act for such period of time as such persons must comply with such requirements in order to resell the Exchange Securities; provided, however, that (i) in the case where
such prospectus and any amendment or supplement thereto must be delivered by an Exchanging Dealer or an Initial Purchaser, such period shall be the lesser of 180 days and the date on which all Exchanging Dealers and the Initial Purchasers have sold
all Exchange Securities held by them (unless such period is extended pursuant to Section 3(j) below) and (ii) the Company shall make such prospectus and any amendment or supplement thereto, available to any broker-dealer for use in
connection with any resale of any Exchange Securities for a period of not less than 90 days after the consummation of the Registered Exchange Offer. 

If, upon consummation of the Registered Exchange Offer, any Initial Purchaser holds Initial Securities acquired by it as part of its initial
distribution, the Company, simultaneously with the delivery of the Exchange Securities pursuant to the Registered Exchange Offer, shall issue and deliver to such Initial Purchaser upon the written request of such Initial Purchaser, in exchange (the
“Private Exchange”) for the Initial Securities held by such Initial Purchaser, a like principal amount of debt securities of the Company issued under the Indenture and identical in all material respects (including the existence of
restrictions on 

  
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transfer under the Securities Act and the securities laws of the several states of the United States, but excluding provisions relating to the matters described in Section 6 hereof) to the
Initial Securities (the “Private Exchange Securities”). The Initial Securities, the Exchange Securities and the Private Exchange Securities are herein collectively called the “Securities”. 

In connection with the Registered Exchange Offer, the Company shall: 

(a) mail to each Holder a copy of the prospectus forming part of the Exchange Offer Registration Statement, together with
an appropriate letter of transmittal and related documents; 
 (b) keep the Registered Exchange Offer open for not less
than 20 business days (or longer, if required by applicable law) after the date notice thereof is mailed to the Holders; 

(c) utilize the services of a depositary for the Registered Exchange Offer with an address in the Borough of Manhattan,
The City of New York, which may be the Trustee or an affiliate of the Trustee; 
 (d) permit Holders to withdraw
tendered Securities at any time prior to the close of business, New York time, on the last business day on which the Registered Exchange Offer shall remain open; and 

(e) otherwise comply with all applicable laws. 

As soon as reasonably practicable after the close of the Registered Exchange Offer or the Private Exchange, as the case may be, the Company
shall: 
 (x) accept for exchange all the Securities validly tendered and not withdrawn pursuant to the Registered
Exchange Offer and the Private Exchange; 
 (y) deliver to the Trustee for cancellation all the Initial Securities so
accepted for exchange; and 
 (z) cause the Trustee to authenticate and deliver promptly to each Holder of the Initial
Securities, Exchange Securities or Private Exchange Securities, as the case may be, equal in principal amount to the Initial Securities of such Holder so accepted for exchange; provided that, in the case of any Securities held in global form by a
depositary, authentication and delivery to such depositary of one or more replacement Securities in global form in an equivalent principal amount thereto for the account of such Holders in accordance with the Indenture shall satisfy such
authentication and delivery requirement. 
 The Indenture will provide that the Exchange Securities will not be subject to the transfer
restrictions under the Securities Act set forth in the Indenture and that all the Securities will vote and consent together on all matters as one class and that none of the Securities will have the right to vote or consent as a class separate from
one another on any matter. 
 Interest on each Exchange Security and Private Exchange Security issued pursuant to the Registered Exchange
Offer and in the Private Exchange will accrue from the last interest payment date on which interest was paid on the Initial Securities surrendered in exchange therefor or, if no interest has been paid on the Initial Securities, from the date of
original issue of the Initial Securities. 
 Each Holder participating in the Registered Exchange Offer shall be required to represent to
the Company that at the time of the consummation of the Registered Exchange Offer (i) any Exchange Securities received by such Holder will be acquired in the ordinary course of business, (ii) such Holder will

  
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have no arrangements or understanding with any person to participate in the distribution of the Securities or the Exchange Securities within the meaning of the Securities Act, (iii) such
Holder is not an “affiliate,” as defined in Rule 405 of the Securities Act, of the Company or if it is an affiliate, such Holder will comply with the registration and prospectus delivery requirements of the Securities Act to the extent
applicable, (iv) if such Holder is not a broker-dealer, that it is not engaged in, and does not intend to engage in, the distribution of the Exchange Securities and (v) if such Holder is a broker-dealer, that it will receive Exchange
Securities for its own account in exchange for Initial Securities that were acquired as a result of market-making activities or other trading activities and that it will be required to acknowledge that it will deliver a prospectus in connection with
any resale of such Exchange Securities. 
 Notwithstanding any other provisions hereof, the Company will ensure that (i) any Exchange
Offer Registration Statement and any amendment thereto and any prospectus forming part thereof and any supplement thereto complies in all material respects with the Securities Act and the rules and regulations thereunder, (ii) any Exchange
Offer Registration Statement and any amendment thereto does not, when it becomes effective, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not
misleading and (iii) any prospectus forming part of any Exchange Offer Registration Statement, and any supplement to such prospectus, does not include an untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. 

2. Shelf Registration. If, (i) because of any change in law or in applicable interpretations thereof by the staff of the
Commission, the Company is not permitted to effect a Registered Exchange Offer, as contemplated by Section 1 hereof, (ii) the Registered Exchange Offer is not consummated within 365 days of the date of original issue of the Initial
Securities (the “Issue Date”), (iii) any Initial Purchaser so requests with respect to the Initial Securities (or the Private Exchange Securities) not eligible to be exchanged for Exchange Securities in the Registered Exchange Offer
and held by it following consummation of the Registered Exchange Offer or (iv) any Holder (other than an Exchanging Dealer) is not eligible to participate in the Registered Exchange Offer or, in the case of any Holder (other than an Exchanging
Dealer) that participates in the Registered Exchange Offer, such Holder does not receive Exchange Securities that are freely tradeable under the Securities Act on the date of the exchange, the Company shall take the following actions: 

(a) The Company shall, at its cost, as promptly as practicable (but in no event more than 30 days after so required or
requested pursuant to this Section 2) file with the Commission and thereafter shall use its commercially reasonable efforts to cause to be declared effective (unless it becomes effective automatically upon filing) a registration statement (the
“Shelf Registration Statement” and, together with the Exchange Offer Registration Statement, a “Registration Statement”) on an appropriate form under the Securities Act relating to the offer and sale of the Transfer Restricted
Securities (as defined in Section 6 hereof) by the Holders thereof from time to time in accordance with the methods of distribution set forth in the Shelf Registration Statement and Rule 415 under the Securities Act (hereinafter, the
“Shelf Registration”); provided, however, that no Holder (other than an Initial Purchaser) shall be entitled to have the Securities held by it covered by such Shelf Registration Statement unless such Holder agrees in writing to be bound by
all the provisions of this Agreement applicable to such Holder. 
 (b) The Company shall use its commercially reasonable
efforts to keep the Shelf Registration Statement continuously effective in order to permit the prospectus included therein to be lawfully delivered by the Holders of the relevant Securities, for a period of one year (or for such longer period if
extended pursuant to Section 3(j) below) from the date of effectiveness of the Shelf Registration Statement or such shorter period that will terminate when all the Securities covered by the Shelf Registration Statement (i) have been sold
pursuant thereto or (ii) have been distributed to the public pursuant to Rule 144 under the Securities Act. The Company shall be 

  
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deemed not to have used its commercially reasonable efforts to keep the Shelf Registration Statement effective during the requisite period if it voluntarily takes any action that would result in
Holders of Securities covered thereby not being able to offer and sell such Securities during that period, unless such action is required by applicable law or is permitted under the terms of this Agreement. 

(c) Notwithstanding any other provisions of this Agreement to the contrary, the Company shall cause the Shelf Registration
Statement and the related prospectus and any amendment or supplement thereto, as of the effective date of the Shelf Registration Statement, amendment or supplement, (i) to comply in all material respects with the applicable requirements of the
Securities Act and the rules and regulations of the Commission and (ii) not to contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading. 
 (d) In the event that the Company is
required to take the actions set forth in this Section solely as a result of the Registered Exchange Offer not being consummated within 365 days of the Issue Date, but the Registered Exchange Offer is subsequently completed in accordance with the
terms of this Agreement prior to the sale of all Securities eligible to be sold under such Shelf Registration Statement, upon consummation of the Registered Exchange Offer, the Company will no longer be required to file, have declared effective or
continue the effectiveness of the Shelf Registration Statement pursuant to this Section. 
 (e) Notwithstanding anything
to the contrary herein, at any time, the Company may delay the filing of the Shelf Registration Statement or delay or suspend the effectiveness thereof if the Company determines reasonably and in good faith (for valid business reasons, but not
including the avoidance of its obligations hereunder) that the filing of any such Shelf Registration Statement or the continuing effectiveness thereof would require the disclosure of non-public material information that in the reasonable judgment of
the Company, would be detrimental to the Company, if so disclosed or would otherwise materially adversely affect a financing, acquisition, disposition, merger or other material transaction or any such action required by applicable law, in all cases,
for a period (a “Delay Period”) expiring upon the earlier to occur of the date which is the earlier of (A) the date on which such financing, acquisition, disposition, merger or other material transaction ceases to interfere with the
Company’s obligations to file or maintain the effectiveness of any such Shelf Registration Statement pursuant to this Agreement or (B) 60 days after the commencement of such delay or suspension. The Delay Period shall not exceed 60 days in
any three-month period or 90 days in any 12-month period. The period of effectiveness of the Shelf Registration Statement provided for in Section 2(b) above shall be extended by a number of days equal to the number of days during any Delay
Period. 
 3. Registration Procedures. In connection with any Shelf Registration contemplated by Section 2 hereof and, to
the extent applicable, any Registered Exchange Offer contemplated by Section 1 hereof, the following provisions shall apply: 

(a) The Company shall (i) upon request, furnish to the Initial Purchasers, prior to the filing thereof with the
Commission, a copy of the Registration Statement and each amendment thereof and each supplement, if any, to the prospectus included therein and, in the event that an Initial Purchaser (with respect to any portion of an unsold allotment from the
original offering) is participating in the Registered Exchange Offer or the Shelf Registration Statement, the Company shall use its commercially reasonable efforts to reflect in each such document, when so filed with the Commission, such comments as
such Initial Purchaser reasonably may propose; (ii) include the information set forth in Annex A hereto on the cover, in Annex B hereto in the “Exchange Offer Procedures” section and the “Purpose of the Exchange Offer”
section and in Annex C hereto 

  
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in the “Plan of Distribution” section of the prospectus forming a part of the Exchange Offer Registration Statement and include the information set forth in Annex D hereto in the Letter
of Transmittal delivered pursuant to the Registered Exchange Offer; (iii) if requested by an Initial Purchaser, include the information required by Items 507 or 508 of Regulation S-K under the Securities Act, as applicable, in the prospectus
forming a part of the Exchange Offer Registration Statement; (iv) include within the prospectus contained in the Exchange Offer Registration Statement a section entitled “Plan of Distribution,” reasonably acceptable to the Initial
Purchasers, which shall contain a summary statement of the positions taken or policies made by the staff of the Commission with respect to the potential “underwriter” status of any broker-dealer that is the beneficial owner (as defined in
Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of Exchange Securities received by such broker-dealer in the Registered Exchange Offer (a “Participating Broker-Dealer”), whether such
positions or policies have been publicly disseminated by the staff of the Commission or such positions or policies, in the reasonable judgment of the Initial Purchasers based upon advice of counsel (which may be in-house counsel), represent the
prevailing views of the staff of the Commission; and (v) in the case of a Shelf Registration Statement, include in the prospectus included in the Shelf Registration Statement (or, if permitted by Commission Rule 430B(b), in a prospectus
supplement that becomes a part thereof pursuant to Commission Rule 430B(f)) that is delivered to any Holder pursuant to Section 3(d) and (f), the names of the Holders, who propose to sell Securities pursuant to the Shelf Registration
Statement, as selling securityholders. 
 (b) The Company shall give written notice to the Initial Purchasers, the
Holders of the Securities and any Participating Broker-Dealer from whom the Company has received prior written notice that it will be a Participating Broker-Dealer in the Registered Exchange Offer (which notice pursuant to clauses
(ii)-(v) hereof shall be accompanied by an instruction to suspend the use of the prospectus until the requisite changes have been made): 

(i) when the Registration Statement or any amendment thereto has been filed with the Commission and when the Registration
Statement or any post-effective amendment thereto has become effective; 
 (ii) of any request by the Commission for
amendments or supplements to the Registration Statement or the prospectus included therein or for additional information; 

(iii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or
the initiation of any proceedings for that purpose, of the issuance by the Commission of a notification of objection to the use of the form on which the Registration Statement has been filed, and of the happening of any event that causes the Company
to become an “ineligible issuer,” as defined in Commission Rule 405; 
 (iv) of the receipt by the
Company or its legal counsel of any notification with respect to the suspension of the qualification of the Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and 

(v) of the happening of any event that requires the Company to make changes in the Registration Statement or the
prospectus in order that the Registration Statement or the prospectus do not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case of
the prospectus, in light of the circumstances under which they were made) not misleading. 

  
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 (c) The Company shall make every reasonable effort to obtain the withdrawal
at the earliest possible time, of any order suspending the effectiveness of the Registration Statement. 
 (d) The
Company shall furnish to each Holder of Securities included within the coverage of the Shelf Registration, without charge, at least one copy of the Shelf Registration Statement and any post-effective amendment or supplement thereto, including
financial statements and schedules, and, if the Holder so requests in writing, all exhibits thereto (including those, if any, incorporated by reference). The Company shall not, without the prior consent of the Initial Purchasers (which consent shall
not be unreasonably withheld), make any offer relating to the Securities that would constitute a “free writing prospectus,” as defined in Commission Rule 405. 

(e) The Company shall deliver to each Exchanging Dealer and each Initial Purchaser, and to any other Holder who so
requests, without charge, at least one copy of the Exchange Offer Registration Statement and any post-effective amendment thereto, including financial statements and schedules, and, if any Initial Purchaser or any such Holder requests, all exhibits
thereto (including those incorporated by reference). 
 (f) The Company shall, during the Shelf Registration Period,
deliver to each Holder of Securities included within the coverage of the Shelf Registration, without charge, as many copies of the prospectus (including each preliminary prospectus) included in the Shelf Registration Statement and any amendment or
supplement thereto as such person may reasonably request. The Company consents, subject to the provisions of this Agreement, to the use of the prospectus or any amendment or supplement thereto by each of the selling Holders of the Securities in
connection with the offering and sale of the Securities covered by the prospectus, or any amendment or supplement thereto, included in the Shelf Registration Statement. 

(g) The Company shall deliver to each Initial Purchaser, any Exchanging Dealer, any Participating Broker-Dealer and such
other persons required to deliver a prospectus following the Registered Exchange Offer, without charge, as many copies of the final prospectus included in the Exchange Offer Registration Statement and any amendment or supplement thereto as such
persons may reasonably request. The Company consents, subject to the provisions of this Agreement, to the use of the prospectus or any amendment or supplement thereto by any Initial Purchaser, if necessary, any Participating Broker-Dealer and such
other persons required to deliver a prospectus following the Registered Exchange Offer in connection with the offering and sale of the Exchange Securities covered by the prospectus, or any amendment or supplement thereto, included in such Exchange
Offer Registration Statement. 
 (h) Prior to any public offering of the Securities, pursuant to any Registration
Statement, the Company shall register or qualify or cooperate with the Holders of the Securities included therein and their respective counsel in connection with the registration or qualification of the Securities for offer and sale under the
securities or “blue sky” laws of such states of the United States as any Holder of the Securities reasonably requests in writing and do any and all other acts or things necessary or advisable to enable the offer and sale in such
jurisdictions of the Securities covered by such Registration Statement; provided, however, that the Company shall not be required to (i) qualify generally to do business in any jurisdiction where it is not then so qualified or (ii) take
any action which would subject it to general service of process or to taxation in any jurisdiction where it is not then so subject. 

(i) The Company shall cooperate with the Holders of the Securities to facilitate the timely preparation and delivery of
certificates representing the Securities to be sold pursuant to any Registration Statement free of any restrictive legends under the Securities Act and in such denominations and registered in such names as the Holders may request a reasonable period
of time prior to sales of the Securities pursuant to such Registration Statement. 

  
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 (j) Upon the occurrence of any event contemplated by paragraphs
(ii) through (v) of Section 3(b) above during the period for which the Company is required to maintain an effective Registration Statement, the Company shall promptly prepare and file a post-effective amendment to the Registration
Statement or a supplement to the related prospectus and any other required document so that, as thereafter delivered to Holders of the Securities or purchasers of Securities, the prospectus will not contain an untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Company notifies the Initial Purchasers, the Holders of the
Securities and any known Participating Broker-Dealer in accordance with paragraphs (ii) through (v) of Section 3(b) above to suspend the use of the prospectus until the requisite changes to the prospectus have been made, then the
Initial Purchasers, the Holders of the Securities and any such Participating Broker-Dealers shall suspend use of such prospectus, and the period of effectiveness of the Shelf Registration Statement provided for in Section 2(b) above and the
Exchange Offer Registration Statement provided for in Section 1 above shall each be extended by the number of days from and including the date of the giving of such notice to and including the date when the Initial Purchasers, the Holders of
the Securities and any known Participating Broker-Dealer shall have received such amended or supplemented prospectus pursuant to this Section 3(j). During the period in which the Company is required to maintain an effective Shelf Registration
Statement pursuant to this Agreement, the Company will prior to the three-year expiration of that Shelf Registration Statement file, and use its commercially reasonable efforts to cause to be declared
effective (unless it becomes effective automatically upon filing) within a period that avoids any interruption in the ability of Holders of Securities covered by the expiring Shelf Registration Statement to make registered dispositions, a new
registration statement relating to the Securities, which shall be deemed the “Shelf Registration Statement” for purposes of this Agreement, subject to the provisions of this Agreement governing permitted suspension periods. 

(k) Not later than the effective date of the applicable Registration Statement, the Company will provide a CUSIP number
for the Initial Securities, the Exchange Securities or the Private Exchange Securities, as the case may be. 
 (l) The
Company will comply with all rules and regulations of the Commission to the extent and so long as they are applicable to the Registered Exchange Offer or the Shelf Registration and will make generally available to its security holders (or otherwise
provide in accordance with Section 11(a) of the Securities Act) an earning statement satisfying the provisions of Section 11(a) of the Securities Act, no later than 45 days after the end of a 12-month period (or 90 days, if such period is
a fiscal year) beginning with the first month of the Company’s first fiscal quarter commencing after the effective date of the Registration Statement, which statement shall cover such 12-month period. 

(m) The Company shall cause the Indenture to be qualified under the Trust Indenture Act of 1939, as amended, in a timely
manner and containing such changes, if any, as shall be necessary for such qualification. In the event that such qualification would require the appointment of a new trustee under the Indenture, the Company shall appoint a new trustee thereunder
pursuant to the applicable provisions of the Indenture. 
 (n) The Company may require each Holder of Securities to be
sold pursuant to the Shelf Registration Statement to furnish to the Company such information regarding the Holder and the distribution of the Securities as the Company may from time to time reasonably require for inclusion in the Shelf Registration
Statement, and the Company may exclude from such registration the Securities of any Holder that fails to furnish such information within a reasonable time after receiving such request. Each such Holder agrees to notify the Company as promptly as

  
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practicable of any inaccuracy or change in information previously furnished by such Holder to the Company or the occurrence of any event in either case as a result of which any prospectus
relating to such Shelf Registration Statement contains or would contain an untrue statement of a material fact regarding such Holder or such Holder’s intended method of disposition of such Securities or omits or would omit to state any material
fact regarding such Holder or such Holder’s intended method of disposition of such Securities required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading,
and promptly to furnish to the Company any additional information required to correct and update any previously furnished information or required so that such prospectus shall not contain, with respect to such Holder or the disposition of such
Securities, an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, the light of the circumstances under which they were made, not misleading. 

(o) The Company shall enter into such customary agreements (including, if requested, an underwriting agreement in
customary form) and take all such other action, if any, as any Holder of the Securities shall reasonably request in order to facilitate the disposition of the Securities pursuant to any Shelf Registration. 

(p) In the case of any Shelf Registration, the Company shall (i) make reasonably available for inspection by the
Holders of the Securities during normal business hours, any underwriter participating in any disposition pursuant to the Shelf Registration Statement and any attorney, accountant or other agent retained by the Holders of the Securities or any such
underwriter all relevant financial and other records, pertinent corporate documents and properties of the Company and (ii) cause the Company’s officers, directors, employees, accountants and auditors to supply all relevant information
reasonably requested by the Holders of the Securities or any such underwriter, attorney, accountant or agent in connection with the Shelf Registration Statement, in each case, as shall be reasonably necessary to enable such persons, to conduct a
reasonable investigation within the meaning of Section 11 of the Securities Act; provided, however, that the foregoing inspection and information gathering shall be coordinated on behalf of the Initial Purchasers by you and on behalf of the
other parties, by one counsel designated by and on behalf of such other parties as described in Section 4 hereof. Any such access granted under this Section 3(p) shall be subject to the prior receipt by the Company of written undertakings
from any person not otherwise subject to a professional duty of confidentiality, in form and substance reasonably satisfactory to the Company, to preserve the confidentiality of any information deemed by the Company to be confidential. 

(q) In the case of any Shelf Registration, the Company, if requested by any Holder of Securities covered thereby, shall
cause (i) its counsel to deliver an opinion and updates thereof relating to the Securities in customary form addressed to such Holders and the managing underwriters, if any, thereof and dated, in the case of the initial opinion, the effective
date of such Shelf Registration Statement (it being agreed that the matters to be covered by such opinion shall be in form, scope and substance reasonably satisfactory to the managing underwriters, if any); (ii) its officers to execute and
deliver all customary documents and certificates and updates thereof reasonably requested by any underwriters of the applicable Securities and (iii) its independent public accountants and the independent public accountants with respect to any
other entity for which financial information is provided in the Shelf Registration Statement to provide to the selling Holders of the applicable Securities and any underwriter therefor a comfort letter in customary form and covering matters of the
type customarily covered in comfort letters in connection with primary underwritten offerings, subject to receipt of appropriate documentation as contemplated, and only if permitted, by Statement of Auditing Standards No. 72. 

(r) If requested by any known Participating Broker-Dealer in a Registered Exchange Offer or by any Initial Purchaser in a
Private Exchange, the Company shall cause (i) its counsel to 

  
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deliver to such Initial Purchaser or such Participating Broker-Dealer a signed opinion substantially in the form set forth in Schedules E and F of the Purchase Agreement with such changes as are
customary in connection with the preparation of a Registration Statement and (ii) its independent public accountants and the independent public accountants with respect to any other entity for which financial information is provided in the
Registration Statement to deliver to such Initial Purchaser or such Participating Broker-Dealer a comfort letter, in customary form, meeting the requirements as to the substance thereof as set forth in Section 7(a) of the Purchase Agreement,
with appropriate date changes. 
 (s) If a Registered Exchange Offer or a Private Exchange is to be consummated, upon
delivery of the Initial Securities by Holders to the Company (or to such other Person as directed by the Company) in exchange for the Exchange Securities or the Private Exchange Securities, as the case may be, the Company shall mark, or caused to be
marked, on the Initial Securities so exchanged that such Initial Securities are being canceled in exchange for the Exchange Securities or the Private Exchange Securities, as the case may be; in no event shall the Initial Securities be marked as paid
or otherwise satisfied. 
 (t) The Company will use its commercially reasonable efforts to (a) if the Initial
Securities have been rated prior to the initial sale of such Initial Securities, confirm the ratings will apply to the Securities covered by a Registration Statement, or (b) if the Initial Securities were not previously rated, cause the
Securities covered by a Registration Statement to be rated with the appropriate rating agencies, if so requested by Holders of a majority in aggregate principal amount of Securities covered by such Registration Statement, or by the managing
underwriters, if any. 
 (u) In the event that any broker-dealer registered under the Exchange Act shall underwrite any
Securities or participate as a member of an underwriting syndicate or selling group or “assist in the distribution” (within the meaning of the Conduct Rules (the “Rules”) of the Financial Industry Regulatory Authority, Inc.
(“FINRA”)) thereof, whether as a Holder of such Securities or as an underwriter, a placement or sales agent or a broker or dealer in respect thereof, or otherwise, the Company will assist such broker-dealer in complying with the
requirements of such Rules, including, without limitation, by (i) if such Rules, including Rule 5121, shall so require, engaging a “qualified independent underwriter” (as defined in Rule 5121) to participate in the preparation of the
Registration Statement relating to such Securities, to exercise usual standards of due diligence in respect thereto and, if any portion of the offering contemplated by such Registration Statement is an underwritten offering or is made through a
placement or sales agent, to recommend the yield of such Securities, (ii) indemnifying any such qualified independent underwriter to the extent of the indemnification of underwriters provided in Section 5 hereof and (iii) providing
such information to such broker-dealer as may be required in order for such broker-dealer to comply with the requirements of the Rules. 

(v) The Company shall use its commercially reasonable efforts to take all other steps necessary to effect the registration
of the Securities covered by a Registration Statement contemplated hereby. 
 4. Registration Expenses. The Company shall bear
all fees and expenses incurred in connection with the performance of its obligations under Sections 1 through 3 hereof, whether or not the Registered Exchange Offer or a Shelf Registration is filed or becomes effective, and, in the event of a Shelf
Registration, shall bear or reimburse the Holders of the Securities covered thereby for the reasonable fees and disbursements of one firm of counsel designated by the Holders of a majority in principal amount of the Initial Securities covered
thereby to act as counsel for the Holders of the Initial Securities in connection therewith, subject to the Company’s reasonable approval. Notwithstanding the foregoing, the Holders shall be responsible for all underwriting commissions and
discounts in connection with an underwritten offering. 

  
 10 

 5. Indemnification. (a) The Company agrees to indemnify and hold harmless each
Holder of the Securities, any Participating Broker-Dealer and each person, if any, who controls such Holder or such Participating Broker-Dealer within the meaning of the Securities Act or the Exchange Act (each Holder, any Participating
Broker-Dealer and such controlling persons are referred to collectively as the “Indemnified Parties”) from and against any losses, claims, damages or liabilities, joint or several, or any actions in respect thereof (including, but not
limited to, any losses, claims, damages, liabilities or actions relating to purchases and sales of the Securities) to which each Indemnified Party may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in a Registration Statement or prospectus or in any amendment or supplement thereto or in any
preliminary prospectus or “issuer free writing prospectus,” as defined in Commission Rule 433 (“Issuer FWP”), relating to a Shelf Registration, or arise out of, or are based upon, the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse, as incurred, the Indemnified Parties for any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage, liability or action in respect thereof; provided, however, that (i) the Company shall not be liable in any such case to the extent that such loss, claim, damage or liability arises
out of or is based upon any untrue statement or alleged untrue statement or omission or alleged omission made in a Registration Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus or Issuer FWP relating
to a Shelf Registration in reliance upon and in conformity with written information pertaining to such Holder or Participating Broker-Dealer and furnished to the Company by or on behalf of such Holder or Participating Broker-Dealer specifically for
inclusion therein and (ii) with respect to any untrue statement or omission or alleged untrue statement or omission made in any preliminary prospectus relating to a Shelf Registration Statement, the indemnity agreement contained in this
subsection (a) shall not inure to the benefit of any Holder or Participating Broker-Dealer from whom the person asserting any such losses, claims, damages or liabilities purchased the Securities concerned, to the extent that a prospectus
relating to such Securities was required to be delivered (including through satisfaction of the conditions of Commission Rule 172) by such Holder or Participating Broker-Dealer under the Securities Act in connection with such purchase and any
such loss, claim, damage or liability of such Holder or Participating Broker-Dealer results from the fact that there was not conveyed to such person, at or prior to the time of the sale of such Securities to such person, an amended or supplemented
prospectus or, if permitted by Section 3(d), an Issuer FWP correcting such untrue statement or omission or alleged untrue statement or omission if the Company had previously furnished copies thereof to such Holder or Participating
Broker-Dealer; provided further, however, that this indemnity agreement will be in addition to any liability which the Company may otherwise have to such Indemnified Party. The Company shall also indemnify underwriters, their officers and directors
and each person who controls such underwriters within the meaning of the Securities Act or the Exchange Act to the same extent as provided above with respect to the indemnification of the Holders of the Securities if requested by such Holders. 

(b) Each Holder of the Securities and Participating Broker-Dealer, severally and not jointly, will indemnify and hold harmless the
Company and each person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act from and against any losses, claims, damages or liabilities or any actions in respect thereof, to which the Company or any such
controlling person may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in a Registration Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus or Issuer FWP relating to a Shelf Registration, or arise out of or are based upon the omission or alleged
omission to state therein a material fact necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or omission or alleged untrue statement or omission was made in reliance upon and in
conformity with written information pertaining to such Holder or Participating Broker-Dealer and furnished to the Company by or on behalf of such Holder or Participating Broker-Dealer specifically for inclusion therein; and, subject to the
limitation set forth immediately preceding this clause, shall reimburse, as incurred, the Company for 

  
 11 

 
any legal or other expenses reasonably incurred by the Company or any such controlling person in connection with investigating or defending any loss, claim, damage, liability or action in respect
thereof. This indemnity agreement will be in addition to any liability which such Holder or Participating Broker-Dealer may otherwise have to the Company or any of its controlling persons. 

(c) Promptly after receipt by an indemnified party under this Section 5 of notice of the commencement of any action or proceeding
(including a governmental investigation), such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 5, notify the indemnifying party of the commencement thereof; but the failure
to notify the indemnifying party shall not relieve the indemnifying party from any liability that it may have under subsection (a) or (b) above except to the extent that it has been materially prejudiced (through the forfeiture of
substantive rights or defenses) by such failure; and provided further that the failure to notify the indemnifying party shall not relieve it from any liability that it may have to an indemnified party otherwise than under subsection (a) or
(b) above. In case any such action is brought against any indemnified party, and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof the indemnifying party will not be liable to such indemnified party under this Section 5 for any legal
or other expenses, other than reasonable costs of investigation, subsequently incurred by such indemnified party in connection with the defense thereof. No indemnifying party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened action in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party unless such settlement (i) includes an
unconditional release of such indemnified party from all liability on any claims that are the subject matter of such action, and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf
of any indemnified party. 
 (d) If the indemnification provided for in this Section 5 is unavailable or insufficient to hold
harmless an indemnified party under subsections (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities (or actions
in respect thereof) referred to in subsection (a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party on the
other from the exchange of the Securities, pursuant to the Registered Exchange Offer, or (ii) if the allocation provided by the foregoing clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative fault of the indemnifying party or parties on the one hand and the indemnified party on the other in connection with the statements or omissions that resulted in
such losses, claims, damages or liabilities (or actions in respect thereof) as well as any other relevant equitable considerations. The relative fault of the parties shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or such Holder or such other indemnified party, as the case may be, on the other,
and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to
in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding any other provision of this Section 5(d), the Holders of the Securities shall not be required to contribute any amount in excess of the amount by which the net proceeds received by such Holders from the sale of
the Securities pursuant to a Registration Statement exceeds the amount of damages which such Holders have otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within 

  
 12 

 
the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this paragraph
(d), each person, if any, who controls such indemnified party within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as such indemnified party and each person, if any, who controls the Company within
the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as the Company. 
 (e) The agreements
contained in this Section 5 shall survive the sale of the Securities pursuant to a Registration Statement and shall remain in full force and effect, regardless of any termination or cancellation of this Agreement or any investigation made by or
on behalf of any indemnified party. 
 6. Additional Interest Under Certain Circumstances. (a) Additional interest (the
“Additional Interest”) with respect to the Initial Securities shall be assessed as follows if any of the following events occur (each such event in clauses (i) through (ii) below a “Registration Default”): 

(i) If on or prior to the 365th day after the Issue Date, neither the
Registered Exchange Offer is consummated nor, if required in lieu thereof, the Shelf Registration Statement is declared effective by the Commission; or 

(ii) If after either the Exchange Offer Registration Statement or the Shelf Registration Statement is declared (or becomes
automatically) effective (A) such Registration Statement thereafter ceases to be effective (and such Registration Statement is required to remain effective under this Agreement); or (B) such Registration Statement or the related prospectus
ceases to be usable (except as permitted in paragraph (b)) in connection with resales of Transfer Restricted Securities during the periods specified herein because either (1) any event occurs as a result of which the related prospectus
forming part of such Registration Statement would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made not
misleading, (2) it shall be necessary to amend such Registration Statement or supplement the related prospectus, to comply with the Securities Act or the Exchange Act or the respective rules thereunder, or (3) such Registration Statement
is a Shelf Registration Statement that has expired before a replacement Shelf Registration Statement has become effective. 
 Additional Interest shall
accrue on the principal amount of the Initial Securities over and above the interest set forth in the title of the Securities from and including the date on which any such Registration Default shall occur at a rate of 0.25% per annum (the
“Additional Interest Rate”) for the first 90-day period immediately following the occurrence of such Registration Default. The Additional Interest Rate shall increase by an additional 0.25% per annum, with respect to each subsequent
90-day period until all Registration Defaults have been cured, up to a maximum Additional Interest Rate of 1.0% per annum. 

Notwithstanding the foregoing, a Holder of Securities that has not provided the information described in Section 3(n) shall not be
entitled to Additional Interest with respect to an event described in the foregoing clause (i), (ii) or (iii) of this Section 6(a) that pertains to the applicable Shelf Registration Statement. 

(b) A Registration Default referred to in Section 6(a)(iii)(B) hereof shall be deemed not to have occurred and be continuing in
relation to a Shelf Registration Statement or the related prospectus if (i) such Registration Default has occurred solely as a result of (x) the filing of a post-effective amendment to such Shelf Registration Statement to incorporate
annual audited financial information with respect to the Company where such post-effective amendment is not yet effective and needs to be declared effective to permit Holders to use the related prospectus or (y) other material events, with
respect to the Company that would need to be described in such Shelf Registration Statement or the related prospectus and (ii) in the case of clause (y), the Company is proceeding promptly and in good faith to amend or supplement such

  
 13 

 
Shelf Registration Statement and related prospectus to describe such events; provided, however, that in any case if such Registration Default occurs for a continuous period in excess of 45 days
(or if a Delay Period (as contemplated in Section 2(e) hereof) exceeds 60 days in any three-month period or 90 days in any 12-month period), Additional Interest shall be payable in accordance with the above paragraph from the day such
Registration Default occurs until such Registration Default is cured. 
 (c) Any amounts of Additional Interest due pursuant to clause
(i), (ii) or (iii) of Section 6(a) above will be payable in cash on the regular interest payment dates with respect to the Initial Securities. The amount of Additional Interest will be determined by multiplying the applicable
Additional Interest Rate by the principal amount of the Initial Securities, multiplied by a fraction, the numerator of which is the number of days such Additional Interest Rate was applicable during such period (determined on the basis of a 360-day
year comprised of twelve 30-day months), and the denominator of which is 360. 
 (d) “Transfer Restricted Securities” means
each Security until (i) the date on which such Transfer Restricted Security has been exchanged by a person other than a broker-dealer for an Exchange Security that is freely transferable under the Securities Act in the Registered Exchange
Offer, (ii) following the exchange by a broker-dealer in the Registered Exchange Offer of a Initial Security for an Exchange Security, the date on which such Exchange Security is sold to a purchaser who receives from such broker-dealer on or
prior to the date of such sale a copy of the prospectus contained in the Exchange Offer Registration Statement, (iii) the date on which such Initial Security has been effectively registered under the Securities Act and disposed of in accordance
with the Shelf Registration Statement, (iv) the date on which such Security is distributed to the public pursuant to Rule 144 under the Securities Act or (v) the earliest date that is no less than two years after the Issue Date and on
which such Security (except for Securities held by an affiliate of the Company) may be resold in reliance on paragraph (b)(1) of Rule 144 under the Securities Act. 

7. Rules 144 and 144A. The Company shall use its commercially reasonable efforts to file the reports required to be filed by
it under the Securities Act and the Exchange Act in a timely manner and, if at any time the Company is not required to file such reports, it will, upon the request of any Holder of Initial Securities, make publicly available other information so
long as necessary to permit sales of their securities pursuant to Rules 144 and 144A. The Company covenants that it will take such further action as any Holder of Initial Securities may reasonably request, all to the extent required from time
to time to enable such Holder to sell Initial Securities without registration under the Securities Act within the limitation of the exemptions provided by Rules 144 and 144A (including the requirements of Rule 144A(d)(4)). Notwithstanding
the foregoing, nothing in this Section 7 shall be deemed to require the Company to register any of its securities pursuant to the Exchange Act. 

8. Underwritten Registrations. If any of the Transfer Restricted Securities covered by any Shelf Registration are to be sold
in an underwritten offering, the investment banker or investment bankers and manager or managers that will administer the offering (“Managing Underwriters”) will be selected by the Holders of a majority in aggregate principal amount of
such Transfer Restricted Securities to be included in such offering, subject to the Company’s reasonable approval. 
 No person may
participate in any underwritten registration hereunder unless such person (i) agrees to sell such person’s Transfer Restricted Securities on the basis reasonably provided in any underwriting arrangements approved by the persons entitled
hereunder to approve such arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements. 

9. Miscellaneous. 

(a) Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be given, except by the Company and the written consent of the Holders of a majority in principal amount of the Securities affected by such amendment, modification, supplement, waiver or
consents. 

  
 14 

 (b) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand delivery, first-class mail, facsimile transmission, or air courier which guarantees overnight delivery: 

(1) if to a Holder of the Securities, at the most current address given by such Holder to the Company. 

(2) if to the Initial Purchasers: 

Credit Suisse Securities (USA) LLC 

Eleven Madison Avenue 
 New
York, NY 10010-3629 
 Fax No.: (212) 325-4296 

Attention: LCD-IBD 
 with a copy
to: 
 Paul, Weiss, Rifkind, Wharton & Garrison LLP 

77 King Street West, Suite 3100 

P.O. Box 226 
 Toronto, Ontario

 Canada M5K 1J3 
 Fax No.:
(416) 504-0530 
 Attention: Christopher J. Cummings 

(3) if to the Company, at its address as follows: 

800, 525 – 8th Avenue S.W. 

Calgary, Alberta 
 Canada T2P
1G1 
 Fax No.: (403) 206-2509 

Attention: Chief Financial Officer 

with a copy to: 

“Treasurer”, at the same address 

with a copy to: 
 Simpson
Thacher & Bartlett LLP 
 425 Lexington Avenue 

New York, NY 10017-3954 
 Fax
No.: (212) 455-2502 
 Attention: Risë Norman 

All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; three
business days after being deposited in the mail, postage prepaid, if mailed; when receipt is acknowledged by recipient’s facsimile machine operator, if sent by facsimile transmission; and on the day delivered, if sent by overnight air courier
guaranteeing next day delivery. 

  
 15 

 (c) No Inconsistent Agreements. The Company has not, as of the date hereof,
entered into, nor shall it, on or after the date hereof, enter into, any agreement with respect to its securities that is inconsistent with the rights granted to the Holders herein or otherwise conflicts with the provisions hereof. 

(d) Successors and Assigns. This Agreement shall be binding upon the Company and its successors and assigns. 

(e) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. 

(f) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect
the meaning hereof. 
 (g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK. 
 (h) Severability. If any one or more of the provisions contained herein, or the application
thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired
thereby. 
 (i) Securities Held by the Company. Whenever the consent or approval of Holders of a specified percentage of
principal amount of Securities is required hereunder, Securities held by the Company or its affiliates (other than subsequent Holders of Securities if such subsequent Holders are deemed to be affiliates solely by reason of their holdings of such
Securities) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage. 

(j) Agent for Service; Submission to Jurisdiction; Waiver of Immunities. By the execution and delivery of this Agreement,
each of the Company that is not organized in the United States (i) acknowledges that it has, by separate written instrument, irrevocably designated and appointed CT Corporation System, 111 Eighth Avenue, New York, New York 10011 (and any
successor entity), as its authorized agent upon which process may be served in any suit or proceeding arising out of or relating to this Agreement that may be instituted in any federal or state court in the State of New York or brought under federal
or state securities laws, and acknowledges that CT Corporation System has accepted such designation, (ii) submits to the nonexclusive jurisdiction of any such court in any such suit or proceeding, and (iii) agrees that service of process
upon CT Corporation System and written notice of said service to the Company shall be deemed in every respect effective service of process upon it in any such suit or proceeding. The Company further agrees to take any and all action, including the
execution and filing of any and all such documents and instruments, as may be necessary to continue such designation and appointment of CT Corporation System in full force and effect so long as any of the Securities shall be outstanding. To the
extent that the Company may acquire any immunity from jurisdiction of any court or from any legal process (whether through service of notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to
itself or its property, it hereby irrevocably waives such immunity in respect of this Agreement, to the fullest extent permitted by law. 

  
 16 

 If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Issuer
a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement among the several Initial Purchasers, the Issuer and the Guarantors in accordance with its terms. 

 

					
	Very truly yours,
	
	PRECISION DRILLING CORPORATION
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION DIVERSIFIED OILFIELD SERVICES CORP.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION LIMITED PARTNERSHIP
	BY:	 	ITS GENERAL PARTNER, PRECISION DIVERSIFIED OILFIELD SERVICES CORP.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION DRILLING CANADA LIMITED PARTNERSHIP
	BY:	 	ITS GENERAL PARTNER, PRECISION DIVERSIFIED OILFIELD SERVICES CORP.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary

  
 [Signature Page to
Registration Rights Agreement] 

 
					
	GREY WOLF INTERNATIONAL DRILLING CORPORATION
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION OILFIELD PERSONNEL SERVICES LTD.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION DRILLING, INC.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	DI ENERGY, INC.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	GREY WOLF INTERNATIONAL, INC.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION DRILLING HOLDINGS COMPANY
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary

  
 [Signature Page to
Registration Rights Agreement] 

 
					
	PRECISION DRILLING LLC
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION DRILLING COMPANY, LP
	BY:	 	ITS GENERAL PARTNER, PRECISION DRILLING HOLDINGS COMPANY
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	MURCO DRILLING CORPORATION
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	DI/PERFENSA INC.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION COMPLETION & PRODUCTION SERVICES LTD.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PD SUPPLY INC.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary

  
 [Signature Page to
Registration Rights Agreement] 

 
					
	PRECISION DRILLING (US) CORPORATION
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION DIRECTIONAL SERVICES, INC.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary
	
	PRECISION DIRECTIONAL SERVICES LTD.
		
	By:	 	/s/ Joanne L. Alexander
		 	Name:	 	Joanne L. Alexander
		 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary

  
 [Signature Page to
Registration Rights Agreement] 

 The foregoing Registration 

Rights Agreement is hereby confirmed 
 and accepted as of the date
first 
 above written. 
  

					
	CREDIT SUISSE SECURITIES (USA) LLC
	RBC CAPITAL MARKETS, LLC
	MORGAN STANLEY & CO. LLC
		
	By:	 	CREDIT SUISSE SECURITIES (USA) LLC
		
	By:	 	 /s/ Max Lipkind

		 	Name:	 	Max Lipkind
		 	Title:	 	Director
		
	By:	 	RBC CAPITAL MARKETS, LLC
		
	By:	 	 /s/ James S. Wolfe

		 	Name:	 	James S. Wolfe
		 	Title:	 	 Managing Director
 Head of US Leverage
Finance

		
	By:	 	MORGAN STANLEY & CO. LLC
		
	By:	 	 /s/ Henrik Z. Sandstorm

		 	Name:	 	Henrik Z. Sandstorm
		 	Title:	 	Authorized Signatory

 Acting on behalf of themselves 

and as the representatives of 
 the several Initial Purchasers.

  
 [Signature Page to
Registration Rights Agreement] 

 ANNEX A 

Each broker-dealer that receives Exchange Securities for its own account pursuant to the Exchange Offer must acknowledge that it will deliver
a prospectus in connection with any resale of such Exchange Securities. The Letter of Transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter”
within the meaning of the Securities Act. This Prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of Exchange Securities received in exchange for Initial Securities where
such Initial Securities were acquired by such broker-dealer as a result of market-making activities or other trading activities. The Company has agreed that, for a period of 180 days after the Expiration Date (as defined herein), it will make this
Prospectus available to any broker-dealer for use in connection with any such resale. See “Plan of Distribution.” 

 ANNEX B 

Each broker-dealer that receives Exchange Securities for its own account in exchange for Securities, where such Initial Securities were
acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities. See “Plan of Distribution.”

 ANNEX C 

PLAN OF DISTRIBUTION 
 Each
broker-dealer that receives Exchange Securities for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection with resales of Exchange Securities received in exchange for Initial Securities where such Initial Securities were acquired as a result of market-making activities or other
trading activities. The Company has agreed that, for a period of 180 days after the Expiration Date, it will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. In addition,
until                     , 20[    ], all dealers effecting transactions in the Exchange Securities may be required to deliver a
prospectus.(1) 
 The Company will not receive any proceeds from any sale of Exchange
Securities by broker-dealers. Exchange Securities received by broker-dealers for their own account pursuant to the Exchange Offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions,
through the writing of options on the Exchange Securities or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or negotiated prices. Any such resale may be
made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer or the purchasers of any such Exchange
Securities. Any broker-dealer that resells Exchange Securities that were received by it for its own account pursuant to the Exchange Offer and any broker or dealer that participates in a distribution of such Exchange Securities may be deemed to be
an “underwriter” within the meaning of the Securities Act and any profit on any such resale of Exchange Securities and any commission or concessions received by any such persons may be deemed to be underwriting compensation under the
Securities Act. The Letter of Transmittal states that, by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

 For a period of 180 days after the Expiration Date the Company will promptly send additional copies of this Prospectus and any amendment
or supplement to this Prospectus to any broker-dealer that requests such documents in the Letter of Transmittal. The Company has agreed to pay all expenses incident to the Exchange Offer (including the reasonable expenses of one counsel for the
Holders of the Securities) other than commissions or concessions of any brokers or dealers and will indemnify the Holders of the Securities (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act.

  
  

	(1) 	In addition, the legend required by Item 502(b) of Regulation S-K will appear on the back cover page of the Exchange Offer prospectus. 

 ANNEX D 

CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR
SUPPLEMENTS THERETO. 
  

							
		 	Name:	 	  
	 	
		 	Address:	 	  
	 	
		 		 	  
	 	

 If the undersigned is not a broker-dealer, the undersigned represents that it is not engaged in, and does not intend to engage
in, a distribution of Exchange Securities. If the undersigned is a broker-dealer that will receive Exchange Securities for its own account in exchange for Initial Securities that were acquired as a result of market-making activities or other trading
activities, it acknowledges that it will deliver a prospectus in connection with any resale of such Exchange Securities; however, by so acknowledging and by delivering a prospectus, the undersigned will not be deemed to admit that it is an
“underwriter” within the meaning of the Securities Act. 

 ANNEX E 
  

			
	 Guarantor
	  	 Jurisdiction

		
	Precision Diversified Oilfield Services Corp.	  	Alberta
	Precision Limited Partnership	  	Alberta
	Precision Drilling Canada Limited Partnership	  	Alberta
	Grey Wolf International Drilling Corporation	  	Canada
	Precision Oilfield Personnel Services Ltd.	  	Alberta
	Precision Drilling, Inc.	  	Delaware
	Precision Completion & Production Services Ltd.	  	Delaware
	DI Energy, Inc.	  	Texas
	Grey Wolf International, Inc.	  	Texas
	Precision Drilling Holdings Company	  	Nevada
	Precision Drilling LLC	  	Louisiana
	Precision Drilling Company, LP	  	Texas
	Murco Drilling Corporation	  	Delaware
	DI/Perfensa Inc.	  	Texas
	PD Supply Inc.	  	Texas
	Precision Drilling (US) Corporation	  	Texas
	Precision Directional Services, Inc.	  	Texas
	Precision Directional Services Ltd.	  	AlbertaExhibit 10.1

 

  

 

LOAN AND SECURITY AGREEMENT

 

Between

 

SUMMIT FINANCIAL RESOURCES, L.P.

Lender

 

and

 

POINT.360

Borrower

 

Effective Date: February 13, 2015

 

 

    	 

    	 

    

 

LOAN AND SECURITY AGREEMENT

 

This Loan and Security
Agreement is made and entered into by and between SUMMIT FINANCIAL RESOURCES, L.P., and POINT.360.

 

For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

 

1.Definitions.
Terms defined in the singular shall have the same meaning when used in the plural and vice versa. Terms defined in the UCC shall
have the meanings set forth in the UCC, except as otherwise defined herein. As used herein, the term:

 

“Account”
shall have the meaning set forth in the UCC.

 

“Account Debtor”
means any person or entity obligated for payment of an Account.

 

“Accounting Standards”
means (a) in the case of financial statements and reports, conformity with generally accepted accounting principles and fully and
fairly representing the financial condition as of the date thereof and the results of operations for the period or periods covered
thereby, consistent with other financial statements of Borrower and Guarantor previously delivered to Lender, and (b) in the case
of calculations, definitions, and covenants, generally accepted accounting principles consistent with those used in the preparation
of financial statements of Borrower and Guarantor previously delivered to Lender.

 

“Advance Rate”
means eighty percent (80%), or such other percent as may be determined from time to time by Lender in its sole discretion.

 

“Banking Business
Day” means any day not a Saturday, Sunday, legal holiday in the State of Utah, or day on which national banks in the State
of Utah are authorized to close.

 

“Borrower”
means POINT.360, a corporation organized and existing under the laws of the State of California, its successors and, if permitted,
assigns.

 

“Collateral”
means the following personal property of Borrower, wherever located, now owned or existing or hereafter acquired or created, all
additions and accessions thereto, all replacements, insurance or condemnation proceeds, all documents covering any of the Collateral,
all leases of any of the Collateral, all rents, revenues, issues, profits and proceeds arising from the sale, lease, license, encumbrance,
collection, or any other temporary or permanent disposition of any of the Collateral or any interest therein, all amendments, modifications,
renewals, extensions, and replacements thereof, and all products and proceeds thereof: (a) all Inventory; (b) all Accounts; (c) all
equipment, goods and motor vehicles (collectively, the “Equipment”); (d) all general intangibles, including, without
limitation, any and all patents, trademarks and copyrights (registered or unregistered), trade secrets, domain names and addresses,
and intellectual property licenses; (e) any and all promissory notes and instruments payable to or owing to Borrower or held by
Borrower; any and all leases under which Borrower is the lessor; any and all chattel paper in favor of, owing to, or held by Borrower,
including, without limitation, any and all conditional sale contracts or other sale agreements, whether Borrower is the original
party or the assignee; and any and all security agreements, collateral and titles to motor vehicles which secure any of the foregoing
obligations; all deposit accounts, including, without limitation, all interest, dividends or distributions accrued or to accrue
thereon, whether or not due; all investment property, including, without limitation, all interest, dividends or distributions accrued
or to accrue thereon, whether or not due, all documents; all letter-of-credit rights; and all supporting obligations (collectively,
the “Financial Obligations”); and (f) all balances, deposits, debts or any other amounts or obligations of Lender owing
to Borrower, including, without limitation, any Reserve, whether or not due.

 

“Collected Payments”
means collections and payments received by Lender on Accounts of Borrower. Credits for Collected Payments shall be provisional
and subject to final payment and collection of the deposited item.

 

    	1

    	 

    

 

“Collected Reserve”
means such amounts as may be determined from time to time by Lender in its sole discretion that are deducted from Collected Payments
or withheld by Lender from disbursements of the Loan.

 

“Default Rate”
means a variable interest rate computed on the basis of a three hundred sixty (360) day year as follows: twelve percent (12%) per
annum above the Prime Rate, adjusted as of the date of any change in the Prime Rate.

 

“Effective Date”
shall mean the date the parties intend this Loan and Security Agreement to become binding and enforceable, which is the date stated
at the conclusion of this Loan and Security Agreement.

 

“Eligible Account”
means an Account of Borrower which meets the following specifications at the time it is created and at all times thereafter until
collected in full:

 

a.The Account meets
all applicable representations, warranties, and covenants concerning the Collateral set forth in Section 4.4 Representations
and Warranties Concerning Collateral and Section 4.5 Covenants Concerning Collateral.

 

b.The Account is
due and payable not more than sixty (60) days from the date of the invoice evidencing the Account and is not more than ninety (90)
days past the date of the invoice evidencing the Account.

 

c.Performance of
all services giving rise to the Account has been completed and all goods giving rise to the Account have been delivered.

 

d.The Account Debtor
is located or authorized to do business within the United States or Canada (excluding the province of Newfoundland, the Northwest
Territories, and the Territory of Nunavut) and maintains an office and transacts business in the United States or Canada (excluding
the province of Newfoundland, the Northwest Territories, and the Territory of Nunavut), or payment of the Account (i) has been
assured by a letter of credit in a form and upon terms acceptable to Lender or (ii) is covered under a policy of credit insurance
acceptable to Lender which has been assigned to Lender or names Lender as an additional insured and lender loss payee in a form
and manner acceptable to Lender.

 

e.No proceeding has
been commenced or petition filed under any bankruptcy or insolvency law by or against the Account Debtor; no receiver, trustee
or custodian has been appointed for any part of the property of the Account Debtor; and no property of the Account Debtor has been
assigned for the benefit of creditors.

 

f.Neither the Account,
nor any invoice, credit application, bill, billing memorandum, correspondence, or any other document relating to an Account, contracts
for or charges any interest or any other charge in excess of the maximum non-usurious rate allowed pursuant to applicable law.

 

g.If twenty-five
percent (25%) or more of the Accounts owing to Borrower by any particular Account Debtor do not qualify as Eligible Accounts, all
Accounts owing by such Account Debtor shall not be Eligible Accounts.

 

h.The Account is
not owing by an Account Debtor for whom the terms of sale by Borrower are cash on delivery (“COD”) or considered a
cash sale.

 

i.Borrower does not
owe an account payable to the Account Debtor which could be set off against the Account.

 

j.If the total of
all outstanding Accounts owing by any single Account Debtor equals seventy percent (70%) or more of the total outstanding Accounts
owing to Borrower, the amount of Accounts owing by that Account Debtor in excess of this limit shall not be Eligible Accounts.

 

    	2

    	 

    

 

k.If the Account
is subject to any type of retainage, only the non-retainage portion of the Account shall be an Eligible Account.

 

l.The Account is
not owing with respect to any job which is bonded.

 

m.The Account does
not arise from goods placed on consignment, guaranteed sale, or other terms by reason of which the payment by the Account Debtor
may be conditional.

 

n.The Account is
not owing by an employee, officer, or director of Borrower or by a parent, subsidiary, sister company, or other company or entity
related to or an affiliate of Borrower.

 

o.For all Accounts
arising under any contract, subcontract, purchase order, or any other agreement with or related to the United States Government,
or any agency, branch, division, or subdivision thereof, the Account Debtor has acknowledged and consented to Borrower’s
assignment of Accounts to Lender and has agreed, in a form acceptable to Lender, to remit payments directly to Lender.

 

p.The Account will
not be paid by credit card or other form of electronic payment other than wire or ACH transfer sent directly to a deposit account
specified by Lender.

 

q.The Account has
not been deemed by Lender to be unacceptable and is not owing by an Account Debtor deemed by Lender to be unacceptable.

 

“Equipment”
shall have the meaning set forth in the definition of Collateral.

 

“Escrow Reserve”
means the amount of Eligible Accounts withheld by Lender on which disbursements of the Loan are based equal to one (1) minus the
Advance Rate multiplied by the face amount of the Eligible Accounts.

 

“Event of Default”
shall have the meaning set forth in Section 9.1 Events of Default.

 

“Guarantee”
means each guarantee executed pursuant to Section 5.1 Guarantee.

 

“Guarantor”
means each person or entity that executes a Guarantee, and its successors, heirs, and assigns.

 

“Inventory”
shall have the meaning set forth in the UCC.

 

“Lender”
means SUMMIT FINANCIAL RESOURCES, L.P., a Hawaii limited partnership, its successors and assigns.

 

“Liquidation
Costs” means the reasonable costs and out of pocket expenses incurred by Lender in obtaining possession of any Collateral,
in storage and preparation for sale, lease or other disposition of any Collateral, in the sale, lease, or other disposition of
any or all of the Collateral, and/or otherwise incurred in foreclosing on any of the Collateral, including, without limitation,
(a) reasonable attorneys’ fees and legal expenses, (b) transportation and storage costs, (c) advertising costs, (d) sale
commissions, (e) sales tax and license fees, (f) costs for improving or repairing any of the Collateral, and (g) costs for preservation
and protection of any of the Collateral.

 

“Loan”
means the loan to be made pursuant to Section 2 Loan Description.

 

“Loan and Security
Agreement” means this agreement, together with any exhibits, amendments, addendums, and modifications.

 

“Loan Commitment
Period” means an initial period of two (2) years commencing on the Effective Date and thereafter successive periods of one
(1) year each commencing upon completion of each prior Loan Commitment Period.

 

    	3

    	 

    

 

“Loan Documents”
means the Loan and Security Agreement, Guarantee, Security Documents, all other agreements and documents contemplated by any of
the aforesaid documents, and all amendments, modifications, addendums, and replacements, whether presently existing or created
in the future.

 

“Lock Box”
means that certain Lock Box owned by Lender located at PO Box 844223, Los Angeles, CA 90084-4223.

 

“Material Adverse
Effect” means a material adverse effect on Borrower’s or any Guarantor’s financial condition, conduct of its
business, or ability to perform its obligations under the Loan Documents.

 

“Maximum Loan
Amount” means two million dollars ($2,000,000).

 

“Monthly Minimum”
means three thousand dollars ($3,000).

 

“Notice of Assignment”
shall have the meaning set forth in Section 4.2 Notice of Assignment.

 

“Organizational
Documents” means, in the case of a corporation, its Articles of Incorporation and By-Laws; in the case of a general partnership,
its Articles of Partnership; in the case of a limited partnership, its Articles of Limited Partnership; in the case of a limited
liability company, its Articles of Organization and Operating Agreement or Regulations, if any; in the case of a limited liability
partnership, its Articles of Limited Liability Partnership; and all amendments, modifications, and changes to any of the foregoing
which are currently in effect.

 

“Permitted Encumbrances”
means liens for taxes and assessments not yet due and payable or, if due and payable, those being contested in good faith by appropriate
proceedings and for which appropriate reserves are maintained, security interests and liens created by the Loan Documents, and
security interests and liens authorized in writing by Lender.

 

“Prime Rate”
means the Prime Rate as published in the Money Rates section of The Wall Street Journal. This definition of Prime Rate is
to be strictly interpreted and is not intended to serve any purpose other than providing an index to determine the variable interest
rate used herein. It is not the lowest rate at which Lender may make loans to any of its customers, either now or in the future.

 

“Qualified Bank
Financing” means financing provided directly by Bank of the West in the form of a revolving line of credit for which the
primary collateral is Borrower’s Accounts. Financing provided by a subsidiary, affiliate or division of Bank of the West
does not qualify as Qualified Bank Financing.

 

“Reserve”
means, individually and collectively, the Escrow Reserve and the Collected Reserve.

 

“Security Documents”
means all security agreements, including, without limitation, this Loan and Security Agreement, assignments, pledges, financing
statements, and other documents which create or evidence any security interest, assignment, lien or other encumbrance in favor
of Lender to secure any or all of the obligations created or contemplated by any of the Loan Documents, and all amendments, modifications,
addendums, and replacements, whether presently existing or created in the future.

 

“UCC” means
the Uniform Commercial Code as adopted now or in the future in the State of Utah.

 

2.Loan
Description.

 

2.1Amount of
Loan. Upon fulfillment of all conditions precedent set forth in this Loan and Security Agreement, and so long as no Event of
Default exists and no other breach has occurred under the Loan Documents, Lender may, in its sole discretion, loan Borrower up
to the Maximum Loan Amount.

 

2.2Nature and
Duration of Loan. The Loan shall be a revolving loan payable in full upon the date and upon the terms and conditions provided
in this Loan and Security Agreement. Lender and Borrower intend the Loan to be in the nature of a line of credit under which Borrower
may repeatedly draw funds on a revolving basis in accordance with the terms and conditions of this Loan and Security Agreement.
The right of Borrower to draw funds and the obligation of Lender to advance funds shall not accrue until all of the conditions
set forth in Section 6 Conditions to Loan Disbursements have been fully satisfied, and shall terminate: (a) upon occurrence
of an Event of Default or (b) upon the expiration of the final Loan Commitment Period.

 

    	4

    	 

    

 

2.3Notice and
Manner of Borrowing. Requests by Borrower for advances of the Loan shall be given in writing or orally no later than one (1)
Banking Business Day prior to the date on which the advance is to be made. Each request for an advance shall be accompanied by
such reports and information as requested by Lender, in the form requested by Lender, including, without limitation, an itemization
of outstanding Eligible Accounts, details and information concerning outstanding Eligible Accounts, and an updated report on collections
on Eligible Accounts.

 

2.4Interest.
So long as no Event of Default has occurred, interest shall accrue on the outstanding principal balance of the Loan from the date
of disbursement of the principal amount of the Loan, or any portion thereof, until paid, both before and after judgment, at a variable
rate computed on the basis of a three hundred sixty (360) day year as follows: one and five-tenths percent (1.5%) per annum above
the Prime Rate from time to time in effect, adjusted as of the date of any change in the Prime Rate.

 

Interest shall be paid
monthly in arrears commencing on February 28, 2015, and on the last day of each month thereafter. For purposes of calculating interest
owing, payments delivered to a bank or other agent on behalf of Lender shall be deemed received four (4) Banking Business Days
after the date of receipt of advice by Lender from the bank or agent that the payments received have been credited to the account
of Lender.

 

2.5Collected
Payments; Setoff and Deduction by Lender. Lender shall apply all Collected Payments to the Loan and to payment of all other
obligations owing by Borrower under the Loan Documents in such order as set forth in Section 11.12 Interest on Expenses and
Indemnification, Collateral, Order of Application. As to all amounts owing to Lender by Borrower, Lender may (a) deduct such
amount from Collected Payments, (b) setoff and deduct such amount against disbursements of the Loan, (c) demand payment from Borrower
whereupon Borrower shall promptly pay such amount to Lender, or (d) exercise any combination of the alternatives set forth in this
Section or available under the Loan Documents, at law, or in equity.

 

2.6Limitations
on Advances. Notwithstanding anything to the contrary in the Loan Documents, no advances shall be made on the Loan if, after
making the requested advance, the total, aggregate, principal amount of all advances outstanding will exceed the total, face amount
of all outstanding Eligible Accounts multiplied by the Advance Rate.

 

Borrower will maintain
at all times Eligible Accounts so that the total, aggregate, principal amount of all advances at any time outstanding and unpaid
shall be in compliance with this formula. If at any time the total, aggregate, principal amount of all such advances outstanding
and unpaid exceeds the amount allowable under this formula, Borrower shall immediately make payment to Lender in a sufficient amount
to bring the amount of such advances back into compliance, and if such payment is not immediately made, interest shall accrue on
such amount at the Default Rate, regardless of whether Lender waives the Event of Default caused by such non-payment.

 

2.7Collateral
Management Fee. Borrower shall pay to Lender a collateral management fee equal to two-hundredths percent (0.02%) of the face
amount of each of Borrower’s Accounts for each day, or portion thereof, that the Account remains outstanding until payment
in full for the Account is received by Lender, for so long as the Loan is outstanding, due and payable in arrears. The collateral
management fees are for monitoring of the Collateral and for collection of the Accounts and are not intended to be and shall not
be construed to be interest. Lender is authorized and directed to disburse a sufficient amount of the Loan as necessary to pay
the collateral management fees.

 

2.8Supplemental
Fee. Borrower shall pay Lender a monthly supplemental fee in an amount equal to the amount by which the Monthly Minimum exceeds
the amount of collateral management fees for each month plus the amount of interest paid for each month. The supplemental fee shall
be due and payable monthly in arrears. Lender is authorized and directed to disburse a sufficient amount of the Loan as necessary
to pay the monthly supplemental fees.

 

    	5

    	 

    

 

2.9Origination
Fee. Borrower shall pay Lender an origination fee in an amount equal to one percent (1%) of the Maximum Loan Amount. The origination
fee shall be due and payable upon execution of this Loan and Security Agreement. In the event the Maximum Loan Amount is increased
during the first year of this Loan and Security Agreement, an additional origination fee shall be charged on the amount of the
increase, prorated from the date of the increase to the anniversary date of this Loan and Security Agreement. Any additional origination
fee shall be due and payable on the effective date of the increase in the Maximum Loan Amount. No portion of any such fee shall
be refunded in the event of early termination of this Loan and Security Agreement or any termination or reduction of the right
of Borrower to request advances under this Loan and Security Agreement. Lender is authorized and directed, upon execution of this
Loan and Security Agreement, to disburse a sufficient amount of the Loan as necessary to pay the origination fee in full.

 

2.10Annual Facility
Fee. On each anniversary of the Effective Date, so long as the Loan has not been terminated, Borrower shall pay Lender an annual
facility fee in an amount equal to twenty-five hundredths percent (0.25%) of the Maximum Loan Amount. In the event the Maximum
Loan Amount is increased after the first anniversary date of this Loan and Security Agreement, an additional annual facility fee
shall be charged on the amount of the increase, prorated from the date of the increase to the next anniversary date of this Loan
and Security Agreement. Any additional annual facility fee shall be due and payable on the effective date of the increase in the
Maximum Loan Amount. No portion of such fee shall be refunded in the event of early termination of this Loan and Security Agreement
or any termination or reduction of the right of Borrower to request advances under this Loan and Security Agreement. Lender is
authorized and directed to disburse a sufficient amount of the Loan as necessary to pay each annual facility fee in full.

 

2.11Reserve.
The Reserve shall be a contingent obligation owing to Borrower by Lender and shall be disbursed only in accordance with the terms
and conditions of this Loan and Security Agreement. Lender may use the Reserve, in Lender’s sole discretion, to repay any
obligations owing by Borrower to Lender as set forth in Section 2.5 Collected Payments; Setoff and Deduction by Lender.
Interest shall not accrue on the Reserve and Borrower shall not be entitled to any interest on the Reserve. Lender shall have no
obligation to segregate, not commingle, or otherwise account for the use of the Reserve, and Lender shall be free to use the Reserve
as working capital or as Lender otherwise determines. From time to time and upon Borrower’s request, Lender may, in its sole
discretion, elect to release all or any portion of the Collected Reserve to Borrower. In addition, upon termination and payment
in full of the Loan and all other obligations owing by Borrower and Guarantor under the Loan Documents, any balance of the Reserve
shall be paid to Borrower, provided that if Lender has reasonable grounds to believe that any collections or other payments received
by Lender may be dishonored, voided, or preferential, or claims may be made against Lender for which Borrower would be liable,
Lender may continue to hold the Reserve so long as such matters are outstanding and unresolved.

 

2.12Excess Interest.
It is the intent of the parties to comply with any usury law applicable to the Loan and to all amounts owing pursuant to the Loan
Documents and it is understood and agreed that in no event and upon no contingency shall Borrower or any Guarantor be required
to pay interest in excess of the rate allowed by any laws of any state which are determined to be applicable and governing. The
intention of the parties being to conform strictly to any applicable usury laws, the Loan Documents shall be held to be subject
to reduction to the amount allowed under any applicable and governing usury laws as now or hereafter construed by the courts having
jurisdiction. In the event Lender receives any interest under the Loan Documents in excess of any highest permissible rate under
any applicable and governing law, such excess interest (including simple interest thereon at the interest rate at the highest permissible
rate which is applicable and governing) shall be promptly applied to any unpaid principal balance owed by Borrower. To the extent
such excess interest is greater than the unpaid principal balance, Lender shall promptly remit such overage to Borrower.

 

3.Renewal
of Loan Commitment Period; Termination of Loan. Each Loan Commitment Period shall automatically renew for an additional Loan
Commitment Period unless Borrower or Lender provides written notice of non-renewal at least sixty (60) days prior to the end of
the current Loan Commitment Period. If Borrower elects to terminate the Loan at any time other than the last day of a Loan Commitment
Period, or if an Event of Default accelerates payment of the Loan or terminates the right of Borrower to receive advances hereunder,
Borrower shall pay Lender an early termination fee calculated as follows: (a) if any such termination occurs during the first twelve
(12) months from the date hereof, then the termination fee shall equal the greater of (i) two percent (2%) of the Maximum Loan
Amount or (ii) the Monthly Minimum multiplied by the number of months, or portions thereof, remaining in the then current Loan
Commitment Period, and (b) if any such termination occurs after the first twelve (12) months from the date hereof, then the termination
fee shall equal the greater of (i) one and twenty-five hundredths percent (1.25%) of the Maximum Loan Amount or (ii) the Monthly
Minimum multiplied by the number of months, or portions thereof, remaining in the then current Loan Commitment Period. The termination
fee shall be due and payable in full upon such termination.

 

    	6

    	 

    

 

Notwithstanding the
foregoing, so long as no Event of Default has occurred, in the event Borrower obtains Qualified Bank Financing after the first
twelve (12) months from the Effective Date to replace the Loan, Lender shall waive the foregoing early termination fee so long
as Borrower provides at least sixty (60) days written notice of its intent to replace the Loan with Qualified Bank Financing, which
notice shall itemize the material financial terms of the Qualified Bank Financing. In the event Borrower provides Lender written
notice of its intent to replace the Loan with Qualified Bank Financing, Lender may, within thirty (30) days of receipt of such
notice, provide written notice to Borrower that Lender will match the material financial terms of the proposed Qualified Bank Financing
whereupon Lender and Borrower shall amend the Loan Documents, as necessary, to match the material financial terms of the proposed
Qualified Bank Financing and the Loan Documents shall remain in force.

 

Upon any such non-renewal
or termination of the Loan, all other terms and provisions of this Loan and Security Agreement, including, without limitation,
the security interests granted in favor of Lender, shall remain in full force and effect until all amounts owing to Lender hereunder
have been finally paid in full.

 

4.Security
for Loan.

 

4.1Grant of
Security Interest. Borrower hereby grants Lender a security interest in the Collateral. Borrower and Lender acknowledge their
mutual intent that all security interests contemplated herein are given as a contemporaneous exchange for new value to Borrower,
regardless of when advances to Borrower are actually made or when the Collateral is created or acquired.

 

The Collateral shall
secure all of Borrower’s present and future debts, obligations, and liabilities of whatever nature, and without any limitation
whatsoever, to Lender, including, without limitation, (a) the Loan, (b) all obligations of Borrower under the Loan Documents,
(c) all advances of the same kind and quality relating to this transaction, and (d) transactions in which the documents evidencing
the indebtedness refer to this grant of security interest as providing security thereof.

 

Borrower’s obligations
under this Loan and Security Agreement may also be secured by other collateral as may be evidenced by other documentation apart
from this Loan and Security Agreement.

 

4.2Notice of
Assignment. Upon execution and delivery of this Loan and Security Agreement, Borrower shall immediately execute and deliver
to Lender a notice of assignment in a form acceptable to Lender (the “Notice of Assignment”). Lender is hereby authorized
to, and may at any time and from time to time, use the Notice of Assignment, or any other form of notice as determined by Lender,
to notify any or all Account Debtors that the Accounts of Borrower have been assigned to Lender and that all payments of the Accounts
are to be paid directly to Lender. Borrower shall not amend, modify, or otherwise alter the payment instructions contained in the
Notice of Assignment or otherwise interfere in any manner with such payment instructions. In addition, unless directed otherwise
in writing by Lender, Borrower shall promptly mail an invoice to each Account Debtor on each Account, which invoice shall be stamped
or printed with a notice, in a form acceptable to Lender, stating that the Account is payable to Lender and providing Lender’s
payment instructions.

 

Borrower does hereby
make, constitute, and appoint Lender and its designees as Borrower’s true and lawful attorney in fact, with full power of
substitution, to endorse Borrower’s name upon notes, checks, acceptances, drafts, money orders, and other forms of payment
of the Accounts of Borrower. Borrower agrees to execute and deliver any documents and take such actions as may be reasonably requested
by Lender to give effect to the foregoing. This power of attorney is irrevocable and coupled with an interest.

 

4.3Collection
of Accounts. Until such time as provided in this Section, Borrower is authorized to collect the Accounts in a commercially
reasonable manner, provided that (a) Borrower instructs all Account Debtors to remit all payments on all Accounts directly
and exclusively to the Lock Box as instructed in the Notice of Assignment, and (b) in the event Borrower receives any payment from
an Account Debtor on an Account, Borrower immediately delivers such payment to the Lock Box. Borrower agrees to use diligent and
good faith efforts to collect the Accounts. Notwithstanding the foregoing, Borrower authorizes Lender to contact Account Debtors
concerning verification and payment of Accounts.

 

    	7

    	 

    

 

Upon Borrower’s
receipt of notice from Lender that an Event of Default or event which, with the passage of time or giving of notice or both, would
constitute an Event of Default, has occurred or that Lender deems itself insecure, the following terms and conditions shall thereafter
apply to all Accounts:

 

a.Unless directed
otherwise in writing by Lender, Borrower shall promptly mail an invoice to each Account Debtor on each Account, which invoice shall
be stamped or printed with a notice, in a form acceptable to Lender, stating that the Account is payable to Lender and providing
Lender’s payment instructions. Except as agreed otherwise in writing by Lender, Lender shall have the exclusive right to
collect and to receive all payments on all Accounts. Borrower shall not otherwise bill for, submit any invoice, or otherwise attempt
to collect any Account. Lender is authorized to use the Notice of Assignment, or any other form of notice as determined by Lender,
to notify Account Debtors of the assignment of Borrower’s Accounts and to direct Account Debtors to make all payments on
Accounts directly to Lender.

 

b.Borrower authorizes
Lender to contact Account Debtors concerning verification, payment, and collection of Accounts and to settle or compromise any
Account, in the sole discretion of Lender subject only to acting in good faith. Borrower hereby waives and releases any and all
claims relating to or arising out of any act or omission by Lender in the verification and collection of Accounts, excluding those
based on gross negligence or intentional misconduct.

 

c.Borrower shall
promptly and completely respond to all requests from Lender for any information or records requested to assist in collection of
Accounts. If Borrower fails to respond to any request within two (2) Banking Business Days, Lender may deem the Account to no longer
be an Eligible Account.

 

d.Upon inquiry from
a customer or upon request of Lender, Borrower shall notify the customer to make payment directly to or as directed by Lender.

 

e.All collections
of Accounts shall be handled by Lender. Collection of Accounts in a commercially reasonable manner does not require, and Lender
is not obligated, to commence any legal action, including, without limitation, the sending of an attorney’s demand letter,
to collect any Account. Borrower acknowledges and agrees that Lender is not a collection agency and will not provide debt collection
services for Borrower’s Accounts. If any Account is not timely paid, Lender may, but is not obligated to, engage a collection
agency, attorney or other service provider to collect the Accounts. All commissions, fees and charges of any such collection agency,
attorney or other service provider shall be paid by Borrower.

 

f.Lender may, but
has no duty to, and Borrower hereby authorizes Lender to, execute and file, on behalf of Borrower or in Lender’s name, mechanic’s
liens and all other notices and documents to create, perfect, preserve, foreclose and/or release any lien for work performed
or materials provided to improve real property.  Except as otherwise instructed by Lender, Borrower is authorized
to file any such mechanic’s liens and other notices and documents in Borrower’s discretion.

 

g.Any payments received
by Borrower on Accounts shall be held in trust by Borrower for Lender. In the event an Account Debtor makes payment to Borrower
on any Account, Borrower shall immediately notify Lender of the payment and deliver the payment to Lender. If payment is made by
check or similar instrument, such instrument shall be immediately delivered to Lender in the form received without negotiation.
If any payment received by Borrower on any Account is deposited or negotiated by Borrower, or if Borrower fails to tender the payment
to Lender within two (2) Banking Business Days of receipt by Borrower, Borrower shall promptly pay Lender a payment conversion
fee equal to ten percent (10%) of the amount of the payment. Lender is authorized and directed to disburse a sufficient amount
of the Loan as necessary to pay any payment conversion fees.

 

    	8

    	 

    

 

4.4Representations
and Warranties Concerning Collateral. Borrower represents and warrants that:

 

a.Borrower is the
sole owner of the Collateral.

 

b.The Inventory and
Accounts are not subject to any security interest, lien, prior assignment, or other encumbrance of any nature whatsoever except
Permitted Encumbrances.

 

c.The Account is
a bona fide obligation of the Account Debtor for the amount identified on the records of Borrower and there have been no payments,
deductions, credits, payment terms, or other modifications or reductions in the amount owing on such Account except as reported
to Lender prior to Lender making any advance based upon the Account.

 

d.There are no defenses
or setoffs to payment of the Account which can be asserted by way of defense or counterclaim against Borrower or Lender and the
Account will be timely paid in full by the Account Debtor.

 

e.There is presently
no default or delinquency in any payment of the Accounts, except for any default or delinquency which has been reserved against
by Borrower in accordance with generally accepted accounting principles and the Accounts will be timely paid in full by the obligors,
except for normal and customary disputes which arise in the ordinary course of business and which do not affect a material portion
of the Accounts.

 

f.Borrower has no
knowledge of any fact or circumstance which would materially impair the ability of any obligor on the Accounts to timely perform
its obligations thereunder, except those which arise in the ordinary course of business and which do not affect a material portion
of the Accounts.

 

g.All services performed
or goods sold giving rise to the Accounts have been rendered or sold in compliance with applicable laws, ordinances, rules, and
regulations and in the ordinary course of Borrower’s business.

 

h.There have been
no extensions, modifications, or other agreements relating to payment of the Accounts, except those granted in the ordinary course
of business and which do not affect a material portion of the Accounts.

 

4.5Covenants
Concerning Collateral. Borrower covenants that:

 

a.Borrower will keep
the Accounts and Inventory free and clear of any and all security interests, liens, assignments or other encumbrances, except Permitted
Encumbrances.

 

b.Borrower will immediately
notify Lender of any dispute concerning any Account and of any bankruptcy filing, lien, garnishment, or other legal action concerning
any Account or Account Debtor.

 

c.Borrower hereby
authorizes Lender to file UCC Financing Statements concerning the Collateral. Borrower will execute and deliver any documents (properly
endorsed, if necessary) reasonably requested by Lender for perfection or enforcement of any security interest or lien, give good
faith, diligent cooperation to Lender, and perform such other acts reasonably requested by Lender for perfection and enforcement
of any security interest or lien, including, without limitation, obtaining control for purposes of perfection with respect to Collateral
consisting of deposit accounts, investment property, letter-of-credit rights, and electronic chattel paper. Lender is authorized
to file, record, or otherwise utilize such documents as it deems necessary to perfect and/or enforce any security interest or lien
granted hereunder.

 

d.Borrower shall
keep the Equipment in good repair, ordinary wear and tear and obsolescence excepted, and be responsible for any loss or damage
to the Equipment. Borrower shall pay when due all taxes, license fees, and other charges on the Equipment. Borrower shall not sell,
convey, transfer, assign, conceal, or in any way dispose of the Equipment. Borrower shall not misuse or permit the Equipment to
be used unlawfully or for hire or contrary to the provisions of any insurance coverage. Risk of loss of the Equipment shall be
on Borrower at all times unless Lender takes possession of the Equipment. Loss of or damage to the Equipment or any part thereof
shall not release Borrower from any of the obligations secured by the Equipment.

 

    	9

    	 

    

 

e.Borrower agrees
to insure the Equipment and Inventory, at Borrower’s expense, against loss, damage, theft, and such other risks as Lender
may request to the full insurable value thereof with insurance companies and policies satisfactory to Lender. Proceeds from such
insurance shall be payable to Lender as its interest may appear. Such policies shall name Lender as an additional insured and as
lender loss payee and shall provide for a minimum thirty (30) days written cancellation notice to Lender. Upon request, policies
or certificates attesting to such coverage shall be delivered to Lender. Insurance proceeds may be applied by Lender toward payment
of any obligation secured by this Loan and Security Agreement, whether or not due, in such order of application as Lender may elect.

 

f.Borrower will at
all times keep accurate and complete records of the Collateral. Lender or its representatives may, at any time and from time to
time, enter any premises where the Collateral and/or the records pertaining to the Collateral are located and inspect, inventory,
audit, check, copy, and otherwise review the Collateral and the records concerning the Collateral.

 

g.So long as no Event
of Default has occurred, Borrower shall have the right to sell or otherwise dispose of the Inventory in the ordinary course of
business. No other disposition of the Inventory may be made without the prior written consent of Lender.

 

h.So long as no Event
of Default has occurred, Borrower is authorized to collect payment on all Financial Obligations Collateral in a commercially reasonable
manner. Borrower agrees to use diligent and good faith efforts to collect the Financial Obligations Collateral.

 

4.6Release of
Lender as Condition to Lien Termination. In recognition of Lender’s right to have all its attorneys’ fees and expenses
incurred in connection with this Loan and Security Agreement secured by the Collateral, notwithstanding payment in full of the
Loan and all other obligations secured by the Collateral, Lender shall not be required to release, reconvey, or terminate any Security
Document unless and until Borrower and all Guarantors have executed and delivered to Lender general releases in form and substance
satisfactory to Lender.

 

5.Guarantee.

 

5.1Guarantee.
Upon execution and delivery of this Loan and Security Agreement, and from time to time as Lender may request, Borrower shall cause
to be executed and delivered to Lender Guarantees, in a form acceptable to Lender, from such persons and/or entities that Lender
may designate. The Loan and all obligations of Borrower owing to Lender shall be guaranteed by the Guarantors under the Guarantees.

 

5.2Payments
on Indebtedness Owing to Guarantor. Borrower agrees to not make any payments on any indebtedness owing to any Guarantor without
the prior written consent of Lender so long as any amount is outstanding and owing under or arising from the indebtedness owing
to Lender pursuant to the Loan Documents.

 

6.Conditions
to Loan Disbursements.

 

6.1Conditions
to Loan Disbursements. Lender’s obligation to advance any funds at any time pursuant to this Loan and Security Agreement
is discretionary, and Lender shall have no obligation to disburse any portion of the Loan under this Loan and Security Agreement,
notwithstanding anything to the contrary in the Loan Documents. Lender may, at any time and from time to time, decline to advance
all or any portion of the Loan under this Loan and Security Agreement for any reason or for no reason, without notice, regardless
of any course of conduct or past advances or disbursements by Lender. In addition, Lender shall not consider making any disbursements
of the Loan until all of the conditions set forth below have been satisfied, and each disbursement of the Loan shall be expressly
subject to such conditions. All of the documents referred to below must be in a form and substance acceptable to Lender.

 

    	10

    	 

    

 

a.All of the Loan
Documents and all other documents contemplated to be delivered to Lender prior to funding have been fully executed and delivered
to Lender.

 

b.All of the documents
contemplated by the Loan Documents which require filing or recording have been properly filed and recorded so that all of the liens
and security interests granted to Lender in connection with the Loan will be properly created and perfected and will have a priority
acceptable to Lender.

 

c.All other conditions
precedent provided in or contemplated by the Loan Documents or any other agreement or document have been performed.

 

d.As of the date
of disbursement of all or any portion of the Loan, the following shall be true and correct: (i) all representations and warranties
made by Borrower and Guarantor in the Loan Documents are true and correct as of the date of such disbursement; and (ii) no Event
of Default has occurred and no conditions exist and no event has occurred, which, with the passage of time or the giving of notice,
or both, would constitute an Event of Default.

 

e.For each requested
disbursement, Lender has received such reports and information concerning outstanding Eligible Accounts and payments as requested
by Lender pursuant to Section 2.3 Notice and Manner of Borrowing.

 

All conditions precedent
set forth in this Loan and Security Agreement and any of the Loan Documents are for the sole benefit of Lender and may be waived
unilaterally by Lender.

 

6.2No Default,
Adverse Change, False or Misleading Statement. Lender’s agreement to make the Loan available to Borrower pursuant to
this Loan and Security Agreement shall, at Lender’s sole discretion, terminate upon the occurrence of any Event of Default,
any event which could have a Material Adverse Effect, or upon the determination by Lender that any of Borrower’s or any Guarantor’s
representations made in any of the Loan Documents were false or materially misleading when made. Upon the exercise of such discretion,
Lender shall be relieved of all further obligations under the Loan Documents.

 

7.Representations
and Warranties.

 

7.1Organization
and Qualification. Borrower represents and warrants that: (a) it is a corporation organized and existing under the laws of
the State of California; (b) it has delivered to Lender or Lender’s counsel accurate and complete copies of its Organizational
Documents which are operative and in effect as of the Effective Date; (c) its complete and exact name is POINT.360; (d) the organizational
identification number, if any, assigned to it by its state of organization is C2967825; (e) its chief executive office and place
of business is located at 2701 Media Center Drive, Los Angeles, California 90065; and (f) during the five (5) years preceding the
date of this Loan and Security Agreement, it has not (i) been known by nor used any legal, fictitious or trade name other than
MovieQ; (ii) changed its name in any respect; (iii) been the surviving entity of a merger or consolidation; or (iv) acquired
all or substantially all of the assets of any person or entity.

 

7.2Authorization.
Borrower represents and warrants that the execution, delivery, and performance by Borrower of the Loan Documents has been duly
authorized by all necessary action on the part of Borrower and are not inconsistent with Borrower’s Organizational Documents
or any resolution of the Board of Directors of Borrower, do not and will not contravene any provision of, or constitute a default
under, any indenture, mortgage, contract, or other instrument to which Borrower is a party or by which it is bound, and that upon
execution and delivery thereof, the Loan Documents will constitute legal, valid, and binding agreements and obligations of Borrower,
enforceable in accordance with their respective terms.

 

7.3Accuracy
of Financial Statements. Borrower represents and warrants that (a) all of its audited financial statements heretofore delivered
to Lender have been prepared in accordance with Accounting Standards; (b) all of its unaudited financial statements heretofore
delivered to Lender fully and fairly represent its financial condition as of the date thereof and the results of its operations
for the period or periods covered thereby and are consistent with other financial statements previously delivered to Lender; (c)
since the dates of the most recent audited and unaudited financial statements delivered to Lender, there has been no event which
would have a Material Adverse Effect on its financial condition; and (d) all of its pro forma financial statements heretofore delivered
to Lender have been prepared consistently with its actual financial statements and fully and fairly represent its anticipated financial
condition and the anticipated results of its operation for the period or periods covered thereby.

 

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7.4Full and
Accurate Disclosure. Borrower represents and warrants that this Loan and Security Agreement, the financial statements referred
to herein, any loan application submitted to Lender, and all other statements furnished by Borrower to Lender in connection herewith
contain no untrue statement of a material fact and omit no material fact necessary to make the statements contained therein or
herein not misleading. Borrower represents and warrants that it has not failed to disclose in writing to Lender any fact that would
have a Material Adverse Effect.

 

7.5Compliance
with Export Controls. Borrower represents and warrants that it is not listed and does not appear on any United States governmental
restricted, debarred, suspended, or prohibited transaction export control designation lists and is able to make and receive any
advance or extension of credit from or otherwise conduct business in accordance with applicable export control laws with Lender.

 

7.6Compliance
with All Other Applicable Law. Borrower represents and warrants that it has complied with all applicable statutes, rules, regulations,
orders, and restrictions of any domestic or foreign government, or any instrumentality or agency thereof having jurisdiction over
the conduct of Borrower’s business or the ownership of its properties, which may have a Material Adverse Effect.

 

7.7Operation
of Business. Borrower represents and warrants that Borrower possesses all licenses, permits, franchises, patents, copyrights,
trademarks, and trade names, or rights thereto, to conduct its business substantially as now conducted and as presently proposed
to be conducted, and Borrower is not in violation of any valid rights of others with respect to any of the foregoing.

 

7.8Payment of
Taxes. Borrower represents and warrants that Borrower has filed all tax returns (federal, state, and local) required to be
filed and has paid all taxes, assessments, and governmental charges and levies, including interest and penalties, on Borrower’s
assets, business and income, except such as are being contested in good faith by proper proceedings and as to which adequate reserves
are maintained.

 

8.Borrower’s
Covenants. Borrower makes the following agreements and covenants, which shall continue so long as this Loan and Security Agreement
is in effect and so long as Borrower is indebted to Lender for obligations arising out of, identified in, or contemplated by this
Loan and Security Agreement.

 

8.1Compliance
with Export Controls. Borrower will notify Lender in writing within ten (10) days of any written or oral notification by any
governmental entity that administrative, civil, or criminal proceedings have been initiated and that could result in Borrower being
listed or appearing on any United States governmental restricted, debarred, suspended, or prohibited transaction export control
designation lists. Borrower will immediately notify Lender in writing of any notification by any governmental entity that Borrower
has actually been listed or appears on any United States governmental restricted, debarred, suspended, or prohibited transaction
export control designation lists. Upon request from Lender, Borrower will provide documentary and other evidence of Borrower’s
identity or to comply with any applicable law or regulation.

 

8.2Continued
Compliance with Applicable Law. Borrower shall conduct its business in a lawful manner and in material compliance with all
applicable federal, state, and local laws, ordinances, rules, regulations, and orders; shall maintain in good standing all licenses
and organizational or other qualifications reasonably necessary to its business and existence; and shall not engage in any business
not authorized by and not in accordance with its Organizational Documents and other governing documents.

 

8.3Payment of
Taxes and Obligations. Borrower shall pay when due all taxes, assessments, and governmental charges and levies on Borrower’s
assets, business, and income, and all material obligations of Borrower of whatever nature, except such as are being contested in
good faith by proper proceedings and as to which adequate reserves are maintained.

 

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8.4Financial
Statements and Reports; Audits. Borrower shall provide Lender with such financial statements and reports as Lender may reasonably
request. Audited financial statements and reports shall be prepared in accordance with Accounting Standards. Unaudited financial
statements and reports shall fully and fairly represent Borrower’s financial condition as of the date thereof and the results
of Borrower’s operations for the period or periods covered thereby and shall be consistent with other financial statements
previously delivered to Lender. In addition, Borrower shall, at any reasonable time and from time to time, permit Lender or any
representative of Lender to conduct field audits, examine, audit, make copies of and extracts from the records and books of Borrower,
visit and inspect the properties and assets of Borrower, and to discuss the affairs, finances, and Accounts of Borrower with any
of Borrower’s officers, directors, and partners with Borrower and with Borrower’s independent accountants.

 

8.5Inventory
and Accounts Receivable. Borrower shall promptly notify Lender in writing upon any Eligible Account ceasing to be or being
determined to have been incorrectly identified as an Eligible Account. Borrower shall provide Lender with such reports and records
concerning Inventory, Accounts, and accounts payable as Lender may reasonably request.

 

8.6Operation
of Business. Borrower shall maintain all licenses, permits, franchises, patents, copyrights, trademarks, and trade names, or
rights thereto, necessary or advisable to conduct its business and Borrower shall not violate any valid rights of others with respect
to any of the foregoing. Borrower shall continue to engage in a business of the same general type as now conducted. Borrower will
not change its name, use any other legal, fictitious or trade name (other than MovieQ), merge or consolidate with any other business
or entity, or acquire all or substantially all of the assets of any person or entity without the prior written consent of Lender.

 

8.7Insurance.
Borrower shall maintain general liability and product liability insurance with financially sound and reputable insurance companies
or associations in such amounts and covering such risks as are usually carried by companies engaged in the same or a similar business
and similarly situated. Proceeds from such insurance shall be payable to Lender as its interest may appear, shall name Lender as
an additional insured and as a lender loss payee, and such policies shall provide for a minimum thirty (30) days written cancellation
notice to Lender. Upon request, policies or certificates attesting to such coverage shall be delivered to Lender. Insurance proceeds
may be applied by Lender toward payment of any obligation secured by this Loan and Security Agreement, whether or not due, in such
order of application as Lender may elect.

 

8.8Change of
Control. No Change of Control of Borrower or any Guarantor shall occur without Lender’s prior written consent.

 

“Change of Control”
means (1) in the case of a corporation, any sale, assignment, or other transfer of more than thirty-five percent (35%) of the stock
of such corporation, the persons who are the directors of such corporation as of the Effective Date fail to constitute a majority
of the Board of Directors of such corporation, or the president or any other executive officer of such corporation resigns, is
terminated, or otherwise ceases to function in such position; (2) in the case of a partnership, any sale, assignment, or other
transfer of more than twenty-five percent (25%) of the partnership interests of such partnership, any of the persons or entities
who are a partner of such partnership as of the Effective Date ceases to be a partner of such partnership, the occurrence of any
Change of Control in any partner in such partnership, or any general manager or person holding a similar position in such partnership
resigns, is terminated, or otherwise ceases to function in such position, (3) in case of a limited partnership, (a) as to all general
partners, any general partner resigns, is terminated, or otherwise ceases to function in such position or the occurrence of any
Change of Control in any such general partner, (b) as to all limited partners, any sale, assignment, or other transfer of more
than twenty-five percent (25%) of the limited partnership interest in such limited partnership, any of the persons or entities
who are limited partners of such limited partnership as of the Effective Date ceases to be a limited partner in such limited partnership,
or the occurrence of any Change of Control in any such limited partner; (4) in the case of a limited liability company, any sale,
assignment, or other transfer of more than twenty-five percent (25%) of the ownership interests of such limited liability company,
any of the persons or entities who are members of such limited liability company as of the Effective Date ceases to be a member
of such limited liability company, any managing member or manager of such limited liability company resigns, is terminated or otherwise
ceases to function in such position, or the occurrence of any Change of Control in any such member, managing member or manager
of such limited liability company.

 

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9.Default.

 

9.1Events of
Default. Time is of the essence of this Loan and Security Agreement. The occurrence of any of the following events shall constitute
a default under this Loan and Security Agreement and under the Loan Documents and shall be termed an “Event of Default”:

 

a.Borrower fails
in the payment or performance of any obligation, covenant, agreement, or liability created by any of the Loan Documents or Borrower
otherwise fails to comply with, or any default occurs on, any term in any of the Loan Documents.

 

b.Any representation,
warranty, or financial statement made by or on behalf of Borrower in any of the Loan Documents, or any document contemplated by
the Loan Documents, is materially false or materially misleading.

 

c.Any indebtedness
of Borrower under any note, indenture, contract, agreement, or undertaking is accelerated.

 

d.Default or an event
which, with the passage of time or the giving of notice or both, would constitute a default, by Borrower, occurs on any note, indenture,
contract, agreement, licensing agreement, or undertaking.

 

e.Borrower is dissolved
or substantially ceases business operations.

 

f.A receiver, trustee,
or custodian is appointed for any part of Borrower’s property, or any part of Borrower’s property is assigned for the
benefit of creditors.

 

g.Any proceeding
is commenced or petition filed under any bankruptcy or insolvency law by or against Borrower.

 

h.Any judgment or
regulatory fine is entered against Borrower which may have a Material Adverse Effect.

 

i.The attachment
or filing of any Federal or State tax lien against Borrower or its assets.

 

j.All or any part
of the property of Borrower is attached, levied upon, or otherwise seized by legal process.

 

k.Borrower becomes
insolvent or fails to pay its debts as they mature.

 

l.Any change occurs
in Borrower’s condition or any event occurs which may have a Material Adverse Effect.

 

m.Any of the foregoing
events occur concerning any Guarantor.

 

n.Any Guarantor dies
or takes any action to repudiate its Guarantee or any Guarantee otherwise ceases to be in full force and effect.

 

9.2No Waiver
of Event of Default. No course of dealing or delay or failure to assert any Event of Default shall constitute a waiver of that
Event of Default or of any prior or subsequent Event of Default.

 

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10.Remedies.

 

10.1Remedies
upon Event of Default. Upon the occurrence of an Event of Default, and at any time thereafter, all or any portion of the Loan
and the other obligations due or to become due from Borrower to Lender, whether arising under this Loan and Security Agreement,
the Security Documents or otherwise, at the option of Lender and without notice to Borrower of the exercise of such option, shall
accelerate and become at once due and payable in full without presentment, demand, protest, or notice or other requirements of
any kind (all of which are expressly waived by Borrower), and interest shall thereafter accrue on the principal amount of the Loan
and on all other obligations owing by Borrower to Lender until paid in full, both before and after judgment, at the Default Rate.
In addition, Lender shall have the following rights and remedies, in addition to all other rights and remedies existing at law,
in equity, or by statute or provided in the Loan Documents:

 

a.Lender shall have
the right, immediately and without prior notice or demand, to set off against Borrower’s obligations to Lender, whether or
not due, all money and other amounts owed by Lender in any capacity to Borrower.

 

b.If at any time
Lender so requests, all collections and other proceeds from the Financial Obligations Collateral, if any, shall be deposited into
an account designated by Lender (the “Cash Collateral Account”), which account shall be under the sole and exclusive
control of Lender. Such proceeds and collections shall not be commingled with any other funds and shall be promptly and directly
deposited into such account in the form in which received by Borrower. Such proceeds and collections shall not be deposited in
any other account and said Cash Collateral Account shall contain no funds other than such proceeds and collections. All or any
portion of the funds on deposit in said Cash Collateral Account may, in the sole discretion of Lender, be applied from time to
time as Lender elects to payment of obligations secured by the Loan and Security Agreement or Lender may elect to turn over to
Borrower, from time to time, all or any portion of such funds.

 

c.Upon an Event of
Default, Lender may terminate the authority of Borrower to collect Financial Obligations Collateral at any time whereupon Lender
is authorized, without further act, to notify any and all obligors to make payment thereon directly to Lender, and to take possession
of all proceeds from the Financial Obligations Collateral, and to take any action which Borrower might or could take to collect
the Financial Obligations Collateral, including, without limitation, the right to make any compromise, discharge, or extension.
Upon request of Lender after an Event of Default, Borrower agrees to execute and deliver to Lender a notice to the obligors instructing
said obligors to pay Lender. Borrower further agrees to execute and deliver to Lender, after an Event of Default, all other notices
and similar documents requested by Lender to facilitate collection of the Financial Obligations Collateral. All costs of collection
of the Financial Obligations Collateral, if any, including, without limitation, attorneys’ fees and legal expenses, shall
be borne solely by Borrower, whether such costs are incurred by or for Borrower or Lender. Borrower agrees to deliver to Lender,
if so requested, all books, records, and documents in Borrower’s possession or under its control as may relate to the Financial
Obligations Collateral or as may be helpful to facilitate such collection. Lender shall have no obligation to cause an attorney’s
demand letter to be sent, to file any lawsuit, or to take any other legal action in collection of the Financial Obligations Collateral.
It is agreed that collection of the Financial Obligations Collateral in a commercially reasonable manner does not require that
any such legal action be taken.

 

d.Borrower does hereby
make, constitute, and appoint Lender and its designees as Borrower’s true and lawful attorney in fact, with full power of
substitution, such power to be exercised only upon an Event of Default and in the following manner: (i) Lender may receive and
open all mail addressed to Borrower and remove therefrom any payments of the Financial Obligations Collateral, if any; (ii) Lender
may cause mail relating to the Accounts and Financial Obligations Collateral to be delivered to a designated address of Lender
where Lender may open all such mail and remove therefrom any payments of the Accounts and Financial Obligations Collateral; (iii) Lender
may endorse Borrower’s name upon notes, checks, acceptances, drafts, money orders, or other forms of payment of the Financial
Obligations Collateral; (iv) Lender may settle or adjust disputes or claims in respect to the Financial Obligations Collateral
for amounts and upon such terms as Lender, in its sole discretion and in good faith, deems to be advisable, in such case crediting
Borrower with only the proceeds received and collected by Lender after deduction of Lender’s costs, including, without limitation,
reasonable attorneys’ fees and legal expenses; and (v) Lender may do any and all other things necessary or proper to carry
out the intent of this Loan and Security Agreement and to perfect and protect the liens and rights of Lender created under this
Loan and Security Agreement. This power of attorney is irrevocable and coupled with an interest.

 

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e.Lender shall have
all the rights and remedies available under the UCC.

 

f.Lender shall have
the right to enter upon any premises where the Collateral or records relating thereto may be and take possession of the Collateral
and such records.

 

g.Upon request of
Lender, Borrower shall, at the expense of Borrower, assemble the Collateral and records relating thereto at a place designated
by Lender and tender the Collateral and such records to Lender.

 

h.Without notice
to Borrower, Lender may obtain the appointment of a receiver of the business, property and assets of Borrower and Borrower hereby
consents to the appointment of Lender or such person as Lender may designate as such receiver.

 

i.Lender may sell,
lease or otherwise dispose of any or all of the Collateral and, after deducting the Liquidation Costs, apply the remainder to pay,
or to hold as a reserve against, the obligations secured by this Loan and Security Agreement.

 

j.Lender may credit
bid at any UCC, bankruptcy, trustee or other sale, including, without limitation, any sale under Section 363 of the United States
Bankruptcy Code.

 

Borrower shall be liable
for all deficiencies owing on any obligations secured by this Loan and Security Agreement after liquidation of the Collateral.
Lender shall not have any obligation to clean-up or otherwise prepare any Collateral for sale, lease, or other disposition.

 

10.2Rights and
Remedies Cumulative. The rights and remedies herein conferred are cumulative and not exclusive of any other rights and remedies
and shall be in addition to every other right, power and remedy herein specifically granted or hereafter existing at law, in equity,
or by statute which Lender might otherwise have, and any and all such rights and remedies may be exercised from time to time and
as often and in such order as Lender may deem expedient.

 

10.3No Waiver
of Rights. No delay or omission in the exercise of any right, power or remedy or in the pursuance of any remedy shall impair
any right, power or remedy or be construed to be a waiver thereof or of any default or to be an acquiescence therein.

 

11.General
Provisions.

 

11.1Governing
Agreement. In the event of conflict or inconsistency between this Loan and Security Agreement and the other Loan Documents,
the terms, provisions and intent of this Loan and Security Agreement shall govern.

 

11.2Borrower’s
Obligations Cumulative. Every obligation, covenant, condition, provision, warranty, agreement, liability, and undertaking of
Borrower contained in the Loan Documents shall be deemed cumulative and not in derogation or substitution of any of the other obligations,
covenants, conditions, provisions, warranties, agreements, liabilities, or undertakings of Borrower contained herein or therein.

 

11.3Payment
of Expenses and Attorneys’ Fees. Borrower shall pay all reasonable expenses of Lender relating to the negotiation, drafting
of documents, documentation of the Loan, and administration and supervision of the Loan, including, without limitation, appraisal
fees, environmental inspection fees, field examination expenses, title insurance, recording fees, filing fees, and reasonable attorneys’
fees and legal expenses, whether incurred in making the Loan, in future amendments or modifications to the Loan Documents, or in
ongoing administration and supervision of the Loan.

 

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Upon occurrence of
an Event of Default, Borrower agrees to pay all costs and expenses, including, without limitation, reasonable attorneys’
fees and legal expenses, incurred by Lender in enforcing, or exercising any remedies under, the Loan Documents, and any other rights
and remedies. Additionally, Borrower agrees to pay all Liquidation Costs. Any and all such costs, expenses, and Liquidation Costs
shall be payable by Borrower upon demand, together with interest thereon from the date of the advance until repaid, both before
and after judgment, at the Default Rate.

 

Borrower agrees to
pay all expenses, including, without limitation, reasonable attorneys’ fees and legal expenses, incurred by Lender in any
bankruptcy proceedings of any type involving Borrower, Guarantor, the Loan Documents, or the Collateral, including, without limitation,
expenses incurred in modifying or lifting the automatic stay, determining adequate protection, use of cash collateral or relating
to any plan of reorganization.

 

11.4Right to
Perform for Borrower. Lender may, in its sole discretion and without any duty to do so, elect to discharge taxes, tax liens,
security interests, or any other encumbrance upon the Collateral or any other property or asset of Borrower, to pay any filing,
recording, or other charges payable by Borrower, or to perform any other obligation of Borrower under this Loan and Security Agreement
or under the Security Documents.

 

11.5Assignability.
Borrower may not assign or transfer any of the Loan Documents and any such purported assignment or transfer is void. Lender may
assign or transfer any of the Loan Documents. Funding of this Loan may be provided by an affiliate of Lender.

 

11.6Third Party
Beneficiaries. The Loan Documents are made for the sole and exclusive benefit of Borrower and Lender and are not intended to
benefit any other third party. No third party may claim any right or benefit or seek to enforce any term or provision of the Loan
Documents.

 

11.7Governing
Law. The Loan Documents shall be governed by and construed in accordance with the laws of the State of Utah without regard
to its conflict of laws principles, and the Loan Documents shall be deemed to have been executed by the parties in the State of
Utah. The Loan Documents shall not be deemed to have been entered into until accepted by Lender at its chief executive office in
Salt Lake City, Utah, and shall be performed by Lender, and the Loan administered by Lender, in Salt Lake City, Utah.

 

11.8Severability
of Invalid Provisions. Any provision of this Loan and Security Agreement which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction only, be ineffective only to the extent of such prohibition or unenforceability without invalidating
the remaining provisions hereof or thereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.

 

11.9Interpretation
of Loan and Security Agreement. The article and section headings in this Loan and Security Agreement are inserted for convenience
only and shall not be considered part of the Loan and Security Agreement nor be used in its interpretation.

 

All references in this
Loan and Security Agreement to the singular shall be deemed to include the plural when the context so requires, and vice versa.
References in the collective or conjunctive shall also include the disjunctive unless the context otherwise clearly requires a
different interpretation.

 

11.10Survival
and Binding Effect of Representations, Warranties, and Covenants. All agreements, representations, warranties, and covenants
made herein by Borrower shall survive the execution and delivery of this Loan and Security Agreement and shall continue in effect
so long as any obligation to Lender contemplated by this Loan and Security Agreement is outstanding and unpaid, notwithstanding
any termination of this Loan and Security Agreement. All agreements, representations, warranties, and covenants made herein by
Borrower shall survive any bankruptcy proceedings involving Borrower. All agreements, representations, warranties, and covenants
in this Loan and Security Agreement shall bind the party making the same, its successors and, in Lender’s case, assigns,
and all rights and remedies in this Loan and Security Agreement shall inure to the benefit of and be enforceable by each party
for whom made, their respective successors and, in Lender’s case, assigns.

 

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11.11Indemnification.
Borrower shall indemnify Lender for any and all claims and liabilities, and for damages which may be awarded or incurred by Lender,
and for all reasonable attorneys’ fees, legal expenses, and other out-of-pocket expenses incurred in defending such claims,
arising from or related in any manner to the negotiation, execution, or performance by Lender of any of the Loan Documents, but
excluding any such claims based upon breach or default by Lender or gross negligence or willful misconduct of Lender. Lender shall
have the sole and complete control of the defense of any such claims. Lender is hereby authorized to settle or otherwise compromise
any such claims as Lender in good faith determines shall be in its best interests. The obligations of Borrower and the rights of
Lender under this Section will survive payment and performance of all obligations owing under the Loan Documents and will remain
in full force and effect without termination.

 

11.12Interest
on Expenses and Indemnification, Collateral, Order of Application. All expenses, out-of-pocket costs, attorneys’ fees
and legal expenses, amounts advanced in performance of obligations of Borrower, and indemnification amounts owing by Borrower to
Lender under or pursuant to this Loan and Security Agreement, and/or any Security Documents shall be due and payable upon demand.
If not paid upon demand, all such obligations shall bear interest at the Default Rate from the date of disbursement until paid
to Lender, both before and after judgment. Lender is authorized and directed to disburse a sufficient amount of the Loan as necessary
for payment of all such obligations and for any other obligations owing by Borrower to Lender under the Loan Documents or otherwise.
Payment of all such obligations shall be secured by the Collateral and by the Security Documents.

 

All payments and recoveries
received by Lender under the Loan Documents shall be applied to payment of the foregoing obligations, the Loan, and all other amounts
owing to Lender by Borrower in such order and priority as determined by Lender. Unless otherwise elected by Lender, payments on
the Loan shall be applied first to accrued interest and the remainder, if any, to principal.

 

11.13Limitation
of Consequential Damages. Lender and its officers, directors, employees, representatives, agents, and attorneys, shall not
be liable to Borrower or any Guarantor for consequential damages arising from or relating to any breach of contract, tort, or other
wrong in connection with the negotiation, documentation, administration or collection of the Loan.

 

11.14Revival
Clause. If the incurring of any debt by Borrower or the payment of any money or transfer of property to Lender by or on behalf
of Borrower or Guarantor should for any reason subsequently be determined to be “voidable” or “avoidable”
in whole or in part within the meaning of any state or federal law (collectively “voidable transfers”), including,
without limitation, fraudulent conveyances or preferential transfers under the United States Bankruptcy Code or any other federal
or state law, and Lender is required to repay or restore any voidable transfers or the amount or any portion thereof, or upon the
advice of Lender’s counsel is advised to do so, then, as to any such amount or property repaid or restored, including, without
limitation, all reasonable costs, expenses, and attorneys’ fees of Lender related thereto, the liability of Borrower and
Guarantor, and each of them, shall automatically be revived, reinstated and restored and shall exist as though the voidable transfers
had never been made.

 

11.15Consent
to Utah Jurisdiction, Exclusive Jurisdiction of Utah Courts, and Jury Waiver. Borrower acknowledges that by execution and delivery
of the Loan Documents, Borrower has transacted business in the State of Utah, and Borrower voluntarily submits to, consents to,
and waives any defense to the jurisdiction of courts located in the State of Utah as to all matters relating to or arising from
the Loan Documents and/or the transactions contemplated thereby. EXCEPT AS EXPRESSLY AGREED IN WRITING BY LENDER, THE STATE AND
FEDERAL COURTS LOCATED IN THE STATE OF UTAH SHALL HAVE SOLE AND EXCLUSIVE JURISDICTION OF ANY AND ALL CLAIMS, DISPUTES, AND CONTROVERSIES,
ARISING UNDER OR RELATING TO THE LOAN DOCUMENTS AND/OR THE TRANSACTIONS CONTEMPLATED THEREBY. NO LAWSUIT, PROCEEDING, OR ANY OTHER
ACTION RELATING TO OR ARISING UNDER THE LOAN DOCUMENTS AND/OR THE TRANSACTIONS CONTEMPLATED THEREBY MAY BE COMMENCED OR PROSECUTED
IN ANY OTHER FORUM EXCEPT AS EXPRESSLY AGREED IN WRITING BY LENDER.

 

BORROWER HEREBY IRREVOCABLY
WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN CONTRACT OR IN TORT AT LAW OR IN
EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO THE LOAN DOCUMENTS.

 

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11.16Joint and
Several Liability. Borrower shall be jointly and severally liable with each Guarantor for all obligations and liabilities arising
under the Loan Documents.

 

11.17Notices.
All notices or demands by any party to this Loan and Security Agreement shall, except as otherwise provided herein, be in writing
and may be sent by certified mail, return receipt requested. Notices so mailed shall be deemed received when deposited in a United
States post office box, postage prepaid, properly addressed to Borrower or Lender at the mailing addresses stated herein or to
such other addresses as Borrower or Lender may from time to time specify in writing. Any notice so addressed and otherwise delivered
shall be deemed to be given when actually received by the addressee.

 

Mailing addresses:

 

Lender:

SUMMIT FINANCIAL RESOURCES, L.P.

2455 East Parleys Way, Suite 200

Salt Lake City, Utah 84109

Attention: Senior Portfolio Manager

 

Borrower:

POINT.360

2701 Media Center Drive

Los Angeles, California 90065

Attention: Chief Financial Officer

 

11.18Duplicate
Originals; Counterpart Execution. Two or more duplicate originals of the Loan Documents may be signed by the parties, each
duplicate of which shall be an original but all of which together shall constitute one and the same instrument. Any Loan Documents
may be executed in several counterparts, without the requirement that all parties sign each counterpart. Each of such counterparts
shall be an original, but all counterparts together shall constitute one and the same instrument.

 

11.19Disclosure
of Financial and Other Information. Borrower hereby consents to Lender disclosing to any other lender who may participate in
the Loan, to any financial institution or investor providing financing or capital for Lender, or to any other third party that
executes a confidentiality agreement acceptable to Lender, any and all information, knowledge, reports, and records, including,
without limitation, financial statements, relating in any manner whatsoever to the Loan and Borrower. In addition, Borrower hereby
authorizes and directs Lender to report or otherwise disclose to any credit reporting agency or other similar agency or entity
any payment history, defaults, aging reports, and other financial and credit information regarding Borrower, the Loan, all Accounts,
and all Account Debtors. Borrower acknowledges that such disclosures and reporting may be subject to the Fair Credit Reporting
Act (FCRA), 15 U.S.C. § 1681 et seq., or other Federal or State laws and hereby voluntarily authorizes such disclosures. Borrower
releases Lender and its employees, officers, directors, members, partners, and agents from any and all liability for furnishing
such information.

 

11.20Identity
Verification Notification. Lender hereby notifies Borrower that pursuant to the requirements of the applicable United States
and other laws and regulations, Lender may be required to obtain, verify, and record information that identifies Borrower, which
information includes the name and address of Borrower and other information that will allow Lender to identify Borrower in accordance
with the applicable law.

 

11.21Integrated
Agreement and Subsequent Amendment. The Loan Documents constitute the entire agreement between Lender and Borrower, and may
not be altered or amended except by written agreement signed by Lender and Borrower. BORROWER ACKNOWLEDGES AND AGREES THAT THE
LOAN DOCUMENTS ARE A FINAL EXPRESSION OF THE AGREEMENTS BETWEEN LENDER AND BORROWER AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
ALLEGED ORAL AGREEMENT.

 

All prior and contemporaneous
agreements, arrangements, understandings, or representations, oral, written, express, or implied, between the parties hereto as
to the subject matter hereof are, except as otherwise expressly provided herein, rescinded.

 

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Effective Date: February 13,
2015.

 

	 	Lender:
	 	 
	 	SUMMIT FINANCIAL RESOURCES, L.P., a Hawaii limited partnership
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 

 

	 	Borrower:
	 	 
	 	POINT.360, a California corporation
	 	 
	 	By:	/s/ Alan R. Steel
	 	Name:	Alan R. Steel 
	 	Title:	Chief Financial Officer
	 	 	 

 

 

 

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